Foster Care Independence Act

Independent living provisions

The purpose of the Foster Care Independence Act is to provide states with flexible funding that will enable children likely to "age out" of foster care at age 18 to obtain employment, continue their education, accept personal responsibility, and prepare for the transition from adolescence to adulthood. The program aims to help foster youth transition out of foster care by encouraging self-sufficiency through funding that will allow for States to design and conduct programs that include:

• Assistance obtaining a high school diploma
• Career exploration
• Vocational training
• Job placement and retention
• Budgeting and financial management skills
• Training in activities of daily living
• Substance abuse prevention
• Preventative health; such as smoking cessation, nutrition, and pregnancy prevention

Program funding is used to provide independent living support services to youth both before and after aging out of foster care. Funding supports financial, housing, counseling, employment, educational, and other supportive programs for transitioning youth. Additional funding promotes interactions with mentors and dedicated adults to provide personal and emotional support to foster youth. With the passage of the act, federal funding for the Independent Living Program was doubled from $70 million to $140 million a year. However, states must contribute a 20 percent state match for Independent Living Program funds and use federal training funds to help foster parents address issues confronting adolescents preparing for independent living.

Use of independent living funds

States may apply funds for a period of five consecutive years through an application process that requires submission of a plan that meets requirements of a program that supports transitioning foster youth. Applications for funding must include plans including how the state will design and deliver programs, ensure that youth in various stages of transition will be served, and involve both public and private agencies in planning for independent living. State agencies are expected to administer, supervise, and oversee the programs carried out under the plan.

The Act requires that states receiving funds develop outcome measures to assess the performance of independent living programs. States must measure data that includes educational attainment, high school graduation rates, employment, homelessness, non-marital childbirth, and incarceration. States must report data regarding the success of independent living program to Congress, or be subject to penalties for noncompliance.

Medicaid provisions

The Act also increases health care options for youth aging out of foster care by making changes to the Medicaid law permitting states to provide Medicaid coverage to youth upon aging out of foster care, up to the age of 21. Provisions also allow for former foster youth who are considered low income to be provided with Medicaid coverage by permitting foster youths to have assets up to $10,000 without compromising their assistance.

Adoption assistance provisions

The Act increases funding for adoption incentive payments, which are bonuses to states for increasing the number of children adopted from public foster care, as opposed to youth remaining in foster care. Additional funding for adoption incentive payments enables States to receive the full amount of the earned bonuses due to increasing adoption rates.

OASDI and SSI provisions

Title II of the Act includes provisions relating to OASDI and SSI provisions. Provisions aim to reduce overpayment and fraud. The Act also contains provisions authorizing a study to determine reasons why family farmers are denied SSI benefits. The following are summary descriptions of the Social Security Administration (SSA) provisions:

Liability of representative payees

• Makes representative payees liable for any OASDI or SSI overpayment made to a beneficiary who is deceased.
• Requires the SSA to create a record under the representative payee's Social Security Number to establish overpayment control.

Recovery of overpayments

• SSI overpayments must be recovered from SSI lump sum amounts by withholding 50 percent of the lump sum amount of the overpayment.

Debt collection

• Extends the debt collection practices available for OASDI overpayments to the SSI program.

Requirement to provide state prisoner information

• Prisoner information must be reported to Federal or federally assisted cash, food, or medical assistance programs.

Treatment of assets held in trust

• For SSI purposes, the assets of any trust containing property transferred from an individual or an individual's spouse, will be included as countable resources.
• An earnings or additions to a trust will be counted as the individual's income.
• Application of the provision to include trust contributions can be waived in cases of "undue hardship," to ensure that SSI beneficiaries who lose their SSI benefits because of assets held in trust will not automatically lose Medicaid benefits.

Disposal of resources

• Provides a penalty of loss of SSI benefits for up to 36 months for the disposal of resources at less than fair market value.

Penalties for false or misleading statements

• For individuals who made a "statement or representation of material fact" for use in determining SSI or OASDI benefits, a penalty is imposed.
• Deletes the provision that denies benefits for 10 years to any individual convicted of making a fraudulent statement in order to simultaneously collect assistance payments in two or more States.

Exclusion of representatives and health care providers

• If representatives and/or healthcare providers are found to have helped committed fraud, they are barred from the OASDI and SSI programs.
• The bar would last 5 years for a first offense, 10 years for a second offense, and permanent exclusion for a third offense.

State data exchanges

• Require that the SSA's privacy standards for data sharing meet the State Privacy Standard.

Study to improve fraud prevention

• Requires that a study be completed to identify measures to reduce OASDI and SSI fraud.
• Includes study to improve processing of beneficiaries reporting change or income.
• Requires a report of recommendations from the study to the United States House Committee on Ways and Means and the Senate Finance Committee.

Annual reporting

• Requires that the SSA include in its annual budget an itemization of the amount of funds required to support efforts to combat fraud by applicants and beneficiaries .

Computer matches with institutionalization data

• Requires periodic matches with Medicare and Medicaid data held by the Secretary of Health and Human Services (HHS).

Access to information

• Provides that SSI applicants and beneficiaries may be required to provide authorization to the SSA to obtain financial records from any financial institution.
• Refusal to provide authorization to the SSA to obtain financial records may result in ineligibility for SSI.

Study of denial of SSI benefits for family farmers

• Requires a study to determine the reasons why family farmers with resources under $100,000 are denied benefits.
• The study would include whether the policies discriminate against family farmers, and the number family farmers who have been denied benefits in each of the past 10 years.

Provisions for special benefits to certain World War II veterans

The Foster Care Independence Act also establishes a new title VIII of the Social Security Act that entitles certain World War II veterans to a monthly SSI benefit. "Every individual who is a qualified individual... shall, in accordance with and subject to the provisions of this title, be entitled to a monthly benefit paid by the Commissioner of Social Security for each month after September 2000 (or such earlier month, if the Commissioner determines is administratively feasible) the individual resides outside the United States." Qualified individuals are considered individuals who:

• Are 65 years of age or older
• Are World War II veteran;
• Are eligible for a supplemental security income benefit under title XVI
• Have a total benefit income that is less than 75 percent of the Federal benefit rate under title XVI
• Have filed an application for benefits under this title
• Are in compliance with all requirements imposed by the Commissioner of Social Security under this title

Legislative history

First Lady of the United States Hillary Clinton was instrumental in passage of the bill, first holding a youth conference on the issues involved and then lobbying the United States Congress in support of legislation. It followed in the wake of her support for the earlier Adoption and Safe Families Act of 1997, which made it easier to adopt foster children; the Foster Care Independence Act was intended to ease the transition into adulthood of foster children who did not get adopted.

Passage of the bill itself was non-controversial: H.R. 3443 was introduced in the U.S. House of Representatives on November 18, 1999, by Congresswoman Nancy Johnson of Connecticut, via the House Committee on Ways and Means and the House Committee on Commerce, and was passed on the House floor without objection. On November 19, it was passed in the U.S. Senate by unanimous consent.

Upon signing the bill into law, President Bill Clinton stated:

Hillary and I are very pleased that the Congress today approved H.R. 3443, "Foster Care Independence Act of 1999." This legislation helps ensure that young people in foster care get the tools they need to make the most of their lives. It builds on proposals in my budget to empower those leaving foster care by providing them access to health care, better educational opportunities, training, housing assistance, counseling, and other support and services. We cannot let these young people walk their tough road alone.

With the passage of the Foster Care Independence Act of 1999, the name of the Independent Living Program was changed to the John H. Chafee Foster Care Independence Program as a testimonial to the late Senator Chafee (R-RI). Senator Chafee was the Senate sponsor of the legislation. Senator Chafee recognized the need for special support and assistance for youth transitioning out of foster care. Senator Chafee was also a vocal advocate for abused and neglected children.