May 16, 2024
The Maine DHHS Office of Child and Family Services (OCFS) announced today new child care reimbursement rates taking effect in July 2024 that will improve access to high-quality child care and early childhood learning for families across Maine.
The new rates support providers who participate in the Child Care Affordability Program (CCAP), which helps eligible families pay for child care so parents can work, go to school, or participate in job training. Through the program, families apply for subsidy and the child care programs where their children attend receive reimbursement through OCFS. All regions of the state will receive increased reimbursement under the new rate strategy, with larger increases going to more rural and lower-income counties to ensure consistency across the state. For example, rates for preschoolers in child care facilities in Aroostook, Piscataquis, and Somerset counties will increase by nearly 65 percent, from $148 to $244 per child, per week.
With this reimbursement rate improvement, Maine will lessen geographic inequity and strengthen the child care system while joining several states across New England and the country to build a more innovative and equitable child care funding system.
“Affordable and accessible child care is vital to ensuring that Maine parents can work and pursue higher education while their children grow and thrive in safe and healthy environments,” said OCFS Director Bobbi Johnson. “These new reimbursement rates are simpler, fairer, and will help Maine providers, especially those in rural areas, continue to provide high-quality care to Maine families.”
The updated rates, funded by the federal Child Care and Development Fund, are designed to support providers who participate in CCAP by better accounting for the costs of providing care in their area. Previously, Maine and many other states only set reimbursement rates based on the prices families are charged in the local market. Reliance on market rates without a cost analysis results in wide disparities across regions. OCFS established the new rates using a dual analysis that incorporates the cost of providing child care in addition to market rates in Maine’s child care market. The new rates, available here, also simplify the program by reducing the number of rate regions across the state from 10 to two. The two rate regions are now:
- Cumberland, Sagadahoc, and York counties
- Androscoggin, Aroostook, Franklin, Hancock, Kennebec, Knox, Lincoln, Oxford, Penobscot, Piscataquis, Somerset, Waldo, and Washington counties
OCFS’ approach to improving the reimbursement rate structure is driven by data and grounded in equity. OCFS’s cost analysis, also known as cost modeling, was completed in partnership with the Center for Early Learning Funding Equity and involved input from over 1,500 child care providers. It found little difference across Maine counties in the cost of providing care – approximately a 5 percent difference for child care centers and a 10 percent difference for family child care. Yet reimbursement rates vary widely; in some areas rates are up to 45 percent lower than in Cumberland County, where private pay families pay more for care.
The new, more equitable rates are aligned with other child care financing strategies and improvements to better meet the needs of young children, the child care workforce, and Maine’s working families.
“This is groundbreaking news,” said Cynthia Murphy, head of the Child Care Business Lab at Coastal Enterprises, Inc. “This fresh approach by OCFS will help child care owners, particularly in rural areas, boost financial sustainability and help them to continue serving families that depend on affordable care.”
“For a while now, it has been evident that child care market rates lead to disparities in subsidy reimbursement practices, and Maine is joining several other states working to address this issue,” said Heather Marden, Co-Executive Director of the Maine Association for the Education of Young Children. “We support policies and practices that reflect the cost of care, such as increasing wages and prioritizing quality for young children, and we are pleased to see rising reimbursement rates for the Child Care Affordability Program in regions across Maine that build equity into the system."
Maine’s CCAP program currently serves more than 3,600 Maine children.
Also beginning July 1, 2024, the income limit for CCAP will increase from 85 percent of the state’s median income (when adjusted for family size) to 125 percent of the state’s median income. Additionally, recent legislation phases in a number of changes to the program by 2030, including further expanding eligibility to families earning up to 250 percent of the state’s median income, and limiting child care costs to no more than seven percent of a family’s income.
The Governor and OCFS, with the support of the Legislature, are also delivering tiered salary stipends, benefitting over 7,000 early educators, helping qualified professionals remain in the industry, rewarding teachers who have years of experience and higher credentials, and supporting programs to retain staff.
In addition, the Administration is implementing a three-year, $24 million Federal grant, announced last year, that will strengthen community support and educational opportunities for young children. These include expanded outreach and programming to families with young children, pilot projects to make preschool more accessible, professional development for early childhood educators, and financial support for child care programs to improve their program offerings.
The state and federal investments are part of unprecedented funding under the Mills Administration to increase access to high-quality care and early learning.
Maine DHHS’ OCFS is helping Maine’s child care system recover from the pandemic and is improving child care quality, accessibility, and affordability over the long-term.
Read Maine’s Market Rate Survey Report.
Maine families can learn more about CCAP here.