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CASE | DECISION | ANALYSIS | JUDGE | FOOTNOTES

Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Appellate Division
IN THE CASE OF  


SUBJECT: West Virginia Department of Health
and Human Resources


DATE: March 6, 2006
        

 


 

Docket No. A-05-116
Decision No. 2017
DECISION
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DECISION

The West Virginia Department of Health and Human Resources (West Virginia) appealed in part the determination of the Administration for Children and Families (ACF) dated August 2, 2005. ACF disallowed a total of $760,292 of federal financial participation (FFP) claimed by West Virginia for foster care maintenance payments and administrative costs claimed under title IV-E of the Social Security Act (Act). ACF's determination was based on a "secondary" eligibility review of payments claimed by West Virginia for 150 sample cases during the period April 1 through September 30, 2004. The purpose of the review was to determine whether the payments were made on behalf of eligible children to eligible foster care providers. ACF found that West Virginia was not in substantial compliance with the IV-E eligibility requirements. Specifically, ACF found that 18 sample cases were "error cases" because they had ineligible payments during the review period. ACF also found that 10 sample cases had ineligible payments outside the review period. ACF subsequently determined based on additional documentation provided by West Virginia that two of the sample cases it had identified as error cases were eligible and stated that it would adjust the amount of the disallowance accordingly.

West Virginia disputes ACF's findings in three of the remaining error cases--sample cases 82, 92, and 137. ACF found each of these cases ineligible on the ground that the child was not removed from home as a result of a court order. ACF also found sample case 82 ineligible on the ground that there was no [Page 2] judicial determination that reasonable efforts were made to prevent the child's removal from home. (1)

For the reasons discussed below, we reverse ACF's finding of ineligibility with respect to sample cases 92 and 137 and uphold ACF's finding of ineligibility with respect to sample case 82. The effect of our decision is to reverse not only the disallowance for two sample cases and the associated administrative costs, but also the disallowance (including associated administrative costs) based on an extrapolation from the sample to the universe of payments.

Legal Background

Title IV-E was originally enacted as part of the Adoption Assistance and Child Welfare Act of 1980, Public Law No. 96-272. (2) Under section 472(a) of title IV-E, as amended by the Adoption and Safe Families Act of 1997 (ASFA), Public Law No. 105-89, federal matching of state foster care maintenance payments is available for a child in foster care who would have been eligible for Aid to Families with Dependent Children under title IV-A as in effect as of June 1, 1995 -

but for his removal from the home of a relative . . . if-

(1) the removal from the home occurred pursuant to a [Page 3] voluntary placement agreement entered into by the child's parent or legal guardian, or was the result of a judicial determination to the effect that continuation therein would be contrary to the welfare of such child and (effective October 1, 1983) that reasonable efforts of the type described in section 471(a)(15) for a child have been made[.]

Revised regulations implementing ASFA were effective March 27, 2000. 65 Fed. Reg. 4020 (Jan. 25, 2000). The regulations that address the eligibility requirements at issue in this appeal are set out later, as are additional statutory eligibility requirements pertinent to this appeal.

Pursuant to 45 C.F.R. § 1356.71, ACF conducts primary reviews every three years based on a randomly drawn sample of 80 cases. ACF reviews these cases to determine whether title IV-E payments were made (1) on behalf of eligible children and (2) to eligible foster family homes and child care institutions. If a state's ineligible cases in the sample do not exceed eight in the "initial primary review," a state's program is deemed in "substantial compliance," and the state is not subject to another primary review for three years. However, a disallowance is assessed for payments and administrative costs associated with the individual error cases in the sample "for the period of time the cases are ineligible." 45 C.F.R. § 1356.71(c)(4). If a state's program is deemed not in substantial compliance, a program improvement plan is required, and the state is thereafter subject to a secondary review of 150 randomly drawn cases, which will result in a disallowance that is based on an extrapolation from the sample to the universe of claims paid if both case and dollar error rates in the secondary review exceed 10 percent. 45 C.F.R. § 1356.71(c)(5) and (6).

ANALYSIS
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Below, we first discuss why we uphold ACF's determination that sample case 82 is ineligible on the ground that there was no judicial determination that reasonable efforts were made to prevent the child's removal from home. We then turn to a discussion of why we reverse ACF's determination that sample cases 92 and 137 are ineligible on the ground that the child was not removed from home pursuant to a court order. We do not discuss whether sample case 82 is ineligible on that ground since we conclude that this sample case is ineligible on a different ground.

[Page 4] Sample Case 82

Section 471(a)(15)(B) requires that a state plan under title IV-E must (subject to certain exceptions in subparagraph (D)) provide that "reasonable efforts shall be made to preserve and reunify families-(i) prior to the placement of a child in foster care, to prevent or eliminate the need for removing the child from the child's home . . . ." Section 471(a)(15)(D) provides that "reasonable efforts of the type described in subparagraph (B) shall not be required to be made with respect to a parent of a child" under specified circumstances (which are also set out in the regulations).

Section 1356.21 of 45 C.F.R. states in pertinent part:

(b) Reasonable efforts. The State must make reasonable efforts to maintain the family unit and prevent the unnecessary removal of a child from his/her home, as long as the child's safety is assured . . . . (1) Judicial determination of reasonable efforts to prevent a child's removal from the home.
(i) When a child is removed from his/her home, the judicial determination as to whether reasonable efforts were made, or were not required to prevent the removal, . . . must be made no later than 60 days from the date the child is removed from the home pursuant to paragraph (k)(1)(ii) of this section.

* * * *

(3) Circumstances in which reasonable efforts are not required to prevent a child's removal from home . . . . Reasonable efforts to prevent a child's removal from home . . . are not required if the State agency obtains a judicial determination that such efforts are not required because:
(i) A court of competent jurisdiction has determined that the parent has subjected the child to aggravated circumstances . . . ;
(ii) A court of competent jurisdiction has determined that the parent has been convicted of:

* * * *

(iii) The parental rights of the parent with respect to a sibling have been terminated involuntarily.

At a hearing on 11/21/03, the court placed the child (referred to here by the initials G.R.) in the custody of the Division of Juvenile Services for placement in the diagnostic unit of a juvenile detention facility for a period not to exceed 60 days. The court order states that "[t]he West Virginia Department of [Page 5] Health and Human Resources made reasonable efforts to prevent removal of the juvenile from the home as the juvenile respondent was offered a psychological evaluation within the community but did not make himself available for this service." West Virginia Ex. 6, at 2. In the next order, issued on 2/5/04, the court ordered that G.R. "be released from the custody of the Division of Juvenile Services and placed in the legal custody of the West Virginia Department of Health and Human Resources and the physical custody of his mother . . . , pending the availability of a bed" in a residential treatment facility. The order continues, "When said bed becomes available the juvenile respondent will also be placed in the physical custody of the West Virginia Department of the Health and Human Resources for placement" in the residential treatment facility. West Virginia Ex. 8, at 2. The order further states that "[r]easonable efforts were unnecessary due to the acts committed by the juvenile and the juvenile's own request for out of home assistance." Id. at 3.

West Virginia argues that there was a reasonable efforts determination in the 11/21/03 order that was reaffirmed in the 2/5/04 order. However, the statement quoted from the 11/21/03 order does not meet the requirement for a reasonable efforts determination because the court ordered that the child be placed in a juvenile detention facility. Under section 472(b) and (c) of the Act, title IV-E payments are not available for a child who is placed in a "facility operated primarily for the detention of children who are determined to be delinquent." See also 45 C.F.R. § 1355.20 (definition of "Child care institution"). Thus, the court did not determine that reasonable efforts were made "prior to the placement of a child in foster care" to prevent the child's removal from home, as required by section 471(a)(15)(B) of the Act.

Moreover, nothing in the 2/5/04 order indicates that the court was reaffirming the statement in the 11/21/03 order that reasonable efforts were made to prevent G.R.'s removal from home. Nor does the statement in the 2/5/04 order that "reasonable efforts were unnecessary due to the acts committed by the juvenile and the juvenile's own request for out of home assistance" meet the requirements for a reasonable efforts determination. A finding that reasonable efforts are not necessary may satisfy the requirement for a reasonable efforts determination only if the finding is based on the existence of one of the circumstances specified in the Act and regulations. See section 471(a)(15)(D); 42 C.F.R. § 1356.21(b)(1) and (3). However, the reason stated by the court here is not related to any of the specified circumstances.

[Page 6] Accordingly, we agree with ACF that sample case 82 was ineligible for IV-E payments since there was no reasonable efforts determination.

Sample Cases 92 and 137

Section 1356.21 provides in pertinent part:

(c) Contrary to the welfare determination. Under section 472(a)(1) of the Act, a child's removal from the home must have been the result of a judicial determination (unless the child was removed pursuant to a voluntary placement agreement) to the effect that continuation of residence in the home would be contrary to the welfare, or that placement would be in the best interest, of the child. The contrary to the welfare determination must be made in the first court ruling that sanctions (even temporarily) the removal of a child from home.

* * * *

(k) Removal from the home of a specified relative.
(1) For the purposes of meeting the requirements of section 472(a)(1) of the Act, a removal from the home must occur pursuant to:
(i) A voluntary placement agreement entered into by a parent or guardian which leads to a physical or constructive removal (i.e., a non-physical or paper removal of custody) of the child from the home; or
(ii) A judicial order for a physical or constructive removal of the child from a parent or specified relative.

In sample case 92, involving the child G.G., the court order issued pursuant to a 4/19/04 hearing on a plea for probation revocation states--

that when the DHHR notifies the respondent [G.G.] that his placement at Cornell-Abraxas [a residential treatment facility] is available, legal and physical custody of the respondent . . . shall be placed with the DHHR, . . . who shall place the respondent at the Cornell-Abraxas facility in Pennsylvania. The Court will allow the respondent to remain at home while awaiting the aforementioned placement . . . .

[Page 7] West Virginia Ex. 15, at 2. (3) The order also states, "The Court finds that continuation in the home is contrary to the best interest of the respondent and that the DHHR made reasonable efforts to prevent the removal of this respondent from his home based upon the history of this case." Id. West Virginia asserts that "the physical placement" took place on 6/6/04 and that "there was no other hearing or order between" the 4/19/04 order and the physical placement. ACF Ex. 2 (copy of West Virginia submission to ACF). Thus, West Virginia asserts, the child was removed as a result of the 4/19/04 order.

In sample case 137, involving the child C.S., the court order issued pursuant to a 6/23/03 hearing notes that the child was adjudicated a delinquent and states that "[c]ustody is awarded to the West Virginia Department of Health and Human Resources . . . to effect said placement [in a residential treatment facility]." The order continues, "The juvenile shall remain with his parent/custodian and be available for transport at all times." West Virginia Ex. 18, 1st and 2nd pages (unnumbered). The order also states, "Continuation in the home is contrary to the best interests of the child and reasonable efforts were made to prevent the placement of the child." Id., 2nd page. West Virginia asserts that "the physical placement" took place on 8/8/03 and that "there was no other hearing or order between" the 6/23/03 order and the physical placement. ACF Ex. 3 (copy of West Virginia submission to ACF). Thus, West Virginia asserts, the child was removed as a result of the 6/23/03 order.

It is undisputed that, in each case, no IV-E payments were made until after the child was physically removed from home and placed in the foster care facility. See West Virginia Reply Br. at 7.

ACF found that these cases were error cases-

because the children were not removed as the result of a court order. Although the court order indicated that it was contrary to the welfare of the child to remain in the home, the child in each case remained in the home for several weeks thereafter.

ACF Ex. 3 (West Virginia Title IV-E Foster Care Eligibility Review) at 5. In its response to the appeal, ACF asserts that it has interpreted the requirement for removal in section 472(a) as [Page 8] a requirement for "physical removal." ACF Response Br. at 7, citing ACF Child Welfare Policy Manual, § 1.2B.3, Question 4, and § 8.3A.11, Question 1 (at ACF Exs. 4 and 5). Thus, according to ACF, each of the disputed cases is ineligible because "the requirement of physical removal from the home did not coincide with the judicial determination that remaining in the home is contrary to the welfare of the juvenile." ACF Response at 7.

ACF does not deny that, in each of these cases, there was a physical removal of the child from the contrary to the welfare home. Neither the regulations nor the manual provisions cited by ACF require (or even imply) that the physical removal must coincide with the court's contrary to the welfare determination. The only provision in the regulations regarding the timing of the contrary to the welfare determination is section 1356.21(c), which states that this determination "must be made in the first court ruling that sanctions (even temporarily) the removal of a child from home." (4) Each of the court orders in question here contained a contrary to the welfare determination and, in ordering the child removed from home as soon as the ordered placement was available, "sanctioned" the child's removal from home. ACF made no finding that either order was not the "first court ruling" to order the child removed from home.

The only question that remains is whether the child's removal was "the result of" or "pursuant to" the court orders, as required by section 472(a)(1) of the Act and sections 1356.21(c) and (k)(1) of the regulations. This requirement is satisfied since, as West Virginia observes, "[b]ut for the court orders, the juveniles would not have been physically removed from their homes and placed in a residential treatment facility." West Virginia Reply Br. at 6-7. While in each case the child remained in the home for several weeks following the order, the order expressly [Page 9] approved this delay in the child's physical removal, and no other order was necessary to effectuate the child's removal. Indeed, in each case, the court's determination that it was contrary to the child's welfare to remain in the home can be viewed as contingent on the child being placed in a specialized facility that could meet the child's needs. Thus, when the child was ultimately physically removed from the home, it was as a result of, or pursuant to, the court order.

Accordingly, contrary to what ACF found, sample cases 92 and 137 were eligible for IV-E payments. Our holding is limited to the facts of these two sample cases, where the removal was ordered primarily due to the child's behavior, not allegations of abuse or neglect on the part of the parents, and removal was delayed only until a bed became available in a specialized foster care facility.

Conclusion

Based on the foregoing, we reverse the disallowance with respect to sample cases 92 and 137 and the disallowance based on extrapolation from the sample (including the associated administrative costs), and we uphold the remaining disallowance.

JUDGE
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Cecilia Sparks Ford

Donald F. Garrett

Judith A. Ballard
Presiding Board Member

FOOTNOTES
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1. The ACF reviewers found sample case 82 ineligible only on the latter ground. ACF added the former ground after West Virginia argued in its appeal brief that ACF acted arbitrarily in finding sample cases 92 and 137 but not sample case 82 ineligible on the former ground. The federal agency may raise new grounds for a disallowance after a disallowance letter is issued as long as the appellant is afforded an opportunity to respond. See, e.g., Iowa Dept. of Human Services, DAB No. 1874, at n.2 (2003). We do not consider whether there are any grounds for the disallowance that were not raised by ACF.

2. Social Security Act §§ 470 through 479A; 42 U.S.C.A. §§ 670 through 679b. The current version of the Social Security Act can be found at www.ssa.gov/OP_Home/ssact/comp-ssa.htm. Each section of the Act on that website contains a reference to the corresponding United States Code chapter and section. Also, a cross reference table for the Act and the United States Code can be found at 42 U.S.C.A. Ch. 7, Disp Table.

3. There is no dispute that the residential treatment facility referred to in this order and the order in sample case 137 qualified as a foster care facility.

4. The preamble to the proposed rule in which this language first appeared states:

We propose that in non-emergency situations the "contrary to the welfare" determination must be made prior to the removal of the child from home, and documented in the initial removal court order to enable the child to be eligible for title IV-E foster care. The "contrary to the welfare" determination is an important protection to safeguard the rights of the child and his/her parents and to ensure appropriate action by the State agency.

63 Fed. Reg. 50,058, 50,075 (Sept. 18, 1998) (emphasis added).

CASE | DECISION | ANALYSIS | JUDGE | FOOTNOTES