Foster Care Rate Setting

The Rate Setting Branch of the DHHS Office of the Controller is responsible for the review of foster care agency cost reports and the subsequent financial analysis of those cost reports in order to establish foster care rates.

To obtain a foster care rate agencies must be licensed as a Child Caring Agency and/or Child Placing Agency through the Division of Social Services for at least one year, attend training and submit the following information to the Office of the Controller no later than: March 14, 2025 for new participants OR March 16, 2026 for agencies qualified as of July 1, 2024.

  • Residential Treatment / Foster Care Cost Report
  • Documentation of All Child Care Days
  • An Independent Financial Audit from a currently licensed CPA

For Foster Care Cost Report information contact: Susan Kesler at susan.kesler@dhhs.nc.gov or at 919-855-3680

Sites of Interest

DSS licensed agency list 
DHSR licensed residential treatment facilities
Links to other North Carolina state agencies
National Association of State Human Services Finance Officers

Tab/Accordion Items

Residential Treatment / Foster Care Cost Report 

  • Schedule A- Signature Certification of demographic information (original signature page required)
  • Schedule A-1 - Group Home Facility Physical Locations
  • Schedule B - Revenues
  • Schedule C - Expenses

Documentation of Child Care Days

All submitted documentation must be totalled. Please attach a calculator tape if log is created manually.

  • Agencies must submit documentation of childcare days from their data collection system (e.g. KIDS, KaleidaCare) for the time period that coincides with the financial audit submitted.
  • Emergency Shelters may submit a Shelter Log.
  • All other agencies must submit a list of children for the designated FY that verifies the number of childcare days by category of funding and legal custodian.
  • The Executive Director must certify that the number of childcare days provided are true and correct and that childcare records at the agency document the number of days listed for the fiscal year specified.

Audits

Agency's financial audit with the required level of specificity delineating allowable foster care costs is required.

  • Audits must show both revenues and expenditures.
  • Revenues must be broken out by fund type.
  • Expenditures must show a separation between administrative costs and program costs.
  • Administrative costs must also delineate between management and fund-raising costs.
  • Program costs must be delineated by type (family foster, group/program setting residential foster care, and non-residential functions (day care or day treatment, for example) as well as identify specific allowable foster care costs (care and supervision cost/childcare staff salaries, food, rent, etc.) within each type.
  • Supplemental reports and schedules may be required where audit detail is not clear. Providers, whose financial audit does not have separate cost centers detailing mental health treatment expenses and the staff salaries/benefits prorated to coincide time spent providing these services, (Including therapy and counseling) must separate and report, by service, showing the mental health treatment expenses.
  • The agency's Executive Director must attest (on Schedule A) to the breakdown of expenditures
  • from the audit to the foster care cost repor

Cost reports and supporting documentation are due: March 14, 2025 for new participants OR March 16, 2026 for agencies qualified as of July 1, 2024.

IV-E Foster Care Rate Setting Manual

Child Welfare Policy Manual - published by the US Department of Health and Human Services, Administration for Children & Family Services.

Compliance Requirements for Title IV-E Maximization Program including Federal and State authorization (93.658-2-STATE FUNDS AND TITLE IV-E MAXIMIZATION PROGRAM)

NC Administrative Code - Children's Services - Chapter 70, Subchapter B lists the code relavent to foster care services.

Q: Does the cost report suspension announced on Feb. 3, 2010 apply to the foster care rate setting cost report?


No. The cost report suspension announcement does not apply to the foster care cost report. If your agency provides or will provide non-treatment residential or family foster care services, you will need to complete the foster care reporting requirements if you wish to receive anything other than the standard board rate.


Q: Is the time study required to be completed this year?


No. The Administration for Children and Families (ACF) has permitted us to discontinue the time study requirement for the foster care cost report.

For questions regarding the foster care program, contract requirements or payments, please contact:

Amy Oathout, DSS
984-314-6779     
Amy.oathout@dhhs.nc.gov

Foster Care Policy, DSS         
919-733-9464         
 
For questions regarding the IV-E foster care cost report please contact:
 
Susan Kesler, OOC         
919-855-3680          
susan.kesler@dhhs.nc.gov
Fax: 919-715-3095        

Documents should be submitted electronically to Susan’s email address provided above.

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