PROVIDENCE –— The Department of Children, Youth and Families is about to fundamentally change the way it does business.

The state child-welfare agency is moving forward with an aggressive plan to rely on a handful of private companies to manage care for Rhode Island’s most vulnerable children. By streamlining services and reducing the number of children taken from their homes, state officials say they can improve the state’s troubled child welfare system while living within a budget that was cut by $60 million this year.

“Rhode Island has relied on many residential programs for too long. Kids need to be in the community, provided that you have the right services for the children,” said DCYF executive director Patricia Martinez. “We’re taking the concepts of 30 years of recommendations and really staying true to our mission: keeping kids safe and making sure families have the resources to really support their kids.”

Child-welfare advocates largely agree with the philosophy behind the new plan, which is dubbed the Family Care Community Partnerships. It follows similar moves in recent years by Massachusetts and New York.

And most agree that change is needed.

The state child advocate, Jametta O. Alston, filed a class-action lawsuit against the DCYF this summer, blaming the current system for widespread physical and mental abuse against children in state care. The attorney general has agreed to represent the state in the case, which has yet to be scheduled for a court hearing.

In theory, Alston said, she applauds the changes.

“Good idea. Great concept. But like anything when you’re dealing with people’s lives, you need to make sure you have everything in place. Something like this should take a year or two to do. It’s not something you do in six months,” Alston said yesterday. “They’re saying let’s do this and work out the kinks later. That’s all well and good if I’m knitting. It’s not good if I’m dealing with someone’s life.”

Nonprofit leaders across the state echoed Alston’s concerns yesterday.

“The dollars are driving decision making, which is unfortunate,” said Margaret Holland McDuff, chief executive officer of Family Service of Rhode Island, which works with 3,000 children across the state. “To do it this way isn’t realistic. The RFP just came out a couple weeks ago.”

The DCYF began holding focus groups with families and service providers about the new system in January, according to Martinez, who added that she’s been pushing for this kind of reform since her appointment two years ago. The DCYF released a 51-page request for proposals on Aug. 14 that gave companies until the end of this month to submit bids.

Martinez denied assertions that the timing of the change is related to the state’s dire fiscal situation. State officials project a $306-million budget deficit next year.

“It may cost less at the end of the day,” Martinez said. “The purpose is not really to cut funding. The purpose is really to make more services available to families.”

The policy shift, set to be implemented later in the year, has pitted service providers — group homes, shelters, counselors and youth programs — against one another as they scramble to survive. A pre-bid conference for the new contracts last Friday attracted 120 people, according to the sign-in sheet, most of whom represented nonprofits currently contracted with the state to work with children or families.

The DCYF will award contracts to just four companies, which will coordinate community-based care such as counseling, parental education classes, and in-home supports, for thousands of families in four regions across the state.

The new model centers on something known as “high-fidelity wraparound.”

The central premise of the concept is that families have significant input into what services they receive before the situation is grave enough that a child needs to be removed, according to Benedict F. Lessing Jr., who helped develop the Massachusetts system in 1998 and now serves as the executive director of Family Resources Community Action, a Rhode Island service provider that offers specialized foster care. He said that the design and bid process in Massachusetts spanned “well over two years.”

Under the new system, a caseworker from one of the four contracted companies would help each family develop a plan that might include a combination of counseling, housing assistance financing and natural supports such as church-based support groups, friends or family.

The DCYF would continue to investigate allegations of abuse, Martinez said.

“If we find there’s no need for us to remove that child, no issues of imminent risk, we would refer that case to the community agency,” she said. “That’s what this practice will show you — fewer children removed from their homes if you really provide good wraparound services.”

The contracted providers will largely be responsible for distributing child-welfare financing previously distributed by the DCYF. They will have the option of providing services themselves or using DCYF dollars to subcontract other companies.

McDuff said she feared the massive shift would jeopardize some good companies.

“Part of good care for families is keeping good agencies and making sure their services stay whole,” she said. “We don’t want the system to collapse and I think a lot of people fear that.”

Martinez, meanwhile, dismissed provider concerns that the process was rushed.

“These are very difficult times for providers. They feel uneasy,” she said. “And it’s easier to wait until next year or two years, but I don’t know that we need to wait. This is not something that we woke up and said, ‘Let’s do this.’ ”

Brother Michael Reis, the head of Tides Family Services, has worked with at-risk youth in Rhode Island since 1975.

“The culture has always been, ‘Place them in beds.’ Changing that culture is a massive undertaking,” he said.

The vast majority of the system’s money typically goes to a small minority of the system’s children who have been removed from their homes, he said.

“It’s all going to residential placements,” he said. “But if you’re going to keep youngsters at home and keep families together, you need to put the majority of the money into the community.

“They took a significant amount of money out of the DCYF budget,” Reis continued. “Whether or not there’s sufficient money left to turn the system around is hard to say.”

speoples@projo.com