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An OPEN MINDS Market Intelligence Report

In FY2012, the last year data is available, states spent $28.2 billion on child welfare services, including $12.7 billion in federal funds, $10.9 billion in state funds, and $4.6 billion in local funds. States use this funding to provide services to children as they move through the child welfare system – services that range from family support services, to foster care, to residential placements.

Family welfare support services are services provided to families and individuals in need of support. Examples of support services include family reunification, family preservation services, protection services, and independent living services. An accurate number of children and families served by these services is not available because some families may receive these services informally and many families may receive more than one service type, resulting in duplicative count.

Foster care is defined as when a child is removed from the family home. There are a number of out-of-home placement options that are available to the child. Federal law requires that states place children in the least restrictive placement possible – defined as the most family-like environment. States have a lot of flexibility in determining a child’s placement, but must be able to justify the placement.

Residential/group care, also referred to as congregate care, is a placement in settings with a larger number of children in a less home-like setting. Congregate care is almost always considered less preferable than foster care families or kinship care. In the past ten years, there has been a significant decrease in the use of congregate care.

Of the $28.2 billion spent on child welfare in FY2012, states estimate that in FY2013 they will spend approximately 80% on these services and supports ($22.5 billion) and 20% on administration ($5.65 billion). This market intelligence report outlines this spending and includes a state-by-state breakdown of spending by category. OPEN MINDS analyzed how child welfare funds are spent; how much states spend on residential & congregate care settings, family foster & kinship care, family support services & independent living services, adoption & guardianship services and the administration of the child welfare system.

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