GAO 

United States General Accounting Office 

Report to Congressional Requesters 

June 1989 FOSTER CARE 

Preliminary Report on 

Reforrn Effects 
GAO United States 

General Accounting Office 

Washington, D.C. 21)548 

Program Evaluation and 

Methodology Division 

B-200518 

.June 1, 1989 

The Honorable Dan Coats 

Ranking Minority Member 

Subcommittee on Children, Family, 

Drugs, and Alcoholism 

Committee on Labor and Iluman Resources 

United States Senate 

The Honorable Thomas .J. Bliley, Jr. 

Ranking Minority Member 

Select Committee on Children, Youth, 

and Families 

House of Representatives 

In response to your request, we have evaluated the effects of the 1980 

foster care reforms. We focused on the federal incentives for reform 

built into the requirements for the states’ receipt of additional funds 

under the Child Welfare Services grants program. This briefing report 

presents, primarily in tabular form, the preliminary results of our 

review as discussed on May 17, 1989. As agreed with your offices, the 

full and final report will convey our findings, conclusions, and recommendations. We have incorporated in this report the comments we 

received from the 11 .S. Department, of Health and Human Services (II~S) 

on a draft of our primary report. 

IJnless you publicly announce the contents of this report earlier, we plan 

no further distribution of it until 30 days from the date of the report. We 

will then send copies to the 1T.S. Department of Health and Human Services and make copies available to others upon request. Please call me 

on (202) 2751854 if you need further information. This report was prepared under the direction of Lois-ellin Datta, Director of Program Evaluation in Human Servicc>s Areas. Other major contributors are listed in 

appendix I. 

Eleanor Chelimsky 

Assistant Comptroller General 

Page 1 GAO PEMD-89-23BR Foster (‘are: Preliminary Report on Reform Effects 
Page 3 GAO/PEMD89-23BR Foster Care: Preliminary Report on Reform Effects 
section 1 

Brkgmund, Objectives, and Method 

on it. The 10 criteria are organized to assess the need for the program 

(problem magnitude, problem seriousness, and duplication), implementation of the program (interrelationships, program fidelity, and administrative efficiency), and effects of the program (targeting success, 

achievement of intended objectives, cost-effectiveness, and other 

effects). (Brief definitions of the criteria are provided in section 3 

below.) 

In coordination with our requesters, we selected two to five indicators 

for each of the framework’s criteria on which to focus our evaluation of 

the section 427 incentive funds. We developed our list by adapting some 

indicators and adding others to the previous report’s list of illustrative 

indicators of the criteria for the Child Welfare Services grants as a 

whole. 

Because of time constraints, we conducted this evaluation by reviewing 

the published and unpublished evidence currently available and did not 

attempt to collect new information on the program or its implementation. We identified existing evidence through bibliographic searches and 

interviews with program officials and external experts. We reviewed the 

literature published primarily since 1985, including 116 studies, 

reviews, and commentaries. We also interviewed federal agency officials 

and external experts, and we reviewed federal agency documents on the 

results of their review of the states’ compliance with the law’s requirements and their payment of incentive funds to the states. 

Page 6 GAO/PEMDW-23BR Foster Care: PmUminary Report on Reform Effects 
!k?ction 2 

The Foster Care Protections 

reading of a random sample of case records. The administrative procedures review ascertains whether the states have developed adequate 

policies and procedures to implement each section 427 requirement. The 

case record survey determines the extent to which the case review system requirements are applied consistently throughout the caseload. This 

case record review looks for evidence of a case plan, a periodic review, a 

dispositional hearing, and the 18 elements HHS identified from sections 

427 and 475 of the act, which detail the specific components of these 

three major requirements. 

Compliance standards for the case record survey are graduated, rising 

regularly as a state receives incentive funds over the years. Once a state 

certifies itself as having the procedural protections in place, the bureau 

conducts an initial case record review. To pass this review, the states 

must have established case planning and review procedures and family 

reunification services. Additionally, at least 66 percent of the sample 

cases must contain case plans and indicate that reviews were conducted, 

and at least 13 of the 18 specific elements of case planning and review 

cited in section 427 must be present in the cases. 

In the year after a state successfully passes this review, the bureau conducts another review in which the percentage of cases required to pass 

is increased to 80. Three years after a state passes that subsequent 

review, the bureau conducts a triennial review-its highest compliance 

standard-in which at least 90 percent of the sampled cases must show 

evidence of a plan, periodic review, dispositional hearing, and at least 15 

of the 18 required elements. Thereafter, compliance reviews are conducted only every 3 years. States failing a review are generally reviewed 

again the following year. 

ACYF considers that the states are eligible for their share of the incentive 

funds for a given fiscal year if they have certified compliance and not 

failed a compliance review for that year. Those that do not pass are 

informed by the commissioner of ACYF that they must return the section 

427 funds received for that year and that they may appeal ACYF’S decision to the departmental appeals board. 

Page 7 GAO/PEMD-8%23BR Foster Care: Preliminary Repcwt on Reform Effects 
Section 3 

Findings on Our Framework (‘riteria 

Criterion Indicator 

Adequacy of resources 

Finding 

Anecdotal reports suggest 

caseworker overload and 

inadequacies in servrces and 

caseworker trainrnq 

Admrnistrative efficiency ACYF compliance 

enforcement 

Reviews probably helped 

states improve therr 

compliance but, by requrrrng 

less than full compliance, 

standards are currently not 

high enough to ensure 

contrnued improvement 

Only 1 of 21 payments made 

to states found rnelrgrble has 

not been recovered 

Delays rn resolvrng state 

appeals, and rn conducting 

follow-up reviews, permit 

continued payments to 6 

states that failed their most 

recent review 

State efficiency Lrttle informatron is available 

Effects of the Reforms To determine whether the reforms have worked, we reviewed whether 

the program has reached its intended target groups (targeting success), 

whether it has achieved its intended purposes and outcomes (achievement of intended objectives), how the value of these effects relate to 

program costs (cost-effectiveness), and whether the program has had 

effects-desirable or not-on other congressional concerns (other 

effects). The findings of our review on the selected indicators of these 

criteria are summarized in table 3.2. 

Table 3.2: Effects of the Foster Care 

Reforms Criterion Indicator 

Targetrng success Drstrrbutron of state grants 

Finding 

Gross levels of state 

complrance are rewarded 

partrcularly over trme 

Focus on problems Case reviews are well 

focused on the problem of 

extended unplanned stays 

State drstrrbutron of funds Unknown, but funds do not 

compensate courts for 

Increased responsibilihes 

(conhnued) 

Page 9 GAO,‘PEMIXS23BR Foster Care: Preliminary Report on Reform Effects 
Section 3 

society of not addressing that problem (problem seriousness); and 

whether other available resources, public or private, are sufficient to 

address the problem (duplication). The findings of our review on the 

selected indicators of these criteria are in table 3.3. 

Table 3.3: Continued Need for the 

Federal Incentives for Reform Criterion 

Problem magnrtude 

Indicator 

Procedural problems 

Finding 

The quaky of case plannrng 

and monrtonng IS 

queshonable, medical, 

dental, and mental health 

services are clarmed 

insuffrcient 

Placement problems One fourth of children In care 

had been there at least 3 

years 21% had 3-5 different 

placements 

Increased demand Increases rn drug use, berths 

to unmarned teenagers, and 

homelessness may 

contribute to Increased 

demand for servrces 

Problem senousness Consequences of procedural Case plannrng and 

problems monrtonng of questionable 

qualrty may increase length 

of stay rn care 

Consequences of placement Longer stays may inhabit 

problems reunrfrcatron efforts 

-- 

Duplrcahon Alternatrve resources Pm/ate funds attempt to 

enhance, not dupkate, 

federal and state funds, 

through funding innovatrve 

approaches and strategres 

Alternatrve protectrons Federal law provrdes 

protectrons not rn all state 

laws and extends them to all 

foster care cases 

Page 11 GAO/PEMD-89.23BR Foster Care: Preliminary Report on Reform Effects 
Related GAO Products 

Better Federal Program Administration Can Contribute to Improving 

State Foster Care Programs (GAO/HRD-84-2, Aug. 10, 1984). 

Children’s Programs: A Comparative Evaluation Framework and Five 

Illustrations (GAO/PEMD-88.28BR, Aug. 31, 1988). 

Foster Care: Use of Funds for Youths Placed in Rite of Passage Program 

(GAO/HRD-87-23BR, Dec. 9, 1986). 

Health and Human Services: Documentation of Funding Decisions for 

Child Abuse and Neglect Grants Inadequate (GAOIHRD-87-69, May 22, 

1987). 

Residential Care: Patterns of Child Placement in Three States (GAO/ 

PEMD85.2, June 28, 1985). 

Review of Certain Aspects of Group Home Care for Children in California (GAO/HRDS~-62, July 19, 1985). - 

Page 13 GAO/PEMD-89-23BR Foster Care: Preliminary Report on Reform Effects 



Appendix I 

Major Contributors to This Report 

Program Evaluation 

and Methodology 

Division 

Lois-ellin Datta, Director of Program Evaluation in Human Services 

Areas (202-275-1370) 

David Cordray, Assistant Director 

Stephanie Shipman, Project Manager 

Jo-Ellen Asbury, Project Staff 

Robert Bleimann, Project Staff 

Pearl Curtis, Project Staff 

Page 12 GAO/PEMD-8923BR Foster Care: Preliminluy Report on Reform Effects 
section 3 

Findings on Our Framework Criteria 

Criterion 

Achrevement of intended 

objectives 

Indicator 

Decrease in placement -- 

drfficultles 

Receipt of needed care and 

serwes 

Facllrtatlon of permanent 

placements 

Cost-effectiveness AddItIonal protections 

Drfferent review bodies 

Other effects Long-term goals 

Spending on servrces versus 

maintenance 

Unmtended side effects 

Finding 

Reductions in lnstltutronal 

placements and in multlple 

placements may stem from 

the reforms 

It IS unknown whether 

unnecessary and other 

lnappropnate placements 

have been reduced 

Llttle InformatIon IS avallable 

Increased proportrons of 

children have permanent 

placement goals 

Unknown, burden of reforms 

has not been quantrfred 

No clear advantage but 

crtlzen volunteers may be 

less expensive and provide 

addItIonal perspective 

Speedier departures from 

foster care and reduced 

caseload sizes may stem 

from the reforms 

Revrews may have Increased 

adoption as well as 

reunlflcatlon 

It IS unknown whether 

children and famllles are 

better off 

Llttle InformatIon IS avaIlable 

Speedier departures may 

have Increased returns 

Courts’ addItIonal burdens 

have not been quantlfled 

A new legal avenue has been 

created for monltorlng foster 

care 

Continued Need for 

the Reforms 

To find out whether there is a continued need for the incentives, we 

examined whether an important and sizable problem still exists (problem magnitude); the possible consequences for children, families, and 

Page 10 GAO/PEMD-39-23BR Foster Care: Preliminary Report on Reform Effects 
Section 3 

F’indings on Our Framework Criteria 

- 

This section, including the tables, summarizes our findings regarding the 

implementation, effects, and continuing need for federal incentives for 

foster care reform. 

Implementation of the In reviewing how the reforms have been carried out, we examined 

Reforms whether they have been implemented as the Congress and the responsible federal agency intended (program fidelity) and in a cost-efficient 

manner (administrative efficiency), and what the nature and extent of 

the relationships are between this program and others, including the 

constraints or advantages that are created for program operations 

(interrelationships). The findings of our review on the selected indicators of these criteria are summarized in table 3.1. 

Table 3.1: Implementation of the Foster 

Care Reforms Criterion Indicator Finding 

Program fidelity State complrance with wrltten Most states meet this 

case plan 

State compliance wrth 6- 

month revrew 

State compliance with 18. 

month dlsposltlonal heanng 

Adequacy of permanency 

(reunlflcatlon) servrces 

ACYF complrance 

requirements 

lnterrelatronshlps State laws and regulahons 

affecting lmplementatlon 

Agency coordlnatlon 

requlrement; only 3% of 

cases In 7 states were out of 

compliance 

The states have established 

thus protectron, but 2%.68% 

of case reviews In 29 states 

were not timely 

The states have establlshed 

this protectlon, but 3%.38% 

of case reviews in 27 states 

were not timely 

Little InformatIon. although 

services are seen as 

InsuffIcIent 

Complrance rewews permit 

flexlbllrty In Implementation, 

standards do not require full 

complrance with the law 

Most, If not all, states have 

modrfied some aspect of 

state law or policy to conform 

to the federal mandate 

InformatIon 1s generally 

lacking, but where courts are 

Involved, coordlnatlon seems 

to have stramed therr 

capacltles 

(continued) 

Page 8 GAO PEMD-39.23BR Foster Care: Preliminary Report on Reform Effects 
Section 2 

The Foster Care Proteetiofis 

The core of the 1980 foster care reforms is embodied in section 427. The 

section provides that for each fiscal year after 1979, a state cannot 

receive incentive funds-that is, its share of the appropriations for 

Child Welfare Services exceeding $141 million-unless it has met the 

following conditions: 

1. completed an inventory of children in foster care for a period of 6 

months prior to the inventory, to determine the appropriateness of and 

necessity for the current placement; 

2. established a statewide information system from which the status, 

demographic characteristics, location, and placement goals of each child 

can be determined; 

3. established a case review system for ensuring that 

a. each child has a case plan designed to achieve placement in the leastrestrictive (most family-like) setting available, in close proximity to the 

biological parents; 

b. the status of the child is reviewed at least every 6 months to determine the continued necessity of the placement and the extent of compliance with the case plan and progress toward mitigating the need for the 

placement; and 

c. a dispositional hearing is held, no later than 18 months after the initial placement (and periodically thereafter), to determine the future status of the child; 

4. implemented a system of services designed to facilitate the child’s 

return home, where appropriate, or other permanent placement. 

Additionally, after the full authorization ($266 million) is appropriated 

for 2 consecutive fiscal years, a state’s allotment is reduced to its fiscal 

year 1979 level (its share of $56 million) unless it has met these requirements and has implemented a system of preplacement preventive 

services. 

In carrying out section 427, the children’s bureau of the Administration 

for Children, Youth, and Families (ACYF) determines a state’s compliance 

and eligibility for the incentive funds through both review of state policies and administrative procedures and a periodic, joint federal-state 

Page 6 GAO, PEMD-89.23BR Foster Care: Prdimhary Report on Reform Effects 
Section 1 

Background, Objectives, and Method 

During the 1970’s, widespread abuses of the foster care system were 

reported. A 1977 study indicated that the number of children in foster 

care had increased to an estimated 502,000 from 318,800 in 1972, and 

their median length of time in care was 31 months. This study and 

others found that many children in foster care had numerous different 

placements over the years and had little hope of returning to their parents or of finding another, permanent home. The Adoption Assistance 

and Child Welfare Act of 1980 (Public Law 96-272) amended several 

child welfare programs under the Social Security Act of 1935 in light of 

these reports. In particular, the 1980 act made funds for the federal Foster Care program and large funding increases for the Child Welfare Services grants contingent on the states’ implementation of certain 

procedural protections for children in foster care. 

Concerned about reports that foster care abuses may be continuing 

despite these reforms, the ranking minority members of the Senate Subcommittee on Children, Family, Drugs, and Alcoholism and the House 

Select Committee on Children, Youth, and Families asked us to conduct a 

comprehensive review of a key component of the 1980 reforms: the foster care case plan and review system that states must institute in order 

to receive their full grant allotment for Child Welfare Services. 

The Child Welfare Services grants, authorized by title IV-B of the Social 

Security Act, assist the states in providing a variety of foster carerelated and family support services. Section 427 of the act precludes the 

states from receiving their full share of annual appropriations exceeding 

$141 million (representing $98.4 million in fiscal year 1988) unless they 

have developed and implemented, among other reforms, 18 elements 

encompassing a system of individual case plans, periodic reviews, and 

dispositional hearings for each child in foster care. These procedural 

reforms were designed t.o help reunify the family or, as appropriate, to 

find for the children suitable adoptive homes. 

We structured our review around a comparative evaluation framework 

developed for the Select Committee in a previous assignment This 

framework consists of a standard format for describing a program (or 

program component) and 10 general criteria for assessing the implementation, effects, and continued need for that program. It is intended as a 

way of formulating questions about a program and organizing evidence 

‘In a prewous report, Chlldrvn’s Programs A Comparative Evaluation Framework and Five Illustrations. GAOIPEMD-88.28BR Washington. D.C. August 31. 1988). wc rresented the framework we 

developed and illustrated potrnflal mhwator~ of thr general criteria f& five specific programs serving chlldren and families 

Page 4 GAO ‘PEMD-89.23BR Foster Care: Preliminary Repwt on Reform Effects 
Contents 

Letter 1 

Section 1 

Background, 

Objectives, and 

Method 

4 

Section 2 

The Foster Care 

Protections 

6 

Section 3 

Findings on Our 

Framework Criteria 

Implementation of the Reforms 

Effects of the Reforms 

Continued Need for the Reforms 

8 

9 

10 

Appendix I 12 

Major Contributors to Program Evaluation and Methodology Division 12 

This Report 

Related GAO Products 13 

Tables Table 3.1: Implementation of the Foster Care Reforms 

Table 3.2: Effects of the Foster Care Reforms 

Table 3.3: Continued Need for the Federal Incentives for 

Reform 

8 

9 

11 

Abbreviations 

ACYF Administration for Children, Youth, and Families 

HHS U.S. Department of Health and Human Services 

Page 2 GAO/PEMD-W-23BR Foster care: Preliminary Report on Reform Effects