Eligibility

Title IV-E foster care requires that the child must have been a recipient of or eligible for AFDC (based on the State AFDC standards that were in place on July 16, 1996) during the month a petition was filed to remove the child (eligibility month) or the month a VPA (Voluntary Placement Agreement) is signed. The child must have lived in the home of a specified relative within six months of the eligibility month and be deprived of parental support. In addition, there must be a court order that finds: (1) Continuation in his/her own home would be "contrary to the welfare of the child" and (2) reasonable efforts were made to prevent the removal of the child from his/her family or to facilitate the return of the child who has been removed. Title IV-E adoption assistance eligibility follows Title IV-E eligibility for foster care with a few exceptions.

Title IV-E is a federal reimbursement for some of the federally eligible foster care or adoption expenses that the state has already paid. Title IV-E is not a grant. There is no cap on available federal funding. Federal funding reflects the number of children eligible for assistance. Federal funding for this program was $4.9 billion in FY 2003. Reimbursement is limited to three areas and the funding formula is different for all three:

* Maintenance
* Administration
* Training

Maintenance is the board and room payment made to licensed foster parents, group homes and residential child care facilities. For children that are Title IV-E eligible, the federal government reimburses the state for 50% to 83% of the costs and the state pays the balance. The federal portion is called the "Federal Financial Participation" or FFP. The FFP for Title IV-E foster care and adoption assistance (maintenance) is the same as Medicaid (Title XIX) that is called the "Federal Medical Assistance Percentage" or "FMAP". A specific state's FMAP is based primarily on each state's per capita income. The higher the state's per capita income, the lower the FMAP. If the child is not Title IV-E eligible, the state is responsible to pay for the entire cost of care with other sources.

Administration includes those activities necessary for the proper and efficient administration of the Title IV-E state plan. Examples of reimbursable administrative activities included in federal regulations include:

* Referral to services
* Determination of Title IV-E eligibility
* Preparation for and participation in judicial determinations
* Placement of the child
* Development of the case plan
* Case reviews
* Case management and supervision
* Recruitment and licensing of foster homes and institutions
* Rate setting
* Costs related to data collection and reporting
* Proportionate share of related agency overhead

The state currently makes its claim to the federal government for administrative reimbursement based on the total administrative cost, the results of the "Random Moment Time Study (RMTS), the percentage of Title IV-E eligible children (often known as the penetration rate), and 50% FFP for administration.

When states contract with private agencies to help them carry out public child welfare responsibilities (such as conducting home studies for special needs adoption), they claim reimbursement, based on the percentage of Title IV-E eligible children in foster care or adoption assistance times 50% FFP for administration

Training includes the cost of providing short and long term training at educational institutions as well as in-service training for personnel employed by or preparing for employment by the state (including a Tribe) or a local public agency administering the Title IV-E state plan. Training also includes the cost of short term training for current or prospective foster or adoptive parents and members of state (or tribal) licensed or approved child care institutions providing care to foster or adopted children.

The state currently makes its claim for training reimbursement based on the total training cost, times the percentage of Title IV-E eligible children and times 75% FFP for training. The state is responsible for the balance or non-federal share.