Market Rate Study - Child Care Circuit

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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.
Overview of Discussion
o
o
o
o
o
Page 2
Survey Purpose and Context
Survey Scope & Methodology
Highlights of Survey Findings
Results of Market Price Survey
Next Steps and Supporting Analyses
Massachusetts Market Price Survey
Survey Purpose & Context
Federal 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
Page 3
Massachusetts Market Price Survey
Survey Scope & Methodology
Survey 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
Page 4
Massachusetts Market Price Survey
Survey Scope & Methodology
Overview 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
Not currently providing care
Part-time only
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
Page 5
Massachusetts Market Price Survey
Results of Market Price Survey
Overview 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
Page 6
Massachusetts Market Price Survey
Results of Market Price Survey
Center-Based 75th Price Percentiles & EEC Rates
$100
$90
75th
Pctl.
$80
$80
Daily Price Per Full-Time Slot
$70
75th
Pctl.
$65
$60
75th
Pctl.
$66
75th
Pctl.
$58
75th
Pctl.
$82
75th
Pctl.
$74
75th
Pctl.
$60
75th
Pctl. 75th
$79 Pctl.
$76
75th
Pctl.
$67
75th
Pctl.
$57
75th
Pctl.
$51
75th
Pctl.
$44
$50
75th
Pctl.
$84
75th
Pctl.
$62
75th
Pctl.
$54
75th
Pctl.
$60
75th
Pctl.
$46
$40
$30
$48
$43
$33
$49
$44
$33
$55
$50
$36
$60
$53
$37
$48
$44
$33
$55
$48
$37
$20
$10
Western
Central
Northeastern
Metro
Southeastern
Boston
$0
Western
Central
Northeastern
Metro
Southeastern
Boston
EEC Rate Region
EEC Infant Rate
Page 7
EEC Toddler Rate
EEC Preschool Rate
Gap with Federal Benchmark - 75th Percentile
Massachusetts Market Price Survey
Results of Market Price Survey
Center-Based 50th Price Percentiles & EEC Rates
$100
$90
$80
50th
Pctl.
$70
Daily Price Per Full-Time Slot
$70
$60
50th
Pctl.
$75
50th
Pctl.
$71
50th
Pctl.
$62
50th
Pctl.
$52
$50
50th
Pctl.
$54
50th
Pctl.
$49
70th
Pctl.
$50
50th
Pctl.
$48
50th
Pctl.
$51
50th
Pctl.
$40
50th
Pctl.
$36
$40
50th
Pctl.
$58
50th
Pctl.
$65
50th
Pctl.
$60
50th
Pctl.
$47
50th
Pctl.
$45
50th
Pctl.
$39
$30
$48
$43
$33
$49
$44
$33
$55
$50
$36
$60
$53
$37
$48
$44
$55
$33
$48
$37
$20
$10
Western
Central
Northeastern
Metro
Southeastern
Boston
$0
Western
Central
Northeastern
Metro
Southeastern
Boston
EEC Rate Region
EEC Infant Rate
Page 8
EEC Toddler Rate
EEC Preschool Rate
Gap With 50th Percentile
Massachusetts Market Price Survey
Results of Market Price Survey
Family Child Care 75th Price Percentiles & EEC Rates
75th 75th
Pctl. Pctl.
$65 $65
$70
75th
Pctl.
$66
$60
75th
Pctl.
$48
Daily Price Per Full-Time Slot
$50
$40
75th
Pctl.
$37
75th
Pctl.
$35
75th
Pctl.
$35
$30
$26
75th
Pctl.
$45
75th
Pctl.
$44
75th
Pctl.
$50
75th
Pctl.
$51
75th
Pctl.
$50
75th
Pctl.
$50
75th
Pctl.
$45
75th
Pctl.
$45
75th
Pctl.
$40
75th
Pctl.
$40
$32
$32
75th
Pctl.
$35
$30
$20
$30
$32
$32
$26
$32
$32
$28
$34
$34
$28
$32
$32
$26
$28
$10
Western
Central
Metro
Northeastern
Southeastern
Boston
$0
Western
Central
Metro
Northeastern
Southeastern
Boston
EEC Rate Region
State Infant Rate
Page 9
State Toddler Rate
State Rate - Over Two
Gap with Federal Benchmark - 75th Percentile
Massachusetts Market Price Survey
Results of Market Price Survey
Family Child Care 50th Price Percentiles & EEC Rates
$70
50th
Pctl.
$58
$60
50th
Pctl.
$56
50th
Pctl.
$55
Daily Price Per Full-Time Slot
$50
$40
50th
Pctl.
$35
50th
Pctl.
$40
50th
Pctl.
$32
50th
Pctl.
$32
$30
$26
70th
Pctl.
$40
50th
Pctl.
$36
50th
Pctl.
$36
50th
Pctl.
$40
50th 50th
Pctl. Pctl.
$40 $40
50th
Pctl.
$35
50th
Pctl.
$40
50th
Pctl.
$35
50th
Pctl.
$34
$32
$32
$30
50th
Pctl.
$30
$20
$30
$32
$32
$26
$32
$32
$28
$34
$34
$28
$32
$32
$26
$28
$10
Western
Central
Northeastern
Metro
Southeastern
Boston
$0
Western
Central
Northeastern
Metro
Southeastern
Boston
EEC Rate Region
EEC Infant Rate
Page 10
EEC Toddler Rate
EEC Rate - Over Two
Gap With 50th Percentile
Massachusetts Market Price Survey
Results of Market Price Survey
Out-of-School-Time 75th Price Percentiles & EEC Rates
$30
75th
Pctl.
$26
75th
Pctl.
$23
$25
Daily Price Per Child
$20
75th
Pctl.
$23
75th
Pctl.
$22
75th
Pctl.
$23
75th
Pctl.
$18
$15
$10
$18
$17
$15
$15
$18
$15
$5
$0
Western
Western
Central
Central
Northeastern
Metro
Northeastern
SoutheasternBoston
Metro
Southeastern
Boston
EEC Rate Region
EEC After-School Rate
Page 11
Gap With Federal Benchmark - 75th Percentile
Massachusetts Market Price Survey
Results of Market Price Survey
Out-of-School-Time 50th Price Percentiles & EEC Rates
$30
$25
Daily Price Per Child
50th
Pctl.
$20
50th
Pctl.
$20
$20
50th
Pctl.
$22
50th
Pctl.
$18
50th
50th
Pctl.
Pctl.
$15
$15
50th
Pctl.
$20
$15
$10
$18
$17
$15
$15
$18
$15
$5
$0
Western
Western
Central
Central
Northeastern
Metro
Northeastern
SoutheasternBoston
Metro
Southeastern
Boston
EEC Rate Region
EEC After-School Rate
Page 12
Gap With 50th Percentile
Massachusetts Market Price Survey
Results of Market Price Survey
Price 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%
Page 13
Massachusetts Market Price Survey
Next Steps
Additional Analysis Planned
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 outof-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
Page 14
Massachusetts Market Price Survey
Sources
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.
Page 15
Massachusetts Market Price Survey
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