Flexibility Matters: The Impact of Title IV-E Waivers and Local Levies on Outcomes for Children in Foster Care

Abstract

For two decades, the federal government has allowed states to apply for waivers from the laws that provide federal support for families and children served by state or local child welfare systems. The waiver demonstrations have been evaluated and are the subject of intense advocacy to influence the federal government to continue the waivers or adopt more of the approaches that were successful waiver demonstrations. One category of waiver allows states to use funds targeted for foster care in a more flexible manner, beyond paying for placements, to provide an array of services to meet the needs of children and families. For states and counties that receive a waiver, they can use the funds flexibly rather than have them earmarked for foster care exclusively. However, the flexible funds are capped, whereas the foster care matching funds are uncapped. Funded by the Public Health Law Program of the Robert Wood Johnson Foundation, findings from a two-year mixed methods study revealed this flexible federal funding, as well as flexible local funding, reduces days in care and days awaiting adoption. The Department of Health and Human Services employs these outcomes to measure lack of permanency for children in placement. Since impermanence poses long-term health risks for children, the use of flexible funding via federal waivers is an important tool in responding to child maltreatment in a manner that reduces the lifelong harms often associated with impermanence. While local levies may be hard to create, flexible federal funding should be an ongoing form of fiscal support for state and local child welfare systems to depend on.

Keywords: child welfare, federal financing, federal waivers

JEL Classification: E62, H53, I38