Massachusetts Child Care Market Price Survey Board of Early Education & Care April 12, 2011 Kenley Branscome Kate Giapponi & Emma Cohen Applied Policy

Massachusetts Child Care Market Price Survey

Board of Early Education & Care

April 12, 2011

Kenley Branscome Kate Giapponi & Emma Cohen

Applied Policy Analytics Public Consulting Group, Inc.

o Survey Purpose and Contexto Survey Scope & Methodologyo Highlights of Survey Findingso Results of Market Price Surveyo Next Steps and Supporting Analyses

Overview of Discussion

Page 2 Massachusetts Market Price Survey

Survey Purpose & ContextFederal Requirements & How Other States Compare


o U.S. Office of Child Care requires states to conduct a market price survey every two years as part of Child Care & Development Fund (CCDF) requirements and encourages setting child care reimbursement rates at or above the 75th percentile of prices in the private market. Seen as benchmark rather than requirement

o The prices for child care in Massachusetts are the highest in the nation, as reported by NACCRRA in 2010. Comparing prices across states, however, is complicated by a lack of standardized methods and definitions used to collect state price data

o Both the 2006 and 2008 surveys found that the state did not meet the 75th percentile benchmark in any region for any type of care. Nationally, only six states met that benchmark in 2010. Down from nine states in 2009. (Schulman & Blank, 2010)

o Comparing states that have met the benchmark with those that have not is a challenge, as each state balances priorities for quality, access and affordability in different ways – e.g., some states serve a larger share of children in unregulated settings, have lower income eligibility limits, and/or charge higher parent co-pays

Survey Scope & MethodologySurvey Scope & Project Goals


Project Goal - Conduct a credible study of market prices in each region of the state and across all program types to assist EEC in evaluating the adequacy of rates for the purpose of demonstrating equal access to child care for low-income families. The survey and companion analyses:

• Examines the market prices for the 25th, 30th, 40th, 50th, 60th and 75th percentiles for each type of care with each of EEC’s rate regions

• Highlights significant price changes between 2008 and 2010

• Compares market prices to practitioner wages

• Considers other questions raised by the Evaluation Subcommittee during the 2008 market price survey – e.g., absentee policies, etc.

• Examines possible alternatives to existing rate areas, especially in regions with clusters of prices that are higher than the region as a whole

Survey Scope & MethodologyOverview of Survey Design


o Relied on a random sample of 4,800 programs, including approximately 2,000 licensed child care centers and out-of-school-time programs and 2,800 family child care providers, stratified by EEC region and type of care. The survey excluded programs that were:

Free to income-eligible families Part-time onlyNot currently providing care Licensed-exempt

o Conducted outreach campaign with letters and e-mails sent from Commissioner to all programs in the sample in English and Spanish with link to on-line survey. Followed up by postcards and up to three phone attempts. Provided a nominal incentive for participation

o The response rate was high, with responses from 90% of center-based and out-of-school-time programs and 78% of family child care providers

Results of Market Price SurveyOverview of Findings


o Prices for center-based care are highest in Boston, Metro and Northeastern regions. Lowest in the Western, Central and Southeastern regions. Prices for family child care are highest in the Metro region and lowest in the Boston and Western regions

o Current EEC rates are below the 75th percentile in all regions. Rates are below the 50th percentile in all regions, except for after-school care in the Western Region. While out-of-school-time rates are generally above the 25th percentile in most cases, center-based and family child care rates remain below the 25th percentile in all cases except for center-based infant care in the Western region and family child care for infants/toddlers in the Western, Northeastern and Boston regions

o Prices decrease significantly in center-based settings as the age of the child increases, while prices in family child care settings decrease less as the age of child increases

o Median prices have increased at a slower pace during the last two years, as compared to the price increases reported in last market price survey

Western Central Northeastern Metro Southeastern Boston

$55$48$60$55$49$48

75thPctl.$79

75thPctl.$62

75thPctl.$84 75th

Pctl.$80

75thPctl.$66

75th Pctl.$65

$48$44$53$50$44$43

75thPctl.$76

75thPctl.$54

75thPctl.$82

75thPctl.$74

75th Pctl.$60

75thPctl.$58

$37$33$37$36$33$33

75thPctl.$60

75thPctl.$46

75thPctl.$67

75thPctl.$57 75th

Pctl.$51

75thPctl.$44

$0

$10

$20

$30

$40

$50

$60

$70

$80

$90

$100


EEC Rate Region

Dai

ly P

rice

Per F

ull-T

ime

Slot

EEC Infant Rate EEC Toddler Rate EEC Preschool Rate Gap with Federal Benchmark - 75th Percentile

Results of Market Price SurveyCenter-Based 75th Price Percentiles & EEC Rates



$55$48$60$55$49$48

50thPctl.$65

50thPctl.$51

50thPctl.$75 50th

Pctl.$70

50thPctl.$54

50th Pctl.$52

$48$44$53$50$44$43

50thPctl.$60

50thPctl.$47

50thPctl.$71

50thPctl.$62

70th Pctl.$50

50thPctl.$49

$37$33$37$36$33$33

50thPctl.$4550th

Pctl.$39

50thPctl.$58

50thPctl.$48

50thPctl.$40 50th

Pctl.$36

$0

$10

$20

$30

$40

$50

$60

$70

$80

$90

$100


EEC Rate Region

Dai

ly P

rice

Per F

ull-T

ime

Slot

EEC Infant Rate EEC Toddler Rate EEC Preschool Rate Gap With 50th Percentile

Results of Market Price SurveyCenter-Based 50th Price Percentiles & EEC Rates



$32$32$34

$32$32$30

75thPctl.$40

75thPctl.$50

75thPctl.$65

75thPctl.$50

75thPctl.$48

75th Pctl.$37

$32$32$34

$32$32$30

75thPctl.$40

75thPctl.$45

75thPctl.$65

75thPctl.$51 75th

Pctl.$45

75thPctl.$35

$28$26$28$28$26$26

75thPctl.$35

75thPctl.$45

75thPctl.$66

75thPctl.$50

75thPctl.$44

75thPctl.$35

$0

$10

$20

$30

$40

$50

$60

$70


EEC Rate Region

Dai

ly P

rice

Per F

ull-T

ime

Slot

State Infant Rate State Toddler Rate State Rate - Over Two Gap with Federal Benchmark - 75th Percentile

Results of Market Price SurveyFamily Child Care 75th Price Percentiles & EEC Rates



$30 $32 $32 $34 $32 $32

50th Pctl.$35

50thPctl.$40 50th

Pctl.$36

50thPctl.$58

50thPctl.$40

50thPctl.$35

$30 $32 $32 $34$32 $32

50thPctl.$32

70th Pctl.$40

50thPctl.$40

50thPctl.$56

50thPctl.$40

50thPctl.$34

$26 $26 $28 $28 $26 $28

50thPctl.$32

50thPctl.$36

50thPctl.$35

50thPctl.$55

50thPctl.$40

50thPctl.$30

$0

$10

$20

$30

$40

$50

$60

$70


EEC Rate Region

Dai

ly P

rice

Per F

ull-T

ime

Slot

EEC Infant Rate EEC Toddler Rate EEC Rate - Over Two Gap With 50th Percentile

Results of Market Price SurveyFamily Child Care 50th Price Percentiles & EEC Rates


EEC After-School Rate

Western Central Northeastern Metro SoutheasternBoston

$15 $15$17 $18

$15$18

75th Pctl.$23

75thPctl.$23

75th Pctl.$26

75th Pctl.$22

75thPctl.$23

75th Pctl.$18

$0

$5

$10

$15

$20

$25

$30


EEC Rate Region

Dai

ly P

rice

Per C

hild

EEC After-School Rate Gap With Federal Benchmark - 75th Percentile

Results of Market Price SurveyOut-of-School-Time 75th Price Percentiles & EEC Rates


EEC After-School Rate

Western Central Northeastern Metro SoutheasternBoston

$15 $15$17 $18

$15$18

50th Pctl.$2050th

Pctl.$18

50th Pctl.$2250th

Pctl.$20

50thPctl.$20

$0

$5

$10

$15

$20

$25

$30


EEC Rate Region

Dai

ly P

rice

Per C

hild

50th Pctl.$15

EEC After-School Rate Gap With 50th Percentile

50th Pctl.$15

Results of Market Price SurveyOut-of-School-Time 50th Price Percentiles & EEC Rates


Results of Market Price SurveyPrice Changes Since 2008 and 2006


o Since 2008, overall median prices increased slightly across all types of care as inflation increased by 4.3%:

Median prices for center-based care increased, on average, by 1% for infant care, 3% percent for toddler care and preschool. Highest increases in Boston and Northeast regions. Lowest in Southeast

Median prices for family child care increased, on average, by 4% for infants/toddlers and 1% for children over two. Highest increases in Boston and Central regions. Lowest in Southeast

Median prices for after-school care increased, on average, by 4%. Largest increase in Metro region and lowest in Boston

o Since 2006, the median price of care has increased 10% to 16%, across all types of care compared to an inflation rate of 9.3%

o Additional research questions were raised in RFP, during the kick-off meeting and by board committees. In response, the following additional analyses are planned:

Analysis of Local Price Variations – Will analyze the extent to which

prices vary among towns within EEC regions. Will rely on zip-code level price data collected in 2008 and update with 2010 price data

Analysis of Practitioner Wage Data – Will analyze the extent to which wages vary across different segments of the early childhood and out-of-school-time workforce. Will be limited to analysis of extant secondary data in the new Professional Qualifications Registry

o All work is expected to be complete on or before June 1

Next StepsAdditional Analysis Planned


o Datta, A.R., Goerge, R., and Yan, T. (2010). Design Phase of the National Study of Child Care Supply and Demand (NSCCSD): Final Report. With additional contributions by Witte, A., Guzman, L., Kreader, L., Weber, R., Schexnayder, D., Zaslow, M., and Wolter, K. Chicago: NORC.

o Marrufo, G., O’Brien-Strain, M. and Oliver, H. (2003). Child Care Price Dynamics in California. San Francisco, CA: Public Policy Institute of California.

o National Association of Child Care Resource and Referral Agencies. (2010). Parents and the High Cost of Care

o Schulman, K. & Blank, H. (2010). National Women’s Law Center. State Child Care Assistance Policies 2010: New Federal Funds Help States Weather The Storm.

Sources


Documents

Massachusetts Child Care Market Price Survey Board of Early Education & Care April 12, 2011 Kenley Branscome Kate Giapponi & Emma Cohen Applied Policy