As liability insurance runs out, crisis looms for private foster care agencies in Illinois

Advocates say a major storm is brewing that could overwhelm the state’s child foster care system.The problem is legal liability insurance, or, more specifically, the lack thereof.Insurance companies, advocates and providers say, are not taking on new private foster care agencies as clients and some agencies are being notified that they’re losing their insurance, including some of the state’s biggest foster care providers. Some others are being forced into high-priced, low-benefit insurance plans. Many may ultimately find themselves out of business.As of the end of February, more than 18,000 kids were in the foster care system, and only a minority of those are actually being cared for by the state. Many are placed with private, not-for-profit agencies. The state generally contracts out services like these, mostly to charities that can also raise additional funds.If those providers are forced out of existence, the state would have to take the foster kids in, and the state simply has no room (or money) for them. The worst-case scenario would be disastrous.

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Advocates say they’ve been warning about this for years and have been ignored. And then California made big headlines last fall when it became public that it is facing a foster care “cliff” this summer, when many private agencies will lose their liability insurance coverage. And now, as one person involved said, “It’s kind of cascading across the country.”Two identical bills have been introduced to address the problem, Senate Bill 1696 sponsored by Sen. Laura Fine and House Bill 3138 sponsored by Rep. Suzanne Ness. The bills would grant the foster care agencies and their employees immunity from civil liability for a two-year period “unless the agency's acts or omissions constitute willful and wanton conduct.”This being Illinois, the politically powerful trial lawyers have a large seat at the bargaining table. They’re the ones who file the lawsuits.“Foster youth in care are among the most vulnerable within our communities,” said Illinois Trial Lawyers Association Executive Director Jim Collins in a statement. “In the tragic event that youth in care are harmed or killed as a result of the negligence of agencies whose charge is to ensure their safety and well-being, the public policy of Illinois should be one that preserves access to justice for the affected youth. Proposals that reduce or erode access to justice for youth victims are as misguided as they are unjust; if there is an insurance ‘crisis’ that has been inflicted upon provider agencies, policymakers should focus on an insurance solution.”And because of that opposition, numerous sources say the bills will not move forward as currently constructed.A reason for optimismEven so, advocates and lobbyists I’ve spoken with on and off the record said they’re optimistic.“I don't know that there's agreement necessarily about what the solutions are,” said Andrea Durbin of the Illinois Collaboration on Youth, “but people are trying to come together, at least, to figure out what can we do in the short run and what can we do in the long run.”Durbin said part of the challenge is the desire to “provide child victims of abuse, especially sexual abuse, with opportunities for recourse as adults, and I don't have any complaints or beefs with that. But it means, as an insurer, you have a long tail of liability.”“People want justice,” Durbin said. “They want justice for that child. And so they end up wanting to punish somebody. And the only person is the community provider. So, we end up sort of holding the bag for the systemic failures.”One idea that’s been floating around is moving the private foster care providers into the Illinois Court of Claims umbrella. That court handles lawsuits against the state and it has a $2 million damages cap. The attorney general’s office has so far resisted the solution, citing staff capacity. But advocates say that DCFS is rarely sued in the Court of Claims, so the staff excuse doesn’t hold water.Rep. Ness, D-Crystal Lake, the bill’s House sponsor, said she believes the negotiators “need to come up with a short-term solution to give the state some more time to look at longer-term solutions. I don't think that this is a DCFS problem only. I think it's also an insurance problem.Ness said negotiators must find a way to come to an agreement so “these kids don't have to be disrupted again and placed in other homes because the agencies they’re with cannot get insured. We can't let that happen.”I couldn’t agree more.Rich Miller also publishes Capitol Fax, a daily political newsletter, and CapitolFax.com.Send letters to [email protected]