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

Table A.3
Health Care Utilization Among Children Receiving Emergency Assistance, by Length of Medicaid Eligibility, 1994
  California Florida
Utilization Emergency Assistance
Foster Care
Emergency Assistance
Foster Care
Percent with a hospital stay (total) 2.5 3.2 4.2 4.1
  1-5 months 2.7 2.0 1.9 3.4
  6-11 months 1.8 4.4 6.1 6.6
  12 months 3.4 3.2 4.5 3.5
Percent with an outpatient provider visit (total) 51.1 65.0 68.4 84.6
  1-5 months 32.8 29.2 45.7 48.7
  6-11 months 70.0 60.5 76.3 80.6
  12 months 80.1 73.4 82.3 91.5
Percent with an emergency room visit (total) 24.1 27.5 22.8 25.0
  1-5 months 11.2 8.1 10.6 9.0
  6-11 months 35.9 26.7 24.3 25.4
  12 months 48.6 31.7 33.2 27.5
Percent with a prescribed drug (total) 33.9 51.2 47.2 67.9
  1-5 months 15.3 15.0 23.5 28.8
  6-11 months 51.7 45.2 53.0 61.5
  12 months 67.1 60.1 64.2 75.9
Percent with a preventive visit (total) 23.3 34.5 25.2 27.6
  1-5 months 11.5 11.9 13.4 17.2
  6-11 months 34.3 30.7 25.6 35.0
  12 months 45.2 40.1 35.4 41.4
Percent with a dental visit (total) 23.7 36.1 19.4 35.4
  1-5 months 10.2 7.2 11.3 6.7
  6-11 months 38.9 56.0 21.6 22.0
  12 months 41.1 44.6 29.3 43.6
Percent with any mental health/substance abuse treatment (total) 19.9 22.6 34.8 38.4
  1-5 months 11.9 6.6 21.8 16.0
  6-11 months 28.8 19.3 40.1 33.3
  12 months 30.1 26.7 42.0 43.4
SOURCE: HCFA State Medicaid Research Files.

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.


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.


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.