Adoptive Parents: Here's Your What-to-Expect Guide
Adoption is a special way to grow your family whether through foster care or adoption. If you’re considering becoming an adoptive or foster parent to a child or children, this guide will help you get started as you think about all things benefits-related through your employer (and beyond). The adoption process isn't necessarily an easy one to navigate, but this should help you and your new adoptive family.
According to the Adoption Network, 135,000 children are adopted each year and another 428,000 children are in the United States foster care system. Of these children, over half are over the age of six and most children spend two to five years in the foster care system before being adopted. (Sadly, some children never get adopted and age out of the foster care system.) Of the over 400,000 children in foster care in the U.S., over 100,000 cannot be returned to their families and are waiting to be adopted. Statistics for domestic and international adoptions are less known because of private agencies not releasing this information and international adoptions have become more restrictive since 2010. The bottom line: There are thousands of children who need a loving home.
Adoption Birth Plan
Every birth parent tends to have a story about pregnancy and the story of their child’s birth. Have you ever heard one of those stories? I know I have, right down to what the nurse was wearing and how many ice cubes were consumed. Consider a similar story experience for your adopted child to hear one day. Create some magic in your journey of becoming their parent — perhaps you have always known that you would one day be an adoptive parent or maybe you’ve found yourself here because of unplanned complications. Or maybe you found yourself inspired after an experience and you just know that one day you would grow your family through adoption. However you got “here” is a special story you can craft for your child.
Types of Adoption
Depending on a host of factors may influence the type of adoption you are eligible for. Keep in mind that you may not be “calling the shots” and instead will need to seek the advice of a professional and/or lawyer to advise you on the most efficient and affordable way to adopt. Many times you are not able to negotiate these terms.
Agency: These are regulated private or public agencies licensed to place children with adoptive parents. There is no typical cost of an adoption to quote, but many would advise to anticipate at least $20,000 which is inclusive of legal fees, medical exams, and agency fees. (Of course, there is always more to the story depending on the unique circumstances.)
Foster Care: There are over 100,000 children in the foster care system waiting to be adopted. Priority tends to be given to a blood relatives, but non-relatives also find it much easier to adopt through the foster care system than through private adoption.
Independent: Adoption can occur when the birth and adoptive parents come to a mutual agreement. This is where “open adoption” can be arranged if agreed upon by both parties. That said, hiring a lawyer to formalize the agreement is recommended so that each side has everything documented properly. In case “hiring a lawyer” isn’t clear, it’s not recommended to write your own adoption agreement even if both parties agree today.
International: Most international adoptions are formalized through an agency as they are the most complicated type of adoption. There is a host of rules a family must satisfy in terms proving that you are fit to adopt. Domestic adoption is complicated as-is, and with international adoption, add in additional financial stability, immigration, social workers, and international travel (which might mean time off of work).
Relative: Sometimes kinship adoptions are possible when a relative is not able to care for a child or children. The law favors relatives raising children, and it can be significantly easier than other types of adoption.
Legalese
Adoption is complex and expenses. Hiring a credentialed adoption lawyer will help you identify the best approach and strategy toward a successful adoption. If your employer offers an Employee Assistance Program (EAP) or legal services benefit, you can potentially save thousands of dollars. Another suggestion is to see if your employer offers a support group where you can combine resources and learnings with others.
Costs and Financing
The Society of Human Resources Management estimates that, adopting a child from foster care may cost about $2,500, domestic private adoptions can cost up to $40,000, and international adoptions can cost up to $30,000. These costs may include public or private agency fees, court costs, legal fees and counseling fees. Additional foreign adoption costs may include agency and home study fees, translation services, travel and lodging, immunizations, and immigration fees. These estimated expenses do not take into account the possibility of lost wages. The employee may lose pay if he or she needs to take time off to complete the adoption or to stay home with the child immediately after the adoption.
One piece of advice to anticipate the overall spend of an adoption is to get an estimated number from the agency you’re working with and multiply that number by three (just to be safe). And there could be unforeseen expenses along the way, which is true throughout the course of parenthood.
Not all employers provide an adoption benefit. Typical reimbursement plans cover about 80 percent of certain itemized expenses up to an established ceiling (about $4,000 on average). Some employers reimburse at a higher rate for adoptions of children with special needs. But again, not all employers offer these types of programs.
Don’t forget about the usual expenses that come with raising a child: the gear, food, and saving for their education. If you have the means to save for your child’s education, consider a 529 plan. These plans offer a tax incentive for education-related expenses. And to sweeten this program, effective 2018, the 529 plan is eligible for K-12 education expenses as part of a recent tax reform.
Employer Benefits
According to Aon Hewitt’s 2015 survey of 1,000 US companies only 12% offered a financial adoption benefit in 1990. By 2015, that number rose to 56 percent. Employees want adoption benefits yet so few inquire about what’s possible. (Read: If your employer doesn’t offer adoption benefits, ask!) If you’re not sure how to ask your employer to cover these benefits, keep reading.
According to the Dave Thomas Foundation for Adoption, less than one percent of eligible employees actually need to access adoption benefits and the average benefit is $7,000. In the program design I put together at one employer, the employee reimbursement benefits fell under the Internal Revenue Service (IRS) definition of “reasonable and necessary” which can include a variety of expenses related to adoption. The goal was to create a stress free reimbursement process so that the person could focus on their growing family rather than justifying every expense.
Your adopted child or children should be eligible for your healthcare benefits. Ask your Human Resources team for a copy of “eligible dependents” under you medical, prescription, dental, and vision plans. For many healthcare plans, an eligible dependent is a legal dependent through birth, foster care, or adoption who is under the age of 26. The effective date of the dependent’s coverage would likely be the official adoption date. You would just need to provide a copy of the adoption paperwork within (usually) 30 days and you can add your new child to your plans.
Your company may also provide an Employee Assistance Program (EAP). These programs are generally free to employees and offer resources and references on a bunch of different topics — including adoption advice. Usually the EAP has easy and confidential access online and by phone 24/7.
Also inquire if your company has a legal counseling benefit. Some employers offer a legal benefit for a nominal charge (e.g. Hyatt Legal Services through MetLife) and includes adoption as part of the package.
Employer Benefits (a little something extra)
Many employers wish to offer an adoption benefit but are unsure how to set-up a program. Unlike insurance where employees pay a premium to offset some of the overall costs, adoption benefits are a straight cash investment. If your employer doesn’t offer anything at all, consider asking your Human Resources team to research a “Health Reimbursement Arrangement (HRA)” which is a type of employer-funded benefit plan that reimburses employees for a specific set of eligible out-of-pocket medical expenses. They are funded solely by the employer and cannot be funded through employee contributions. It’s a tax free benefit to the employer and employee.
Adoption benefits can be built into a HRA program. Since all of the inclusive adoption fees can cost easily $30,000, it wouldn’t be reasonable to expect an employer to fund the whole expense. However, starting small with a $5,000 per child benefit with a $x lifetime benefit can go a long way.
I would suggest that the business justification for this “expense” would be if the employer covers infertility benefits, those expenses can run north of $20,000 and are often covered by the medical plan. Think of it as a balancing mechanism from a budget perspective. Having managed benefit plans, in the end, a lot of these ‘expenses’ come out in the wash since so few people need adoption benefits. I always tell finance folks that people don’t tend to adoption children as a hobby, so we shouldn’t expect an uncomfortable amount of reimbursements.
Taking Time Off of Work
Under the Family and Medical Leave Act (FMLA), an eligible person can take up to twelve consecutive work weeks off from work in a job-protected and benefit-eligible status. This means that if you take a leave of absence to bond with your foster care child or adopted child, your employment is protected and you are guaranteed access to your benefits. Take note, though, the FMLA is unpaid unless your employer offers a supplemental benefit such as using paid time off or supplemental pay. If you reside in one of the handful of states that offer a state paid family program, and possibly more time off of work, such as California or New York, you should contact your Human Resources team for more information and next steps.
If you’re not eligible for the FMLA or a state leave, consider an unpaid leave of absence. Many employers allow for time off of work for personal and family reasons. The process to apply is generally company specific, which means you’ll have to provide a leave of absence request form and a short justification as to why you need time off of work. The company would reserve the right to approve, deny, or ask for a reasonable adjustment to your request.
Support Groups
Depending on your marital status (such as if you’re single, in a relationship, or married) or type of adoption that suits you (international, domestic, or foster care), this may influence the types of adoption that would be easiest for you. Joining a support group can be useful to learn from others in terms of getting the most out of available resources and available options.
Transition
If you’re adopting an older child, they may have feelings, language, or cultural barriers that you will need to consider post adoption.
Additional Resources
- Step by Step Guide to Adoption
- Family and Medical Leave Act
- California Paid Family Leave
- New York Paid Family Leave
Advocating for Adoptive Benefits
Now that you’ve made it to the end of this piece, you’re snarking to yourself: Yeah that’s nice, I don’t work for one of “those employers.” Don’t give up.
Many employers are caught up in the daily fire fighting and aren’t always directing proactive effort to creating the most inclusive workplace. It’s not personal. I would suggest advocating for adoption benefits by:
- Participating in your companies women’s network and/or diversity and inclusion group. If you don’t have these groups, create them!
- Talk about how adoption benefits would create and enhance a family-friendly work environment that is inclusive of different ways people grow their families.
- If you’re in front of a finance audience, point out that infertility benefits are often more expensive than an adoption benefit. (Hopefully there is no adverse impact there — but the point is if infertility is covered to grow one’s family why not adoption?)
- Write your own adoption policy for leave of absence and the benefit itself. Perhaps the Human Resources team isn’t sure where to start. One passionate person can make all of the difference.
- Establish equity between birth parents and adoptive parents.
As the topic of adoption starts to normalize, there will be more programs and benefits offered throughout the adoption process. Have you seen any creative practices? I would love to hear from you and your adoptive family!
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Emily Chardac is a people operations leader designing the future of work. Throughout her career, she has designed and implemented best in class “people products” from Silicon Valley to Wall Street. Emily focuses on the employee experience from hire to retire and everything in between. Follow Emily on Twitter @EmilyChardac.
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