Adoption costs vary widely. Where does the money go?

Private adoption is notoriously expensive, even though adopting through foster care is free. Why is adoption so expensive, and does it promote unethical practices?

Key Takeaways:

• The average cost of private adoption in the United States ranges from $40,000 to $80,000.

• Independent adoption, in which a couple seeks adoption without using an adoption agency, is significantly cheaper, and adopting through foster care is often free.

• Birth mothers have said they were pressured into adoption with threats of having to reimburse costs accrued by would-be parents and adoption agencies if they decided to raise their child.

• The high cost of adoption could push couples towards assisted reproductive technologies like in vitro fertilization (IVF) as a cheaper alternative.

The Details:

When it comes to the cost of adoption, the situation becomes incredibly complex. There are, broadly, three different kinds of adoption:

• Domestic adoption, in which a child is adopted from within the United States;

• International adoption, in which a child is adopted from overseas;

• Foster-to-adopt, in which a child is adopted through the foster care system.

Within the realm of domestic adoption, there are more options for parents to parse; they can choose to pursue adoption more traditionally, working with an adoption agency, or they can choose to try what is now being called "independent adoption," in which the parents forgo an adoption agency and use just a lawyer they hire.

Depending on what path a would-be parent takes, the costs can vary greatly. The highest costs seem to come from working with an adoption agency, while pursuing an independent adoption, an international adoption, or an adoption through foster care costs significantly less. Foster care adoption can have no fees at all, and newborn or infant adoption using just an attorney costs an average of $10,000 to $15,000. For a traditional adoption through an adoption agency, the cost is typically between $40,000 and $80,000.

Yet this drastic difference in cost raises questions. The paperwork does not change between forms of adoption, so there are not increased legal issues to handle with a traditional domestic adoption. Some might point to the need to cover the birth mother's medical care, which is true and good, but Medicaid covers the cost of prenatal care in every single state, so those costs should be negligible.

So why does it cost so much and where is the money going?

Zoom In:

A 2018 article from the National Council for Adoption offers some insight into what the money involved in traditional adoption goes towards, and, to put it plainly, it funds the adoption industry. The bulk of the money is not spent on caring for the birth mother or helping the would-be parents navigate the adoption process, but on the agency's own administrative and bureaucratic costs.

While the article explained that the agencies are often not making a large profit, the money is not being spent in ways many might think it is. The National Council for Adoption explained:

Only 4% of the revenue is spent on fundraising. Charity-tracking experts generally give an A+ to non-profits who spend less than 15% on fundraising.

Management and general expenses make up 11% of the expenditures for adoption agencies. These expenses include compensation, benefits, office expenses, and travel for officers or directors.

Program expenses account for 82% of the expenditures of these adoption agencies. These expenses include compensation, benefits, rent, and travel for employees who provide direct adoption services, as well as pass-through costs paid by agencies to other providers. Personnel costs account for 52% of the total revenue of adoption agencies.

American Adoptions likewise claimed the costs include "[l]egal oversight and coordination across states and jurisdictions; Medical care and counseling; Licensed professional services; Marketing and outreach to create adoption opportunities."

In essence, hopeful parents are paying agencies to remain open and potentially do some marketing for them to make it more likely that they find a baby to adopt. It's estimated there are 36 would-be parents for every one child placed for adoption, so parents may feel its worth the additional costs to have the extra help in making their profile stand out.

The base fees to adopt a child — legal representation, court fees, social workers, etc. — are significantly less, and these fees are typically waived altogether if adoption occurs through foster care.

The Big Picture:

Part of the problem comes with the lack of regulation surrounding the adoption industry, with birth mothers and hopeful adoptive parents alike harmed in the process. Adoption is a multi-billion dollar industry, and it seems some have a vested interest in making sure the money keeps flowing... no matter what.

One of the most notorious examples is that of Tara Lee, who ran the Always Hope adoption agency and was caught scamming multiple parents. She was able to do so thanks to a lack of regulations and little-to-no government oversight. As the New Yorker explained:

The private-sector and nonprofit adoption and child-welfare-services industries in America generate an estimated nineteen billion dollars a year in revenue. Each state has its own rules about who is qualified to arrange an adoption, which families are eligible to adopt, the rights of birth mothers to change their minds, and the rights of birth fathers to be involved in the decision. This has left enormous gaps in the system. “The whole thing is so fraught with vulnerability, inequality of power, and you still have the apparatus of the old secrecy-and-shame system,” Smolin said. “Big money and a veil of secrecy attracts bad actors.”

Lee carefully controlled all communication between expectant mothers and adoptive families, and tried to prevent the two sides from contacting each other directly; she arranged most in-person meetings and usually came along. This gave her tremendous influence over two sets of emotionally vulnerable people.

Lee would find vulnerable women, such as those struggling with homelessness and addiction, and persuade them to place their child for adoption.

“You love this baby so much, and you say to yourself, ‘Can I really do it?’” one mother who placed her child for adoption through Lee said. “Even if it breaks your heart, you say, ‘I’m going to put you with someone wonderful who can really take care of you.’  Something put [Lee] on this earth to be the best manipulator and liar you have ever seen."

Lee would dangle hope in front of prospective adoptive parents, insisting she had a pregnant mother ready and convincing them to sign contracts with her. The adoptive parents would send her payments of tens of thousands of dollars over and over again, only for Lee to abruptly say the pregnant mother backed out of the transaction.

After an investigation, Lee pled guilty to wire fraud and was ordered to pay $1 million in restitution to the 160 prospective adoptive families and birth mothers. According to the New Yorker:

"The investigation had found a hundred and sixty families and seventy birth mothers whom Lee allegedly defrauded. Some of them, including Teresa and Mike Matheny, had successfully adopted babies, but most had not. Dozens of members of adoptive families travelled from across the country to a federal courtroom in downtown Detroit to attend the sentencing, which took place about two weeks before the COVID-19 shutdown. Melanie Peterson, one of the adoptive mothers, told me that the hearing was one of the most powerful experiences of her life. 'There was something about being present with those other families—we walked into that courtroom literally hand in hand,' she said. Watching Lee enter the room in a prison jumpsuit, hearing the sound of her ankle chains clinking, was deeply cathartic. 'I just needed to see her face, to know that she was a real person, that I wasn’t making this all up in my heart and head,' Peterson said."

Lee is just one example. The problem is that there are no laws in place to prevent other people like Lee from exploiting the desperation of others within the adoption realm. While adoptions through foster care are highly monitored by individual states, private adoptions are not. And with as much money that flows through the adoption industry, it can easily create unethical scenarios.

The Other Side:

For the birth mothers, one issue is the effect the money can have on their decision to place their child for adoption. In every state, birth mothers have the right to change their mind, typically for several days after giving birth. Adoption agencies have been caught financially pressuring these women to relinquish their children, even if they don't want to.

Shyanne Klupp told Time she had reluctantly considered adoption, and when she found adoptive parents for her child, she hadn't looked to get a ton of money from them — but her adoption agency disagreed.

"Klupp and her husband entered in the essentials: gas money, food, blankets and the like. She remembers thinking, 'I’m not trying to sell my baby.' But ANLC, she says, pointed out that the prospective adoptive parents were rich. 'That’s not enough,' Klupp recalls her counselor telling her. 'You can ask for more.' So the couple added maternity clothes, a new set of tires, and money for her husband’s prison commissary account, Klupp says. Then, in January 2010, she signed the initial legal paperwork for adoption, with the option to revoke."

Klupp said she had recurring doubts about adoption throughout her pregnancy, but whenever she voiced those doubts, the money that had been spent was brought up.

“I will never forget the way my heart sank,” she said. “You have to buy your own baby back almost.”

She was also never told that part of the expenses the adoptive parents were paying for was an attorney to represent her. Ultimately, scared of being sued, she relinquished her son, a decision she said she regrets.

Another woman, Madeline Grimm, had the same experience. That was something that I would think of if I was having any kind of doubt,” she said. “Like, well, sh-t, I’d have to pay all this back.”

Still another birth mother told PBS how she considered adoption when she was pregnant and facing eviction. Her Utah-based adoption agency promised cash after she relinquished her child. Still, despite being on the brink of homelessness, she was resisting, only for her adoption agency to pressure her to continue with the adoption.

"I text Sandi and told her, like, I'm kind of starting to change my mind a little bit. This might not be something I want to do," she said. "It all was just happening so fast. It's not something I wanted to do. Why are they still wanting me to sign? Then I'm like, if I don't do this, where am I going to end up?"

After she delivered her baby, she was given $4,000, and then her baby was taken away almost immediately.

"I didn't really hold her. I didn't really tell her goodbye. I didn't kiss her. They didn't [give] me a chance to talk to her. So they just came, just came and got her," she recalled. "A lot of people say it's like you sold your baby. I did not sell my baby. I think I took -- that people took advantage of me for my baby."

Reality Check:

Per the New York Times, in the 1980s, adoption cost between $5,000 and $12,000. The costs have since skyrocketed, all while there are fewer and fewer babies available to adopt. And most would-be parents are not interested in adopting older children; they almost universally want infants, all while older children seeking adoption from foster care go their entire lives without finding a forever family, even though the cost is practically zero.

That the adoption industry has become so expensive has almost certainly led more and more couples to pursue IVF instead, as adoption has become prohibitively expensive. IVF, particularly if the couple does not go through multiple rounds, is significantly less expensive than adoption.

And while IVF does create life, it is not a pro-life tool; only about seven percent of the babies created through IVF survive to birth. IVF promotes a eugenicist mindset and turns children into products to be bought and sold.

Can You Be Pro-Life And Support IVF?

The Bottom Line:

Adoption, while born in trauma, is a way of mending a tragedy, and can be a beautiful thing, particularly with the rise in open adoptions. Yet the unchecked adoption industry arguably is taking advantage of vulnerable women and desperate would-be parents. Politicians should take action to protect both parties from those who look at babies and see nothing but dollar signs.