Mathematica Policy Research, Inc.

Children in Foster Care:
Challenges of Meeting Their Health Care Needs Through Medicaid

Children in foster care are of special interest to policymakers because they are a particularly vulnerable group. Many have physical, emotional, or developmental problems, sometimes resulting from abuse or neglect they have suffered. Yet there have been ongoing concerns about the adequacy of the health care services they receive. These concerns have grown as managed care has become a more dominant form of health care delivery for this group. 

To complicate matters, existing data provide only a limited snapshot of these children`s health-related characteristics. To address problems related to the health care of children in foster care, policymakers must have detailed information about health status, health care utilization, and expenditures.

This publication summarizes a study Mathematica Policy Research, Inc., conducted for the Office of the Assistant Secretary for Planning and Evaluation in the U.S. Department of Health and Human Services. The data source is the State Medicaid Research Files (SMRF), a series of analytic files maintained by the Health Care Financing Administration (HCFA) containing Medicaid eligibility and claims data. Three states -- California, Florida, and Pennsylvania -- were selected for this study based on the following criteria: (1) the availability of Medicaid claims and enrollment data in the SMRF files, (2) the ability to identify foster care children in the SMRF files, (3) an identifiable foster care population of at least 10,000 children, (4) the degree to which children were enrolled in Medicaid managed care, and (5) variation in features of state foster care systems. 

The study period for California and Florida was 1994 and 1995; for Pennsylvania, it was 1993 and 1994 (representing the most recent years of data available in each state). The study population was made up of children under age 19 with a foster care placement during the year. The three comparison groups included children under age 19 who received adoption assistance, Aid to Families with Dependent Children (AFDC), or Supplemental Security Income (SSI) benefits because of disability. The study captures only health care utilization and expenditures that were paid by Medicaid. Foster care children may have received health care that was not billed to Medicaid or that was paid by other sources. As a result, the study understates the total amount and cost of health care services provided to children in foster care.