The four categories of changes made to the Child Care and Development Fund

Photo by mokra.

The 2016 Child Care and Development Fund Final Rule was finalized late last month by the US Department of Health and Human Services (HHS), updating regulations to incorporate and clarify changes made through the Child Care and Development Block Grant Act of 2014. 

The Child Care and Development Fund (CCDF) is the primary federal funding source devoted to improving the quality of care for all children and to helping low-income families who work or participate in education pay for child care. The federal program is also among the five largest funding streams that support local providers in offering quality afterschool programming for school-age children. CCDF provides child care financial assistance for 1.4 million children each month throughout the United States, U.S. Territories and Tribal Nations. CCDF investments in improving the quality of care also benefit millions more of the nation’s children who do not receive a child care subsidy, but who participate in child care programs that benefit from these quality investments, such as program staff and teacher training. 

On November 19, 2014, President Obama signed into law bipartisan legislation that comprehensively updated the Child Care and Development Block Grant (CCDBG) Act for the first time in nearly twenty years. The law focused on strengthening child care to better support the success of both parents and children, while also providing a new emphasis on the importance of providing high-quality early education and care for children under the age of five. 

The final rule updates CCDF regulations for the first time since 1998 to make them consistent with the new law. The rule applies to states, territories and tribes administering CCDF and reflects more than 150 comments received on the Notice of Proposed Rulemaking (NPRM) published in December 2015. The Afterschool Alliance provided comments on the proposed rule, several of which were incorporated into the final rule. 

The final rule recognizes the important role of school-age afterschool programs, stating:

The Office of Child Care (OCC) at HHS summarized the major changes in the CCDBG Act and the CCDF final rule into categories. 

Here are the four categories of changes made:

      1)    Protecting the health and safety of children in child care;  

      2)    Helping parents make informed consumer choices and access information to support child development;  

      3)    Supporting equal access to stable, high quality child care for low-income children; and  

      4)    Enhancing the quality of child care and better support the workforce. 

1. Health and safety of children in child care 

Prior to the new law, health and safety standards varied widely across states and left critical gaps. The law and final rule establish a baseline for health, safety and quality, ensuring children are adequately protected and are in nurturing environments that support their healthy growth and development.   

The requirements include, but are not limited to:  

• Annual monitoring for CCDF licensed and license-exempt providers and a pre-licensure inspection for licensed CCDF providers; 
• Health and safety requirements and training on ten basic topics (such as first aid and CPR), to which the final rule adds “reporting and recognition of child abuse and neglect” and “child development training” and points to Caring for Our Children Basics as a recommended baseline for minimum health and safety standards; 
• Comprehensive background checks for child care staff members (including prospective child care staff members and individuals with unsupervised access to children) of all licensed and CCDF-eligible providers (which includes licensed providers who do not receive CCDF funds).

2. Parents making smart, informed choices

A key pillar of CCDF is parental choice, and providing families clear and accurate information about child care providers can help them make sound decisions for their families. The final rule, which will reach beyond those directly served by CCDF, ensures that parents have specific information on provider options and available services. This includes, but is not limited to, requiring states to:  

• Disseminate information to parents, providers and the general public on child care services and other assistance programs such as the Supplemental Nutrition Assistance Program (SNAP);  
• Maintain a consumer education website with provider-specific information, including school-age afterschool care, and if available, information provided through a transparent system of quality indicators;  
• Post provider-specific reports and results from child care monitoring inspections in a consumer-friendly and easily accessible format;  
• Provide CCDF families with a provider-specific consumer education statement that includes a summary of the state’s health and safety and licensing policies; 
• Post the annual number of deaths, serious injuries, and instances of substantiated child abuse that occurred in all CCDF-eligible child care settings. 

3. Equal access to stable, high-quality child care for low-income families

Prior to the new law, many families received subsidies for only a short period and frequently cycled on and off the program, leading to significant instability for families. Provider subsidy payment rates and other policies and practices were also insufficient to allow low-income families to afford high quality care. The law and this final rule lengthen eligibility periods so families have more stable subsidies while also supporting continuity of care and relationships between children and their providers. These and other reforms in the law and rule also encourage more providers to care for children receiving subsidies. This includes, but is not limited to:  

• Establishing minimum twelve-month eligibility periods; 
• Allowing states to end assistance prior to the end of the eligibility period only in limited circumstances: loss of job or cessation of attendance at a job training or education program, excessive unexplained absences, change in residency outside of State, and substantiated fraud or intentional program violations; 
• Establishing a graduated phase-out of subsidies for families who, at eligibility redetermination, exceed initial State income thresholds but still have modest incomes; this would extend assistance until families exceed 85 percent of state median income or a lower income level that still accommodates some increase in family income and reasonably allows a family to continue accessing care; 
• Requiring states to take the cost of providing quality child care into account when setting provider subsidy payment rates, and to use valid methodologies to update rates at least every three years; 
• Allowing the public to participate in the state’s decision-making process around the setting of reimbursement rates; 
• Requiring states to show how base payment rates enable providers to meet health, safety, quality, and staffing requirements;  
• Providing for affordable co-payments that are not a barrier to families’ ability to access quality care and requiring states to monitor, and limit if applicable, any additional fees a provider may charge above the copayment; and  
• Building the supply and quality of care for priority and vulnerable populations, including promoting services for children experiencing homelessness. 

4. Quality of child care and the early childhood workforce 

Despite extensive research on how early learning shapes brain development, many children are in child care settings that do not lay a strong foundation for future learning and life, or do not have access to stable, quality child care. The law and rule address these concerns, in part, by the following: 

• Gradually increasing (over a five-year period) the proportion of funds states must use for quality from four percent to nine percent;  
• Requiring states to have training and professional development requirements tied to a progression of professional development for CCDF providers; and 
• Prioritizing populations with high-concentrations of poverty & unemployment