PRESS RELEASE – Changes in child care policies in Michigan have improved access to child care for families and enhanced financial stability for child care providers, according to long-term research by Public Policy Associates.
The research project is a partnership between PPA, the Michigan Department of Lifelong Education, Advancement, and Potential (MiLEAP), and the Michigan Department of Health and Human Services (MDHHS). The work has assisted Michigan policymakers in developing and assessing policies to help families with one of their most crucial and challenging issues—finding affordable, quality child care.
National statistics illustrate the financial burden families face with child care. Single-income families typically spend 36% of their income on child care and two-income families 15%, both far exceeding the 7% maximum that is recommended by the U.S. Department of Health and Human Services.
A cornerstone of Michigan’s efforts is the Child Development and Care (CDC) Scholarship program. The CDC Scholarships help parents afford child care while they maintain jobs or pursue education, strengthening Michigan’s economy in the process. Over 32,000 children received assistance through the program in December 2022.
PPA researchers noted that Michigan expanded income eligibility four times between 2015 and 2022, raising family income limits from 125% to 200% of the federal poverty level. Michigan moved from having the most restrictive eligibility level in the country in 2019 to a midway ranking in 2022. Program enrollment hit a peak in 2019, dipped during the pandemic, and rebounded to pre-pandemic levels in 2022.
“Overall, expanded eligibility and rate increases led to more families enrolling their children in high-quality programs and staying in them longer, which supports child development and helps parents,” said Colleen Graber, the project director and principal investigator. “Child care challenges remain, but Michigan is moving in a positive direction.”
Black families, who were impacted heavily by health and financial obstacles during the pandemic, benefited more from the last eligibility increase than other groups, the PPA research showed, and were 10% less likely to exit the program than before the eligibility threshold was expanded. In addition, their access to high-quality providers increased.
Child care accessibility issues, including the supply of child care providers, present barriers to parents seeking to hold jobs and/or advance in careers.
The PPA research found substantial differences in child care availability in various parts of the state. Urban areas, like Metro Detroit, had the highest rate of CDC Scholarship use and the highest concentration of providers. Rural families were less likely to use their CDC Scholarships and had the lowest availability of child care slots.
Michigan increased payment rates to providers during the study period, and it provided relief and stabilization grants in response to the pandemic. Higher rates resulted in increased program enrollment and improved continuity of care for children, PPA’s research showed.
PPA also found that providers who received one or more stabilization grants were three times less likely to close between June 2022 and December 2022.
The five-year study used mixed research methods, including analysis of program data, surveys of MDHHS eligibility specialists, and interviews with parents and providers.
PPA offered a series of recommendations based on study results:
- Invest in increased provider supply and more child care slots across the variety of settings families value.
- Bolster CDC program payment rates to reflect the cost of providing quality child care and support providers with business, workforce, and quality-care technical assistance.
- Maintain CDC program eligibility at no less than 200% of the federal poverty level.
- Help families to locate care by building awareness of existing resources and facilitating timely communication about open slots.
- Further examine why some families do not utilize their CDC Scholarships.
Public Policy Associates has worked extensively on a range of early care and education issues over the past decade. For more information, contact Colleen Graber at cgraber@publicpolicy.com. To learn more about this study’s results and other project outcomes, visit PPA’s website at www.publicpolicy.com/MICCPRP-2019.