State Innovations in Child Welfare Financing. Massachusetts: Family-Based Services Initiative

04/01/2002

The goal of Massachusetts’s Family-Based Services Initiative is to implement a collaborative, community-based approach utilizing Department of Social Services (DSS) financial resources in coordination with other community, state, and private providers, systems, and funding sources in order to address family needs in a comprehensive and efficient manner. The impetus for the initiative came from the State child welfare staff wanting to be able to provide more flexible, collaborative, and responsive services to improve outcomes for children. The previous system of purchasing services through contracts prohibited the local customizing of services. The initiative allows the customizing of services based on community needs and resources; it enlarges the pool of service providers available; and it allows the State to purchase services on an as-needed basis. In addition, it provides a new emphasis on maximizing third party reimbursement and access to services not funded by DSS.

The target population for the initiative is primarily intact families who are at-risk of their children entering custody due to supported assessments of abuse and neglect. About 75 percent of the 38,000 children in the child welfare system are still at home, so that is the primary population targeted, although children in out-of-home care are not excluded.

The initiative, which began serving clients in January 2000, involves the State contracting with nonprofit community-based child welfare agencies to serve as lead agencies for DSS service areas. There are 29 service areas and 18 lead agency contracts – some area offices joined together to be covered by a single lead agency. The lead agencies receive a specified amount of money (initially $100,000 per year) to provide lead agency functions – gatekeeping, conducting utilization review, creating and coordinating provider networks, monitoring quality of services, and accessing third-party reimbursement. Each service area office now has a staff person from the lead agency on-site full-time. A separate contractor (Community for People) is tracking the initiative and developing and supporting a database for utilization management. There is no formal evaluation in place, but the State recently completed a six-month self-assessment report.

The lead agencies develop local networks comprising a broad array of formal and informal social service, educational, housing, and cultural resources serving families. These agencies recommend a core group of network providers from whom DSS purchases family-based services through contracts and at rates the providers negotiate with DSS. The providers are paid primarily on per-diem and hourly rates. The state is encouraging case rates, as the initiative utilizes models that vary in intensity according to the needs of the families, but case rates require time to develop necessary administrative structures.

The array of services required include family stabilization and reunification services, family support services, respite and short-term placement services, and miscellaneous resources (the last category is capped at $500 per family, and is flexible money to purchase either goods or services). Most of an area’s service budget is obligated in an “open order encumbrance” assigned to the lead agency, and payments to the network providers are made against and “draw down” on the open order encumbrance. Thus, the service budget is flexible and able to respond to changing client needs without the burden of administrative contract amendments. However, it is necessary to manage the service budget closely, pay attention to the services being provided, and be careful not to duplicate services. Although lead agencies do not receive incentive payments for exceeding goals or financial penalties for underperformance, one agency has already ceased being a lead agency for the initiative, at least partially because it went through the service budget too quickly. The initiative emphasizes the importance of informal family and neighborhood supports as primary components of every family’s treatment plan; the rough rule-of-thumb is that 75 percent of the treatment should come from family, faith, and friends, with 25 percent funded services.

The lead agencies convene and facilitate treatment planning teams, which consist of small groups of providers, other persons representing systems and/or community resources, and families. After a social worker brings a case to the attention of the area DSS office, the team (including the family) meets to develop and discuss a treatment plan. Two important changes the Initiative has brought about are (1) the involvement of the family right from the beginning as key players in planning the treatment, and (2) the involvement of the team in planning and coordinating services, rather than the social worker directly calling service providers.

Quality of services is monitored by lead agencies through weekly meetings with the core team and six-week review meetings with the families. Lead agencies meet quarterly with DSS to discuss quality issues. Providers are supposed to administer client satisfaction surveys, but it is not administered consistently.

It appears that the initiative is able to serve more families than were served under the previous system because the families now turn over more quickly. The initial funding for the lead agencies ($100,000 per service area, for a total of $2.9 million) was taken from the direct services budget rather than staffing budgets, which was not popular among providers but obviated the need to reduce public agencies’ staff sizes. (There were some staffing reductions, but this was handled by eliminating a few vacant positions so that nobody was laid off.) There is no formal evaluation being conducted, but the State developing a database, reviewing every three months and retooling as needed.

The initiative has broadened and enhanced the pool of providers and provides opportunities for newcomers. A major goal is to include minority agencies and community-based agencies, and the state is providing capacity-building for these agencies.

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