Pennsylvania Enhances Subsidized Child Care Program to Lower Costs for Families and Incentivize Participation by Providers

Department of Human Services Advises Providers and Partners of Operational Recommendations for Yellow Phase Counties

HARRISBURG, PA — The Wolf Administration announced recent changes to Child Care Works (CCW), Pennsylvania’s subsidized child care program, that will decrease costs to families who qualify for subsidized care and add incentives for child care providers to participate in the program.

“We cannot miss an opportunity to invest resources where they will make a positive and lasting impact on our children. By targeting investments to our subsidized child care system, we are investing in equitable quality child care for all Pennsylvanians, no matter where they live or their income,” said Gov. Wolf. “Pennsylvania’s economy, its families, and its future depend on a strong child care and early learning system, and I want to extend my deepest gratitude to the dedicated child care providers and professionals who choose to invest in our children and families every day. Our economic recovery from the pandemic will be possible because of you.”

Pennsylvania received more than $1 billion from the American Rescue Plan Act (ARPA) to support the commonwealth’s child care industry, child care providers, and the children and families that rely on this system. Beginning January 1, 2022, $352 million in Child Care Development Fund federal ARPA funding will also support:

  • Lower maximum copayments for families eligible for CCW: $121.9 million will be used to reduce the maximum family copayment for families participating in subsidized child care through CCW. Current copayments range from 3-11 percent of a family’s overall income.  This change will lower the copayment to 3-7 percent, in line with federal recommendations for family obligations for subsidized child care. No family will see an increased copay through the adjustment, and providers will still receive the difference as a part of the CCW base rate.
  • Increased base rates for providers participating in CCW: $213.7 million will support increasing base rates paid to subsidized child care to the 60th percentile compared to the private pay market rate. This change brings Pennsylvania closer to the federally-recommended 75th percentile.
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Nearly two-thirds of children whose families are eligible for CCW are enrolled in a STAR 1 or 2 rated facility. By investing in base rates to providers participating in CCW, Pennsylvania is investing in quality across the child care industry for the children and families served by this program. In March 2021, the Wolf Administration raised base rates from the 25th percentile to the 40th percentile.

  • Rate incentives for providers that offer child care during non-traditional hours: $16.8 million will support add-on incentives to CCW base rates for child care providers that offer at least two hours of care during non-traditional hours.

Prior to the pandemic, the Keystone Command Center for Economic Development and Workforce recommended expanding availability of licensed child care before 6 a.m. and after 6 p.m. – what is normally considered “traditional” child care hours – in order to give flexibility and security for working parents. These rate incentives will support providers that offer care outside of traditional hours, giving parents a safe place for their children and the security necessary to help parents return to work.

“For our youngest Pennsylvanians, an early childhood education experience can shape their educational, social, and emotional development throughout their lives,” said DHS Acting Secretary Meg Snead. “Beyond its necessity for a thriving economy today, investments in quality early learning and child care programs carry into PreK-12 education and throughout adulthood. This funding will give our youngest Pennsylvanians a strong start they deserve and supports the dedicated educators and professionals that make this possible.”

The Wolf Administration is committed to supporting Pennsylvania’s child care industry and its devoted professionals and educators as they weather the ongoing challenges created by the public health and economic crises. Since March 2020, more than $1.1 billion of aid has been made available directly to providers to offset financial losses, assist with added infection control and safety costs, and invest in staff recruitment, retention, and higher, livable wages.

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Additionally, $600 Pandemic Relief Awards were extended to approximately 38,000 child care professionals for their service through the pandemic. The stabilization grants are the largest one-time funding Pennsylvania has been able to extend thus far. To date, approximately 3,150 applications have been approved, while 367 are in-process and 269 are under review. More than $382 million has been obligated to approved providers.

For more information on child care providers operating in Pennsylvania, visit Providers seeking to apply for Child Care Stabilization Grants can learn more and apply here.

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