Child Welfare: Complex Needs Strain Capacity to Provide Services (Letter
Report, 09/26/95, GAO/HEHS-95-208).

GAO reviewed the foster care system and related child welfare services,
focusing on: (1) recent trends in the characteristics of the foster care
population; (2) whether resources for foster care and child welfare
services have kept pace with changing needs; and (3) how states are
responding to current foster care and other service needs.

GAO found that: (1) the sharp increase in the number of child abuse and
neglect reports and foster care caseloads have increased the demand for
child welfare services and have greatly restricted resources for those
services; (2) resource constraints have resulted in restrictions on the
use of federal foster care funds, diversion of funds to child abuse and
neglect investigations, caseworker recruiting and retention problems,
shortages of foster parents, and difficulties in obtaining outside
services; (3) states have adopted various cost saving methods to meet
their service needs while protecting children; (4) family preservation
services and kinship care reduce costs while maintaining family ties;
(5) specialized foster care for emotionally disturbed and medically
fragile children is less costly than institutionalization; and (6) while
proposed legislation creating a block grant for child welfare services
and foster care would give states greater flexibility in allocating
funds to match needs and reduce administrative costs, Congress must
consider provisions that reflect lessons learned from earlier attempts
to provide block grants for child welfare services.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  HEHS-95-208
     TITLE:  Child Welfare: Complex Needs Strain Capacity to Provide 
             Services
      DATE:  09/26/95
   SUBJECT:  Welfare services
             Children
             Foster children
             Child abuse
             Proposed legislation
             Block grants
             Grants to states
             Funds management
             Child care programs
             Families
IDENTIFIER:  Los Angeles County (CA)
             New York (NY)
             Philadelphia (PA)
             Aid to Families with Dependent Children Program
             AFDC
             APWA Voluntary Cooperative Information System
             Federal Adoption Assistance Program
             Child Protection Block Grant
             Medicaid Program
             Michigan
             
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Cover
================================================================ COVER


Report to Congressional Committees

September 1995

CHILD WELFARE - COMPLEX NEEDS
STRAIN CAPACITY TO PROVIDE
SERVICES

GAO/HEHS-95-208

Foster Care Overview

(105823)


Abbreviations
=============================================================== ABBREV

  AFDC - Aid to Families With Dependent Children
  APWA - American Public Welfare Association
  CAPTA - Child Abuse Prevention and Treatment Act
  CPBG - Child Protection Block Grant
  HHS - Department of Health and Human Services
  HIV - human immunodeficiency virus
  SSI - Supplemental Security Income
  VCIS - Voluntary Cooperative Information System

Letter
=============================================================== LETTER


B-261055

September 26, 1995

The Honorable William V.  Roth, Jr.
Chairman
Committee on Finance
United States Senate

The Honorable Nancy Landon Kassebaum
Chairman
Committee on Labor and Human Resources
United States Senate

The Honorable Bill Archer
Chairman
Committee on Ways and Means
House of Representatives

The Honorable Bill Goodling
Chairman
Committee on Economic and Educational
 Opportunities
House of Representatives

In 1993, more than 1 million American children suffered some abuse or
neglect.\1 One in six of these children were removed from home for
their protection and temporarily placed in foster care.  Both the
children remaining home and those placed in foster care were eligible
for services to help them deal with their family situation, obtain
medical treatment, or meet other critical needs.  By the end of 1993,
an estimated 450,000 children were in foster care, more than in any
other year since the mid-1970s. 

States provide the majority of funds for foster care and child
welfare services.  Even so, the federal share of expenditures reached
$4.1 billion in 1995.  These federal funds come primarily from two
sources, one an open-ended entitlement and the other limited to
annual appropriations.  Under title IV-E of the Social Security Act,
open-ended funds are available to states for the maintenance (food,
shelter, and incidentals) of all foster children meeting certain
income and other criteria.  Title IV-B of the act provides separate
funds to states for child welfare services for abused and neglected
children who remain in their homes or are placed in foster care. 
These services include helping families to resolve their problems and
referring families for specialized help, such as substance abuse
treatment. 

The Congress is currently considering sweeping changes to programs
designed to support children and families.  Among these changes is a
proposal to replace many child welfare programs, including foster
care, with a block grant.  To assist the Congress in its
deliberations, this report presents an overview of the foster care
system and related child welfare services.  Specifically, we address
the following questions: 

  What are recent trends in the characteristics of the foster care
     population? 

  Have resources for foster care and child welfare services kept pace
     with changing needs? 

  How are states responding to current foster care and other service
     needs? 

To develop this information, we drew upon our past reports on foster
care and related child welfare issues (see list of Related GAO
Products in app.  V) and reviewed reports by government and other
organizations as well as position papers and written testimony from
witnesses at congressional hearings.  In addition, we interviewed
national experts and researchers in the child welfare area, child
welfare advocates, representatives of public interest groups,
government officials in selected states and localities, and federal
officials (see app.  I).  Our work was performed between March and
July 1995. 


--------------------
\1 The most recent year for which data are available is 1993. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

Between 1983 and 1993, sharp increases in the number of foster
children combined with unprecedented service needs led to a crisis in
foster care.  Reports of child abuse and neglect nearly doubled, and
foster care caseloads grew by two-thirds.  Demands for child welfare
services grew not only because the number of foster children
increased but also because families and children were more troubled
and had more complex needs than in the past.  In Los Angeles County,
New York City, and Philadelphia County, for example, 29 percent of
preschool-age foster children in 1986 were at risk of health problems
due to prenatal drug exposure; this rose to 62 percent in 1991. 

Meanwhile, resources for child welfare services failed to keep pace
with the needs of troubled children and their families.  While foster
care funding has increased dramatically at all levels of government,
federal funding for child welfare services has lagged.  States and
localities have found it difficult to meet the demand, although they
have more than tripled expenditures in some cases.  Federal foster
care funds generally cannot be transferred to support child welfare
services, and available state funds are increasingly being spent on
child abuse and neglect investigations.  The effect has been to
further constrain resources for preventive and rehabilitative child
welfare services that offer some promise of containing growth in
foster care caseloads. 

Faced with increasing demands and limited resources, states have
adopted various measures to meet the needs of troubled children and
their families while maintaining children's safety.  Many states now
offer family preservation services or place children with relatives
to maintain family ties and save money.  States are also increasingly
considering the use of specialized foster homes for children with
unique problems, including emotionally disturbed and medically
fragile children, to provide more family-like care at lower costs
than institutions, where such children are typically placed.  If
states can save foster care costs, they may be able to transfer state
funds to support child welfare services. 


   BACKGROUND
------------------------------------------------------------ Letter :2

Foster care is an integral part of a child welfare system designed to
ensure the safety and well-being of children whose families are not
providing adequate care for them.  Foster care provides primarily
food and housing to meet the physical needs of children who are
removed from their homes.  Child welfare services are designed to
address the complex family problems associated with children's abuse,
neglect, exploitation, or delinquency.  In providing child welfare
services, caseworkers may also refer children and their families to
mental health agencies, medical facilities, or elsewhere for
specialized treatment and services. 

Child welfare services are critical in helping prevent the need for
foster care as well as in achieving appropriate and stable permanent
living arrangements for children placed in foster care.  Most states
and counties provide some child welfare services directly and
purchase others from private agencies.  Available services vary
considerably from one area to another in number, type, intensity, and
duration, although calls and visits with caseworkers are considered
essential in most areas. 

Children generally enter foster care for their own protection because
their parents will not or cannot take care of them.\2 When problems
such as abuse or neglect are identified, the child welfare system may
intervene with services designed to improve the situation and avoid
removing children from their homes.  If such services cannot ensure
children's safety and well-being in their homes, the child welfare
system petitions the court to place children in foster care, either
in the homes of relatives or nonfamily foster parents, group homes,
or institutions. 

Foster care provided by relatives, who are often grandmothers, is
known as kinship care.  States may choose whether to license
relatives as foster parents and provide foster care payments.  On the
other hand, states require nonfamily foster parents to be licensed
and pay them an average of $8 to $15 a day per child for food,
housing, and incidental expenses.  States also license group homes
and institutions to provide care by paid staff.  These homes receive
an average of $100 a day per child for food, housing, and overhead
expenses.\3 Foster care is a temporary solution until children can be
returned safely to their parents, adopted, or placed in some other
permanent living arrangement; however, some children remain in foster
care until their eligibility for foster care assistance expires,
generally at age 18. 

Under federal law, states must provide foster care if they
participate in Aid to Families With Dependent Children (AFDC), the
largest federal welfare program providing cash assistance to poor
families.  States receive federal matching funds for about half of
all foster children because these children would have qualified for
AFDC had they remained in their homes.  For the other half, states
and localities are the sole source of government support.  In
addition, states and localities supply the majority of government
funds for child welfare services.  Many states directly administer
foster care and child welfare, but nearly one-third delegate this
authority to their counties, including several states with the
largest caseloads--California, Pennsylvania, and New York. 

Two titles under the Social Security Act provide federal funding
targeted specifically to foster care and related child welfare
services.\4 (See app.  II.) Title IV-E provides an open-ended
individual entitlement for foster care maintenance payments to cover
a portion of the food, housing, and incidental expenses of children
from AFDC-eligible families.  Title IV-E also provides payments to
adoptive parents of eligible minority foster children or others with
special needs, such as health problems, that may make adoptive homes
more difficult to find.  Title IV-B provides limited or "capped"
funding for child welfare services to foster children as well as
children remaining in their homes. 

In 1995, total IV-E funding was $3.6 billion and total IV-B funding
was $453 million, representing about 97 percent of all federal
funding targeted to child welfare and protection, including foster
care.  Another nine programs provided an additional $136 million in
federal funds to states for activities designed to protect the safety
and well-being of children. 

Under the Child Protection Block Grant passed by the House in 1995,
foster care and the other child welfare programs would be replaced by
a single block grant to states with capped funding.  (See apps.  III
and IV.) In addition, proposals for an AFDC block grant would cap
federal funding and repeal AFDC eligibility rules that currently
enable states to claim IV-E foster care funds.  Further, the AFDC
block could affect the amount of federal funds states would receive
for IV-E foster care if it makes certain categories of children
ineligible for AFDC and all children ineligible for AFDC after 5
years of assistance. 


--------------------
\2 Other children enter care because they represent a danger to
themselves, their families, or their communities. 

\3 Cost estimates are for 1990 as reported in Overview of Entitlement
Programs:  1994 Green Book, Committee on Ways and Means, U.S.  House
of Representatives (Washington, D.C.:  1994). 

\4 Title XX provides funds under the social services block grant that
may be used for many purposes, including child welfare.  See Foster
Care:  Services to Prevent Out-of-Home Placements Are Limited by
Funding Barriers (GAO/HRD-93-76, June 29, 1993). 


   RECENT TRENDS HAVE LED TO A
   FOSTER CARE CRISIS
------------------------------------------------------------ Letter :3

Current trends in the number and needs of foster children have led to
a crisis in the child welfare system.  The number of reports of abuse
and neglect and the number of children removed from home and placed
in foster care for their protection have grown alarmingly.  Also,
compared with the foster children of 10 years ago, today's foster
children have characteristics associated with longer stays in foster
care and greater service needs.  Although stays in foster care for
most children are less than 1 year, permanent placements following
foster care are delayed or unstable for a significant minority of
children. 


      REPORTS OF CHILD ABUSE AND
      NEGLECT HAVE INCREASED
---------------------------------------------------------- Letter :3.1

An estimated 2.3 million children were reported possible victims of
abuse or neglect in 1993.\5 Although the number of reports has nearly
doubled since 1983, the rate of increase has shown signs of leveling
off since 1990.  The increased reporting has been due, in part, to
heightened public awareness and state laws mandating reports from
professionals who see children on a daily basis.\6

Meanwhile, the incidence of poverty and substance abuse, factors
associated with abuse and neglect, were also at relatively high
levels during this period. 

Upon investigation, child welfare workers confirmed abuse or neglect
of 1 million children in 1993.\7 Although child abuse and neglect are
more likely to be reported today than 10 years ago, whether children
are as likely to be removed from their homes is not clear.  Experts
believe that as a result of increased demands, strained resources,
and efforts to strengthen families, child welfare agencies are
currently reevaluating conditions in the family and neighborhood that
formerly might have been grounds for the child's removal.  Most of
the 1 million abused or neglected children remained in their homes. 
However, about 15 percent were considered in imminent danger and
placed in foster care.  Most children who enter foster care do so
because of abuse; neglect; inadequate care due to parental absence;
or conditions, such as illness or financial difficulty, as shown in
figure 1. 

   Figure 1:  Reasons Children
   Entered Foster Care, 1990

   (See figure in printed
   edition.)

Notes:  "Protective service" includes children who entered care
because of abuse or neglect reported to child protective services.

"Parent condition or absence" includes children who entered care
because of absence, illness, death, handicap, financial hardship, or
other condition of the parent(s).

"Status offense/delinquent" includes children who entered care
because of (1) status offenses, such as running away or truancy, or
(2) delinquent behavior.

"Other" includes children who entered care for such reasons as
parent-child relationship problems, child's handicap, a plan for
adoption, deinstitutionalization, and unwed motherhood. 

Source:  American Public Welfare Association (APWA) Voluntary
Cooperative Information System (VCIS). 


--------------------
\5 Child Maltreatment 1993:  Reports From the States to the National
Center on Child Abuse and Neglect, Department of Health and Human
Services (Washington, D.C.:  1995). 

\6 Teachers most often reported the abuse or neglect that was most
often perpetrated by parents or other relatives. 

\7 Nearly half of the confirmed cases involved neglect; a quarter,
physical abuse; one-seventh, sexual abuse; and the remainder,
unspecified maltreatment.  About half of the children were under 8
years of age, a quarter under 4.  Neglect was more common among
younger children; physical abuse, among boys under 12 or girls over
12; and sexual abuse, among girls.  (See footnote 5.)


      FOSTER CARE CASELOADS HAVE
      REACHED RECORD LEVELS
---------------------------------------------------------- Letter :3.2

By 1993, an estimated 450,000 U.S.  children--more than at any other
time in two decades--were in foster care.  This represents a
two-thirds increase in the foster care caseload since 1983, as shown
in figure 2.  The growth in foster care caseloads occurred because
more children entered than left care in each year between 1983 and
1993.  This trend was especially noticeable between 1987 and 1990,
when the number of children entering care increased the most.  Since
peaking in 1990, the number of children entering care has leveled
off. 

   Figure 2:  Foster Care
   Caseloads, 1983-1993

   (See figure in printed
   edition.)

Source:  APWA VCIS. 

Meanwhile, the number of foster children who were eligible for
federal matching funds, by virtue of their family's eligibility for
AFDC, grew by a larger percentage than the number of foster children
in general.  In 1993, about half of all children in foster care were
eligible for federal matching funds under title IV-E.  California and
New York, the two states with the largest foster care caseloads,
accounted for one-third of all foster children and much of the
increase in title IV-E eligible children. 


      MORE MINORITY AND YOUNG
      CHILDREN ARE IN CARE
---------------------------------------------------------- Letter :3.3

Although trends in the characteristics of foster children vary by
state, since 1983, foster children increasingly have come from
minority groups and have been younger.  The 1990 foster care
population consisted of 40 percent African Americans and 11 percent
Hispanics compared with 39 percent whites.\8 Not only are more
minorities entering, but, once placed in foster care, African
American and Hispanic children remain longer and leave at slower
rates than whites.\9 African American children, in particular, are
disproportionately represented in foster care, as shown in figure 3,
and, if the trend continues, caseloads may increasingly consist of
minority children removed from their homes for prolonged stays in
foster care. 

   Figure 3:  Proportion of White
   and African American Children
   in General Population and
   Foster Care, 1990

   (See figure in printed
   edition.)

Sources:  For the general population, U.S.  Census Bureau,
Statistical Abstracts; for the foster care population, APWA VCIS data
from 31 states. 

Also by 1990, the average median age of children in foster care had
dropped from 12.6 to 8.6 years of age,\10 as the percentage of
preschoolers increased by 50 percent and the percentage of teens
declined (see fig.  4).  The increase in infants entering the system
is particularly striking.  Although the majority of foster children
entered the system between the ages of 1 and 12, the percentage of
children entering care who were under 1 year increased by two-thirds
from 1983 to 1990, leading to a foster care "baby boom." Further,
infants are staying in foster care longer than any other age group,
and as their time in care increases, their chance of being adopted
decreases.\11

   Figure 4:  Foster Children by
   Age, 1983-1990

   (See figure in printed
   edition.)

Source:  APWA VCIS.  Number of states responding in each year is 30
(fiscal year 1983), 33 (fiscal year 1984), 32 (fiscal year 1985), 33
(fiscal year 1986), 26 (fiscal year 1987), 26 (fiscal year 1988), 27
(fiscal year 1989), 23 (fiscal year 1990).  Nine states gave data in
all 8 years. 


--------------------
\8 1990 is the most recent year for which nationwide data on
characteristics are available from the American Public Welfare
Association's (APWA) Voluntary Cooperative Information System (VCIS),
the major source of nationwide information on foster care. 

\9 Toshio Tatara, A Comparison of Child Substitute Care Exit Rates
Among Three Different Racial/Ethnic Groups in 12 States, FY 84 to FY
90, APWA, Research Note #10 (Washington, D.C.:  June 1994). 

\10 APWA VCIS. 

\11 R.M.  Goerge, F.H.  Wulczyn, and A.W.  Harden, Foster Care
Dynamics 1983-1993:  An Update from the Multistate Foster Care Data
Archive, The Chapin Hall Center for Children, University of Chicago
(Chicago:  1995). 


      FOSTER CHILDREN HAVE GREATER
      SERVICE NEEDS THAN IN THE
      PAST
---------------------------------------------------------- Letter :3.4

Children are also entering care from families more troubled than in
the past and with greater emotional, behavioral, and medical needs. 
Such families today more often face economic hardship, substance
abuse, homelessness, mental or physical illness, or the imprisonment
of a family member.  In Los Angeles County, New York City, and
Philadelphia County in 1991, over half of the preschool-age foster
children were estimated to have serious health-related problems,
including developmental delays, low birth weight, heart problems, and
human immunodeficiency virus (HIV) infection.  An estimated 62
percent of the preschool-age foster children were at risk of serious
health problems due to prenatal drug exposure, more than double the
29 percent at risk of such problems in 1986.\12

Children with these complex needs require a variety of
community-based services and a level of care not required in the
past.  A California study found that foster children were 10 times
more likely to use mental health services than other children on
Medicaid and that they were hospitalized for mental conditions almost
twice as long.\13

For this reason, while foster children constituted only 4 percent of
California children on Medicaid they accounted for 40 percent of all
Medicaid mental health expenditures. 


--------------------
\12 See Foster Care:  Parental Drug Abuse Has Alarming Impact on
Young Children (GAO/HEHS-94-89, Apr.  4, 1994). 

\13 N.  Halfon, G.  Berlowitz, L.  Klee, "Children in Foster Care in
California:  An Examination of Medicaid-Reimbursed Health Services
Utilization," Vol.  89 Pediatrics (1992), pp.  1230-37. 


      PERMANENT LIVING
      ARRANGEMENTS FOLLOWING
      FOSTER CARE MAY BE DELAYED
      OR UNSTABLE
---------------------------------------------------------- Letter :3.5

Children who leave foster care are increasingly returned home when
caseworkers consider it safe.  About 67 percent of children leaving
care in 1990 returned to their families (see fig.  5), up from 56
percent in 1983.  Meanwhile, the percentage of children adopted
declined from 12 to 8 percent. 

   Figure 5:  Disposition of
   Children Leaving Foster Care,
   1990

   (See figure in printed
   edition.)

Note:  "Other" includes such reasons as placement with a legal
guardian, marriage, running away, incarceration, death, or discharge
to another public agency. 

Source:  APWA VCIS data from 24 states. 

Although foster care is a relatively short-term experience for many
children, some children remain in care for extended periods.  Of the
children leaving care in 1990, for example, 50 percent had been in
foster care for 8 months or less.  However, of those remaining in
care, over 25 percent had been in foster placements for at least 3
years.  (See fig.  6.) Foster children for whom adoption is
ultimately planned spend an average of 4 to 6 years in foster care,
according to a 1991 report on adoptions in 20 states.\14

   Figure 6:  Length of Stay in
   Foster Care at the End of 1990

   (See figure in printed
   edition.)

Source:  APWA VCIS data from 22 states. 

The shorter the initial stay in foster care, the more likely it
appears that children who are reunited with their parents will
reenter care.\15 In Los Angeles County and New York City, for
example, 32 percent of children whose initial stay in foster care was
less than 1 year later returned to care, compared with 16 percent of
children whose initial stay was 1 year or longer. 

Youths who leave foster care at age 18 because they are no longer
eligible may experience unstable and troubled lives.  A study
conducted 2.5 to 4 years after youths left foster care found that 46
percent had not completed high school, 38 percent had not held a job
for more than 1 year, 25 percent had been homeless for at least one
night, and 60 percent of young women had given birth to a child.\16
Forty percent had been on public assistance, incarcerated, or a cost
to the community in some other way. 


--------------------
\14 See J.K.  McKenzie, "Adoption of Children With Special Needs,"
The Future of Children:  Adoption, Vol.  3, The Center for the Future
of Children (Los Altos, Cal.:  Spring 1993). 

\15 Foster Care:  Children's Experiences Linked to Various Factors;
Better Data Needed (GAO/HRD-91-64, Sept.  11, 1991). 

\16 A National Evaluation of Title IV-E Foster Care Independent
Living Program for Youth:  Phase II Final Report, Vols.  I and II,
Westat, Inc.  (Rockville, Md.:  1991). 


   RESOURCES HAVE NOT KEPT PACE
   WITH SERVICE NEEDS
------------------------------------------------------------ Letter :4

The child welfare system has been under great pressure to meet
increased demands.  States and localities provide the majority of
funding for foster care and child welfare services.  From 1983 to
1993, rising caseloads have increased federal, state, and local
expenditures for foster care dramatically, leaving proportionately
less for child welfare services.  Federal foster care funds cannot be
used to pay for most child welfare services, and available state
funds are increasingly required for investigations of abuse and
neglect reports.  As a result, states have found it difficult to
ensure that child welfare services are sufficiently funded to meet
needs.  Other resource constraints have included problems recruiting
and retaining caseworkers, shortages of available foster parents, and
difficulties obtaining needed services from systems outside the
control of child welfare. 


      FOSTER CARE EXPENDITURES
      HAVE INCREASED DRAMATICALLY
      AT ALL LEVELS OF GOVERNMENT
---------------------------------------------------------- Letter :4.1

With increasing foster care caseloads, expenditures for the basic
needs of foster children and program administration have risen
dramatically at all levels of government.  Federal expenditures grew
faster than state expenditures in three of the largest states from
1983 to 1993.  Nevertheless, as of 1990, states and localities
continued to fund about 65 percent of all foster care. 

Federal costs of foster care maintenance increased by over 350
percent (see table 1) from 1983 to 1993 in California and New York,
which approaches the nationwide increase of nearly 400 percent for
this period.  (See fig.  7.)

   Figure 7:  Expenditures for
   Title IV-E Foster Care
   Maintenance and Title IV-B
   Child Welfare Services,
   1983-1993

   (See figure in printed
   edition.)

Source:  Overview of Entitlement Programs; 1994 Green Book, Committee
on Ways and Means, U.S.  House of Representatives. 

The rapid rise in federal foster care expenditures has been linked to
several simultaneous developments:  States have increased efforts to
determine children's eligibility for federal funds; more children
have become eligible under AFDC rules for IV-E assistance; and
payments to providers have increased in most states.  Further,
federal administrative costs\17 have increased over the same period
as states have increasingly emphasized the case management and
placement activities required by federal law (see app.  IV) and
sought full reimbursement for these activities.  By 1993, nearly $1.1
billion in IV-E reimbursement went to states for foster care
administrative activities, almost as much as the $1.3 billion that
went for foster care maintenance in that year.\18

At the state level, foster care expenditures also rose between 1983
and 1993.  For example, California and New York increased
expenditures for foster care maintenance payments by about 200
percent, while Michigan's expenditures doubled, as shown in table
1.\19



                                Table 1
                
                  Changes in Foster Care Caseloads and
                 Related Expenditures in Three States,
                               1983-1993


                                                Califo  Michig     New
                                                  rnia      an    York
----------------------------------------------  ------  ------  ------
Foster care caseload growth                       119%     50%    108%

Foster care maintenance expenditures
----------------------------------------------------------------------
State and local                                    258     112     183
Federal IV-E                                       381     146     356

Child welfare services expenditures
----------------------------------------------------------------------
State and local                                  309\a     213     239
Federal IV-B                                       131      80   -14\b
----------------------------------------------------------------------
\a Percent change from 1985 to 1992.  Data for other years are not
available. 

\b The allocation formula under IV-B reduced New York's grant from
$18 million to $15.5 million. 

Because of fiscal difficulties states experienced in the early
1990s,\20 they looked to localities and the federal government to
assume greater shares of foster care costs.  California, Michigan,
and New York, for example, are among the states that increased the
portion of foster care maintenance payments supported by local funds. 
Faced with a $14 billion budget deficit in 1992, California increased
counties' portion of foster care maintenance payments by 1,100
percent. 


--------------------
\17 Expenditures for administrative activities include costs required
to recruit and license foster homes, determine children's title IV-E
eligibility, and manage cases (see app.  II). 

\18 Overview of Entitlement Programs:  1994 Green Book. 

\19 State and local expenditure data are not routinely reported.  We
obtained this information directly from the three states shown. 
These states include the two with the nation's largest
caseloads--California and New York. 

\20 This is according to fiscal surveys of states conducted by the
National Association of State Budget Officers and the National
Governors' Association. 


      AVAILABLE FUNDING AND
      COMPETING DEMANDS CONSTRAIN
      CHILD WELFARE SERVICES
---------------------------------------------------------- Letter :4.2

Available funding and competing demands from other activities have
constrained resources available for child welfare services.  Despite
increasing appropriations, the federal government spent about $.12 on
child welfare services in 1993 for every $1 it spent on foster care,
as compared with about $.40 in 1983.  While states and localities
have continued to provide the majority of funds for child welfare
services, they have found it increasingly difficult to maintain
sufficient funding levels to ensure that needs are met. 

At the national level, title IV-B appropriations increased 88 percent
from 1983 through 1993, lagging behind increases in federal foster
care maintenance costs, as shown in figure 7.\21 Increases in federal
expenditures for child welfare services also lagged behind state and
local expenditure growth during this period. 

State and local expenditures for services rose dramatically from the
early 1980s to the early 1990s and represented over half of all
funding as of 1990.  In California, Michigan, and New York, state and
local expenditures for child welfare services increased by over 200
percent (see table 1).  Meanwhile, federal IV-B funding for
California and Michigan increased at half these rates and in New York
actually decreased by 14 percent. 

Although federal law requires the provision of direct child welfare
services to children and families, these services generally cannot be
supported with federal funds designated for foster care.\22 Available
state funds, meanwhile, have been stretched to the limit to cover
increasing demands from other activities.  Most notably, rising
reports of abuse and neglect have led states to devote more resources
to investigating reports, leaving less for providing services. 

Because of constrained resources and competing demands, states have
not been able to ensure that child welfare services are sufficient to
meet needs.  For example, an APWA survey of agencies in every state
found that services were limited and generally involved managing,
rather than treating, families and their abused or neglected
children.  Since 1987, children's advocates have successfully filed
class action lawsuits on behalf of children against eight states,
obtaining court orders to improve child welfare services, and similar
cases are pending in other states.\23


--------------------
\21 The Congress authorized a new IV-B program for family
preservation and support services designed to prevent the need for
foster care and appropriated $60 million for start-up activities in
1994. 

\22 AFDC funds for emergency assistance to families have been used
for services, particularly since 1993.  See Review of Rising Costs in
the Emergency Assistance Program, Department of Health and Human
Services, Office of the Inspector General (Washington, D.C.:  1995). 

\23 The eight states are Alabama, Arkansas, Connecticut, District of
Columbia, Illinois, Indiana, Kansas, and Utah. 


      SHORTAGES OF CASEWORKERS AND
      FOSTER PARENTS FURTHER
      STRAIN SERVICE DELIVERY
---------------------------------------------------------- Letter :4.3

Next to funding, states report that staffing is the most serious
issue facing their child welfare systems.  In response to an APWA
survey, 90 percent of states reported difficulty recruiting and
retaining caseworkers.  Caseworkers are at the heart of the foster
care system, visiting children and families in their homes and
arranging services to help prevent the need to remove children from
their homes, or, in case of their removal, to find permanent living
arrangements for foster children.  Caseworkers also coordinate
contacts among families and children with health, mental health, and
other service systems. 

State officials attributed difficulties in recruiting and retaining
caseworkers to several factors, including hiring freezes, low pay,
and poor working conditions.  These factors, in turn, led to staff
shortages, high caseloads, and high burnout and turnover rates among
caseworkers.  In some jurisdictions, caseloads have reached 100 cases
per caseworker, well above the 25 per caseworker recommended by the
National Association of Social Workers.  In New York City, annual
turnover rates for caseworkers have been as high as 75 percent, so
that each year most foster children, who have suffered from unstable
families, get a new caseworker. 

Foster parents are the other essential component of an effective
service delivery system, but the supply of foster parents has lagged
behind the growth in the foster care caseload.  While the number of
children in foster care has increased, the number of foster homes has
decreased.\24

Child welfare experts attribute this growing shortage of foster homes
to several factors, including the poor public image of foster care,
low reimbursement rates, inadequate support services, greater
difficulties caring for today's more troubled foster children, and
increased employment opportunities for women.  In some states, the
shortage of foster homes is so great that children are placed in
temporary shelters or shuttled from one place to another until a
proper home can be found, according to the National Foster Parent
Association. 


--------------------
\24 See Foster Parents:  Recruiting and Preservice Training Practices
Need Evaluation (GAO/HRD-89-86, Aug.  3, 1989). 


      FRAGMENTED SERVICE DELIVERY
      SYSTEM EXACERBATES PROBLEM
---------------------------------------------------------- Letter :4.4

Difficulties providing families and children with services also arise
because many needs must be met by services, such as medical care and
drug treatment, that are outside the control of the child welfare
system.  Rarely does a single state or local agency have control over
the full array of services required to address the needs of
increasingly troubled children and families who have many problems. 
Rather, a complex set of service delivery systems must be tapped;
these are usually linked to separate categorical funding sources and
different eligibility criteria. 

Because caseworkers may be overworked and families may often lack the
sophistication and resources necessary to arrange services on their
own behalf, some children and families may experience delays or gaps
in service.  For example, when we visited metropolitan areas in three
states, we found that many foster children under age 3 lacked routine
health examinations and immunizations.\25

The goals of the child welfare system and those of various programs
may also be inconsistent.  For example, caseworkers report that more
parents of abused and neglected children are addicted to drugs than
in the past.  Although one of the primary goals of the current child
welfare system is to keep families together, residential drug
treatment programs are rarely able to accommodate the children of
parents undergoing treatment.  For parents to receive treatment,
therefore, some children must be placed in some kind of foster care. 


--------------------
\25 See Foster Care:  Health Needs of Many Young Children Are Often
Unknown and Unmet (GAO/HEHS-95-114, May 26, 1995). 


   STATES STRUGGLE TO MEET
   CASELOAD AND RESOURCE
   CHALLENGES
------------------------------------------------------------ Letter :5

In response to the escalating pressure on the foster care system,
states have adopted various measures to meet changing foster care
needs.  Many states provide family preservation services to avoid the
need for foster care or facilitate the return of foster children to
their families.  When children must be removed from their homes, many
states give preference to placing them in kinship care with relatives
to maintain family ties, and, in some cases, save on costs.  In
addition, some states are considering the use of specialized foster
parents for children with health or other unique needs because these
parents provide more family-like care than institutions, and at the
same time, save costs.  To find permanent homes for foster children
who cannot return to their families, states have also participated in
a federal adoptions assistance program, although significant barriers
to adoption still exist. 


      STATES SEEK TO PRESERVE
      FAMILIES AND MINIMIZE THE
      NEED FOR FOSTER CARE
---------------------------------------------------------- Letter :5.1

States have acted to strengthen families to lessen the likelihood of
continued abuse and neglect and minimize the need for foster care. 
To prevent the need for foster care, states and localities are
experimenting with providing family preservation services.  Families
with children at risk of abuse or neglect receive a combination of
services over several weeks or months arranged by caseworkers who
generally make frequent home visits and concentrate on helping a few
families.  Services can include training in parenting and
housekeeping, transportation, and mental health and family
counseling. 

Studies show that family preservation services can preclude the need
for foster care at least up to 1 year, although little is known about
long-term results.\26 Because costs for family preservation services
are a fraction of foster care costs, these findings offer some
promise of cost savings.  In 1993, 48 states offered some family
preservation services.  Despite promising early results, resources
are still sufficiently limited so that most states cannot offer
family preservation services to all clients in need of services.\27
However, such services should expand as a result of recent federal
funding earmarked for this purpose. 


--------------------
\26 See Foster Care:  Services to Prevent Out-of-Home Placements Are
Limited by Funding Barriers. 

\27 See Child Welfare:  Opportunities to Further Enhance Family
Preservation and Support Activities (GAO/HEHS-95-112, June 15, 1995). 


      STATES INCREASE USE OF
      KINSHIP CARE
---------------------------------------------------------- Letter :5.2

When foster care is necessary, states have increasingly placed
children with relatives in what is called kinship care.  The
proportion of foster children placed with relatives grew from 18
percent to 31 percent between 1986 and 1990 in 25 states, including
California and New York.\28

The proportions were even higher in some metropolitan areas, such as
New York City, where about half of foster children were in kinship
care in the early 1990s.  African American children are especially
likely to be placed in kinship care.  About 29 states give preference
to kinship care when appropriate. 

States have increased their use of kinship care for a variety of
reasons:  to maintain children's ties to their families; encourage
long-term placements; meet federal standards of care (see app.  IV);
offset shortages of traditional foster homes; and, in some cases,
save on costs by offering lower payments.  Kinship care is less
costly than traditional foster homes in those states where relatives
are ineligible for state foster care payments.  Although relatives
might be eligible for assistance from AFDC, AFDC levels are
significantly lower than state foster care maintenance payments. 

Kinship care, however, poses several challenges.  First, children's
access to needed services may be more limited because kinship foster
parents are more likely to live in impoverished communities and lack
experience accessing needed services than other foster parents. 
Second, children may be more vulnerable to repeated neglect or abuse
because they are more at risk of unsupervised visits with parents or
other relatives from whose care they were removed.  Third, child
welfare agencies do not always monitor or supervise kinship care
placements as much as traditional foster care placements.  Finally,
children in kinship care tend to stay in foster care longer than
other foster children because, for various reasons, child welfare
agencies are less likely to arrange alternative placements, such as
guardianship or adoption.  In those states where relatives receive
AFDC rather than foster care payments, AFDC costs may offset savings
that might have resulted from lower reimbursement rates when children
remain in kinship care for prolonged periods. 


--------------------
\28 Using Relatives for Foster Care, HHS, Office of the Inspector
General (Washington, D.C.:  July 1992). 


      SPECIALIZED FAMILY FOSTER
      CARE ADDRESSES NEEDS IN LESS
      INSTITUTIONAL SETTING
---------------------------------------------------------- Letter :5.3

Increasingly, states are using specialized foster parents rather than
institutional care to provide more nurturing and family-like care at
reduced costs for children and adolescents with special needs.  These
children include those who are severely emotionally disturbed,
medically complex or fragile, HIV positive, or delinquent. 
Specialized care typically involves therapy or treatment provided in
the foster home. 

To meet the unique needs of foster children they serve, specialized
foster parents are generally carefully selected and trained.  In
addition, they are paid at higher rates, provided more agency support
and supervision, and given access to more comprehensive referral
services than traditional foster parents.  Although generally more
expensive than traditional foster family care, specialized care is
less expensive and considered more nurturing than institutional care
in group homes, residential facilities, or psychiatric institutions. 


      STATES PARTICIPATE IN
      ADOPTION INITIATIVE FOR
      HARD-TO-PLACE FOSTER
      CHILDREN
---------------------------------------------------------- Letter :5.4

States also participate in the federal adoptions assistance program,
which is designed to obtain stable, permanent homes for certain
foster children.  This program encourages the adoption of federally
eligible foster children who cannot return to their biological
families and have special needs that make them difficult to place. 
Title IV-E provides an open-ended individual entitlement that helps
cover one-time adoption expenses and offers monthly payments to
adoptive families of children who might otherwise languish in foster
care because of their age; minority status; disabilities; emotional,
behavioral, or learning problems; or other special needs.  Studies
have indicated that such assistance increases the likelihood of
adoption of older and minority children and is cost effective. 
Regarding costs, a Westat study found that adoption assistance saved
the government $1.6 billion from 1983 to 1987 over what costs would
have been if children had remained in foster care.\29

The success of the adoption assistance program in reducing foster
care caseloads and costs, however, appears to be limited by barriers
to timely adoptions.\30 Many states view federal standards (see app. 
IV) as requiring a sequential approach to the permanent placement of
foster children and therefore plan for family reunification before
considering adoptions.\31 Further, once adoption is planned, delays
often occur in terminating parental rights, a required step before
adoptions can be arranged.  This occurs, in part, because the courts
lack a clear consensus on the proper balance among the needs of
biological parents, adoptive parents, and the child.  Attempts to
ensure racial or ethnic matches between children and adoptive parents
are also believed to add delays.\32


--------------------
\29 A.J.  Sedlak and D.D.  Broadhurst, Study of Adoption Assistance
Impacts and Outcomes:  Final Report, Vol.  I, Westat, Inc. 
(Rockville, Md.:  1993). 

\30 See also Barriers to Freeing Children for Adoption, HHS, Office
of the Inspector General (Washington, D.C.:  1991). 

\31 Washington state is experimenting with concurrent reunification
and adoption efforts to decrease the time needed to place children
for adoption. 

\32 The Howard M.  Metzenbaum Multi-Ethnic Placement Act of 1994
(P.L.  103-382) bars these practices.  Although the block grant
proposal repeals this act, it substitutes similar language
prohibiting racial or ethnic barriers to adoption. 


   THE CONGRESS CONSIDERING
   CHANGES TO CHILD WELFARE
   PROGRAMS
------------------------------------------------------------ Letter :6

The Congress is currently debating proposals to replace foster care
and other child welfare programs with a block grant.  The Child
Protection Block Grant (CPBG)--title II of H.R.  4--passed by the
House of Representatives on March 24, 1995, would consolidate foster
care and at least 18 related child welfare programs into a single
block grant to states.  (See app.  III.) CPBG would eliminate
restrictions on states' use of various funding sources under the
current programs, place annual limits on funding, and allocate funds
to states on the basis of past rather than current expenditures. 
Federal eligibility criteria and oversight largely would be
eliminated, and standards and planning and reporting requirements
would be streamlined to allow states more flexibility in designing
and administering their programs.\33

Federal, state, and local officials and child welfare experts we
consulted (see app.  I) noted possible benefits of CPBG.  First,
officials agreed that capping the block grant would control federal
foster care expenditures and might result in savings at that level. 
Second, officials generally agreed that CPBG would provide increased
program flexibility so that states could respond more quickly and
creatively to changing caseload needs.  For example, states would be
able to use funds, formerly restricted to foster care, for preventive
and rehabilitative services--a move that some states believe holds
promise for controlling caseload growth.  Further, increased
flexibility resulting from simplified planning, reporting, and
eligibility criteria would streamline administration and could cut
costs.  As a result, states could more easily shift resources to
areas of greater need. 

On the other hand, many experts expressed concern that the block
grant would shift much of the financing burden to the states, which
might be unable to support increased caseloads without reducing
services.\34 They were also concerned that, due to reduced federal
funding and oversight, the quality of foster care could be adversely
affected. 

Our work on block grants suggests that three lessons can be drawn
from the experience with the 1981 block grants\35 that would have
value to the Congress as it considers creating new ones.  First, a
clear need exists to focus on accountability for results to provide
the Congress with information on program performance.  Second,
funding allocations to states should be studied carefully and reflect
need, ability to pay, and variations in the cost of providing
services.  Finally, because the programs in the current proposal are
much larger and essentially different from those programs included in
the 1981 block grants, states are likely to face greater challenges
than they did in the early 1980s. 

In addition to Members of the Congress, we are providing copies of
this report to the Secretary of Health and Human Services, state
child welfare directors, and other interested parties.  Should you
have any questions or wish to discuss the information provided,
please call me at (202) 512-7230.  Other GAO contacts and staff
acknowledgments appear in appendix VI. 

Jane L.  Ross
Director, Income Security Issues


--------------------
\33 See Karen Spar's Welfare Reform:  Implications of H.R.  4 for
Child Welfare Services (CRS 95-566 EPW), Congressional Research
Service (Washington, D.C.:  May 1995). 

\34 Advocates expect foster care caseloads to grow to accommodate
children ineligible for AFDC under the proposed welfare block grant. 
Growing caseloads, in turn, would shift funds from services to
payments to foster care providers. 

\35 Under the Omnibus Reconciliation Act of 1981, the administration
of federal domestic assistance programs was substantially changed by
consolidating more than 50 categorical grant programs into nine block
grants and shifting primary administrative responsibility for these
programs to the states. 


ORGANIZATIONS AND EXPERTS
CONTACTED REGARDING FOSTER CARE
AND BLOCK GRANT PROPOSED UNDER
TITLE II OF H.R.  4
=========================================================== Appendix I

Organization                            Expert
--------------------------------------  ------------------
American Enterprise Institute           Douglas Besharov

American Public Welfare Association     Jan Cooper, Betsy
                                        Rosenbaum, Pat
                                        Shapiro, Toshio
                                        Tatara

California Department of Social         Wes Beers, Marilyn
Services                                Lewis

Center on Effective Services for        Jule Sugarman
Children

Center for Law and Social Policy        Jodie Levin-
                                        Epstein

Center for the Study of Social Policy   Mark Friedman,
                                        Charles
                                        Gershenson, Judy
                                        Meltzer

Child Welfare League of America         Mike Petit

Congressional Budget Office             Sheila Dacey, John
                                        Topogna

Congressional Research Service          Dale Robinson,
                                        Karen Spar

Congressional Quarterly                 Jeffrey Katz

County Welfare Directors' Association   Frank Mecca
of California

Los Angeles County Department of        Peter Digre
Children's Services

Massachusetts Department of Social      Linda Carlisle
Services

Michigan Department of Social Services  Stephanie Comai-
                                        Page

National Conference of State            Shelly Smith, Jack
Legislatures                            Tweedie

New York State Department of Social     Fred Wulczyn
Services

North Dakota Department of Social       Don Schmid
Services

U.S. Department of Health and Human
Services

Children's Bureau                       Michael Ambrose,
                                        Dan Lewis, Penny
                                        Maza

National Center on Child Abuse and      David Lloyd
Neglect

Office of Human Services Policy,        Laura Feig,
Division of Children and Youth          Matthew Stagner

University of California Berkeley       Richard Barth,
Child Welfare Research Center           Jill Duerr
                                        Berrick, Barbara
                                        Needell

University of Chicago Chapin Hall       Robert Goerge
Center for Children

University of Washington School of      James Whittaker
Social Work

Westat                                  Diane Broadhurst,
                                        Ronna Cook, Andrea
                                        Sedlak

Washoe County, Nevada, Department of    May Shelton
Social Services

Wisconsin Division of Community         Linda Hisgen
Services
----------------------------------------------------------

FUNDING TO STATES UNDER SOCIAL
SECURITY ACT TITLES IV-B AND IV-E
========================================================== Appendix II

Program         Federal support          Eligibility     Allowable costs
--------------  -----------------------  --------------  --------------------------------
Title IV-B      Nonentitlement for 75    No eligibility  Child welfare services to
Child Welfare   percent match with 1995  criteria        prevent abuse, neglect; foster
Services        appropriations cap at                    care; reunited families; arrange
                $292 million                             adoptions; ensure adequate
                                                         foster care

Title IV-B      State entitlement for                    Services to support families and
Family          75 percent match with                    prevent need for foster care
Preservation    1995 cap at $150
and Support     million
                                         AFDC-eligible   Payments to foster care
Title IV-E                               children        providers; may not be used for
Foster Care     Individual entitlement                   direct services
                with open-ended
                funding; state claims
                in 1995 for
                reimbursement of                         asic maintenance, including
Maintenance     $3.1 billion                             children's food and shelter\a
                                                         plus parental visits
                Match at Medicaid rate   B
Administration  (50 to 83 percent)                       Case management, eligibility
                                                         determinations, licensing, and
                Match of 50 percent                      other administrative costs

Training        Match of 75 percent                      Training of agency staff and
                                                         foster parents

Title IV-E      Individual entitlement   Special needs   Payments to adoptive parents not
Adoption        with open-ended          children\a      to exceed comparable foster care
Assistance      funding; state claims    eligible for    amounts; nonrecurring adoption
                in 1995 for              AFDC or SSI\b   expenses
                reimbursement of
                $426 million
Maintenance                                              Basic maintenance\c
                Match at Medicaid rate
                                                         Child placement and other
Administration  Match of 50 percent                      administrative activities

                                                         Training of agency staff and
Training        Match of 75 percent                      adoptive parents
                                         Special needs
Nonrecurring    Match of 50 percent up   children        Reasonable and necessary
Expenses        to $2,000 per placement                  adoption fees, court costs,
                                                         attorney fees, and related
                                                         expenses

Title IV-E      State entitlement for    Foster          Services to assist in transition
Independent     50 percent match of      children at     from foster care to independent
Living          first $45 million of     least 16 years  living, including basic living
                $70 million of 1995 cap  old             skills training and education
                                                         and employment initiatives
-----------------------------------------------------------------------------------------
\a A special needs child is defined in the statute as a child for
whom the state determines that a specific condition or situation,
such as age; membership in a minority or sibling group; or a mental,
emotional, or physical handicap prevents placement without special
assistance. 

\b The Supplemental Security Income (SSI) program provides cash
benefits to disabled children. 

\c Basic maintenance includes expenditures for food, shelter, daily
supervision, school supplies, incidentals, liability insurance for
the child, reasonable travel to the child's home for visits, and, for
group homes and institutions, some overhead. 


CHILD WELFARE PROGRAMS PROPOSED
FOR CONSOLIDATION UNDER TITLE II
OF H.R.  4 AND FISCAL YEAR 1995
APPROPRIATIONS
========================================================= Appendix III

                         (Dollars in millions)

                                                                Fundin
Programs                                                             g
--------------------------------------------------------------  ------
Mandatory entitlements authorized under the Social Security
 Act
Family Preservation and Support                                 $150.0
Adoption Assistance                                             399.3\
                                                                     a
Foster Care                                                     3,128.
                                                                   0\a
Independent Living                                                70.0
======================================================================
Total entitlement spending                                      $3,747
                                                                    .3
Discretionary programs authorized under the Social Security
 Act
Child Welfare Services                                          $292.0
Research and Demonstration                                         6.4
Training                                                           4.4
Discretionary programs authorized under the Child Abuse
 Prevention and Treatment Act (CAPTA)
HHS administered
Child Abuse Research and Demonstration Grants                     15.4
Child Abuse State Grants                                          22.9
Community-Based Family Resource Grants                            31.4
Other discretionary programs
HHS administered
Abandoned Infants Assistance                                      14.4
Adoption Opportunities                                            13.0
Temporary Child Care for Children With Disabilities and Crisis  11.8\b
 Nurseries
Family Support Centers                                             7.4
Department of Justice administered
Children's Advocacy Centers                                        3.0
Grants to Improve the Investigation and Prosecution of Child       2.0
 Abuse Cases
Missing and Exploited Children                                     7.0
Department of Housing and Urban Development administered
Family Unification Program                                         7.6
======================================================================
Total discretionary spending                                    $438.7
----------------------------------------------------------------------

Note:  We list 18 programs proposed for consolidation in the Child
Protection Block Grant, title II of H.R.  4 passed by the House of
Representatives in 1995.  Other congressional sources list 22
programs as being consolidated.  We list four fewer programs because
we treat title IV-E Foster Care and title IV-E Adoption Assistance as
one program each, whereas other sources break out both programs into
their three parts:  maintenance payments, administration, and
training. 

\a Estimated in February 1995. 


FEDERAL FOSTER CARE STANDARDS IN
CURRENT LAW AND TITLE II OF H.R. 
4
========================================================== Appendix IV

                                                      Bloc
                                                      k
                                              Curren  gran
                Standard                      t law   t
--------------  ----------------------------  ------  ----
Applicable to all children
----------------------------------------------------------
Abuse and       Enact laws to mandate         x       x
neglect         reporting and investigate
reports         promptly

Child's safety  Protect children              x       x


Applicable to federally eligible children at risk of
foster care
----------------------------------------------------------
Services to     Make reasonable efforts to    x
family          improve family conditions so
                child need not be removed
                from home


Applicable to all foster children
----------------------------------------------------------
Child's safety  Ensure proper care            x

Services to     Provide services to improve   x
family          family conditions so foster
                child can return to family

Services to     Provide services to assist    x
foster family   in permanent placement

Parent's        Procedurally safeguard        x
rights          parent's rights when child
                is removed from home, the
                foster placement is changed,
                or visitation is at issue

Family's        Protect family's rights               x
rights

Foster care     Place child in most family-   x
placement       like, least restrictive
                setting available that meets
                child's needs and best
                interests

                Place child in close          x
                proximity to parents' home
                consistent with child's
                needs and best interests

Case plan       Have written plan for foster          x
                child with goal for
                permanent home

                Include placement type,       x
                appropriateness, health and
                education records

                Include information on                x
                children collected regularly

Case review     Ensure that foster placement  x
                is needed, appropriate, and
                in compliance with plan

                Hold every 6 months           x       x

Court hearing   Decide disposition or future  x
                of child within 18 months of
                placement

                Decide disposition or future          x
                of child within 3 months of
                fact-finding hearing
----------------------------------------------------------

RECENT GAO REPORTS AND TESTIMONIES
ON CHILD PROTECTION, FOSTER CARE,
ADOPTION, AND RELATED TOPICS
=========================================================== Appendix V


   CHILD ABUSE AND NEGLECT
   PREVENTION
--------------------------------------------------------- Appendix V:1


      CHILD ABUSE:  PREVENTION
      PROGRAMS NEED GREATER
      EMPHASIS (GAO/HRD-92-99,
      AUG.  3, 1992)
------------------------------------------------------- Appendix V:1.1

Child abuse prevention programs have been shown to be effective and
may pay for themselves by lowering the social costs resulting from
child abuse.  However, federal child abuse prevention funding appears
relatively low compared with federal expenditures for assistance to
abuse victims.  Prevention programs have difficulty meeting their
funding needs because grants are short term and come from multiple
sources, which increases programs' administrative costs. 


      CHILD ABUSE AND NEGLECT: 
      PROGRESS OF THE NATIONAL
      CENTER SINCE MAY 1991
      (GAO/T-HRD-92-14, MAR.  6,
      1992)
------------------------------------------------------- Appendix V:1.2

Since May 1991, the National Center on Child Abuse and Neglect has
made some progress in monitoring grant programs, managing the
clearinghouse and resource centers on child abuse data, and obtaining
more staff and expertise.  Despite these encouraging signs,
administrative effectiveness may not improve because of the Center's
growing workload.  The Center continues to fall short in providing
timely on-site monitoring, assessing its technical assistance, and
submitting required reports to the Congress.  The Center's limited
resources continue to hinder its goal of providing leadership in
preventing and treating child abuse and neglect. 


      CHILD ABUSE AND NEGLECT: 
      NCCAN'S IMPLEMENTATION OF
      CAPTA OF 1988
      (GAO/T-HRD-91-29, MAY 9,
      1991)
------------------------------------------------------- Appendix V:1.3

Although the National Center on Child Abuse and Neglect addressed the
requirements of the Child Abuse Prevention and Treatment Act of 1988
to varying degrees, staff and resource shortages hindered its grant
administration.  Further, the Center's implementation of the act does
not satisfy all of the requirements. 


      CHILD ABUSE PREVENTION: 
      STATUS OF THE CHALLENGE
      GRANT PROGRAM
      (GAO/HRD-91-95, MAY 9, 1991)
------------------------------------------------------- Appendix V:1.4

By fiscal year 1989, 42 states had established child abuse prevention
trust funds with a median trust fund revenue of about $240,000. 
Although more than $94 million in state funds were available for
child abuse prevention activities, only $40 million were considered
for federal matching funds.  The total amount of federal funds spent
on child abuse prevention was unknown. 


   FOSTER CARE
--------------------------------------------------------- Appendix V:2


      CHILD WELFARE: 
      OPPORTUNITIES TO FURTHER
      ENHANCE FAMILY PRESERVATION
      AND SUPPORT ACTIVITIES
      (GAO/HEHS-95-112, JUNE 15,
      1995)
------------------------------------------------------- Appendix V:2.1

A crisis in the child welfare system has constrained states' ability
to meet the service needs of our nation's most vulnerable children
and their families.  The family preservation and support provisions
of the Omnibus Budget Reconciliation Act of 1993 were enacted to help
states provide services designed to preserve families, especially
those at risk of abusing and neglecting their children, and prevent
unnecessary foster care placements.  While activities implementing
the law during its first 18 months appear to be on target,
opportunities exist for HHS to further enhance state efforts to
develop a viable plan and monitor results. 


      FOSTER CARE:  HEALTH NEEDS
      OF MANY YOUNG CHILDREN
      UNKNOWN AND UNMET
      (GAO/HEHS-95-114, MAY 26,
      1995)
------------------------------------------------------- Appendix V:2.2

Important health-related needs, including routine medical
examinations and various specialized services, remained unmet for
nearly one-third of the young foster children in Los Angeles County,
New York City, and Philadelphia County.  Additionally, most young
foster children in the locations reviewed were at high risk for the
human immunodeficiency virus (HIV) as a result of parental drug
abuse.  Yet, foster care agencies have been slow to respond to one
critical health need--HIV risk assessment--which is the first step in
identifying infected children so that they can receive appropriate
and timely health care.  Few children in the locations reviewed were
tested for the virus.  Furthermore, young children in kinship care
were less likely than those placed in traditional foster care to
receive needed health-related services. 


      FOSTER CARE:  PARENTAL DRUG
      ABUSE HAS ALARMING IMPACT ON
      YOUNG CHILDREN
      (GAO/HEHS-94-89, APR.  4,
      1994)
------------------------------------------------------- Appendix V:2.3

Compared with the 1986 population, the 1991 population of young
foster children in Los Angeles County, New York City, and
Philadelphia County were more likely to have drug-abusing parents and
to be at risk for health problems related to prenatal drug exposure. 
Seventy-eight percent of the foster children in 1991 had at least one
drug- or alcohol-abusing parent, compared with 52 percent in 1986. 
Further, 62 percent of the foster children had a higher risk for
future health-related problems because of prenatal drug exposure
compared with 29 percent in 1986. 


      RESIDENTIAL CARE:  SOME
      HIGH-RISK YOUTH BENEFIT, BUT
      MORE STUDY NEEDED
      (GAO/HEHS-94-56, JAN.  28,
      1994)
------------------------------------------------------- Appendix V:2.4

Residential care appears to be a viable treatment option for some
high-risk youths.  Residential care programs report benefits in
school attendance and in avoiding drug abuse and criminal activity. 
However, these programs seldom conduct controlled or comparison
studies to determine how outcomes are linked to their treatment
efforts, and few programs have conducted studies to show what
happened to participants more than 12 months after they left the
programs. 


      FOSTER CARE:  FEDERAL POLICY
      ON TITLE IV-E SHARE OF
      TRAINING (GAO/HRD-94-7, NOV. 
      3, 1993)
------------------------------------------------------- Appendix V:2.5

Federal funds for foster care and foster care training are made
available to the states under title IV-E of the Social Security Act. 
Under current procedures, states allocate foster care training costs
between the IV-E foster care program and other programs so that each
program is charged its proportionate share of training costs on the
basis of benefits received.  Some state officials oppose the current
HHS cost-sharing policy because it limits IV-E reimbursement and the
amount of foster care training they can provide. 


      FOSTER CARE:  SERVICES TO
      PREVENT OUT-OF-HOME
      PLACEMENTS ARE LIMITED BY
      FUNDING BARRIERS
      (GAO/HRD-93-76, JUNE 29,
      1993)
------------------------------------------------------- Appendix V:2.6

The existing federal system for financing child welfare programs
offers little incentive for states to provide services designed to
keep families together and avert the need for foster care; instead,
states find it easier to house a growing population in federally
subsidized foster care.  Various funding barriers limit states'
ability to provide welfare services.  Federal funding for foster care
is open ended, but funding for direct child welfare services is
limited.  Further, state fiscal crises have limited funding for
preventing foster care placements and family reunification services. 


      FOSTER CARE:  STATE AGENCIES
      OTHER THAN CHILD WELFARE CAN
      ACCESS TITLE IV-E FUNDS
      (GAO/HRD-93-6, FEB.  9,
      1993)
------------------------------------------------------- Appendix V:2.7

HHS has issued several policy statements clarifying eligibility
requirements for reimbursement for foster care placements.  The
Department has reimbursed states for placements made by juvenile
justice agencies since 1984.  Of the states that responded to a 1991
survey, 21 claimed reimbursement for placements by juvenile justice
agencies, and 13 claimed reimbursement for placements by mental
health agencies. 


      FOSTER CARE:  CHILDREN'S
      EXPERIENCES LINKED TO
      VARIOUS FACTORS; BETTER DATA
      NEEDED (GAO/HRD-91-64, SEPT. 
      11, 1991)
------------------------------------------------------- Appendix V:2.8

We analyze data on length of stay in foster care and reentry for
children who entered or left foster care in six states and two
localities.  Of children reunited with their families in 1986, up to
27 percent subsequently reentered foster care.  The median length of
stay for children entering or leaving care in 1986 in the states and
localities reviewed varied from 8 to 19 months.  Children whose
initial stay in foster care was under a year, however, were more
likely to reenter foster care than those whose initial stays were
longer.  Moreover, children placed in institutions in the states
reviewed generally stayed in foster care longer than those placed in
foster family homes. 


      CHILD WELFARE:  MONITORING
      OUT-OF-STATE PLACEMENTS
      (GAO/HRD-91-107BR, SEPT.  3,
      1991)
------------------------------------------------------- Appendix V:2.9

Our review of 42 children from 15 states showed that placement
agencies complied with federal law regarding the frequency of case
reviews.  Despite budgetary constraints, most placement agencies
visit the children to assess the children's well-being and progress
in the treatment program. 


      RESPITE CARE:  AN OVERVIEW
      OF FEDERAL, SELECTED STATE,
      AND PRIVATE PROGRAMS
      (GAO/HRD-90-125, SEPT.  6,
      1990)
------------------------------------------------------ Appendix V:2.10

Respite care provides temporary child care relief to family members
and other caretakers of disabled children to prevent child abuse and
neglect and support family unity.  Respite care services are funded
through state and local agencies, national organizations, and federal
departments.  Funding patterns differ among states.  The demand for
respite care services exceeds the available supply. 


      FOSTER PARENTS:  RECRUITING
      AND PRESERVICE TRAINING
      PRACTICES NEED EVALUATION
      (GAO/HRD-89-86, AUG.  3,
      1989)
------------------------------------------------------ Appendix V:2.11

The most effective recruiting strategies realistically portrayed
foster care difficulties, emphasized foster care's temporary nature,
and defined the positive role of foster parents.  Effective
preservice training focused on enabling foster parents to make
informed decisions about foster children's needs, enabling social
service agencies to assess foster parents' suitability for caring for
foster children, and facilitated teamwork between social service
agencies and foster parents.  States have performed limited formal
evaluations of their recruiting and preservice training practices,
and few have comprehensively evaluated the effectiveness of various
demonstration activities. 


   OTHER
--------------------------------------------------------- Appendix V:3


      ADOPTION:  ASSISTANCE
      PROVIDED BY SELECTED
      EMPLOYERS TO ADOPTING
      PARENTS (GAO/HRD-90-47FS,
      DEC.  19, 1989)
------------------------------------------------------- Appendix V:3.1

Fifty-six of 77 employers in our review financially assisted
employees adopting children and commonly imposed a dollar limit on
the amount of assistance.  All 77 employers allowed adopting parents
to use some form of unpaid or paid leave, but few employers provided
adoption or parental leave benefits. 


      CHILD WELFARE:  HHS BEGINS
      TO ASSUME LEADERSHIP TO
      IMPLEMENT NATIONAL AND STATE
      SYSTEMS (GAO/AIMD-94-37,
      JUNE 8, 1994)
------------------------------------------------------- Appendix V:3.2

HHS' initiatives to address information system implementation
problems include issuing final regulations and functional system
requirements, working with the states to develop a draft system model
for other states to follow in developing their systems, and hiring a
contractor to help states develop their systems. 


      FAMILIES ON WELFARE:  SHARP
      RISE IN NEVER-MARRIED WOMEN
      REFLECTS SOCIETAL TREND
      (GAO/HEHS-94-92, MAY 31,
      1994)
------------------------------------------------------- Appendix V:3.3

From 1976 to 1992, the proportion of single women receiving Aid to
Families With Dependent Children (AFDC) who had never been married
more than doubled, increasing from about 21 percent to about 52
percent.  This change paralleled a broader societal trend among all
single mothers.  Single women receiving AFDC in 1992 were better
educated, had fewer children, and worked as much as their
counterparts in 1976, but were twice as likely to have incomes below
the poverty level. 


      FAMILIES ON WELFARE: 
      TEENAGE MOTHERS LEAST LIKELY
      TO BECOME SELF-SUFFICIENT
      (GAO/HEHS-94-115, MAY 31,
      1994)
------------------------------------------------------- Appendix V:3.4

Women who gave birth as teenagers make up nearly half of the AFDC
caseload--a sizeable group.  Women who had their first child when
they were teenagers may have the most difficulty earning their way
off welfare and becoming self-sufficient. 


      INTEGRATING HUMAN SERVICES: 
      LINKING AT-RISK FAMILIES
      WITH SERVICES MORE
      SUCCESSFUL THAN SYSTEM
      REFORM EFFORTS
      (GAO/HRD-92-108, SEPT.  24,
      1992)
------------------------------------------------------- Appendix V:3.5

Broad-based and ambitious system-oriented efforts have faced many
obstacles and met with limited success.  For example, programs and
initiatives we visited were unable to create new organizational
structures or develop multiagency service plans and budgets.  In
contrast, service-oriented efforts were able to link at-risk families
to human services and provide a combination of health and other
supportive services. 


      ADMS BLOCK GRANT:  WOMEN'S
      SET-ASIDE DOES NOT ASSURE
      DRUG TREATMENT FOR PREGNANT
      WOMEN (GAO/HRD-91-80, MAY 6,
      1991)
------------------------------------------------------- Appendix V:3.6

The Alcohol, Drug Abuse, and Mental Health Services women's set-aside
increased almost 500 percent between fiscal years 1988 and 1990. 
Despite that increase, the Congress lacked adequate information to
determine whether the set-aside effectively reduced treatment
barriers and addressed treatment needs since HHS did not clearly
specify reporting requirements to states.  The women's set-aside did
not ensure that states provided appropriate treatment services to
women since the set-aside encouraged, but did not require, states to
fund specifically designed treatment. 


      DRUG ABUSE:  THE CRACK
      COCAINE EPIDEMIC--HEALTH
      CONSEQUENCES AND TREATMENT
      (GAO/HRD-91-55FS, JAN.  30,
      1991)
------------------------------------------------------- Appendix V:3.7

Cocaine abusers had high rates of such mental disorders as
depression, schizophrenia, and antisocial personality disorder. 
Health professionals associated crack use with the spread of acquired
immunodeficiency syndrome and other sexually transmitted diseases. 
No state-of-the-art treatment method for crack abusers existed. 


      DRUG-EXPOSED INFANTS:  A
      GENERATION AT RISK
      (GAO/HRD-90-138, JUNE 28,
      1990)
------------------------------------------------------- Appendix V:3.8

Estimates of the number of infants exposed to cocaine annually ranged
from 100,000 to 375,000.  Drug-exposed infants were more likely than
unexposed infants to suffer from medical problems and, in some cases,
required costly medical care.  Twelve hundred of the 4,000
drug-exposed infants at 10 hospitals were placed in foster care, and
the cost of 1 year of foster care for those infants was about $7.2
million. 


      CHILDREN'S ISSUES:  A DECADE
      OF GAO REPORTS AND RECENT
      ACTIVITIES (GAO/HRD-90-162,
      SEPT.  21, 1990)
------------------------------------------------------- Appendix V:3.9

Pursuant to a congressional request, we provided an annotated
bibliography of our studies on children's issues.  We provided (1) an
annotated bibliography of 58 reports and testimonies published
between October 1988 and March 1990; (2) titles of reports issued
between fiscal years 1980 and 1988; (3) information on current
assignments relating to children and families, as of March 31, 1990;
and (4) information on other publications by our staff on
child-related issues. 


GAO CONTACTS AND STAFF
ACKNOWLEDGMENTS
========================================================== Appendix VI

GAO CONTACTS

Robert L.  MacLafferty, Assistant Director, (415) 904-2123
Patricia L.  Elston, Evaluator-in-Charge, (916) 974-3341
Susan E.  Arnold, Senior Evaluator

STAFF ACKNOWLEDGMENTS

In addition to those named above, the following individuals made
important contributions to this report.  Inez Azcona, Kerry Dunn,
Karen Lyons, and Elizabeth Olivarez provided information in their
areas of expertise.  Jon Silverman assisted in writing the report. 

