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July/August 2006Vol. 7, No. 6Government Costs for Adoption vs. Foster Care

While the social benefits of adoption over long-term foster care for children are widely recognized, a new study shows that adoption also means significant cost savings for governments. The study found that adoption, including the cost of adoption assistance, provides substantial savings in government funding when compared to the cost of maintaining children in long-term foster care.

In "A Comparison of the Governmental Costs of Long-Term Foster Care and Adoption," the authors compared the costs of similarly situated North Carolina children in long-term foster care (n=691) and adoption (n=1,902). Costs included those covered by Federal, State, and local contributions for adoption subsidies, foster care placements, group home placements, emergency care, home studies, administrative costs, and other child welfare and court costs. The discrepancy was significant:

  • Over 7.7 years, the cost for foster care averaged $86,100 per child, compared to $65,100 per adopted child.
  • Applying that figure to the approximately 50,000 children adopted from foster care in the United States each year results in $1 billion in government savings.
  • Projecting these savings through age 18 for these children shows that approximately $65,422 to $126,825 is saved for every child who is adopted rather than placed in long-term foster care.

In providing these figures, the authors point out that adoption expenditures tend to be higher toward the beginning of an adoption case and then decrease, whereas the costs of long-term foster care increase as the child gets older. They also cite studies showing that cuts in adoption assistance result in decreases in adoptions.

The results suggest a number of implications for funding adoption assistance. While some jurisdictions are considering cutting subsidies due to tight budgets, an increase in adoption assistance amounts actually might generate greater savings over the long run, as more children may move from long-term foster care to adoption. Funding activities such as recruitment of adoptive families and bonuses for families who adopt older children may also increase adoptions.

"A Comparison of the Governmental Costs of Long-Term Foster Care and Adoption," by R. P. Barth, C. K. Lee, J. Wildfire, and S. Guo, appeared in the March 2006 issue of the Social Service Review. It is available through the journal website:

Related Item

Children's Bureau Express examines the related topic of subsidized guardianship in another article in this issue, "Providing Permanency With Subsidized Guardianship."