California considering bill to create trust funds for COVID-19 orphans

COVID-19 has made tens of thousands of children orphans, and, in some cases, they're left with little resources to help them with their burdens.

A bill introduced in the California Legislature last month seeks to give children who are in this situation some hope for a better future, and one children welfare policy expert told ABC News this legislation could serve as a blueprint for the rest of the country.

Under California state Sen. Nancy Skinner's Hope, Opportunity, Perseverance, and Empowerment (HOPE) for Children Act, children who lost a parent or caregiver to COVID-19 and are in the state's foster care system or a low-income household would be eligible for a state-funded trust fund.

Skinner told ABC News there is a great need for this program since data has shown a large number of COVID-19 orphans were of low-income families who didn't have options such as life insurance to provide for their loved ones after they died.

"Those children would be in an especially vulnerable situation when they're adults and on their own," she said

Over 200,000 Americans under 18 have lost a parent or adult caregiver to COVID-19, according to research released by the U.S. Centers for Disease Control and Prevention, up from 140,000 in October.

Skinner's office estimates that 20,000 Californian children have lost their parent or caregiver to the virus so far. They are working to ascertain exactly how many of those children are in the California foster system.

If the bill passes, the state would make an initial deposit of $4,000 for eligible children under 10 and $8,000 for eligible children over 10. Annual deposits would continue with an amount that will be later determined, and the state would handle the investment options, according to the bill's current language.

Once the eligible children turn 18 or 21, depending on their status in the foster care system, they would be able to withdraw the funds from the HOPE account.

"The money wouldn't be available to them now, but the very presence would ensure that they have some financial wellness when they are adults," Skinner said.

Skinner said her office is still determining the income thresholds for eligible COVID-19 orphans not in the foster care system, though she is considering using the same income requirements used for MediCal, the state's Medicaid system.

She noted that data shows the majority of the state's COVID-19 orphans are children of color.

The program will be paid for using taxpayer money already in the state budget and would not seek tax increases, Skinner said.

The bill also seeks to create a California survivor benefit program that would create a cash benefit for minors who aren't eligible for other forms of financial assistance, such as Social Security, when their parent or caregiver dies.

Dan Treglia, an associate professor of practice at the University of Pennsylvania, told ABC News the California bill addresses a growing problem brought on by the pandemic's deadly repercussions, and he said it should be a model for other states.

Treglia said COVID-19 deaths have left thousands of children with long-term mental health complications and that policymakers needed to act fast to mitigate the psychological and financial damage.

"They need resources today, but at the same time we need to make sure we are looking out for the long-term economic health," he said.

Treglia co-authored a report issued in December by the COVID Collaborative, a national assembly of doctors, public health experts and other researchers, that presented several recommendations to help COVID-19 orphans.

One of the recommendations was for the federal government to create a "COVID-Bereaved Children Fund" for children who lost a parent to the virus.

"The scale of need arising from this crisis is beyond the scope of nearly any private funder, and such a fund would be in-line with public responses to other tragedies and public health crises," the report said.

Treglia said the crisis will only get worse as more children lose a parent to the virus and he hoped that other states and the federal government consider following California's proposal.

"We need to see this level of energy for providing for families," he said.