Thousands of Foster Youth On The Brink
California’s Child & Youth Services Insurance Crisis
California’s counties, schools, foster family agencies (FFAs), Short-Term Residential Therapeutic Programs (STRTPs), and other child-serving organizations are experiencing an unprecedented insurance crisis that threatens their ability to care for children and youth facing adversity.
Within the child welfare system, counties depend on FFAs and STRTPs to provide critical support for children and youth with high needs. These providers advance Governor Newsom’s vision of prioritizing family placements by supporting reunification, strengthening bonds between adoptive families and children in foster care, and offering vital services such as parenting classes, family therapy, and substance use counseling.
However, without urgent action to address the insurance crisis, many providers face closure—putting at risk the very supports that thousands of children and families depend on. Other states, like Texas, have already recognized that rising liability costs are driving providers out of the foster care system and have taken legislative action to ensure insurance access and protect organizational capacity. California now faces a similar crossroads: without a long-term solution, the state risks losing critical providers and undermining its commitment to safe, family-based care for children and youth.
The Immediate Challenge
For thousands of California's most vulnerable children, the stability they desperately need is being put at risk. When foster care providers cannot secure or afford adequate insurance, their ability to operate is jeopardized. This crisis directly threatens the safe and stable placements, access to mental health care, educational continuity, and essential, daily supports that these children and youth rely on to heal and thrive.
Potential Impacts
California's insurance crisis is creating potentially disastrous risks for resilient youth and the systems that support them.
Unsustainable insurance premiums are devastating the operations of FFAs, STRTPs, and licensed care facilities, directly threatening the critical support systems for thousands of children, including medically fragile youth, LGBTQ+ teens, and high-needs students.
Short-Term Relief
With the support of our amazing partners and members, the CA Alliance secured $31.5 million in emergency bridge funding in the 2025–26 state budget to keep FFAs operational. This funding provides critical short-term relief—but this is only a short-term solution.
As the insurance crisis spreads across sectors serving children, youth, and families, California needs a comprehensive, long-term solution to stabilize the system. State leaders have acknowledged this reality, and now is the time to act to ensure children and youth do not lose access to the vital care and support they depend on.
Take Action
Stand Up for California’s Children & Youth: Protect Care, Secure Futures
Help spread the word—share this report from ACRC with your networks and urge your elected officials to take action to protect essential child-welfare services from the insurance crisis.
Resources
This section is your central source for information and support related to the insurance crisis. We are actively building this library for you, so expect new resources to be added regularly.
Latest News
Behind the numbers are real stories of vulnerable children and families, and the providers who support them. These news articles document the human impact of the insurance crisis happening right now.
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Over the last year, a Times investigation found a practice of paying for plaintiffs among a nebulous network of vendors
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19 foster family agencies have already closed after their insurer pulled out of the market.
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Opinion: The foster care system is facing an urgent insurance crisis threatening family stability.
California’s foster care system is on the verge of collapse without urgent state action.
Private foster care agencies appeal to the state for relief from rising insurance costs.
Viewpoint: California foster youth are at risk unless the state intervenes immediately.
Child welfare providers face an insurance crisis that threatens critical programs that ensure access to vital care
Advocates challenge the Governor’s budget proposal, urging protection of foster youth programs.
