LINCOLN — Nebraska will pay $6 million to the Kansas-based KVC even after the contractor stops managing child welfare cases for the state.
State officials said Thursday the money is to ensure the state can have continued access to case files and data.
It's also to make certain KVC pays all of its subcontractors, said Scot Adams, interim children and family services director for the Department of Health and Human Services.
The money would come from about $20 million worth of unused funds within the HHS budget, which officials hope to shift into child welfare.
HHS provided more information to state lawmakers Thursday about the sources and potential uses of those funds.
Along with additional money for KVC, the department plans a $6.7 million increase for the state's remaining private child welfare contractor through June 30.
Earlier Thursday, officials announced that the remaining contractor, the Omaha-based Nebraska Families Collaborative, would take over cases previously managed by KVC.
State officials said the change will take place March 1. KVC previously announced that it would stop managing child welfare cases as of Feb. 29.
KVC has been responsible for the safety and well-being of all abused and neglected children in southeast Nebraska and one-third of those in the Omaha area.
The collaborative has been responsible for the remaining two-thirds of the Omaha cases.
Dave Newell, the collaborative's executive director, said the organization will seek to hire former KVC workers to minimize disruptions.
Kerry Winterer, CEO of the State Department of Health and Human Services, said the collaborative's “stronger presence” and relationship with the department will stabilize the child welfare system.
State caseworkers will resume management of cases in the southeast area, including Lincoln.
State workers already manage cases in the central, western and northern parts of the state.
HHS officials said they want to continue their two-year experiment with privatization in the eastern area.
Adams said the private sector has much to contribute to child welfare reform.
“We can learn from private agencies like NFC that have access to cutting-edge research and data systems and the ability to be more flexible to changing dynamics,” he said.
The Legislature's Health and Human Services Committee advanced a bill Wednesday that would return case management duties to the state for all areas. But committee members left open the possibility of altering the bill later, in light of this week's developments.
The bill grew out of the committee's investigation into the privatization initiative, which increased state spending on child welfare by 27 percent and left the system in turmoil.
Three of the five original contractors lost or dropped their contracts within the first year of the initiative.
Along with the $20 million that HHS plans to reallocate in the current fiscal year, officials are seeking a $19.7 million increase in child welfare funding for the fiscal year beginning July 1.
The increase is needed to bring caseloads down statewide to a nationally recommended standard, Adams said.
Manageable caseload sizes have been identified as key to allowing workers time to help children and families and to reducing caseworker turnover.
Some $7.2 million of the funds for the current fiscal year would go toward hiring more caseworkers in the central, western and northern areas of the state and toward paying for the rising costs of services to children and families.
Some of the $6.7 million increase in the collaborative's contract also would pay for higher-than-expected costs of services.
HHS officials could not provide information late Thursday about whether the increase included the cost of caring for the additional children as well.
Newell said it was “premature” to provide numbers. He said the collaborative is still negotiating with HHS about a new contract and new payment method.
A small portion of the $20 million would be available to encourage the development of new child welfare services.
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