DCF should stop taking Social Security benefits from foster children

The Department of Children and Families took Marissa Pike from her mother’s house in North Attleborough when she was 12, and she spent six years in foster care and group homes. As a child with ADHD in a low-income household, Pike received Social Security benefits, and when she entered state custody, DCF began collecting those benefits, keeping most of the money and setting aside a portion for her needs. The benefits continued as long as the amount set aside for her didn’t grow larger than $2,000, which would have made her ineligible. Pike, now 25 and living in Lynn, only knew that occasionally — in retrospect, when she neared that asset limit — her social worker would ask her what she wanted and buy it: movie tickets, an iPad, a Fitbit.

When Pike aged out of DCF custody, she had almost nothing. She turned 18 in the middle of her senior year, moved in with her sister, then became homeless for six months. She has since earned associate’s and bachelor’s degrees and become certified as an EMT. She works for the North Shore 911 system and Lynn Public Schools.

“I had no family, I had no guidance, the only support system I knew was foster care. … I [was] on the streets with no money, no resources, and no clue how to be an adult,” Pike recalled.

According to the Disability Law Center, which is working on a report on this issue, the Massachusetts Department of Children and Families is taking $450,000 to $500,000 a month in federal Social Security payments due to approximately 1,250 children in foster care — around $5.5 million a year, or an average of $4,400 per child per year. There are more than 9,000 children and young adults in DCF placements.

This includes Supplemental Security Income, which helps children with disabilities in low-income households, and survivors benefits for children of a deceased parent who paid into Social Security. DCF puts 10 percent of the benefits into the child’s personal needs account to pay for things like summer camp, sports equipment, toys, and laptops, then the agency directs 90 percent to the state’s general fund.

Under federal law, the Social Security Administration can approve DCF as the “designated payee,” someone appointed to act in a fiduciary capacity for a child, and let the agency reimburse the state’s general fund for the expense of the child’s care.

While it may be permitted by the federal government, the Disability Law Center says this arrangement is illegal because state law obligates DCF to care for children using agency funds. But regardless of legality — and advocates may file suit if a change is not forthcoming — DCF and the Legislature should eliminate the practice of using benefits to reimburse state government and instead set aside those benefits to help foster children enter adulthood.

When DCF takes the benefits, the children lose money that could be spent for their long-term benefit. “This is legally and morally questionable, and it’s simply terrible public policy,” said Rick Glassman, director of advocacy at the Disability Law Center.

There are administrative challenges to giving children the money. If SSI accrues, the child will hit a $2,000 federal asset limit and become ineligible. But there are financial savings accounts — like an ABLE account for people with disabilities — for the child’s benefit that do not count toward the asset limit.

Andrea Grossman, a DCF spokesperson, said DCF is “actively working with partners in the financial community” to give DCF the ability to establish ABLE investment accounts, but it is not set up yet.

DCF in January changed its regulations so the agency, rather than being required to take 90 percent, has discretion to take up to 90 percent. Grossman said this will “allow for more flexibility in distributing amounts based on each child’s unique, personal needs.”

The Marshall Project and NPR called attention to similar practices nationally in a 2021 story, which has spurred some change. Other states have found legal workarounds to the federal asset limit by using different types of trust accounts, like ABLE accounts. Today, at least six states, Washington, D.C., and several large cities require their child welfare agency to set up accounts for children where benefits can accrue, with the specifics of how much can be saved in what kind of account varying by state. Connecticut forbids its Department of Children and Families from using Social Security benefits to reimburse itself and requires the money be put in children’s trust accounts. Illinois and Maryland require state agencies to save an increasing percentage of benefit money for the child as the child ages.

These children desperately need their money. When children age out of foster care at 18 — or 21 if they voluntarily accept services — they are among society’s most vulnerable young adults. They usually lose their home and rarely have money to pay for housing or college. Many lived through trauma and lack a stable adult guide. According to Massachusetts data from the Annie E. Casey Foundation, 40 percent of 21-year-olds leaving foster care lack stable housing; 74 percent aren’t enrolled in post-secondary school; 23 percent have been incarcerated; and 18 percent are parents.

“Most young people have a financial safety net they can fall back on in dire circumstances. Young people who age out of foster care don’t have that. They end up in our shelters, in our prisons, at our food banks, and a lifetime of reliance on public assistance,” said Julie Segovia, vice president of research, policy, and learning for HopeWell, which provides services to foster children.

The $5.5 million annually that DCF takes from foster children on Social Security is a drop in DCF’s bucket, but for those foster children, it could be life-changing. A savings account of accumulated federal benefits could help young adults pay for college, rent, or transportation.

Bills sponsored by state Senator Joanne Comerford and state Representative Tricia Farley-Bouvier would require that every child receive financial literacy training, be screened for benefit eligibility when they enter care, be told how much they are due, and, when DCF applies for the money, be updated about money they receive. DCF would have to put 10 percent of the benefits in a child’s personal needs account and manage the rest in a savings account to be available when the child turns 18.

These policies would have helped Lazara Wilson, 26, who lived in group and foster homes from age 9 to 19. When she was 17, her mother died, and Wilson said she applied for survivors benefits and only then learned that her mental health conditions, including post-traumatic stress disorder, qualified her for disability benefits from childhood. She says DCF never screened her for eligibility.

Wilson spent her teenage years working multiple jobs to afford a car and pay for personal items like shampoo, snacks, and laundry. When she aged out of the system, she lived in her car and started using drugs. “If had financial support, I wouldn’t be under so much stress needing to provide for myself,” Wilson said.

As a young adult, Wilson got Social Security benefits, became sober, and, with help from her grandparents, bought a condo in Osterville. She earned a bachelor’s degree and is starting a master’s in social work at Bridgewater State University.

But her path shouldn’t have been so hard. As Comerford said, “Wouldn’t it be wonderful if young adults who age out of foster care and enter into adulthood … had a small amount of money to pursue their dreams?”

These children desperately need their money. When children age out of foster care at 18 — or 21 if they voluntarily accept services — they are among society’s most vulnerable young adults.