Report to the Congress on Kinship Foster Care. II. Financial Assistance for Caregivers


Issue: Should kin foster parents receive the same level of financial support for the care of foster children as is provided to non-kin foster parents? Should such support be available only while the child remains in State custody, or should it continue if the child is discharged to the relative’s legal custody?

Discussion: Central to congressional interest in kinship care is the call by some States to allow long-term financial assistance for relative caregivers under title IV-E of the Social Security Act after children are discharged from State custody or in order to prevent the need for a State to take custody of the child. Many relative care providers have limited economic resources and cannot make a longterm commitment to a child without assistance. A number of advocates have suggested specific policy changes to provide ongoing financial assistance to such relatives.

The most common formulation of this idea is to allow relatives who assume legal guardianship of the child access to adoption assistance payments (subsidies that help the family meet the child’s needs, generally until the child reaches age 18). A number of States operate subsidized guardianship programs using their own funds. Under Federal title IV-E (which provides the bulk of Federal child welfare funding to the States), adoption assistance payments are currently available only to adoptive parents of special needs children or under demonstration waivers which have been granted to several States to evaluate the concept of subsidized guardianships. Others have suggested that long-term foster care should be considered a more acceptable permanency option for these children because relative foster caregivers should be viewed as “more permanent” than other foster parents. Under some suggested formulations of such a policy, relative caregivers, either as foster parents or legal guardians, would receive a reduced subsidy, would have to meet less stringent licensing standards, or would receive less supervision than other title IV-E foster care providers.

Subsidized guardianship programs are generally sought as a way to address the fact that children need permanent homes outside the foster care system. While many relative care providers have limited economic resources, they are generally devoted to the children in their care, and, as a group, appear to provide more stable foster care settings than are provided by non-relatives. Concerns regarding such proposals tend to center around their costs and whether they push child welfare agencies away from their core protective functions and toward income assistance functions. Several positions raised by panel members should be noted.

First, it is clear that relatives are not now consistently being told that they have the option of becoming paid foster parents. In order to reduce public costs, some States and localities divert children from foster care by using Temporary Assistance for Needy Families (TANF) child-only payments or unpaid relative care for children who are in need of protection. TANF (and what prior to welfare reform was the Emergency Assistance Program) is also used by States to pay relative foster parents when children or the placements they are in are not title IV-E eligible. Most Advisory Panel members believed that in many cases whether or not a caregiver received foster care payments was based less on the family’s situation, needs and eligibility than on the child welfare agency’s administrative and financial convenience. Most members agreed that if a child is in State custody and the relative caregiver has gone through the same training and certification process and receives the same supervision as other title IV-E foster care providers, they should receive full title IV-E foster care payments. While this report focuses on title IV-E foster care, members also spent time discussing children placed with relatives who receive only TANF (welfare) funding. While there was not a full exploration of this issue, several members described the value of using TANF funding to enable lower income family members to care for a child as long as the child is in a safe and stable environment. There was concern expressed that the TANF rules should not create an incentive to force the child welfare system to take custody of children and pay the foster care rate when State protection is not necessary. Perceived penalty threats in proposed TANF regulations related to child-only cases and welfare system time-limits on relatives who voluntarily take over the care of children were among the particular issues discussed. Final TANF regulations which moderated the language perceived as threatening should reduce this potential problem.

HHS Position: Closely following the principles laid out above, children should be in State custody only if there is an ongoing need for protection. Foster care payments under title IV-E should not be used primarily for supplemental income for a family. The Department recommends at this time delaying consideration of subsidized guardianship proposals until we have the results of demonstration projects underway in several States. While it is clear that some States currently implement a separate payment system for relatives using their own funding or by diverting the case from the child welfare system and providing TANF funding instead, we believe there is not currently sufficient evidence to support a major change in Federal reimbursement policies under the IV-E foster care or adoption assistance program in order to provide long-term income support to relative caregivers. Relatives should, however, be informed consistently of the option to become licensed foster parents when the children in their care are in State custody. In addition, relatives should be encouraged to adopt the children in their care if reunification is ruled out and this is the most appropriate plan for the child. Initial results from demonstration projects indicate that relatives are more often willing to adopt the children in their care than has generally been expected.

Several issues would need to be carefully considered before the Department could adequately anticipate the consequences of Federal funding for subsidized guardianships. Such changes may affect children and families in ways we do not fully understand, such as creating more pressure to place children with relatives while providing children less protection. There is little evidence regarding the long-term stability of guardianship arrangements. Do they actually become permanent situations for children or do they merely delay accomplishing a permanent placement? Clearly, too, there would be a significant cost implication if Federal child welfare funding were used for an additional type of arrangement that is now supported by TANF or State foster care funds. The Department is also concerned about the potential of guardianship subsidies to undermine the primary protective function of the child welfare system. This becomes a danger if child welfare becomes (or is viewed as) more a system of financial support for relatives than one of protection for children.

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