Nova Law Review Volume25,Issue3 2001 Article3 Child Welfare Managed Care in Florida: Will It Be Innovation or Abdication? Christina A. Zawisza∗ ∗ Copyright (cid:13)c2001 by the authors. Nova Law Review is produced by The Berkeley Electronic Press(bepress). https://nsuworks.nova.edu/nlr Zawisza: Child Welfare Managed Care in Florida: Will It Be Innovation or A Child Welfare Managed Care in Florida: Will It Be Innova- tion or Abdication? Christina A. Zawisza TABLE OF CONTENTS I. CHILD WELFARE COMMUNITY-BASED CARE IN FLORIDA ........... 621 II. IMPETUS FOR CHILD WELFARE COMMUNITY-BASED CARE ......... 625 I. ATTRIBUTES OF SUCCESSFUL COMMUNITY-BASED CARE ........... 629 IV. LIMITATIONS OF COMMUNITY-BASED CARE INFLORIDA ............ 632 A. Adequate Funding. ................................................................. 632 B. Limitation of Legal Liability .................................................. 635 C. Preservationo f Appropriate State Parens Patriae Role ......... 636 V. RECOMMENDATIONS AND CONCLUSION ...................................... 638 I. INTRODUCTION Election ballots and international custody battles aside, all eyes are on Florida for yet another reason: Florida's steady push to privatize the opera- tion of its social services programs. Part of Governor Jeb Bush's plan to trim the government payroll by transferring state functions to private com- munity groups, including faith-based organizations, privatization in Florida has hit industries ranging from nursing homes for veterans to the child welfare system.' Privatization is also known as "managed care" and resembles managed care in the health care setting.2 Both terms refer to the use of a variety of approaches intended to balance the cost of services with quality and cus- tomer access by reconciling the provision of care to each individual with the resources available to serve an entire pool of customers. "Cost effective- ness is achieved by efficiently delivering the most appropriate services to J.D., University of Virginia School of Law (1977); M.A. in Public Policy and Administration, University of Wisconsin (1971). Director of the Children First Project at Nova Southeastern University Shepard Broad Law Center. 1. See Steve Bousquet, Veterans Blast Bush Plan to Privatize, MIAMI HERALD (Broward), Jan. 29, 2001, at IA; Steve Bousquet, Faith-BasedI nitiative Familiart o Florida, MIAMI HERALD (Broward), Jan. 30, 2001, at 1A. 2. Florida calls this movement "community-based care." See FLA. DEP'T OF CHILD- REN & FAMILmS, COMMUNrTY-BASED CARE END OF YEAR REPORT 2, available at http:/Iwww. dcf. state.fl.us/cf_web/mspt (Dec. 2000) [hereinafter REPORT]. Published by NSUWorks, 2001 1 Nova Law Review, Vol. 25, Iss. 3 [2001], Art. 3 620 Nova Law Review [Vol. 25:619 each individual served.",3 The following strategies are typically used by managed care systems to balance cost, quality, and access: pre-authorized care; gatekeeping and utilization review; use of standardized practice guide- lines; management of data through information technology; built-in financial risks and incentives; and outcome-based contracting. While Florida is unique in the breadth and scope of its privatization movement, many other states are experimenting with the transfer of pieces of state government functions to private organizations, particularly in the area of child welfare services.5 By 1999, twenty-nine states had one or more initiatives to change their management, financing, or child welfare service delivery practices by adopting one or more principles of managed care.6 There are two basic elements to managed care arrangements in child welfare: fixed or capitated prospective payments to at least one service provider, rather than traditional fee-for-service reimbursement payments; a single private entity responsible for providing appropriate and quality services.7 The majority of the twenty-nine states that operate child welfare "man- aged care" initiatives are experimenting with the delivery of services to emotionally disturbed children, only one segment of the child welfare popu- lation. In some states, certain counties, most notably Jefferson and Mesa Counties in Colorado, serve all children in foster care in privatized systems.8 Kansas was the first state to develop a statewide system of managed care for all of its child welfare services.9 Now Florida has joined Kansas in this endeavor. 3. CHILD WELFARE LEAGUE OF AM., MANAGED CARE INsTrruTE 1, available at http://www.cwla.orglprograis/managedcare (last visited Mar. 10, 2001). 4. Id. 5. Cynthia M. Fagnoni, Child Welfare: New Financing and Service Strategies Hold Promise, but Effects Unknown, Statement Before the Subcommittee on Human Resources, Comm. on Ways and Means, House of Representatives (July 20, 2000), in U.S. GEN. ACCT. OFFICE (GAO), GAO/T-HEHS-00-158 (2000) [hereinafter GAO Statement]. For purposes of this article, "child welfare" or "child welfare system" will refer to the full range of functions and services operated to protect Florida's abused, neglected or dependent children, including protective investigations, early intervention services, family preservation and support services, shelter care, foster care, therapeutic foster care, group care, residential care, independent living, postadjudication case management, postplacement superversion, permanent foster care, and adoption. 6. Id. at 3. 7. Id. 8. See generally Patricia Callahan & Kirk Mitchell, Foster Care Too Often Fails to Keep Kids Safe, available at http:llwww.denverpost.comnews/fosterO521a.htm (last visited Mar. 17, 2001). 9. GAO Statement, supra note 5, app., at 16. https://nsuworks.nova.edu/nlr/vol25/iss3/3 2 Zawisza: Child Welfare Managed Care in Florida: Will It Be Innovation or A 2001] Zawisza This article will first describe the statutory characteristics of the child welfare community-based care movement in Florida, as well as the shift in statutory philosophy regarding the roles and responsibilities of Florida's state child welfare agency, the Department of Children and Families. Next, the national and state contextual drivers serving as the impetus for Florida's child welfare community-based care and the attributes of successful com- munity-based care will be described. This will serve as background for a discussion of the following three challenges facing Florida's implementation process: adequate state funding; limitation of legal liability; and preserva- tion of appropriate state parensp atriaer oles. The article will conclude with recommendations designed to assure that Florida's process is effective in protecting children, rather than abdicating state responsibility and devolving state obligations upon local communities and private providers without adequate resources. I. CHILD WELFARE CoMMUNrTY-BASED CARE IN FLORIDA The Department of Children and Family Services ("DCF'), Florida's child welfare agency, began privatizing child welfare services in several Florida communities in the early 1990s by purchasing an extensive array of services from private sector providers such as the Florida Sheriffs Youth Association and the Children's Home Society. "Of Florida's $373 million child protection budget [in 1999], $240 million or [sixty-three] percent [was] spent on services provided by the private sector."' ° Some seventy licensed child-placing agencies offered foster, group, and shelter placements, and some 104 offered only adoption services. But in 1996, the sea change in the delivery of child welfare services in Florida began in earnest. The Florida Legislature authorized DCF to con- tract with competent community-based agencies for the provision of foster care and related services,12 and to establish five model community-based pilot programs, one of which had to be operated by a for-profit corporation.13 10. THE FLORIDA LEGISLATURE, COMMITrEE ON CHILDREN & FAMILIES, SENATE STAFF ANALYSIS AND ECONOMIc IMPACT STATEMENT, CS/SB 660, at 1 (1999). 11. Susan Vivian Mangold, Protection, Privatization, and Profit in the Foster Care System, 60 OHIO ST. L.J. 1295, 1313 n.81 (1999). 12. These services are to include: "family preservation, independent living, emer- gency shelter, residential group care, foster care, therapeutic foster care, intensive residential treatment .... postadjudication case management, postplacement supervision, permanent foster care, family reunification, the filing of a petition for the termination of parental rights, and adoption." FLA. STAT. § 409.1671(1) (Supp. 1996). 13. § 409.1671(1), (5). The 1996 Personal Responsibility and Work Opportunity Act amended the Social Security Act shortly after the 1996 session of the Florida Legislature adjourned to allow federal reimbursement of costs by Title IV-E for foster care provided by Published by NSUWorks, 2001 3 Nova Law Review, Vol. 25, Iss. 3 [2001], Art. 3 Nova Law Review [Vol. 25:619 The expressed intent of the Florida Legislature in creating this community- based care model was to strengthen the support and commitment of commu- nities for the reunification of families and to promote efficiency and in- creased accountability in the care of children and families.'4 In 1998 the Florida Legislature expanded the concept of community- based care and directed DCF to privatize all foster care and related services statewide, phased in over a three-year period beginning on January 1, 2000. " The legislature required DCF to prepare a plan to transfer all available funds, including federal funds, to such community-based agencies. 16 The concept of an "eligible lead community-based provider," a single agency that contracts with DCF for the provision of child protective services in a community no smaller than a county, was established with the following parameters: [t]he ability to coordinate, integrate, and manage all child protective services in the... community in cooperation with child protective investigations; [t]he ability to ensure continuity of care from entry to exit for all children re- ferred [by] ... protective investigation and court[s]... ; [t]he ability to provide directly, or contract for through a local network of providers, all necessary... services; [t]he willingness to accept accountability for meeting the outcomes and performance standards... established by the Legislature and the Federal Government; [t]he capabil- ity and the willingness to serve all children referred to it from the protective investigation and court systems, re- gardless of the level of funding allocated to the commu- nity by the state, provided all related funding is trans- ferred; [t]he willingness to ensure that each individual who provides child protective services completes the train- ing required .... DCF, the contracting agency, retained responsibility for the quality of contracted services and programs, for ensuring services were delivered in accordance with applicable federal and state statutes and regulations, and for private for-profit companies. See 42 U.S.C. § 672(c) (Supp. III 1997). Some argue that "[tihe entrance of profit making into the system raises issues of accountability and oversight unique to the profit making structure of the corporations." Mangold, supra note 11, at 1295. 14. FLA. STAT. § 409.1671(1)(a) (Supp. 1998). 15. Id. 16. Id. The services to be privatized include the list of services authorized in 1996 minus the filing of petitions for the termination of parental rights. Id. 17. § 409.1671(1)(b). https://nsuworks.nova.edu/nlr/vol25/iss3/3 4 Zawisza: Child Welfare Managed Care in Florida: Will It Be Innovation or A 2001] Zawisza establishing a quality assurance program and an annual evaluation of com- munity-based agencies. IS Emboldened by its 1996 and 1998 legislative successes, DCF sought and obtained permission from the legislature in 1999 to suspend its statutory duties and responsibilities and to submit a comprehensive reorganization plan to achieve more effective and efficient service delivery and improve accountability.'9 The Department's comprehensive plan articulated an eye- catching vision for community-based care that created local community alliances to draw together lead agencies, networks of service providers, and the department in implementing the reorganization.20 The effort would begin with community-based care for child welfare services, but would incremen- tally expand to include all other services.21 According to DCF, such a bold step was necessitated by the following factors: a statutory mission too enormous to fulfill, with a span of control too broad and communications between central offices and districts often problematic; "[1lack of true partnership with local communities; [a]bsence of local systems of care ... characterized by a single point of intake for as- sessment, service planning, and care management with necessary specialized services carefully coordinated and integrated to meet the needs of... client[s]; [lack of uniformity in] contract management [of] over 1700 indi- vidual contracts;... [lack of resource coordination between the state and localities]. 22 DCF's proposed solution would be to create a responsive system of care in local communities which would produce an integrated service plan for each family and which would be accessible, individualized, family-centered, respectful, integrated, effective, efficient, normalized, and community focused.23 Community-based care would be composed of the community, a Community Alliance serving as the focal point of community ownership and oversight of the system of care, a lead agency providing core services, and a network of local service providers.24 While DCF would "continue to be responsible for the overall provision of state and federally mandated and funded services,"5 the most controver- sial portion of the plan would require local communities to share both the 18. § 409.1671(2), (3)(a). 19. Ch. 99-219, § 1(1), 1999 Fla. Laws 1351 (to be codified at FLA. STAT. § 20.19). 20. FLA. DE"T OF CHI)R.DN & FAMnmS, CoMPREHENsvE PLAN TO REORGANTE Thm DEPARTmENT OF CHILDREN & FAMuI 8, available at http://www.state.fl.us/cf-web/reorg (Jan. 1, 2000) [hereinafter COMPSREHENsE PLAN]. 21. Ida.t 7. 22. Ida.t 5-6. 23. Id. at 9-10. 24. Id. at 11-12. 25. COMPREHENSIVE PLAN, supran ote 20, at 19. Published by NSUWorks, 2001 5 Nova Law Review, Vol. 25, Iss. 3 [2001], Art. 3 Nova Law Review [Vol. 25:619 costs and the risks of operating the system and delivering services.26 Local communities would be expected to commit increased funds and might be expected to develop local match funds in order to obtain an increment of state funding.27 Risk would be shared through a case rate funding approach with a state set-aside of a risk pool.28 The Florida Legislature balked at the notion of requiring local govern- ments to share greater costs, and specifically provided in year 2000 that "the Legislature does not intend by its privatization of foster care and related services that any county, municipality, or special district be required to assist in funding programs that have previously been funded by the state., 29 The legislature was silent, however, with regard to expectations of private pro- viders, although it authorized the creation of a risk pool to reduce the finan- cial risk to eligible lead agencies resulting from unanticipated caseload growth30 and agreed to establish community alliances to oversee the devolu- tion to local communities.31 The legislature further put some skids on DCF's adventurous plan, limiting application of the larger plan to one prototype region and requiring demonstrated improvement in management and over- sight of services or cost savings from more efficient administration before the Secretary of DCF could expand the plan to other districts.32 Perhaps the greatest change in Floridalaw regarding the administration of its child welfare system is the reduced mission of the state child welfare agency and its Secretary. In 1995, the mission of the then Department of Health and Rehabilitative Services, was "to deliver, or provide for the deliv- ery of, all health, social, and rehabilitative services offered by the state through the department to its citizens,"33 and the duties of the department were statutorily prescribed. Most notably, they included providing assis- tance to individuals, preventing and remedying neglect, abuse, exploitation of children, and aiding in the preservation, rehabilitation, and reuniting of families.34 26. Id. at 23. 27. Id. 28. Id. 29. FLA. STAT. § 409.1671(l)(a) (2000). 30. § 409.1671(7). The legislature appropriated $4.5 million for the risk pool in 2000. REPORT, supra note 2, at 18. 31. § 20.19(6). The initial membership of each community alliance is a representative of county government, school district, county United Way, sheriffs office, circuit court, and children's board. Id. § 20.19(6)(d)(1)-(7). 32. § 20.19(7). The prototype region is the geographical area including counties in the 6th, 12th, and 13th judicial circuits. Id. § 20.19(5)(a)(7), (16), (17). 33. FLA. STAT. § 20.19(1)(a) (1995). 34. Id. Other responsibilites included but were not limited to: cooperating with other state and local agencies in integrating the delivery of all health, social, and rehabilitative https://nsuworks.nova.edu/nlr/vol25/iss3/3 6 Zawisza: Child Welfare Managed Care in Florida: Will It Be Innovation or A 2001] Zawisza In 1996, this mission was changed, along with the name of the depart- ment. DCF was "to work in partnership with local communities to help people be self-sufficient and live in stable families and communities.,,35 The 1996 statute, however, retained the prescribed duties of DCF.36 By 2000, these defined purposes had disappeared. The mission of DCF now is "to work in partnership with local communitiese' to help people be self-sufficient and live in stable families and communities.37 The duties of the Secretary are, simply, to assure "that the mission of the department is fulfilled in accordance with state and federal laws, rules, and regulations."38 Gone are the obligations to provide assistance to individuals and to prevent or remedy neglect, abuse, and exploitation and to aid in the preservation, rehabilitation and reunification of families. The community-based care revolution in Florida is now complete. No longer is the focus of ownership, responsibility, and service delivery. The state child welfare agency, according to state law, at best, holds shared responsibility for the protection of children with local communities and enjoys a vast diminution of duties. II. IMPETUS FOR CHILD WELFARE COMMUNMTY-BASED CARE The motivation for community-based care comes from different sources. One driving force, certainly one prevalent in Florida, is the desire to shrink the size of state government and eliminate the need for civil service protections that make it difficult or impossible to discipline or fire incom- petent employees. Community-based agencies can terminate ineffective employees at the will of the supervisor.39 A stronger motivating force, however, is the desire to fix what most commentators describe as a broken child welfare system: one beset with escalating costs and a poorly integrated patchwork of services.40 Nationally, state child welfare systems are currently responsible for more than one services offered by the state to those in need of assistance; providing such assistance as is authorized so that clients might achieve or maintain economic self-support and self-suffi- ciency; preventing or reducing inappropriate institutional care, as well as functions related to health and mental health. Id. 35. FLA. STAT. § 20.19()(a) (Supp. 1996). 36. Id. The prescribed purposes are almost identical to the purposes contained in the 1995 statute. See FLA. STAT. § 20.19(1)(a) (1995). 37. FLA. STAT. § 20.19(1)(a) (2000). 38. § 20.19(1), (2). 39. See Bousquet, Veterans Blast Bush Plan to Privatize,s upra note 1, at 6A. 40. U.S. GEN. ACCT. OFFICE (GAO), GAO/HEHS-99-8, CHILD WELFARE: EARLY Ex- PERIENCES IMPLEMENTING A MANAGED CARE APPROACH 2 (Oct. 1998). Published by NSUWorks, 2001 7 Nova Law Review, Vol. 25, Iss. 3 [2001], Art. 3 Nova Law Review [Vol. 25:619 million children needing protection or care.41 "Foster care is intended to provide a temporary, safe haven for children whose parents are unable to care for them," according to Michael Mushlin.42 Yet more than half a mil- lion children currently languish in government foster care at a cost of $12 billion.43 In the current child welfare delivery system, there are many prob- lems. Among these problems is the lack of permanence; "children remain in foster care too long without being reunited with their parents or adopted into a permanent home."" Compromised safety is another issue; "children are sent back to abusive homes or placed with abusive foster parents or in overcrowded conditions."45 There are a high number of placements; "chil- dren move from foster home to foster home within short time periods, jeop- ardizing their safety and stability." Heavy caseloads is yet another prob- lem; "social workers are responsible for far too many children to supervise all cases thoroughly."47 Finally, caseworker turnover is among the problems; "foster children face many changes and have to adjust to many casework- 48 ers." In the latter half of the 1990s, the march toward foster care drift for abused and neglected children seemed almost inexorable. While [i]n 1996, approximately 520,000 children were in foster care; by March 1999, 547,000 children were in foster care. In 1996, 11 percent had been in foster care for three to four years, and 10 per- cent had been there for five years or longer. By March 1999, 15 percent had been in foster care three to four years and 18 percent had been in foster care 5 years or longer. In 1996, 54,000 children were legally available for adoption; by March 1999, 117,000 were legally available for adoption. The average length of stay of a child in foster care in Florida in November, 2000 was 35.6 months.50 41. Id. at 5. 42. Michael B. Mushlin, Unsafe Havens: The Case for Constitutional Protection of Foster Childrenf rom Abuse and Neglect, 23 HARv. C. R.-C.L. L. REv. 199, 204 (1988). 43. Lisa Snell, Reason Public Policy Study #271, Child Welfare and the Role of Privatization6 , available at http://www.rppi.org/ps271html (Oct. 2000). 44. Id. 45. Id. 46. Id. 47. Id. 48. Snell, supra note 43. 49. Id. 50. REPORT, supra note 2, at 30. https://nsuworks.nova.edu/nlr/vol25/iss3/3 8 Zawisza: Child Welfare Managed Care in Florida: Will It Be Innovation or A 2001] Zawisza Jill Chaifetz observes the incalculable human loss behind these statis- tics, the enormous personal pain and hurt, and the tangible, detrimental societal costs. "Children who have grown up or left foster care fill the nation's jails, mental hospitals and welfare rolls," according to documented studies.5 These results have occurred despite the passage of good laws. The federal Adoption Assistance and Child Welfare Act of 1980 (AACWA) was designed to address the decades old problem of foster care drift: the phe- nomenon of a child literally growing up in foster care. 2 The AACWA provided fiscal incentives to states to "prevent the removal of children from their homes unless necessary and to reunify them with parents or relatives as soon as possible. Adoption or other permanent living arrangements were to be found if prevention or reunification was lacking.53 The AACWA required states to make "reasonable efforts" to prevent removal or to reunify through services;'4 to develop written case plans to direct the provision of services for each child;55 to judicially or administratively review the status of each child at least every six months;56 and to hold a permanency hearing within eighteen months of placement. 5 The promise of the AACWA was never fulfilled. The federal law's financing scheme incentivized keeping children in foster care. Lack of state funds for services, insufficient foster homes, and lax federal monitoring of state programs contributed to the problem.58 The Adoption and Safe Families Act of 1997 (ASFA) sought to cure some of the defects of the AACWA. It makes federal reimbursement con- tingent on speeding up the process of cases heading towards termination of parental rights, by removing the mandate for reasonable efforts to reunify children under certain circumstances,59 requiring permanency hearings within twelve months instead of eighteen,60 and providing fiscal incentives to states to foster more adoptions. As another impetus, President Clinton issued a challenge to states to double the number of children moved from 51. Jill Chaifetz, Listening to Foster Children in Accordance with the Law: The Failuret o Serve Children in State Care, 25 N.Y.U. REv. L. & Soc. CHANGE 1, 8 (1999). 52. See Robert M. Gordon, Drifting Through Byzantium: The Promise and Failureo f the Adoption and Safe FamiliesA ct of 1997, 83 MINN. L. REv. 637, 639 (1999). 53. See 42 U.S.C. § 625(a)(1) (1994). 54. § 671(a)(15) (Supp. IV 1999). 55. § 671(a)(16). 56. § 675(6). 57. § 675(5)(c). 58. Chaifetz, supra note 51, at 9. 59. 42 U.S.C. § 671(a)(15)(D) (Supp. IV 1999). 60. § 675(5)(c). 61. § 673(b) (West Supp. 2000). Published by NSUWorks, 2001 9