States’ Use of Medicaid Waivers for Children with Behavioral Health Needs is Associated with Lower Rates of Voluntary Child Welfare Placements

Abstract

For many children with significant behavioral health needs, the inability to obtain funding for adequate behavioral health care through private means results in parents “voluntarily” placing their child in the state’s child welfare system. This study investigated the association between states’ use of 1915(c) Medicaid waivers for children with behavioral health needs and state rates of voluntary foster care placements. This study used data from the Children’s Bureau Adoption and Foster Care Analysis and Reporting System (AFCARS), from 2010 to 2019. Multilevel, linear regression models with state-year fixed-effects assessed the relationship between states’ use of a 1915(c) waiver and their total new entry voluntary foster care placement rates for children with behavioral or developmental health care needs, controlling for a variety of state-level policy and demographic characteristics. States’ use of 1915(c) waivers is significantly associated with lower total voluntary placement rates, both in total (β= -1.51 [-2.82, -0.21]) and proportionally (β=-1.03 [-2.07, 0.02]). HCBS Medicaid waivers targeting children with complex behavioral health needs may reduce state rates of voluntary foster care placements.