"KEEPING FAMILIES TOGETHER:
REMOVING BARRIERS THAT FORCE PARENTS TO RELINQUISH CUSTODY OF
THEIR CHILDREN TO SECURE MENTAL HEALTH SERVICES"

TESTIMONY

OF

TAMMY SELTZER
STAFF ATTORNEY, BAZELON CENTER FOR MENTAL HEALTH LAW

BEFORE THE

COMMITTEE ON GOVERNMENTAL AFFAIRS
UNITED STATES SENATE

JULY 15, 2003

Good morning Madame Chairman, Senator Lieberman and members of the Committee. My name is Tammy Seltzer. I am a staff attorney for the Judge David L. Bazelon Center for Mental Health Law. The Bazelon Center is the leading national nonprofit, legal-advocacy organization representing people with mental disabilities. The center works to define and uphold the rights of adults and children with mental disabilities who rely on public services and to ensure them equal access to health and mental health care, education, housing and employment.

Thank you for the opportunity to share with you our knowledge about the custody relinquishment problem, including the scope of the problem, why the practice continues to occur, and practical suggestions for what you can do to end this national tragedy. I applaud you for holding today's hearing on the heels of the release of the recent General Accounting report (Child Welfare and Juvenile Justice: Federal Agencies Could Play a Stronger Rule in Helping States Reduce the Number of Children Placed Solely to Obtain Mental Health Services, GAO-03-397, April 2003) you requested, along with Representatives Pete Stark and Patrick Kennedy. The bicameral commitment you share to further study and address this devastating practice is commended.

The issue we are here today to discuss has been a long standing concern to the Bazelon Center. We have provided technical assistance to stakeholders, including states, worked with the media, including Time, Newsweek, ABC PrimeTime and others and have published two reports (Relinquishing Custody: The Tragic Result of Failure to Meet Children's Mental Health Needs and Avoiding Cruel Choices: A Guide for Policymakers and Family Organizations on Medicaid's Role in Preventing Custody Relinquishment) directly related to this issue. These reports document the two main culprits for custody relinquishment: a lack of access to appropriate and timely mental health services and supports for children in both the public and private sectors and a lack of oversight for existing programs that should be providing these services and supports. Custody relinquishment is all the more tragic because it does not and should not have to happen to one more child.

During my testimony, I will describe how the Senate can address the access issue by passing the Family Opportunities Act, improving flexibility to the states through the Medicaid Home- and Community-Based Waiver, enacting insurance reform, and preserving and strengthening the Individuals with Disabilities Education Act (IDEA). I will also underscore the importance of improving federal oversight of another aspect of the Medicaid program, the TEFRA or Katie Beckett option.

Today's hearing will describe our nation's failure to meet the needs of families with children who have emotional and behavioral disorders— a failure that is tearing apart families and putting children at risk. It is our hope that these proceedings will encourage you and your fellow lawmakers to support specific legislation to end this unnecessary tragedy.
BACKGROUND

First, let me provide the committee with an overview of the custody relinquishment problem. Neither the juvenile justice nor the child welfare system is designed to address children's mental health needs. Yet increasing numbers of children with mental or emotional disorders are unnecessarily and inappropriately dumped into both systems. The US General Accounting Office (GAO) documented at least 12,700 cases in fiscal year 2001 of children placed in child welfare and juvenile justice systems so they could access needed mental health services. Approximately 3,700 children were placed in child welfare systems; another 9,000 were "placed" in the juvenile justice system by police who had detained children—sometimes at parents' request—for delinquent behaviors that stemmed from or were related to their mental or emotional disorders.

We believe the GAO findings are just the tip of the iceberg. The tragic and inhumane practice of custody relinquishment has been documented in at least half the states in the country. A survey by the National Alliance for the Mentally Ill found that 23 percent of parents with behavioral disorders had been told that they needed to relinquish custody to get intensive mental health services for their children and that 20 percent had actually done so (Families on the Brink: the Impact of Ignoring Children with Serious Mental Illness, 1999). At the Bazelon Center, we consistently hear from families that when they seek help for their children, they are offered none. Instead, they are encouraged to call the police to "document" the problem or pushed to give up custody to the foster care system. This appalling practice must end.

FACTORS THAT CONTRIBUTE TO CUSTODY RELINQUISHMENT
A variety of barriers prevent parents from accessing appropriate treatment, perpetuating the tragic practice of custody relinquishment. Custody relinquishment is largely the result of the failure of all child serving agencies, but particularly mental health and education agencies, which have the primary responsibility of addressing children's needs before they reach a crisis. The failure of mental health and school systems to provide access to care drives families to the brink of custody relinquishment--families who would prefer to care for their children at home but cannot do so without effective services and proper support.

The single most important obstacle that pushes families into giving up custody is a lack of access to appropriate and timely mental health services and supports for children in both the public and private sectors. It is clear that mental health is not a public health priority–parents have to jump through hoops to get the most basic services for their children. Imagine a child with diabetes being torn from his family in order to get basic health care—I can't, but for children with mental health needs, it happens every day in communities across the country. There is no doubt the public mental health system is underfunded and crisis-, rather than prevention-driven. As a result, many children are placed in the custody of child welfare or juvenile justice systems because that is the only way their parents can gain access to care that should have already been available to them through a comprehensive healthcare delivery system. In many cases, the lack of appropriate community mental health care leads to high use of emergency and hospital care or unnecessary costs to other systems, like welfare and juvenile justice. Many describe the lack of child services as worse than the crisis we know exists for adults.

Recently, the interim report of the President's Commission on Mental Health declared that the public mental health system is in "shambles." Additionally, the Surgeon General's National Action Agenda detailed a public crisis in children's mental health with many "falling through the cracks." As the Surgeon General points out, "children and families are suffering because of missed opportunities for prevention and early identification, fragmented treatment services and low priorities for resources." Only one in five children with mental health needs receives services. In our report entitled, "Disintegrating Systems, The State of States' Public Mental Health Systems," we note that states' own documents' describe the extent of system failure. Connecticut, for example, reported that children are languishing in detention cells and more than 350 children are placed in out-of-state facilities. In Arizona, children and adolescents have a less than 50% chance of being adequately served by the system. And in Ohio, access to mental health services for children is "substandard." Where children and youth need services and supports, they are not provided early enough or in sufficient supply.

Across the country, children who need intensive mental health treatment are not getting it early enough to prevent a host of adverse outcomes, such as custody relinquishment. Parents of children with mental or emotional disorders often struggle financially to pay for services and supports that are medically necessary for their children. Some parents are caught in a gray area where they lack any insurance—public or private. These families typically deplete their financial resources paying for intensive services. The Kaiser Commission on Medicaid and the Uninsured estimated the uninsured rate at 15.6% in 1998. With the slow down in the economy, this rate has likely risen since the Kaiser study. A growing number of children in this country are either uninsured or under-insured, with minimal coverage for mental health care. Private insurance is often inadequate because it carries limitations and restrictions on mental health care, such as number of outpatient sessions or inpatient days covered-- limitations that do not apply to their physical health care benefits. Data show that 94% of health maintenance plans and 96% of other plans have such restrictions. In these cases, families that face health insurance restrictions or exhaust their benefits are left without options. Moreover, private insurance plans do not cover the full array of intensive, community-based rehabilitative services that children with the most severe mental or emotional disorders need—services that can be covered under Medicaid.

When families are uninsured or have exhausted their private insurance benefits, both mental health providers and public child welfare agency staff often advise parents that relinquishing custody of their child to the state is the only way to obtain services. Custody relinquishment carries with it a host of negative outcomes, including making children feel abandoned by their family. It also leads to children being placed in more expensive and less supportive residential placements. Residential treatment centers, according to the 1999 Surgeon General's Report on Mental Health, are the second most restrictive form of care for children with severe mental disorders (next to inpatient hospitalization) with only weak evidence for their effectiveness. Additionally, parents have no say in their day-to-day activities–what they eat, what they wear, who their friends are. They may not even know where their children are. Ultimately, children who need the most emotional support and stability are being ripped from their homes to live with complete strangers.

Students with emotional and behavioral disorders (termed emotionally disturbed under the IDEA) have been recognized as among the most under-identified and under-served students with disabilities. Something is obviously wrong when the U.S. Surgeon General estimates that nationwide five percent of all school-aged children have mental disorders and "extreme functional impairment" and 11 percent have mental disorders with "significant functional impairment" while, for more than two decades, the national rate of students identified with emotional disturbance under IDEA hovered just under one percent. By 2001, the rate of identification under IDEA had fallen to 0.74 percent. Data suggest that schools may be failing to correctly identify four fifths of children with mental or emotional disorders serious enough to adversely affect their educational performance. The federal definition—due to its vague language, undefined terms and inappropriate criteria—leads to significant under-identification of children with emotional disturbance. The exclusion of children on the basis of "social maladjustment"—an ambiguous distinction with no basis in research—contributes to the fact that many children who need special education services are failing to qualify for them under IDEA.

Even when students with emotional and behavioral problems are identified as needing special education services, schools often fail to deliver the positive behavioral supports required by the 1997 amendments—interventions that have been proven to reduce behavior problems and improve students' chances to succeed in school. Instead, without the necessary interventions, students' problems worsen, escalating to a point where parents lose their jobs because they must stay home with children who are repeatedly suspended or expelled or the juvenile authorities are called to arrest the child. Every parent we've come into contact with who has been faced with the decision to relinquish custody describes a deteriorating school situation as a significant factor.

REMOVING THE BARRIERS
The situation is bleak, but I have good news—custody relinquishment need not happen. Public policy alternatives exist that could rescue families from the awful choice of giving up custody to the state or seeing their child go without needed care. Families of children with mental or emotional disorders requiring intensive services and supports to avoid out-of-home placement must have access to a full range of community-based services and supports.

Family Opportunity Act/Medicaid Home and Community Based Services Waiver
Congress has bipartisan legislation before it right now that would take two giant steps toward preventing custody relinquishment. The Family Opportunity Act would 1) help expand Medicaid coverage to children whose families would otherwise not be eligible and 2) give states greater flexibility to use the Home- and Community-Based Services Waiver to serve children with serious emotional and behavioral disorders. The Family Opportunity Act (S. 622, sponsored by Senators Charles Grassley and Edward Kennedy) has maintained high bipartisan support for more than three years but has not yet become law. It would remove the barriers that today keep thousands of families from being able to meet their child's serious health and mental health needs. Last Congress, the Senate Finance Committee favorably reported the bill out of Committee. It is time for Congress to finally enact this important legislation.

The Home- and Community-Based Services Waiver is a critically important tool that most states have failed to take advantage of because of obstacles Congress has the power to eliminate. The three states (Vermont, New York and Kansas) that have taken advantage of this waiver to provide more flexible services to children with mental or emotional problems have found that the costs of serving these children in the community is about half of what would be spent on institutional care. For example:
1. Kansas: Average annual per child costs are $12,900, compared with institutional costs of $25,600
2. Vermont- Average annual per child costs (2001) were $23,344, compared with inpatient costs of $52,988
3. New York- Approximate annual per child costs (2001) were $40,000, compared with institutional costs of $77,429

The Kansas home and community based waiver for children with serious emotional disturbance has reduced custody relinquishment and led to positive outcomes in schools. The benefits of a home and community based waiver in this regard is that states have considerable flexibility. They can limit the number of slots, apply to certain geographic region and can be initiated with a relatively small state investment. Furthermore, the costs of the wavier services are offset by institutional savings.

The Surgeon General Report on Mental Health discusses the strong record of effectiveness for home-based services—which provide intensive services within the homes of children and youth with SED. Most important, under the Home- and Community-Based Services waiver, families remain intact.

Unfortunately, States have requested this waiver for children with SED and have been turned down (e.g. Maryland). Federal law has not kept up with changes in practice. The current "level of care" a child must meet under the statute to be able to be served by the waiver includes a hospital, ICF/MR or nursing home. Children are now rarely in psychiatric hospitals for extended periods of time, but are instead in psychiatric residential treatment centers (RTCs)–an institutional level of care not explicitly covered by the statute.

Congressional support is needed to modify the Medicaid's Home and Community-Based Services Waiver statute to allow children receiving or at risk of receiving inpatient psychiatric services in a RTC to be able to receive services in the community. Removing this barrier will go a long way toward helping to eliminate custody relinquishment. The Family Opportunity Act contains a legislative provision to eliminate this barrier so states can provide services to these children.

Insurance Reform
Insurance reform is another area where Congressional action is necessary. For parents who have insurance, Congress should ensure that insurance companies cover the range of mental health services that would prevent custody relinquishment and cover them without arbitrary limits. Enacting mental health parity legislation (currently sponsored by Senators Pete Domenici and Edward Kennedy, S. 486, "The Senator Paul Wellstone Mental Health Equitable Treatment Act") would be an essential first step. Parity legislation would help by prohibiting private insurers from denying access to needed services because of stigma and discrimination through current limitations and restrictions on mental health care that are not placed on physical health care. But parity alone will not solve the problem.

IDEA Reauthorization
IDEA is currently in the process of reauthorization. Research demonstrates that the use of positive behavioral interventions and supports can significantly reduce discipline problems (see the recent Bazelon Center publication Suspending Disbelief). The current IDEA supports this approach, and S. 1248 would continue the requirement that schools adopt a proactive approach to manage students' problem behavior by providing positive behavioral interventions and supports. The Senate bill would provide funds for schools to expand the use of behavioral supports and school-wide behavioral interventions——funding absent in the House-passed version of the bill.

Although the Senate bill, unlike the House legislation, requires a behavioral assessment, it requires only a general assessment, rather than the more specific "functional behavioral assessment" currently mandated by the IDEA. If the word "functional" is omitted, schools could rely heavily on teachers' notes or subjective observations, rather than using a science-based approach to determine the impetus behind the child's behavior. Educators argue that functional behavioral assessments are essential to designing effective behavioral intervention plans to reduce or eliminate troubling behaviors. We urge you to support S. 1248 with the restoration of the term "functional behavioral assessment."

In addition, the federal government, at a minimum, should drop the "social maladjustment" exclusion in the federal IDEA definition of emotional disturbance. It should also develop programs and materials to assist states in making more accurate assessments so as to correctly identify students with emotional disturbance in order to provide appropriate services and to encourage earlier identification, including identification of preschoolers and very young children. Students with mental and emotional disorders exhibit behaviors that are hard to manage, especially if they do not receive the services they need. But if appropriate services were furnished earlier, the outcomes could be very different.

TEFRA Oversight
The TEFRA option is another important tool for expanding access to Medicaid. TEFRA, or the Katie Beckett option as it is sometimes called, allows states to cover home- and community-based services for children with disabilities who would otherwise need the kind of skilled care provided in a medical institution. Eligibility is based on the child's disability and care needs, not on family income.

Only 20 states have selected the TEFRA option for children with disabilities. In the states that have the TEFRA option, half have no children who qualified as a result of a mental or emotional disorder even though there is nothing in the program requirements that would exclude children with mental or emotional disorders. It's shocking that children with the most serious needs–children who face the greatest risk of being given up in order to receive necessary mental health services–would be virtually shut out of a program in 40 states plus the District of Columbia.

States that do not currently select the TEFRA option have clearly stated that they need more information about the program, as documented by a Bazelon Center survey (see Avoiding Cruel Choices). In states that have TEFRA, the state TEFRA rules are written in such a way as to exclude children with mental and emotional disorders, primarily by their failure to mention how these children can qualify. State-prepared materials for parents leave most parents of children with mental and emotional disorders uninformed about their eligibility for the program. Congress can and should provide greater oversight of the TEFRA program to ensure that states can make informed decisions to take advantage of the option and that when they do, children with mental and emotional disorders are fully included with other children who have serious disabilities.

CONCLUSION
Many states are struggling to address the custody relinquishment tragedy, but they cannot solve the problem without Congressional assistance. Currently, thirteen states (Colorado, Connecticut, Idaho, Indiana, Iowa, Maine, Massachusetts, Minnesota, North Dakota, Oregon, Rhode Island, Vermont and Wisconsin) have statutes that prohibit child welfare from requiring custody relinquishment in order for parents to obtain mental health services for their children. These statutes purport to stop the practice at its current point of origin, but these outright bans have a limited effect if families are still unable to access the mental health services and supports they need without going through a judge or signing "voluntary" custody agreements with child welfare agencies. Prohibitions on custody relinquishment must be coupled with efforts to address the underlying cause—the lack of mental health services. A ban alone will not reduce the number of children placed in the child welfare system solely for mental health purposes.

States and the federal government need to work together to ensure that more and better mental health services are available for more kids. A coordinated effort between states and the federal government aimed at removing barriers to needed mental healthcare for children is paramount to ending custody relinquishment.

In conclusion, I again want to thank you for holding this important and timely hearing. The Committee's oversight jurisdiction on federal agencies that serve such children is critical to fostering needed collaboration at the federal, state and local level. Far too often, in order to get essential health and mental health services for their child, caring parents must choose between living in poverty in order to keep custody or giving their child up to the state so the child can qualify for needed care. Too many children with mental or emotional disorders and their families have suffered too long for the system's failures. I end by stressing that custody relinquishment is not a rational choice for society–and it is no choice at all for families. In all cases, the societal costs of custody relinquishment greatly exceed the cost of adequate and preventative health and mental health treatment. I urge you to take the necessary legislative action to ensure greater access to mental health services and supports and greater oversight to ensure that existing programs are used to their fullest potential to help families at risk of custody relinquishment.

I would be happy to answer any questions you might have.

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