Child care reimbursement rate increased

Published 2:17 pm Thursday, July 14, 2022

NASHVILLE — Child care centers that participate in a Tennessee state reimbursement program for low and moderate-income parents just got a 20% increase — and parents in the program are having their co-pays waived for the rest of the year.

Blair Taylor, CEO for Tennesseans for Quality Early Education, said the changes are a huge win for both parents and child care providers. Taylor said, “We applaud the Tennessee Department of Human Services for increasing child care reimbursement rates so significantly.

“This is a huge step in the right direction and moves Tennessee’s child care payment assistance program closer to covering the actual costs of quality child care, while also making quality child care more accessible and affordable for eligible working families.”

The subsidies are available for any families making at or below 85% of the state’s median income. For a family of four, that upper limit is $68,652 per year. The amount of “co-pay” the family is responsible for increases the closer their income gets to that 85% mark.

Using toddler reimbursements (13 to 31 months), what that means for participating centers is this: weekly reimbursements have increased from about $170 to $205 for non “star-rated” centers. A “three-star” center now gets $246 weekly for a child in that age range, up from about $205 before the increase. (The totals are for “top tier” counties, which include Greene, Washington and Sullivan in Northeast Tennessee.)

“There’s no denying that we are facing a child care crisis here in Tennessee and across the country. A child care survey conducted by Tennesseans for Quality Early Education found that 98 percent of Tennessee parents of children under 5 reported child care challenges had adversely impacted their workforce participation and productivity or limited career opportunities — with affordability, access and difficulty finding quality care being the biggest problems.

“While this reimbursement rate increase is a step in the right direction, there’s much more that needs to be done to fix the broken child care system and to ensure Tennessee’s working families can afford quality child care and early educators are compensated competitively. We look forward to the continued work of the state-appointed Child Care Task Force, on which I’m proud to serve, as it finalizes recommendations to improve Tennessee’s child care system and strengthen our workforce of today and workforce of tomorrow.”

The second part of Monday’s announcement was the waiving of co-pays from August 1 through the end of 2022. Taylor said many people’s incomes qualify them for the “Smart Steps” program.

A household of four earning 60% of the median income — $48,468 a year — currently pays $64 weekly out of pocket for one child or $112 for two. Even for one child, that family will save more than $1,300 through the end of the year thanks to the waiver.