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Indiana will be implementing new CCDF reimbursement rates effective May 11, 2014.Frequently Asked Questions
As a benefit to quality level advancement, Paths to QUALITY™ Centers and Homes at levels 2 through 4 and Registered Ministries at levels 1 through 4 will be given 30 days to update their program fees upon achieving a successful Paths to QUALITY level increase rating. Click here for instructions.
Click here for a copy of the Provider Information Page.
CCDF-certified child care programs and families on the CCDF program were mailed a letter regarding the new reimbursement rates.
Additional Information about CCDF Reimbursement Rates
CCDF reimbursement rates are established through a market rate survey that is conducted every two years by the Office of Early Childhood and Out of School Learning (OECOSL). Market rates are the rates that child care programs charge. The Office of Early Childhood and Out of School Learning’s database, CCIS, receives this market rate data electronically from the Indiana Association of Child Care Resource and Referral (IACCRR). IACCRR gathers the data via telephone surveys of regulated child care programs conducted every six months at a minimum. Data is collected on each provider’s rates for infants, toddlers, preschoolers, kindergarteners, and school age children (for before and after school care or full time care during summer or other breaks). Rates are also separated by the county in which the program is located and by the provider type, for example licensed home, licensed center or registered ministry. For the 2013 survey, the response rate was 98%.
To analyze the market rates collected through the survey, the Office of Early Childhood and Out of School Learning must also calculate the percentile of current CCDF reimbursement rates. Reimbursement rate is the maximum amount that the State will reimburse a program for the care of a child with a CCDF voucher. Like market rates, reimbursement rates are grouped by county, child age group, and provider type. Percentile is a value on a scale of zero to one hundred that indicates whether a distribution is above or below it. For example, a reimbursement rate that is at the 75th percentile is equal to or greater than 75 percent of the reimbursement rates.
The CCDF block grant requires States to demonstrate that reimbursement rates are sufficient to ensure families receiving CCDF vouchers have access to child care. To determine if Indiana’s reimbursement rates are sufficient, the Office of Early Childhood and Out of School Learning compares the percentile of current CCDF reimbursement rates with the market rate data collected in the market rate survey.
Potential reimbursement rate increases must also be considered in terms of the current available budget, the number of children waiting for CCDF vouchers, and the overall fiscal impact of any increase. To estimate the fiscal impact of an increase, potential scenarios are analyzed. This analysis includes calculating the impact of phasing in new rates, at various percentiles, over a period of time. Averages are also calculated for small, medium, and large counties, as well as regionally, to determine if an increase in rates is weighted by county size or particular areas of the state.
Due to budgetary constraints and a high demand for CCDF vouchers as evidenced by the large number of children on the voucher waitlist, Indiana has not been in a position to increase reimbursement rates for a number of years. However, as a result of a large transfer of TANF funds to the CCDF program, OECOSL has recently been able to greatly reduce the CCDF voucher waitlist and is now in a position to raise the reimbursement rates to help cover inflation and the increase in the availability of high quality child care, through Paths to QUALITY™, Indiana’s child care quality rating and improvement system.
Effective May 11, 2014 OECOSL will be implementing increased CCDF reimbursement rates. These new rates will be tiered based on the Paths to QUALITY level of the child care program. Licensed homes and licensed centers will have a new base rate for reimbursement. Programs who reach Level 2 in Paths to QUALITY will see a 10 percent increase over the base rate; Level 3 programs will have a 20 percent increase; and at the highest level, Level 4, programs will have a 30 percent increase over the base rate.
Registered Ministries that have obtained Voluntary Certification through the Voluntary Certification Program (VCP) and are enrolled in Paths to QUALITY at level 1 will also see a rate increase effective in May. As a Registered Ministry moves up the levels to levels 2, 3 and 4 the rates are the same as the rates for centers at the same level. As with centers and homes, these rate increases are designed to help cover the increased costs associated with meeting higher quality standards.
For more information on the Paths to QUALITY system, please click here: http://www.in.gov/fssa/carefinder/2554.htm
Currently over 2,300 child care programs have voluntarily enrolled in Paths to QUALITY and more than a third of these providers are rated at the highest two levels, Levels 3 and 4. By structuring CCDF reimbursement rates to tie to the levels of Paths to QUALITY, OECOSL believes that even more programs will be encouraged to join Paths to QUALITY and move up the rated quality levels, which raises the quality of care for all children, not just those receiving CCDF vouchers. Improvements in quality often come with an associated cost. The new reimbursement rate structure will help programs cover these costs. OECOSL also hopes that high quality programs that don’t currently accept CCDF vouchers will consider changing their policy when the reimbursement is adequate.
Furthermore, the Office of Early Childhood and Out of School Learning wants to ensure that families with CCDF vouchers have affordable access to the highest quality programs available. These new reimbursement rates are designed to reduce or eliminate CCDF family “overages” at high quality programs and allow CCDF families to choose higher quality programs without paying more. Overage is the difference between the provider’s charges and the State’s reimbursement. By reducing or eliminating overages at high quality programs, we anticipate that more low income families will be able to choose higher quality care. Research has clearly indicated that high quality early care and education helps low income children enter school prepared, experience greater academic success, including higher graduation rates, and makes them less likely to be involved in the juvenile justice system.