Enacted in 2018, the Family First Prevention Services Act (FFPSA) significantly reformed the child welfare system and allowed states to use Title IV-E funds to reduce out-of-home placements for children and youth. When those placements are necessary, the FFPSA authorized specific types of allowable congregate settings, including qualified residential treatment programs (QRTPs).

A QRTP:

• Provides a trauma-informed model of care designed to address the needs of children with serious emotional or behavioral disorders;
• Has registered or licensed nursing staff available 24/7;
• Facilitates family participation in a child’s treatment and documents how members are integrated into the treatment; and
• Provides discharge planning and family-based aftercare support for at least six months post discharge, among other attributes.

Background

The FFPSA has generated significant reforms to the child welfare system and several key provisions allow states to use Title IV-E funds, which is the largest federal funding source for child welfare activities for certain evidence-based prevention services to reduce unnecessary out-of-home placements for children and youth. When out-of-home placement is necessary, FFPSA prioritizes Title IV-E funds for placements in foster family homes over those in congregate care, in part, by authorizing specific types of allowable congregate settings. These include qualified residential treatment programs (QRTPs), among others. States that do not implement QRTPs or other allowable congregate settings will soon be limited in their ability to claim Title IV-E foster care maintenance payments.

These new restrictions went into effect Oct. 1, 2019, however states had the option of delaying implementation of this provision for up to two years, until Oct. 1, 2021. At least 11 states opted for early adoption of these changes to congregate settings, with others opting for a delay. States that opted to delay implementation of these specific types of allowable congregate settings were simultaneously unable to use Title IV-E funds for prevention services under FFPSA – one of the hallmarks of the new law.

Changes to Congregate Settings Under FFPSA

Prior to FFPSA’s passage, states were able to claim federal Title IV-E for children in congregate settings with few constraints. But, as the final implementation date nears, only the following settings will be eligible for Title IV-E foster care maintenance payments:

• QRTPs designed to address the clinical needs of children with serious emotional or behavioral disorders. Key requirements include:
  • Utilization of a trauma-informed treatment model;
  • Having a registered or licensed nursing staff or other licensed clinical staff available 24/7;
  • Facilitating family participation in the treatment process;
  • Offering at least six months of support after discharge; and
  • Being licensed and national accredited.
• Specialized settings for youth ages 18 and older who are living independently;
• Settings providing high-quality residential care and supportive services to children and youth who have been found to be, or at risk of becoming, sex trafficking victims; and
• Children who are placed with a parent in a licensed residential family-based treatment facility for substance use disorder for up to 12 months.

While there are limited exceptions, states will be unable to claim Title IV-E foster care maintenance payments after two weeks of placement in “childcare institutions” (i.e., congregate settings) that do not meet the above criteria. While existing congregate care settings will not necessarily close, their reimbursement structures may change. While the priority is to prevent children from being placed in congregate care, it remains an important option for some children and youth.

Approximately 10 percent of children and youth in out-of-home care were placed in a congregate setting in during fiscal year 2019. As a result, a delay in uptake of these changes beyond the final implementation date could represent a significant shift in costs onto states’ already constrained budgets. Texas estimates it will lose $26 million annually in federal Title IV-E funds if the state is unable to implement these provisions by the October 2021 deadline.

State Efforts to Implement QRTPs under FFPSA

Since the provision went into effect in October 2019, states have been at various stages of implementing allowable congregate settings that are eligible to claim Title IV-E foster care maintenance payments under FFPSA. Nearly all states have either implemented or are working to implement QRTPs, with many states launching and/or refining their program models in the coming months of this year.

• Michigan added the definition of QRTP to its state statute and is scheduled to submit its Title IV-E state plan amendment for federal review in early 2021, with contracts with QRTPs executed by February 2021.
• North Dakota began implementing QRTPs in October 2019 and now has three in place. This effort included making policy updates and the writing of a comprehensive document outlining answers to common questions.
• Virginia is scheduled to implement QRTPs by Jan. 31, 2021. The state also developed a comprehensive document outlining answers to common questions to provide clarity around the state’s implementation of the new congregate changes under FFPSA.
• Washington State received federal approval in October 2020 for its updated QRTP policy and related Title IV-E state plan amendments to implement QRTPs. The state also received federal approval of a corresponding waiver allowing “qualified individuals” to perform the required assessments under FFPSA. The majority of the state’s QRTP facilities are accredited.

To support the uptake of QRTPs, some states are exploring use of supplemental funding, such as rate increases and federal Family First Transition Act funds. Many of these efforts are designed to incentivize providers to scale up their service delivery models to become QRTPs, reimburse providers for accreditation costs, and pilot QRTPs during the initial transition period.

• Maine is investigating opportunities for incentives and/or rate increases for providers that become accredited QRTPs. Maine is also working to develop and implement an application for providers becoming accredited QRTPs to receive partial reimbursement using the state’s federal Family First Transition Act funding.
• Texas is using federal Family First Transition Act funds awarded to support the state’s implementation of FFPSA to develop a two-year QRTP pilot program.
• Virginia officials indicated the state may provide funds to temporarily cover the cost of Title IV-E ineligible placements during the transition period as QRTPs are phased in. The state is also conducting a rate analysis to determine if a Medicaid rate adjustment is needed as providers transition to become accredited QRTPs.
• Washington State is working to establish dedicated funding to support providers working through the QRTP accreditation process.

The National Academy for State Health Policy will continue to monitor implementation and financing of QRTPs and other allowable congregate settings under FFPSA at both the state and federal level during 2021 and in the future.