Sponsored Residential Services: A Family-Friendly Alternative to Group Home Placement

Updated on January 22, 2018
mdgardner profile image

I have been a mental health professional for over 15 years. I provide case management services for people with developmental disabilities.


One of the most difficult times a parent of a special needs child experiences is when their child becomes a young adult and needs transition services. It’s a time of extreme anxiety as they see their child age out of the comfort and security of the school system—and into the new world of adult services. One of the toughest decisions a parent can make is to place their child in a facility outside of the home.

Virginia’s Medicaid Intellectual Disability Waiver provides two forms of residential placement options. These options include group home placement and sponsored residential services. We will explore each of these options and discuss their benefits and limitations. Group homes have been the primary form of community-based residential services. However, sponsored residential services are rapidly becoming an alternative for families who wish to keep their loved ones at home.

Group Homes

When people think of outside residential placements, they usually think of a group home setting. A group home is a residence that serves individuals with intellectual disabilities and is staffed 24 hours a day. These homes are licensed and regulated by the state. Providers are reimbursed through Medicaid funding. Group homes are the primary form of outside residential placement in VA. Staff are usually trained to give medication, CPR, First Aid, and behavioral management. Group home staff provides all of the direct care services and provide all transportation to appointments and community outings. Group homes play a vital role in providing services to individuals in the community who might otherwise be placed in a state institution or more confined facility. Group homes are even more important now that Virginia is moving to downsize institutions and implement more community- based housing options.

However, there are some limitations to group home placements. Any time you live in close quarters with others, there is an increase in the chances of illness. Staffing may also impact the level of community integration. If there are not enough staff on duty, opportunities for community outings will be limited. The group home setting also provides limited one on one attention due to the needs of the other residents. Group homes also tend to have a high turnover rate. This could negatively impact the overall quality and consistency of care. As with just about any service, there are some good group homes and some group homes that do the bare minimum to keep their license. I encourage families to tour as many homes as possible, research, and ask questions before making any final decision on a placement.

Group home placements are not inexpensive but they do cost less than state institutions. Based on current reimbursement rates in Virginia, the average group home placement costs the state around $90,000 a year. This figure is what Medicaid reimburses the provider for staffing the home. This does not account for room and board which can range from $500-$700 per month.

Sponsored Residential Services

Sponsored residential services are an interesting alternative to the group home setting. Sponsored residential services are often compared to adult foster care in that it provides an opportunity for an individual to live with a private family or single caregiver instead of a home with other residents. Caregivers are hired and trained through agencies that are licensed by the state. These caregivers or “sponsors” provide all of the direct care just as the staff in the group home. Sponsors also have the flexibility of providing more one-on-one attention and more opportunities for community integration.

Another unique aspect of sponsored residential services is that parents and family members can also be certified to be sponsors and get paid for caring for their disabled family member. Some are opposed to family members getting paid to be caregivers but I think it’s a great idea. The program was originally established for rural areas of Virginia where there were limited service providers. It was actually less expensive to train family members and caregivers than to put people in facilities. In addition, the money that the family makes balances out because many parents of special needs children (or adults) have a difficult time maintaining a regular job due to the constant doctor appointments, therapy sessions, and meetings centered around services. Family members would have a better knowledge of the individual’s needs than staff in a group home. This option would also be most appropriate for individuals with specialized medical needs that can be best managed by a family member.

The average cost of sponsored residential is around $50,000 per year. Room and board costs are usually cheaper than that of a group home. Another advantage of sponsored residential services is that the income the caregiver makes is TAX-FREE. Caregivers do not have to file taxes for any income earned for providing these services.

I work with several clients and families that use this service and they have nothing but positive feedback. Clients reported that they have more freedom than they did in the group home setting. One family told me that this program has allowed their family to have the ability to go on vacations and enjoy life just like any other family. Families also point out that this program allows their loved one to receive care from people who have a personal connection with them as opposed to someone they don’t know. There is also a high turnover rate in group homes and they could have different care staff each day. High staff turnover diminishes the overall quality of care.

The sponsored residential setting provides an opportunity for more 1:1 interaction and training with staff.
The sponsored residential setting provides an opportunity for more 1:1 interaction and training with staff.

The sponsored residential program does have its limitations. Sponsor homes face the same regulations as group homes. They have to be approved by the fire marshal and the state licensure department. Personal homes may not be approved if they are not up to code.

The sponsor has to be able to complete documentation as if they were staff in a group home. A case manager with the sponsoring agency can assist with this documentation. This can be a difficult transition for families not use to documenting everything they do throughout the course of a day.

The sponsored residential program is not appropriate for everyone. Some family members start the program but later realize it was just too much work. Keep in mind this is a 24-hour-a-day job. Some situations call for a more structured environment due to certain behavioral and medical needs.

Group homes and sponsored residential services provide a vital service for people with intellectual and developmental disabilities. These services allow people with special needs to enjoy the same freedom to live in a normal neighborhood and community just like the rest of society. Unfortunately, institutions are the only option in some situations. However, more people are enjoying life in the community because of these community-based programs.

If you had a loved one with special needs which option would you choose?

See results

© 2013 Martin D Gardner


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    • mdgardner profile image

      Martin D Gardner 3 months ago from Virginia Beach

      He would still be able to attend a day program with sponsored residential services.

    • profile image

      Laurie midkiff 3 months ago

      If I turn my home into a sponsored residential home does this disqualify my son for day support services out in the community?

    • profile image

      Terri 9 months ago

      My son has been in group homes since 2005 I am considering bringing him home!

    • profile image

      Angela 10 months ago

      Yes I just took on the responsibility of my 25 year old cousin and I was wondering how can I go about becoming a sponsor

    • profile image

      Mike Washington 10 months ago

      Really great info, it has helped my fiance and I alot because her and I would like to work with children in our home, even though we probably won't make a dent into all the people who needs services but at least it's a start. Thank you

    • mdgardner profile image

      Martin D Gardner 2 years ago from Virginia Beach

      Thanks S. Nicole. Because I’m still a case manager I’m not allowed to show preferential treatment to any specific providers. I would encourage you to review the providers in your area and get with your case manager (I assusme you have one) to determine which provider works best for you. Hopefully some of these changes with the state will open up more slots for people in the future. No one really knows at this point.

    • profile image

      S. Nicole 2 years ago

      Thank you for the great article! I'm considering pursuing tho option for my 20 yr old special needs foster daughter w/ID, who has been with me for a few years. We are currently waiting to see if she will be awarded an ID waiver. I have been a TFC foster parent for a little over 10 years; so I feel like I have a solid foundation to build upon. Do you have an agency preference? If yes, why?

    • mdgardner profile image

      Martin D Gardner 2 years ago from Virginia Beach

      Thanks for stopping by Chantelle. We have a similar situation in VA. I'm not sure if it's 21,000 but the amount of funding allocated each year is only a drop in the bucket for what's needed. And with more people added to the waitlist each year, it's a never ending cycle. There's really no excuse for people to have to wait years (some over a decade) for basic services.

    • Chantelle Porter profile image

      Chantelle Porter 2 years ago from Chicago

      Thank you for writing this article. So many people are not familiar with the treatment and associated costs of supporting adults with disabilities. In my state, we have 21,000 adults waiting for help. (I live in Illinois). It is a disgrace.

    • profile image

      Sylvia N 2 years ago

      Loved your article. It is very informative. Thanks

    • mdgardner profile image

      Martin D Gardner 3 years ago from Virginia Beach

      Thanks for the resource JD!

    • profile image

      JD 3 years ago

      Leah, check out wallresidences.com. They are a great agency!

    • mdgardner profile image

      Martin D Gardner 3 years ago from Virginia Beach

      Leah contact Serenity C&C, Inc. The contact number is in my previous comment.

    • profile image

      Leah Bell 3 years ago

      If been looking into opening my home and becoming a sponsor. Do you know of any good agencies im the Richmond or Chester area?

    • mdgardner profile image

      Martin D Gardner 3 years ago from Virginia Beach

      Hi Annette. Serenity C&C, Inc. is the only sponsored residential program that I know of that works with children. Contact their Chester office at (804) 681-0256. Most providers are only licensed to serve age 18 and up. Good Luck.

    • profile image

      annette 3 years ago

      I'm trying to sponsor my child 14 with an ID waiver. So that I can spend more time with he needs. I live in the Richmond VA area

      Can you help me

    • Andy Hullender profile image

      Andy Hullender 3 years ago

      If these funds are coming from a federal source, which they are, and you have less than 10 ind. under 19 or 5 over 19, these are considered "difficulty of care" payments by the IRS. Refer to IRS Pub 17, Chapter 12. This however may not be the case for state taxes and hence the 1099. However this is income exclusion only, FICA still applies.

    • profile image

      Darwyn 4 years ago

      Call mr lee price director of special needs programming in Richmond, he's your guy and you should have a case manager who is your go to. Remember you do not work for them, they work for you. They are what's referred as a pass through. They get paid a fee to take care of paper work and training that's it

    • profile image

      Elizabeth 4 years ago

      Thanks for your post. We are in the Central part of the state with very few agencies who serve our area. I have been trying to get an answer from the state 'powers that be,' with no success... but will keep trying.

    • mdgardner profile image

      Martin D Gardner 4 years ago from Virginia Beach

      If he is in the Medicaid Waiver program you DO NOT have to pay taxes on that income. Some agencies have started to do this and it has caused a lot of problems. I'm not a tax expert but I would strongly recommend looking into another agency. If you live in the Hampton Roads/VA area I have an idea who might be your agency. I would recommend the UP Center, Blue Ridge Residential Services, or Support Services of VA. Hope that helps.

    • profile image

      Elizabeth 4 years ago

      I am a parent and a sponsored family residential provider for my son. The agency is telling us that we do NOT qualify for the tax free status and are issuing 1099's causing us to have to file tax returns. Any info out there to help us argue against the 1099?

    • denise.w.anderson profile image

      Denise W Anderson 4 years ago from Bismarck, North Dakota

      Thanks for pointing out some possible options we may need to pursue in the future. Our daughter with special needs is currently residing in our home, however, if the need arises for her to have 24 hour care, and a group home or hospital setting are not appropriate for her, I have considered the possibility of turning my home into a care facility where I would be paid to provide care for her and others, if necessary.

    • epbooks profile image

      Elizabeth Parker 4 years ago from Las Vegas, NV

      I don't have children, but this is valuable information for those who do have special needs children. Thanks for sharing!

    • mdgardner profile image

      Martin D Gardner 4 years ago from Virginia Beach

      Thanks for the input. It is very expensive but I think the quality of life it provides is worth every penny.

    • MsDora profile image

      Dora Weithers 4 years ago from The Caribbean

      Thank you for dealing with this very important issue. There are no sponsored residential services in my country, and group homes are few and expensive. Still, it's good to be aware of what's happening in other places.


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