A hidden number of elderly grandparents are raising grandchildren under informal arrangements and do not qualify for state government payments such as those given to foster carers.
Many of these grandparents voluntarily agree to take care of children, who have been removed from parents, and then once Child Safety Services is satisfied the children are safe, the child notification cases are closed.
This leaves grandparents as informal carers with no state assistance to care for the children and no direct access to specialised medical and psychological support.
It occurs despite the high needs of such children, many who are traumatised, and despite the known legal, financial, health and social challenges that grandparent families face.
Kin Raising Kids Tasmania chief executive Frank Tyers said the "drop and run" practice by CSS left grandparent families in a financially vulnerable situation.
The organisation's ambassador, former Children's Commissioner Mark Morrissey, said it was often driven by a lack of funds.
"In a number of states across Australia I have often been told by child protection staff that the safety threshold is driven by resourcing," he said.
Former Women's Legal Service chief executive Susan Fahey said some grandparents were forced back into intense, hard-body jobs to pay for legal and other financial costs associated with raising grandchildren.
"As a matter of policy, you should not see a retired person returning to work in their seventies after the state says 'can you take your grandchildren?'"
Grandparents Australia head Anne McLeish said the practice of closing cases early was disgraceful.
"They remove the children from parents but then make grandparents informal carers by saying 'the children are safe with you'," she said.
"We think that is unconscionable to say 'you don't need us anymore, you don't need support' when that is just not true."
She said children often had acute needs, with trauma sometimes surfacing months or years later, and without state support their health deteriorated.
"Before long it can become a child protection matter."
A department spokesman said support for grandparents is a shared responsibility of Commonwealth and state.
"The Australian Government takes primary responsibility for income support. Grandparents and other relative carers are able to access the same Centrelink payments for the care of children that families can generally access."
He said the state provides more than $150,000 each to Baptcare and Mission Australia for grandparent carer programs.