For the clear majority of foster care providers, funding is a necessity for the simple fact that taking on an additional child or children on short notice is beyond the financial capacity of most households. Considering this fact foster parents can receive funding from either state or federal sources. Statistics from the government reflect this fact, showing that 91% of foster parents rely on adoption subsidies to meet foster children’s needs.
Types of foster care funding
Funding to aid with foster care related expenses falls into the following categories: basic foster care reimbursement, incidental expenses reimbursement and special benefits provided for children with special needs.
Basic foster care reimbursement
To assist foster parents in meeting their foster children’s needs, child welfare agencies offer what is known as a basic foster care reimbursement or adoption subsidy. Basic foster care reimbursement is funded through a combination of state and federal funding streams to reimburse providers for expenses in taking care of a foster child or foster children in their home.
The amount of funding a foster family receives depends on the state in which the foster home is located and the level of care being provided. For example, the reimbursement rate for children with more intensive behavior or medical needs will be higher than the basic rate for a child with average needs. The reimbursement rate is also tied to a children’s age and will generally increase as the child gets older.
Most states offer foster care providers an allowance for incidental expenses beyond the basic reimbursement rate. Reimbursable for incidental expenses can include payment or reimbursement for such items as school supplies, clothing, and presents for holidays and birthdays.
Special needs funding
Foster parents caring for a child with special needs can qualify for federal Title IV-E adoption assistance. If a child is IV-E eligible, the federal government reimburses the state at least half of the subsidy cost, depending on the state. To be eligible for federal Title IV-E adoption assistance, the child must meet all three of the criteria below:
- The child cannot or should not be returned to the birth parents’ home.
- A specific factor or condition, or combination of factors and conditions make the child more difficult to place for adoption.
- A reasonable, but unsuccessful, effort to place the child without providing adoption assistance has been made.
In addition to meeting these factors the child must meet additional need based and age based factors.
Related: Background and History of Foster Care
Adoption subsidy benefits for special needs children are determined on a case-by-case basis and can include monthly maintenance payments based on needs, medical assistance and other reimbursable expenses.