When poor parenting leads to abuse or neglect, the child welfare system intervenes on behalf of a child and, at the extreme, removes the child from the home of the parents and places him or her in foster care. The events that lead to state intervention often develop over time; parental stress over job loss or low income may be cumulative or problems with substance abuse may escalate over time to an eventual breaking point. As researchers, we can most reliably capture the breaking point — when the state intervenes — for the vast majority of children. To do otherwise — to monitor the quality of parenting — would be invasive and costly. With welfare reform, there is concern that the new requirements of the parents may inadvertently affect child well-being negatively and thus increase intervention by the child welfare systems. Our purpose here is to better understand when and how often the child welfare system intervened prior to welfare reform. Such data offer a baseline of knowledge against which to measure the effects, if any, of welfare reform on the child welfare system.
Although there was political consensus in the mid-1990s that reform of the AFDC program was necessary, there was considerable concern that the changes made might affect children adversely. National and state policymakers, federal, state, and local administrators, and child advocates expressed concern about the potential negative effects on child well-being of welfare reform — codified in the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA).(1) On the other hand, there was also reason to believe that working and not just receiving a "handout" would have a positive effect on parental self-image and, therefore, on parenting skills. This, in turn, would lead to improved child well-being.
The intent of welfare reform was to move more people into the workforce and toward greater self-sufficiency. Federal requirements eliminated the entitlement to cash assistance and instituted lifetime limits on receipt of AFDC, now labeled Temporary Assistance for Needy Families (TANF).(2) Although the policies vary among the three states included in this study (California, Illinois, and North Carolina — see Appendix of Tables - Table 1 for comparisons), two requirements apply to all states: a parent may now receive TANF for only five years over his or her lifetime, and recipients must be enrolled in a work "activity" after two years. States can, however, choose to exempt certain individuals or groups (up to 20% of the caseload) and may set their own shorter time limits. The consequence of a grantee failing to abide by these requirements and others established by the states is loss of cash assistance, and, if the states choose, loss of adult Medicaid coverage.
It is clear that, as a result of welfare reform and an improved economy, the economic situation of many families receiving income assistance has changed. As time goes on, more parents' economic status will change. Given time limits and the requirements to work, a significant proportion of the pre-PRWORA caseload will either become employed or be sanctioned and forced to leave income assistance. For those who are employed, we expect their income to increase. Positive changes in the lives of low-income children may arise from a parent's increased self-sufficiency, higher income, and future potential. However, some families will reach their time limits or experience sanctions, reducing their aid and likely reducing household income. In either case, parents' stress levels are likely to fluctuate with work, causing both improvement in self-esteem and increased challenges related to the work and home environments (e.g., transportation and child care). Unemployed parents are likely to feel the stress that accompanies concern about providing the basic needs for their children.
If parents' emotional states improve, better parenting, and a reduced need of the child welfare system to intervene, will likely follow. If their emotional state deteriorates, all else being equal, parental care of children may become less adequate and, in some cases, abusive or neglectful. The children of these parents may not be safe in their homes. The child welfare service system will likely respond by intervening more. The most intrusive response of the child welfare system is to remove a child from his or her parents' custody and place the child in a living arrangement supervised by the child welfare system — foster care.
There may also be an increase in the use of foster care services among the TANF population prior to reaching time limits or incurring sanctions, as families anticipate these events and try to plan for their children. This could lead to "apparent abandonments," in which parents leave children with relatives who can obtain assistance through foster care or through child-only TANF payments. We should also be alert to changes in TANF policy that could result in cases that formerly would have been kinship foster care cases becoming covered under TANF. The distinctions between kinship care in the child welfare system and child-only TANF cases are blurring. In both cases, children are being taken care of relatives. In the child welfare case, custody is taken by the state and the reimbursement to the relative caretaker is significantly higher than that of a child-only case. One trend in the child welfare field currently, is to attempt to reduce the number of children in kinship care by diverting them from formal foster care or moving them into a permanent guardianship status. There are still, however significant difference in reimbursement to the caretakers.
However, those families that improve earnings via employment or other sources may counterbalance the rate of increase in transitions from TANF to foster care. Children who are in foster care in the years following welfare reform may also be affected by their parents' economic situation and their parents' psychological response. Parents' ability to maintain employment is often one signal to juvenile courts and child welfare agencies that they "have gotten their life together." Parents' inability to keep a job, continued substance abuse, or the lack of satisfactory housing may negatively affect the likelihood of a child being reunified with his or her parents.
There have also been other policy changes that are likely to interact with PRWORA. In child welfare, the recent Adoption and Safe Families Act (ASFA), which increases incentives for adoption, and Title IV-E waivers to expand the permanency options in the three states under review (IL, CA, and NC), are likely to change foster care dynamics. Therefore, the transition from foster care to AFDC may also be affected.
One of the biggest concerns for policymakers and welfare administrators is that these interventions will cost society more and result in long-term harm to children. If more children are entering foster care from income maintenance programs in the years following welfare reform, reforms will have had unintended, serious consequences for children, families, and the state, and the policies may need to be revised or services better targeted. Also, if fewer children were discharged from foster care because of changes owing to welfare reform, policymakers may want to reconsider certain elements of reform — both in the income maintenance and child welfare arenas.
Therefore, we need to accurately monitor the movement of children from one program to another and to determine what factors affect that flow. In terms of monitoring the effects of welfare reform on the child welfare system, we do not know exactly when, both in historical terms (how long after welfare reform is implemented) and during the child's experience (before or after income maintenance receipt), the effects will be seen. When the effects are seen in the service system depends on when the effects in the family manifest themselves, and when the system responds to the new conditions in the family.
From a monitoring perspective, we can only observe the latter — when the system responds. Methods to capture when parenting changes would be, at the very least, expensive and intrusive, and perhaps, impossible to implement on a large scale. Therefore, if the response of the child welfare system changes as a result of welfare reform, our analysis may not capture the psychosocial effects of welfare reform on the family. However, there is no reason to expect that the time to respond to abuse or neglect will be longer or shorter as a result of welfare reform. If the process of reporting and investigating abuse and neglect changed as a result of welfare reform, we would be concerned about capturing an unrelated outcome in our data. We know of no reason why this would be true.
In this study, our purpose is to understand better when and how the system-level effects of poor parenting occur prior to welfare reform in order to have a baseline for assessing the effects of reform in addition to simply understanding the careers of children in the service system. Since the system-level effects of poor parenting may happen before or after an AFDC grant ends, because of the variability in how the stress will manifest itself, we must track children before, during, and after their income maintenance and child welfare experience to capture the effects. Therefore, the construction of the study population for assessing the system effects is critical.
The Study Population
Although federal welfare reform was implemented July 1, 1997, many believe that there was an anticipatory effect, and consequently, some AFDC recipients in the early months of 1997 voluntarily stopped their cash assistance although still eligible. Others also believe that potentially eligible recipients avoided applying, believing, mistakenly, that welfare "as we knew it" was a thing of the past. With this in mind, we wanted to select a cohort of recipients who entered AFDC, Medicaid, or foster care near enough to welfare reform to avoid the effects of the changed policies in each state, but not be influenced by any anticipatory effects. We chose children who entered one of the three programs in calendar years 1995 and 1996 and followed them through the end of 1996.
We also wanted a study population that shared similar program experiences. Such shared experiences, such as entry into a program during the same period of time, allow us to control for factors that might affect outcomes. A population of children with entry dates from different historical periods, such as that of a point-in-time population, could also fundamentally change the potential distribution of the likelihood of the events of interest occurring. Understanding factors that affect the flow of children among programs in either case would be difficult. Choosing a point-in-time population would have included children with widely varying durations of participation, as well as varying set of previous programs used. A child in care on a particular day may have been in a particular program for any duration between one day or 17 years. Therefore, the reasons for children entering foster care when they had been receiving AFDC for a considerable period before 1995 would be confounded. We would not know if children were entering foster care because of long-term poverty or because of changes in parenting during a short period of time before foster care entry. Also, we find that children are more likely to enter foster care at the beginning of their AFDC career and that the likelihood decreases over time.
In addition, for the point-in-time population of some programs, we would never expect the majority of the children to leave a program. Another study population might be an exit cohort. Choosing an exit cohort excludes those children who had not formally left the programs, but were nevertheless at risk of entering one of the other programs.(3) Although a transition from foster care to AFDC requires a formal opening of an AFDC case, it does not require a closing of the Medicaid case. Therefore, if we only look at children who exited AFDC, we would miss a transition to foster care of a child receiving AFDC. Because of these issues, one should be careful when comparing the findings in this study to studies with either repeated cross-sections or the "leaver" studies.
In an "entry" cohort study such as the one presented in this report, it is imperative to understand any possible effects of the study population's experiences prior to the "observation" period. In studies that use similar longitudinal methods similar to ours, it is well documented that experiences of the new entry cohorts (those who enter a particular program for the first time) are often quite different from those who had previous service experiences (i.e., re-entries or those who had previous contacts in other service systems). To control for the effect of the previous service experiences, to the extent the longitudinal service data allow, we include those children with no AFDC, Medicaid or foster care two years prior to AFDC entry.
We believe that this study population is the most appropriate one for accurately portraying the movement of children from income maintenance receiving families into foster care. There is a high representation of young children our AFDC group and that is also true of the children that enter foster care. Foster care in the larger states in the U.S. has become a program that targets children under the age of five (Wulczyn et al., 1999).
The Transitions Studied
The diagram below depicts, in general, the transitions that we studied. The first and second levels depict the direct transitions (no time between the two) from AFDC to foster care, Medicaid only, and no participation in any of the three programs. Going from the second to the third levels depict the second transition for the original AFDC cohort. We only have one branch going to the fourth level because it is the only transition at that level that we analyze. Hazard and survival curves for each of these transitions are in the Appendix.
The transition from AFDC to foster care. Using longitudinal statistical techniques, we find that at two years from entry to AFDC, 2 percent (20/1000) of the California entries, 2.5 (25/1000) percent of the North Carolina entries, and 2.6 percent (26/1000) of the Illinois entries have entered foster care (see table 1) (see figures CA4, NC4, and IL4 in the appendix). Although this seems to be a relatively small number, entries into foster care from the AFDC caseload account for a majority of the entries (about 60%) across the three states. There is also significant variation among the states in the rate of entry to foster care from AFDC, with the rates in North Carolina and Illinois being 25 percent greater than in California.
Transition from AFDC to Foster Care
|% of AFDC cohort that enter FC by 2 years
|% of FC entries previously in AFDC or Mediciad
|% of FC entries from AFDC that go directly from AFDC to FC
It is also the case that the vast majority (85% in Illinois, 96% in California, and 90% in North Carolina) of these children who went to foster care went from an AFDC grant directly to foster care prior to their AFDC case closing (see table 1). The remainder experience an interim of no cash assistance before entry into foster care. Therefore, a typical transition pattern is not one in which an AFDC case closes and an entry to foster care occurs, but rather one in which a child enters foster care from an active AFDC case. This is particularly relevant because many of the current welfare reform evaluations now focus on those TANF cases that have exited. There are likely to be very small numbers of foster care entries from the families that have exited, if this transition pattern remains for the period after welfare reform.
The following findings on the effect of age, type of foster care and county-level poverty were the results of our multivariate analyses (Tables IL1, CA1 and NC1). Infants are nearly three times as likely to enter foster care from an AFDC spell than 15-17 year olds in North Carolina and California and four times as likely in Illinois. We also find that all children on AFDC are more likely to enter foster care early (within the first ten months of their AFDC experience) and that infants exhibit this to the greatest degree. These findings suggest that foster care entry from AFDC is more likely to occur for young children at a time of crisis or stress that has caused a family to move onto the AFDC rolls. Future analysis should include the age of the mother as an additional independent variable because infants who enter foster care are more likely to be born to adolescent or young adult mothers (Goerge and Lee, 1997).
Kinship care in Illinois and California has been used as a formal foster care placement. Therefore, we track kinship care in these two states as a separate outcome. There is some reason to believe that the dynamics of entry to kinship care as opposed to other types of foster care are different, since relatives may be taking care of a child informally prior to the intervention by the child welfare agency. Here we find evidence for this; in California, it is 160% more likely that a child from an AFDC grant enters non-kinship foster care placements than kinship foster care and, in Illinois, the likelihood is 60% greater. Since the overall rate of entry into kinship care has been at least as high as that of non-kinship care in these two states, this likely reflects the fact that children are living with relatives prior to foster care who are not on AFDC.
The effect of county-level poverty on the transition rates varied by state. In California, children from poor counties were more likely to be placed in foster care. However, placement in Los Angeles County seems to account for most of that finding, since it does have a greater than average poverty rate. We found no effect of county poverty levels in Illinois or North Carolina. We also did not get a consistent race effect across the three states. Given that the race and county-level poverty effects are highly correlated, we believe that it is important to look at smaller geographic regions, such as zip codes or even census tracts in order to properly estimate the effect of these two factors.(4)
The transition from foster care to AFDC, Medicaid-only, or no program participation. There are quite different dynamics across the three states in this transition. Of the three states, Illinois has the highest number of all foster care entries still in foster care after two years (61%), a finding that is well-known in child welfare (see table 2). Both California and North Carolina have moved more children out of foster care than Illinois. In California, the most likely transition is from foster care to Medicaid-only (40%). Most North Carolina children (69%) move from foster care to a system exit (no longer receiving AFDC or Medicaid). Relatively few children transition from foster care to AFDC (4% in Illinois, 5% in North Carolina and 11% in California).
Those children who do make the transition from foster care to AFDC are likely to do it very quickly, with 69 percent of the foster care exiters in Illinois, 79 percent in California, and 91 percent in North Carolina doing so within 31 days of exit from foster care. Given that the AFDC pathway out of foster care is an unlikely one, we do not anticipate that welfare reform will have a great effect on the type of foster care exits. It may be, however, that children exit more slowly from foster care than they do now.
We find that the percentage of children who have re-entered AFDC after entering foster care from AFDC is very similar to the percentage of foster children entering AFDC who have not been in AFDC before foster care. These statistics are relatively similar across states. It is unclear why these numbers are similar across states, because of the great variation in how long children stay in foster care. One hypothesis is that the experience of foster care itself changes either the family or the child in ways that prevents certain children from ever returning to the original family. The small percentages of children who return to their families and participate in AFDC may be the cases in which children are reunified with their families very quickly and where the families can be preserved.
Transition from Foster Care to AFDC and Medicaid-only
|% of FC entries still in care at the end of 2 years
|% of FC entries that made transition to AFDC
|% of FC entries that made transition to Medicaid
|% completely out of system after 2 years
|% of AFDC entries from FC that do so within 31 days of FC exit
|% of exits that enter AFDC or Medicaid
|% of children who have entered FC from AFDC who re-enter AFDC (at 1, 2, and 3 months)
|% of children who have entered FC from AFDC who re-enter AFDC (2 years)
The transition dynamics of entry among AFDC cohorts into foster care across states are very similar on many parameters and quite different on a few important ones. The consistency across states in the pre-foster care AFDC and Medicaid participation of foster children suggests that poverty, or perhaps participation in welfare program, plays an important role in the entry of children into foster care. Also, it is clear that infants are at greatest risk and that the birth of a new child is a time when the child welfare system is most likely to intervene in a family's life. The primary differences in the findings are in the percent who enter foster care two years after entry to AFDC; figures in Illinois and North Carolina are about 25 percent greater than California. Also, there is a significant difference between Illinois and California in the likelihood of entry to kinship care compared with non-kinship care, with California children being more likely to enter non-kinship care.
We are able to use these findings to simulate what may happen as a result of changes in the transition from AFDC to foster care. There have been estimates that a one percent increase in the number of children receiving AFDC who end up in foster care would increase the foster care population by 20 percent. Although it is difficult to replicate this exact scenario, we provide in Table 3 below a set of scenarios in which we vary the change in the rate of entry to foster care from TANF and the number of foster children entering TANF cases. These scenarios assume that the number of entries to foster care from Medicaid-only and the number for children who participate in neither TANF nor Medicaid stay constant. The changes in the foster care entries include those children who come to foster care from all previous statuses (TANF, Medicaid-only, and neither of the two).
We find that if an additional one percent of children who begin receiving TANF after welfare reform entered foster care, we would see a 25 percent increase in the number of entries to foster care in 1999 and a 30 percent increase in the year 2000 (scenario #1). Perhaps a more likely scenario would be #4, where the rate of entry to foster care increases, but the number of entries to TANF decreases by 10 percent each year. In such a scenario, we would have much smaller increases to the foster care entries in 1999 (6%) and 2000 (5%). A quite unlikely scenario, given what has already happened since welfare reform, is scenario #5, where both the rate of entry to foster care and the number of entries to TANF increase. The effect on the number of foster care entries under this scenario would be dramatic, with a 51 percent increase in 1999 and a 67 percent increase for 2000.
Alternatively, given the recent decreases in the caseload and the strong employment statistics, we might anticipate that the number of entries to foster care decreases as a result of the positive effects of parents' employment. A one percent decrease in the percentage of children entering foster care from TANF with no accompanying decrease in the number entering TANF would result in a 25 percent decrease in the total number of entries to foster care in 1999 and a 30 percent decrease in 2000 (scenario #7). However, with a decrease in the number of entries to TANF and a decrease in the rate of foster care entry, we would see a 28 percent decrease in the foster care entries in 1999 and 34 percent decrease in 2000.
Simulated changes to foster care entries as a result of welfare reform.
||Increase in rate of entry from TANF to Foster Care
||Yearly change in the number of entries to TANF
||Change in 1999 Foster Care entries from baseline
||Change in 2000 Foster Care entries from baseline
The prevalence of the transition from foster care back to a cash assistance grant may be affected by the existence in some states of the family cap policies that prohibit TANF payments for children born to parents while on TANF. It is likely that many of the children who enter foster care will be born to mothers already receiving TANF. In this case, they would be ineligible for TANF when they exited foster care. Therefore, the transition from foster care to Medicaid may be an important one to focus on in a follow-up study.