A History of Foster Care Rate Setting in SC1
Federal Regulations at 42 USC §675 (4)(A)states, in part: “The term "foster care maintenance payments" means payments to cover the cost of (and the cost of
providing) food, clothing, shelter, daily supervision, school supplies, a child's personal incidentals, liability insurance with respect to a child, and reasonable travel to the
child's home for visitation. In the case of institutional care, such term shall include the reasonable costs of administration and operation of such institution as are
necessarily required to provide the items described in the preceding sentence.” 2 At this time, DSS has not shared with private child serving organizations any
methodology used by the state agency to establish reimbursement rates. The Association cites the following concerns regarding the establishment by SC DSS of the
current rates in the Fixed Price Bid:
1.
2.
3.
4.
5.
The rates do not adequately cover the costs of administration and operation of a child caring organization at any level.
There have been no rate increases since 2009, and rates have actually decreased since the late 1990’s.
According to the Consumer Price Index Inflation Calculator, the $155.00 daily rate that was paid to High Management (Level 3) facilities in 1998 should be
$218.22 in 2012.3 (A 41% increase.) The current rate for a Level 3 facility is $150.00 per day.
In October 2007, Children’s Rights, the National Foster Parent Association and the University of Maryland’s School of Social Work published a report titled
“Hitting the M.A.R.C. Establishing Foster Care Minimum Adequate Rates for Children.” In this report, SC was cited at second from the bottom tier of states those needing to raise rates by 76% - 100% for at least one age group. The recommended payment levels at that time were $576, $660 & $ 723 to be minimally
adequate.4
Regular foster care reimbursement rates are generally established using the Expenditures on Children by Families report published by the Center for Nutrition
and Policy of the US Department of Agriculture. In 2011, the estimated annual expenditures on a child in a two parent family in the urban South (SC is included
in this geographic region) ranges from $8,470 to $9,390 varying by the age of the child ($705.83 – 782.50 per month).
Survival of many child serving institutions is dependent on the charitable donations, grants, and in-kind support received by the organization. Many of these
organizations’ CEOs will agree that their primary responsibility is fund raising and marketing. In 2011, members of the Association raised $18 million in donations for
children and families, used to undergird the child welfare system and assure that the needs of children in foster care were met.
In a number of states, foster parents and private providers of foster care services have sought relief through the court system. The advocacy organization,
Children’s Rights, has included inadequate reimbursement rates in the class action lawsuits that they filed in Oklahoma and Michigan. Foster Parent Association’s in
Indiana and California both charged that the state was in violation of the requirements of the Child Welfare Act [42 USC §675 (4)(A)] which stipulates, in part:
“The term "foster care maintenance payments" means payments to cover the cost of (and the cost of providing) food, clothing, shelter, daily supervision, school supplies,
a child's personal incidentals, liability insurance with respect to a child, and reasonable travel to the child's home for visitation. In the case of institutional care, such term
shall include the reasonable costs of administration and operation of such institution as are necessarily required to provide the items described in the preceding
sentence.”
The following matrix shows the funding history by level of care, solicitation number and purchasing agency.
Prepared by Palmetto Association for Children and Families, September 18, 2012.
CFR On-line Edition. Accessed 8/8/2012.
3 www.bls.gov. Accessed 8/10/2012.
4 Diane DePanfilis and others, authors. Hitting the M.A.R.C. Establishing Foster Care Minimum Adequate Rates for Children, Children’s Rights, 2007, pg.5-9.
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2
1
RATE HISTORY OF FOSTER CARE REIMBURSEMENT
Non-Treatment Levels of Care
Regular Foster Care
The foster care board rate is set by the General Assembly and has been unchanged since 2006. Note: Group Home providers who
choose not to enter into contracts with DSS are paid the regular Board Rate for services. They are licensed, but there are no other
contracts to be signed, as there would be for providers billing under a Fixed Price Bid or RFP.
From 2001 – 20065, the rates were:
Ages 0-5
Ages 6-12
Ages 13+
$312
$339
$405
The current rate for services was established in the 2006-07 Appropriations Act6:
Ages 0-5
Ages 6-12
Ages 13+
$332
$359
$425
Payment is intended to cover basic needs: food, clothing, housing, transportation, education and other costs as defined in the US
Department of Agriculture Study of “Annual Costs of Raising a Child to Age Eighteen.”
In October 2007, Children’s Rights, the National Foster Parent Association and the University of Maryland School of Social Work
published a report titled “Hitting the M.A.R.C. Establishing Foster Care Minimum Adequate Rates for Children.” In this report, SC was
cited as second from the bottom tier of states - needing to raise rates by 76% - 100% for at least one age group. The recommended
payment levels were $576, $660 & $ 723 to be minimally adequate.7
Based on the USDA estimates for 20118 and using the data gathered from the urban South region that included SC, rates should now
be approximately:
Ages 0-5
Ages 6-12
Ages 13+
$705
$744
$782
Part 1B section 13 L04 – DEPARTMENT OF SOCIAL SERVICES Page 392. 2003-2004 Conference Committee Report. www.statehouse.gov accessed 9/14/2012.
Part 1B 33 L04 – DEPARTMENT OF SOCIAL SERVICES Page 393. 2006-2007 Appropriations Act. www.statehouse.gov accessed 9/14/2012.
7 DePanfilis; op. cit. pg. 5.
8 Expenditures on Children by Families, 2011. Center for Nutrition and Policy, United States Department of Agriculture. www.cnpp.usda.gov accessed 8/9/2012
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6
2
Emergency Shelter Care
and Level 1 (Previously
Called Low Management)
DSS FPB
Prior to the 1990’s most group home providers in SC were private not for profit 501C organizations that ran short term shelters or
“orphanage” type facilities. These providers did not proclaim to do treatment services. They received the same reimbursement rate
as regular foster care families $10.00 - $14.00 per day.9 By 2004, some emergency shelters had entered into Title IV-E contracts with
DSS and had negotiated independent reimbursement rates.
Prior to October, 2009 providers of Emergency Shelter and Low Management Care contracted with DSS through a true RFP
(5400000891). In their responses, providers established their rates based on projected costs and these projections were supported
by financial statements. Therefore, rates varied from provider to provider.
In October 2009 a Fixed Price Bid for Emergency Shelter/Low Management group care was released by MMO to procure these
services for the Department of Social Services. The reimbursement rate was $87.00.10 A second FPB in March 2010 maintained that
rate.11
The DSS FPB issued in 2011 eliminated Emergency Shelter Care as a level of care under the contract. Any level of care can provide
Emergency Intake Services. Facilities previously considered Emergency Shelters are now classified as Level 1 facilities. 12
Prior to 2009
2009-2011
2011
Rates varied by
Provider
$87.00
$85.00
Multi-agency FPB
The multi-agency FPB does not include Emergency Shelter or Level1 (Low Management) as a service, as this level of care and is not
used by the other State child placing agencies.
Part 1B section 13 L04 – DEPARTMENT OF SOCIAL SERVICES Page 392. 2003-2004 Conference Committee Report. www.statehouse.gov accessed 9/14/2012.
FPR Solicitation #5400001215, Dated 10/20/2009 - EMERGENCY SHELTER/LOW MANAGEMENT GROUP CARE – SC Department of Social Services.
11 FPB Solicitation #5400001753, Dated 03/26/2010 – EMERGENCY SHELTER/LOW MANAGEMENT GROUP CARE – SC Department of Social Services.
12 FPB Solicitation #5400002885, Dated 04/12/2011 – STATEWIDE RESIDENTIAL SERVICES FOR CHILDREN - SC Department of Social Services.
9
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3
Treatment Levels of Care
Moderate & High
Management Group
Homes/
Group Care Intermediate
Services & Group Care
Intensive Services
In the early 1990’s, treatment levels of care were implemented as Medicaid services, and providers were encouraged to enroll as
Medicaid providers with the Department of Health and Human Services. The reimbursement rates were set by the Medicaid agency
with the State Child Placing agencies responsible for the Room and Board portion of the reimbursement.
Solicitation 00-S2407 issued 10/22/1999 established the following rate structure13:
Level of Care
High Management
Moderate Management
Intensive Crisis Care
Therapeutic Foster Care
Supervised Independent
Living (Levels 1 & 2) in a
treatment home format.
Treatment Rate
$115.00
$55.77
$119.64
$52.22
$56.00
Room & Board
Total
$50.00
$50.00
$51.15
$12.78
$35.00
$165.00
$105.77
$170.79
$65.00
$91.00
In December, 1999 DHHS announced a 2.3% cost of living increase. 14
Level of Care
High Management
Moderate Management
Intensive Crisis Care
Therapeutic Foster Care
Supervised Independent
Living (Level 1&2)
Treatment Rate
$117.65
$57.05
$122.39
$53.42
$57.29
Room & Board
$51.15
$51.15
$51.15
$13.07
$51.15
(TFC)
(group)
or
$13.07
Total
$168.80
$108.20
$173.54
$66.49
$108.44 or $70.36
In January 2001 DHHS announced a 3.1% inflationary rate increase for selected treatment services. 15
Level of Care
High Management
Moderate Management
Intensive Crisis Care
Therapeutic Foster Care
Supervised Independent Living (Level 1&2)
Treatment Rate
$121.30
$58.82
$126.18
$55.08
$59.07
Solicitation 00-S2407 Issue Date: 10/22/1999.Amendmant 1, Page 4.
Memo from Darlynn Thomas, Bureau Chief, the Department of Health and Human Services dated December 10, 1999 and sent to all Children’s Out of Home Placement Providers.
15 Memo from William A. Prince, Director, Department of Health and Human Services dated January 2, 2001 and sent to Children’s Out of Home Placement Providers.
13
14
4
Solicitation #01-S4064 issued 03-29-2001 maintained those treatment rates and established the following rates for Room and Board.
16
Level of Care
High Management
Moderate Management
Intensive Crisis Care
Therapeutic Foster Care
Level 1
Therapeutic Foster Care
Level 2
Therapeutic Foster Care
Level 3
Supervised Independent
Living (Level 1&2 in a group
setting)
Treatment Rate
$121.3
$58.82
$126.18
$55.08
Room & Board
$51.15
$51.15
$52.33
$13.07
Total
$172.45
$109.97
$178.51
$68.15
$88.52
$13.07
$101.59
$127.29
$13.07
$140.36
$59.07
$35.81
$94.88
Prior to the release of the independent FPB by DSS in 2011, all state child placing agencies were under the same solicitation.
Solicitation 06-S7191 released 4/24/2006 titled Fixed Price Residential Services to Children that are Emotionally and/or
Behaviorally Disturbed established the following rates: 17
Group Care Intensive (High Management)
Group Care Intermediate Services (Moderate Management)
Group Care Independent Living
$166.64 up to $209.87
$74.69 up to $120.76
$86.87 up to $94.88
That solicitation was renumbered by MMO to become #540000526 and was released on 9/25/08. That solicitation established the
following rates:
High Management Group Home Care
Moderate Management GHC
Up to $177.39
Up to $102.78
Note: In December 2009 providers were notified that rates being paid by DSS were being cut to $160.00 due to budget reductions.
One provider filed a contract controversy and providers were eventually reimbursed for the lost funding. In July 2010, the rates for
Group Care Intensive Services (High Management) were dropped to $160.00 per day.
16
Solicitation 01-S4064 issued 03/29/2001. Amendment #1; Page 33
17
RFP 06-S7191 PROVIDE RESIDENTIAL SERVICES TO CHILDREN THAT ARE EMOTIONALLY AND/OR BEHAVIORIALLY DISTURBED - Multi-Agency (DSS, DJJ, DDSN, COC, DMH)
5
Levels 2 & 3 in the DSS FPB
DSS FPB
In April 2011, DSS released a Fixed Price Bid for Statewide Residential Services for Children and the rates were:
Level 3 (High Management)
Level 2 (Moderate Management)
Up to $130.00 per day
Up to $97.00 per day18
Provider could receive an additional amount up to $20.00 per day for non-Medicaid counseling activities.
Providers were encouraged to enroll in the Medicaid program to provide RBHS services, thereby supplementing their rates. (This
never materialized, however, as state agencies never authorized it via the appropriate authorization processes. Total billing suffered
as a consequence, even though state agencies made such promises.)
Group Care Intermediate
Services & Group Care
Intensive Services in the
Multi-Agency FPB
Multi-Agency FPB
The other state child placing agencies released a FPB in March 2011 to procure residential services for their populations of children.
This FPB specified that current providers were to retain the rates bring paid under the previous contract19.
Group Care Intensive (High Management)
Group Care Intermediate Services (Moderate Management)
Group Care Independent Living
$166.64 up to $209.87
$74.69 up to $120.76
$86.87 up to $94.88
New providers of GC with the exception of PRTFs who enrolled under this solicitation received a Fixed Price Daily Rate As Follows:
Group Care Intensive Services - $166.64
Group Care Intermediate Services - $74.69
Group Care Independent Living Services $86.87
PRTFs continued to have their rates set by DHHS.
IMD Transition
With the identification of the IMD issue, DHHS sought an appropriation of $39M in state funds over a three year period, and as
funding became available, began a phased-in reduction in the Medicaid portion of the rate to remove FFP for therapeutic levels of
care. On August 1, 2007 the first rate adjustment took effect with the new Medicaid portion of the rates shown below. The General
Assembly appropriated $13 as the first year of funding to offset the anticipated loss of federal funds for group home services. HHS
allocated and transferred the $13M appropriation to state child placing agencies. Following the first incremental rate reduction for
18
19
FPB Solicitation #5400002885, Dated 04/12/2011 – STATEWIDE RESIDENTIAL SERVICES FOR CHILDREN - SC Department of Social Services; Pgs. 53-55
FPB Solicitation #5400002734, Dated 02/08/2011 - FIXED PRICE STATEWIDE RESIDENTIAL SERVICES FOR CHILDREN – Multi-Agency (DJJ,CoC, DSSN, DMH); Pg. 25
6
residential providers, the state general funds payment to group home services providers was increased by a like amount. In
September ’08, HHS allocated and transferred the second $13M to state child paling agencies in accordance with the transition plan.
HHS anticipated that the child placing agencies would continue to allocate this disbursement to residential providers to offset the
reduction in treatment rates that became effective 1/1/09.
Therapeutic Foster Care
Services
Historically, TFC services were reimbursed as a bundled service with rates established by DHHS. A portion of the rate was paid by
the state child placing agency to cover room and board and the remainder of the rate was paid by Medicaid.
Solicitation 00-S2407 issued 10/22/1999 established the following rate structure 20
Therapeutic Foster Care
Treatment
$52.22
R&B
$12.78
Total
$65.00
In December, 1999 DHHS announced a 2.3% cost of living increase. 21
Therapeutic Foster Care
Treatment
$53.42
R&B
$13.07
Total
$66.49
In January 2001 DHHS announced a 3.1% inflationary rate increase for selected treatment services 22
Therapeutic Foster Care
Treatment
$55.08
In 2003 the rates were:
Level 1 - $68.15 (DHHS Treatment $55.08/DSS R&B $13.07)23
Level 2 - $101.59 (DHHS Treatment $88.52/DSS R&B $13.07
Level 3 - $140.36 (DHHS Treatment $127.29/DSS R&B $13.07}
Due to a number of budgetary reductions, DSS implemented a 10% reduction to the room and board portion of the TFC
reimbursement that became effective January 1, 2004. 24
Level 1 - $66.84 (DHHS Treatment $55.08/DSS R&B $11.76)
20
Solicitation 00-S2407 Issue Date: 10/22/1999.Amendmant 1, Page 4.
21
Memo from Darlynn Thomas, Bureau Chief, the Department of Health and Human Services dated December 10, 1999 and sent to all Children’s Out of Home Placement Providers.
Memo from William A. Prince, Director, Department of Health and Human Services dated January 2, 2001 and sent to Children’s Out of Home Placement Providers.
23 Solicitation 01-S4064 issued 03/29/2001. Amendment #1; Page 33
24 Memo from Kim S. Aydlette, State Director, SC Department of Social Services, Dated 10/31/2003 and sent to Private Therapeutic Foster Care and Group Home Providers.
22
7
Level 2 - $100.28 (DHHS Treatment $88.52/DSS R&B $11.76
Level 3 - $139.05 (DHHS Treatment $127.29/DSS R&B $11.76}
July 1, 2005 rates were restored to their previous level where they remained through 2008.25
Level 1 - $68.15 (DHHS Treatment $55.08/DSS R&B $13.07)
Level 2 - $101.59 (DHHS Treatment $88.52/DSS R&B $13.07
Level 3 - $140.36 (DHHS Treatment $127.29/DSS R&B $13.07}
IMD Transition (See previous section)
Rate Change by SC DHHS August 1, 2009 through January 15,2010:
Level 1 - $70.00 (DHHS Treatment $27.50/DSS R&B $42.50
Level 2 - $102.00 (DHHS Treatment $44.25/DSS R&B $57.75
Level 3 - $142.00 (DHHS Treatment $63.65/ DSS R&B $78.35
Rate Change 1/16/2010
Level 1 - $66.17 (DHHS Treatment $27.50/DSS R&B $38.67)
Level 2 - $96.80 (DHHS Treatment $44.25/ DSS R&B $52.55)
Level 3 - $134.95 (DHHS Treatment $63.65/DSS R&B $71.30)
In 2010, TFC was unbundled as a service by DHHS with vehement opposition by providers. The new Medicaid State Plan Amendment
required TFC providers to bill room and board to DSS for state funds, and to bill Medicaid for the RBHS services being provided by
the foster parent and provider staff.
DSS FPB (state non-Medicaid funds)
Therapeutic Foster Home
Services Care
Level 1,2,3 (DSS FPB)
Level 1 – up to $42.00 per day (R&B and State Services)
Level 2 – up to $57.00 per day (R&B and State Services)
Level 3 – up to $77.00 per day (R&B and State Services)
It was anticipated that RBHS authorization could average approximately $27.50 per day in TFHS Level 1, $44.50 in TFHS Level 2, and
$63.00 in TFHS Level 3. These funds are Medicaid funds for treatment services (not state funds for room and board) to therapeutic
level children.
25
Memo from Kim Aydlette, State Director, SC Department of Social Services, dated June 8, 2005 sent to Private Therapeutic Foster Care and Group Home Providers.
8
Therapeutic Foster Care
Level1,2,3 (Multi agency
FPB)
Multi-Agency
Therapeutic Foster Care State Rates paid by the other State Child Placing Agencies are as follows:
Level 1 - $42.50
Level 2 - $57.75
Level 3 – $78.35
Medical Therapeutic Foster
Home Services 1,2,& 3
Medical Treatment Foster Home Services
Supervised Independent
Living
Solicitation 00-S2407 issued 10/22/1999 established the following rate structure for SIL services:26
Level 1 Medical – up to $70.00 per day
Level 2 Medical – up to $102.00 per day
Level 3 Medical – up to $138.00 per day
Supervised
Independent
Living (Levels 1 & 2) in a
treatment home format.
Treatment
$56.00
R&B
$35.00
Total
$91.00
In December, 1999 DHHS announced a 2.3% cost of living increase 27
Supervised
Independent
Living (Levels 1 & 2) in a
treatment home format.
Treatment
R&B
Total
$57.29
$51.15 or
$13.07
$108.44 or
$70.36
In January 2001 DHHS announced a 3.1% inflationary rate increase for selected treatment services 28
Supervised Independent Living (Level 1&2)
Treatment
$59.07
Solicitation #01-S4064 issued 03-29-2001 maintained those treatment rates and established the following rates for Room and
Board.29
26
Solicitation 00-S2407 Issue Date: 10/22/1999.Amendmant 1, Page 4.
Memo from Darlynn Thomas, Bureau Chief, the Department of Health and Human Services dated December 10, 1999 and sent to all Children’s Out of Home Placement Providers.
28 Memo from William A. Prince, Director, Department of Health and Human Services dated January 2, 2001 and sent to Children’s Out of Home Placement Providers.
29 Solicitation 01-S4064 issued 03/29/2001. Amendment #1; Page 33
27
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Supervised Independent
Living (Level 1&2 in a group
setting)
Treatment
$59.07
R&B
$35.81
Total
$94.88
Prior to the release of the independent FPB by DSS in 2011, all state child placing agencies were under the same solicitation.
Solicitation 06-S7191 released 4/24/2006 titled Fixed Price Residential Services to Children that are Emotionally and/or
Behaviorally Disturbed established the following rates: 30
Group Care Independent Living
$86.87 up to $94.88
That solicitation was renumbered by MMO to become #540000526 and was released on /9/25/08.
Independent Living Services remained at $86.87. 31
Rates for Group Care
In the FPB issued by DSS in 2011 no longer identified Supervised Independent Living as a type of placement. DSS incorporated life
skills education and preparation for independent living services into all levels of care. 32
The Multi-agency FPB still procures SIL placement services and the reimbursement rate is the same as the previous FPB. New
Providers will be reimbursed $86.87. 33
Psychiatric Residential
Treatment Facility (PRTF)
In 2007, High Management Residential facilities were given an opportunity to convert their programs to PRTF. Those who took the
option were brought in at a daily rate of $300.00. Reimbursement rates for established programs varied because they were based on
cost reports and budget projections submitted under prior RFP’s.
In 2010, reimbursement rates were reduced by 3% which brought the median rate for providers to $291.00.
Rates range from $274.79 - $389.77 per day effective 4/8/2011. The mode for reimbursement rate is $291.00.
RFP 06-S7191 PROVIDE RESIDENTIAL SERVICES TO CHILDREN THAT ARE EMOTIONALLY AND/OR BEHAVIORIALLY DISTURBED - Multi-Agency (DSS, DJJ, DDSN, COC, DMH)
Solicitation #5400000526, Amendment 3, Dated 08/25/2008 - PROVIDE FIXED PRICE RESIDENTIAL SERVICES TO CHILDREN THAT ARE EMOTIONALLY AND/OR BEHAVIORIALLY DISTURBED - Multi-Agency
(DSS, DJJ, DDSN, COC, DMH)
32 FPB Solicitation #5400002885, Dated 04/12/2011 – STATEWIDE RESIDENTIAL SERVICES FOR CHILDREN - SC Department of Social Services.
33 FPB Solicitation #5400002734, Dated 02/08/2011 - FIXED PRICE STATEWIDE RESIDENTIAL SERVICES FOR CHILDREN – Multi-Agency (DJJ, CoC, DSSN, DMH); Pg. 25
30
31
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MMO SOLICITATIONS HISTORY:
FPB Solicitation #5400004668, Dated 07/31/2012 – RESIDENTIAL SERVICES FOR CHILDREN AND YOUTH - SC Department of Social Services
FPB Solicitation #5400002200, Dated 03/14/2012 – SHELTER/EMERGENCY SERVICES – DJJ Administration
FPB Solicitation #5400002885, Dated 04/12/2011 – STATEWIDE RESIDENTIAL SERVICES FOR CHILDREN - SC Department of Social Services
FPB Solicitation #5400002734, Dated 02/08/2011 - FIXED PRICE STATEWIDE RESIDENTIAL SERVICES FOR CHILDREN – Multi-Agency ( , DSSN, DMH)
FPB Solicitation #5400001937, Dated 06/09/2010 – FIXED PRICE BID FOR MEDICAID REHABILITATIVE BEHAVIORAL SERVICES – Multi-Agency
FPB Solicitation #5400001753, Dated 03/26/2010 – EMERGENCY SHELTER/LOW MANAGEMENT GROUP CARE – SC Department of Social Services
FPR Solicitation #5400001215, Dated 10/20/2009 - EMERGENCY SHELTER/LOW MANAGEMENT GROUP CARE – SC Department of Social Services
RFP Solicitation #5400000891, Dated 05/01/2009 - EMERGENCY SHELTER/LOW MANAGEMENT GROUP CARE – SC Department of Social Services
FPB Solicitation #5400000526, Amendment 3, Dated 08/25/2008 - PROVIDE FIXED PRICE RESIDENTIAL SERVICES TO CHILDREN THAT ARE EMOTIONALLY AND/OR
BEHAVIORIALLY DISTURBED - Multi-Agency (DSS, DJJ, DDSN, COC, DMH)
RFP 06-S7191 PROVIDE RESIDENTIAL SERVICES TO CHILDREN THAT ARE EMOTIONALLY AND/OR BEHAVIORIALLY DISTURBED - Multi-Agency (DSS, DJJ, DDSN, COC,
DMH)
RFP Solicitation #01-S4064, Dated 03/29/2001- PROVIDE RESIDENTIAL SERVICES FOR CHILDREN WHO ARE EMOPTIONALLY ANS/OR BEHAVIORALLY DISTURBED
RFP Solicitation #00-S2407, Dated 10/22/1999 – PROVIDE RESIDENTIAL SERVICES FOR CHILDREN WHO ARE EMOPTIONALLY ANS/OR BEHAVIORALLY DISTURBED
11