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Why Foster Children Are Sleeping in Offices and What We Can Do About It

American Enterprise Institute

April 4, 2023

Key Points

  • Efforts to deinstitutionalize foster care have significantly reduced placement capacity and forced older children and those with higher levels of need to live in a range of inappropriate settings—child welfare offices, emergency rooms, hotels, and homeless shelters.
  • Deinstitutionalization efforts in juvenile justice, increasing acuity levels within the child welfare population, and the failure to develop alternative placements capable of serving the children and youth previously in congregate care have compounded the crisis.
  • The federal government must exempt Qualified Residential Treatment Programs (QRTPs) from classification as institutions for mental disease under Medicaid, amend the Family First Prevention Services Act to provide an exemption from QRTP standards for programs serving youth in the juvenile justice system, and significantly increase federal investment in developing alternative placements to congregate care that can capably serve and support older youth and youth with higher levels of need.

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Across the country, child welfare systems are struggling to find placements for children and youth in foster care—especially those who are older and have higher levels of need. While bed shortages have long plagued child welfare systems, a confluence of issues has caused the problem to metastasize into a crisis. These issues include increasing levels of need within the foster care population, financial challenges facing direct service providers, and ideological shifts that have driven new legislative and regulatory requirements and new restrictions on funding and administrative decision-making. 

The result is that states and counties are rapidly losing residential treatment and congregate care capacity while struggling to recruit and retain foster homes capable of serving higher-needs foster children. Consequently, foster children across the country are increasingly being housed in a range of temporary settings, including county and state offices, hospitals, hotels, and shelters. These placements’ unsuitability and frequency have attracted significant press attention.

An August 2022 story in the Philadelphia Inquirer investigated the Philadelphia Department of Human Services’ use of its conference rooms as temporary housing for foster children. According to its own data, the department has housed more than 300 kids in its offices for at least one night over the previous year. Most nights, five to 10 children with complex needs are sleeping in the “childcare room,” where young children are comingled with teenagers. Safety concerns—including assault, vandalism, and trafficking—are rampant. Some children spend weeks if not months there. Children are likewise languishing for extended periods in other inappropriate settings such as emergency rooms and juvenile detention centers.1

Michigan is also suffering from a shortage of behavioral and psychiatric treatment programs. An August 2022 Detroit News article featured one 9-year-old foster child who spent at least six weeks in a hospital emergency department as he awaited placement. In the same article, the head of the Michigan Health and Human Services Department described the placement issue as “very pervasive.”2 The state is currently under federal court monitoring to develop corrective action to address these issues. 

The crisis is perhaps most acute in Illinois, where, as reported by the Illinois Answers Project,  the Illinois Department of Children and Family Services (DCFS) has documented since 2018 more than 2,000 cases of foster children being improperly held in inappropriate settings, including offices, shelters, and psychiatric hospitals. The DCFS director was held in contempt of court 12 separate times in 2022 for failing to provide an appropriate placement for foster children—the last finding centering on a 15-year-old girl who was held in a mental hospital for nearly six months while awaiting placement.Since 2015, the state has lost at least 460 children’s residential treatment beds.3

In West Virginia and Montana, hundreds of foster youth have been sent to facilities out of state, where program quality is a concern, oversight is more difficult, and many have experienced unsafe and abusive situations, including improper restraint, isolation, and alleged sexual assault. According to West Virginia Public Broadcasting,4 the lack of in-state youth mental health care is cited as a primary reason children are sent out of state. Likewise, in Montana, children are sent out of state due to bed shortages at in-state facilities, according to Kaiser Health News.5These states are not outliers. Similar stories have emerged in Colorado,6 Georgia,7 New Mexico,8 North Dakota,9 Oregon,10 Virginia,11 and Washington,12 among others.

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