Health Conditions, Utilization, and
Expenditures of Children in Foster Care

APPENDIX A:
CHARACTERISTICS OF CHILDREN RECEIVING EMERGENCY ASSISTANCE

Contents

• Demographic Characteristics
• Medicaid Eligibility Dynamics
• Health Conditions
• Expenditures and Utilization
• Conclusion

Title IV-A of the Social Security Act authorized matching funds to states that provide emergency assistance (EA) under approved state plans.⁽¹⁾ State plans were required to designate the types of emergencies eligible for assistance. Potential uses were wide-ranging and included providing aid to those affected by natural disasters (floods, fires, storms); those who were homeless or faced a risk of homelessness (due to eviction or foreclosure, for example); those facing financial crises due to loss of employment or strikes; and those with medical needs such as emergencies, illnesses, accidents, or injuries.

During the decade from 1985 to 1995, spending for emergency assistance grew 20-fold. More states submitted amendments and received approval for emergency assistance programs. Additionally, many states expanded eligibility so that they could use EA funds for juvenile justice, mental health, or child protection (US House of Representatives 1996).

This appendix describes the characteristics of children receiving emergency assistance in conjunction with child welfare services in 1994, and who were covered by Medicaid. The analysis includes 1,301 EA children in California, and 6,898 EA children in Florida. The EA coverage category was used much more frequently in Florida, relative to the number of children in foster care during the year. There were no children in Pennsylvania who were identified in the SMRF file as receiving emergency assistance related to child welfare during this time period.

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Demographic Characteristics

As shown in Table A.1, the average age of children receiving emergency assistance was nearly 12 in California and slightly over 10 in Florida. The higher average age (relative to children in foster care) is accounted for by the higher concentration of adolescents in this population, presumably a diversion from the juvenile justice system. Sixty percent were male, a disproportionate rate compared to the 50/50 gender distribution within the foster care population. The racial/ethnic distribution was quite similar between emergency assistance and foster care children. The geographic distribution was similar for the two groups in Florida, whereas in California, emergency assistance was more common among children in smaller urban or rural areas.

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Medicaid Eligibility Dynamics

Children receiving emergency assistance were far less likely to receive Medicaid coverage for the full year than children in foster care. In California, EA children averaged less than six months of coverage during 1994, compared to 10 months for foster care children. The disparity was less pronounced in Florida, where EA children averaged eight months of Medicaid coverage. It would appear that emergency assistance was not only used more often in Florida than in California, but that it also provided a pathway to more stable Medicaid coverage.

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Health Conditions

In California, foster care children were more likely than children receiving emergency assistance to have health conditions (reflected in the CDPS), but this is a function primarily of a higher rate of physical conditions in the foster care population.⁽²⁾ The rate of mental conditions was quite similar between the two groups.

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Expenditures and Utilization

Table A.2 compares the level and distribution of average monthly Medicaid expenditures between children receiving emergency assistance and those in foster care. Children receiving emergency assistance in California had higher average monthly expenditures than those in foster care, due to higher inpatient expenditures. In Florida, the differential was reversed, with foster care children having slightly higher expenditures on average than those receiving emergency assistance, due primarily to higher expenditures for ancillary services (such as case management, prescribed drugs, and home health services).

Within the emergency assistance group, average monthly spending was 60 percent higher in Florida than in California. The majority of expenditures for EA children in California were for inpatient services, while most of the expenditures in Florida were for outpatient services. The higher spending in Florida appears to be driven by clinic services (mostly for mental health services) and case management services.

Children receiving emergency assistance not only had higher average monthly expenditures, but were also intense users of health care services relative to their short stays on Medicaid. Because of the differences in dynamics of Medicaid eligibility between the two groups, Table A.3 compares utilization by length of Medicaid eligibility. Beginning with California, EA children with one to five months of Medicaid coverage were more likely to have an inpatient stay (as were those enrolled the full year). This explains the higher average monthly Medicaid expenditures and the greater concentration of Medicaid expenditures in the inpatient sector among EA children. Indeed, EA children in California appear to be higher users than the foster care population on almost all measures of utilization, once we control for length of Medicaid eligibility.

Patterns of use were quite different in Florida; in general, EA children had lower levels of use relative to foster care children, just as they had lower monthly expenditures, on average. The one exception was mental health and substance abuse treatment services, where EA children enrolled part of the year were more likely to receive services than foster care children.

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Conclusion

This analysis has shown that children receiving emergency assistance had a different demographic profile than foster care children, had shorter Medicaid stays, and had different patterns of utilization and expenditures. Moreover, this analysis has demonstrated that California and Florida each used EA to serve a different mix of children, and the variations in patterns of utilization and expenditures reflect these differences. Since the termination of emergency assistance under the Welfare Reform Act of 1996, it is unclear what has happened to this highly vulnerable — but largely invisible — group.

Footnotes

1. The authority, however, was rescinded with the Welfare Reform Act in 1996.

2. Due to lack of diagnostic data on Florida's outpatient SMRF claims, data on health conditions are available only for California.