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What Is an Adoption Subsidy?

Understanding the Use of Adoption Subsidies

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Caucasian baby girl with Down Syndrome playing with blocks
JGI/Tom Grill/Blend Images/Getty Images

To help encourage the adoption of special needs children, federal subsidies were created by Congress through Public Law 96-272, the Adoption Assistance and Child Welfare Act of 1980. A child may receive a federally funded adoption subsidy under Title IV-E or a state funded adoption subsidy (non-Title IV-E) based on each state's guidelines.

Defining Special Needs

A child may be deemed special needs and be eligible for an adoption subsidy based on a variety of guidelines that are unique to each state. Some of the guidelines that help determine a child's eligibility include:


  • age of the child
  • sibling group of 3 or more who are being adopted together
  • medical disability
  • mental disability]
  • emotional disability
  • a family history indicating that the child may need medical treatment or therapy at various developmental milestones
  • member of a minority group

To find information specific to your state see the State Adoption Subsidy Profiles.

Amount of Adoption Subsidy

The amount of the adoption subsidy varies by state with a range of approximately $400 to $700 per child. Whether an adoptive relative can obtain an adoption subsidy also varies by state.

Medicaid Benefits

Children who have federally funded (Title IV-E) subsidy are automatically eligible for Medicaid benefits. However, if the child has state-funded adoption subsidy (non-title IV-E) it is the state's decision whether that child is eligible for Medicaid benefit. Benefits cover a broad range of medical services, therapy, and treatment.

Should adoptive families receive adoption subsidies?
1. Yes, but only in the case of special needs children.

2. Yes, adoptive parents are taking on another person's responsibility. They don't know what issues the child may have down the road.

3. No, all parents must be fully responsible for their children, including financially.

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