Michigan Put Foster Children’s Benefits Back Where They Belong.

Who should own a foster child’s Social Security payment?

The child.

That answer sounds obvious. The system did not always treat it that way.

A child in foster care may qualify for Social Security survivor benefits after a parent dies. A child with a disability may qualify for Supplemental Security Income, usually called SSI. Because a minor cannot manage those payments alone, another person or agency serves as the “representative payee.” That means the payee receives and manages the money for the child.

When the state fills that role, an ugly conflict appears. The agency responsible for protecting the child also controls money belonging to the child. Without a clear prohibition, those benefits can be used to reimburse the government for foster-care costs.

Michigan passed two connected laws to end that practice.

House Bill 4750, now Public Act 51, contains the central protection. When the Department of Health and Human Services manages a foster child’s benefits, it cannot use any of that money to reimburse the state for the cost of care.

Foster care remains a public obligation funded through the state budget. The child’s survivor, disability, or veterans benefits remain available for the child.

The law also requires the department to screen a child for available benefits within 60 days of entering foster care and again every year. The state may become representative payee only when no other suitable person is available.

If the state manages the money, it must use or save it in the child’s best interest. For foster youth ages 14 through 17, at least half must be conserved. The department must also protect the child from losing eligibility because savings pushed the child above a federal asset limit. The law allows tools such as an ABLE account or special-needs trust to hold the money safely.

Older youth must receive financial-literacy training, including information about college financing and the FAFSA. The child’s benefits may also cover education, medical expenses, job training, transportation, and immediate living expenses.

Senate Bill 18, now Public Act 52, supplies the transparency and ownership rules.

The department must notify the child’s guardian ad litem and placement agency when it applies for benefits, receives a decision, or files an appeal. Before each permanency-planning hearing, it must report the benefit money received and provide information about the child’s assets and resources.

The law then states the principle plainly: the benefit payments are the child’s property.

When the department’s responsibility ends, the remaining money must be released according to the benefit program’s rules. If those rules do not specify a recipient, the funds go to an adult or emancipated child, to the person responsible for a younger child, or to the child’s heirs if the child has died.

This reform has a budget consequence. Michigan can no longer reduce its foster-care costs by drawing from children’s benefits. The state must absorb the administrative work and fund care through appropriations.

That is a real expense. It is also an honest one.

A foster child does not owe the government reimbursement for being placed in its care. A survivor payment from a parent who died or a disability benefit belongs to the child. The state has no claim to it.

The laws take effect October 1, 2026. Their implementation should still be watched, especially when the department decides that a requested expense is outside a child’s best interest. The annual accounting and court oversight give the child’s advocate a way to see those decisions.

A teenager aging out of foster care already carries enough uncertainty. Michigan’s government should not send that young person into adulthood with an empty account because the state paid itself first.

The state assumed responsibility for the care. The child keeps the money.

This is our read of the laws. We encourage you to read them yourself and reach your own conclusions.