The Massachusetts Department of Early Education and Care

DRAFT FOR DISCUSSION ONLY

Massachusetts Child Care Market Price Survey

Evaluation CommitteeFebruary 17, 2011

o Mandate for Market Price Surveyso Child Care Market Prices and Affordabilityo Scope of the Massachusetts Market Price Surveyo Survey Methodology & Update on Progresso Next Steps – Planned Analyses & Reporting

Overview of Discussion

Page 2 Massachusetts Market Price Survey

Mandate for Market Price SurveysFederal Requirement & How Other States Compare

Page 3 Massachusetts Market Price Survey

o The U.S. Office of Child Care requires states to conduct a market price survey every two years as part of the Child Care & Development Fund (CCDF) rules

o Purpose of the survey is to help ensure that state child care payment rates are high enough to enable families to competitively find and afford care through CCDF-funded child care assistance programs

o Federal CCDF rules encourage states to set reimbursement rates that are at or above the 75th percentile of prices in the private market. Viewed as a benchmark rather than a federal requirement

o Based on findings of the 2008 market price survey, EEC does not meet the federal 75th percentile benchmark in any region for any type of care. Nationally, only six states were meeting that benchmark in 2010. Down from nine states in 2009 (Schulman & Blank, 2010).

Market Prices & AffordabilityHow Massachusetts Compares to Other States

Page 4 Massachusetts Market Price Survey

• Prices for early childhood services are higher in Massachusetts than in any other state, with an average cost of $18,773 per year for infants and $13,158 for preschool-aged children (NACCRRA, 2010)

• When placed within the context of a family’s budget, the challenge of affordability and the importance of child care assistance is clear for low-income families

• Faced with the high price of care, low-income families are more likely to turn to informal types of care and likely to rely on multiple care arrangements (Adams, Tout & Zaslow, 2007; Burnstein & Layzer, 2007). These factors have been shown to have a negative impact on child development

• State child care assistance brings center-based care and regulated family child care within the grasp of low-income families (Adams & Rohacek, 2002; Snyder, Bernstein & Koralek, 2004)

Scope of the Market Price Survey

Page 5 Massachusetts Market Price Survey

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 study will:

• Examine 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

• Highlight significant price changes between 2008 and 2010

• Compare market prices to practitioner wages

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

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

Overview of MethodologySurvey of Random Sample of Programs

Page 6 Massachusetts Market Price Survey

• Sample Design – Relies on a random sample of 4,800 programs, stratified by EEC region and type of care

• Outreach Campaign – 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 reminder postcards and up to three phone attempts

• Data Collection – Data are being collected through on-line questionnaire, with follow-up phone calls to programs that do not respond on-line

• Progress Update – More than 3,600 responses received so far. With two weeks left, responses exceed 75% of the sample targets in nearly all areas. Placing additional emphasis on Family Child Care in Western, Metro and Northeastern regions, where response rates have been lower

Project WorkplanProject Timeline, Milestones & Deliverables

Page 7 Massachusetts Market Price Survey

11 25 8 22 6 20 3 17 31 14 28 14 28 11 25 9 23 6 20 Apr May JuneJan

2011Feb MarOct Nov Dec

2010

Survey Development

Survey Data Collection

Analysis & Reporting

Additional Analyses

Final Work Plan

October 29,2010

Survey Development Complete & Data Collection Teams

TrainedDecember 17, 2010

Data Collection Began

December 27,2010

75th Percentile Calculations

March 15, 2011

Final Market Price Survey

ReportApril 8, 2011 Final

Report on Market Prices-Wages and

Regional Price Variations

June 1,2011

• Initial report with 75th percentile calculations (March 15)

• Complete and final Market Price Survey report (April 8)

• Analysis of market prices and wages (June 1)

• Analysis of regional price variations and price clusters (June 1)

Next StepsPlanned Analyses & Reporting

Page 8 Massachusetts Market Price Survey

o Adams, G., Tout, K., Zaslow, M. (2007). “Early Care and Education for Children in Low-Income Families: Patterns of Use, Quality and Potential Policy Implications.” Paper prepared for the Urban Institute and Child Trends Roundtable on Children in Low-Income Families, Washington, D.C.

o Adams, G. & Rohacek, M. (2002). More than a Work Support? Issues Around Integrating Child Development Goals Into the Child Care Subsidy System. Early Childhood Research Quarterly, 17, 418-440.

o Burstein, N. & Layzer, J.I. (2007). National Study of Child Care for Low-Income Families: Patterns of Child Care Use Among Low-Income Families. Cambridge, MA: Abt Associates, Inc.

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.

o Snyder, K., Bernstein, S., & Koralek, R. (2004). Parents’ Perspectives on Child Care Subsidies and Moving from Welfare to Work. Washington, DC: Urban Institute.

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

Sources

Page 9 Massachusetts Market Price Survey