Fewer children are in foster care. The caseworkers who run it still can't stay.

American foster care is, at bottom, two systems layered on top of each other.▸ One is a funding formula: a federal entitlement, Title IV-E of the Social Security Act, that pays states for every eligible child's maintenance, adoption subsidy, or guardianship support, no appropriation cap required. The other is a workforce: the caseworkers who investigate reports, place children, and write the court filings that formula depends on. In 2026 the first system is shrinking and rebalancing. The second hasn't moved in a generation.

Title IV-E doesn't run through an annual appropriations fight the way housing or nutrition programs do — it's mandatory spending that scales automatically with how many eligible children states claim.▸ That gives it a different failure mode than a program that can hit a funding cliff: it can't run out, but Congress and HHS can quietly redirect where the formula sends money.

That's exactly what's happening.▸ Per the Congressional Research Service's analysis of federal child welfare funding, Foster Care Maintenance payments — the money that pays for a child's actual room, board, and supervision while in care — are on a three-year slide: $5.354 billion in FY2025, an estimated $5.298 billion in FY2026, and a requested $5.123 billion in FY2027. Adoption Assistance is moving the opposite direction, from $4.136 billion to $4.397 billion to a requested $4.485 billion over the same span. Prevention Services — in-home help meant to keep a child out of foster care altogether, created by the 2018 Family First Prevention Services Act — is growing fastest of all in percentage terms, from $170 million to $203 million to a requested $229 million. Fewer children are entering care in the first place: 175,008 did in federal fiscal year 2025, down from 216,450 in FY2020, per the Administration for Children and Families' AFCARS dashboard. The formula is quietly re-weighting itself toward keeping families together and toward permanency after care, and away from paying for care itself.

None of that reallocation touches the workforce problem, because Title IV-E funds placements and subsidies, not headcount.▸ The number of children the system has to track fell from 407,332 in care on September 30, 2020 to 331,747 on September 30, 2025 — an 18.6% drop — per the same AFCARS dashboard. Even so, 175,008 children entered care and 169,927 exited during federal fiscal year 2025 alone, and 15,030 of those exits were kids aging out of the system at 18 or older without ever being reunified, adopted, or placed with a guardian — 9% of everyone who left.

The federal government's own workforce study, the NSCAW III Workforce Study, found that 53.3% of supervisors said turnover among their caseworkers had increased between March 2019 and June 2022, and asked them why.▸ Job stress and burnout topped the list at 74.9%, ahead of better pay elsewhere (44.6%) and workload (41.3%). That same report notes that child welfare agencies have been estimated to run 20% to 40% annual turnover for at least the fifteen years before the pandemic — this isn't a new emergency, it's a baseline the system has never gotten below.

The federal government also just loosened one of its few levers over the consequence of that churn.▸ Since FY2015, states have been required to complete monthly in-person visits for at least 95% of children in foster care or face a cut in their federal cost-share. Effective this fiscal year, the Supporting America's Children and Families Act (P.L. 118-258) eliminated that funding penalty — the 95% target stays on the books, but states that miss it because they can't staff enough caseworkers no longer lose federal money over it.

Dollar figures are the Congressional Research Service's FY2026 comparable estimate of mandatory Title IV-E spending under current law, not an enacted appropriation; component figures may be revised as actual claims come in. Foster care population and entry/exit figures are preliminary AFCARS estimates for federal fiscal year 2025 as of February 27, 2026, and are subject to revision as states submit corrected data.