New Rule Proposed to Improve Child Care Access, Affordability, and Stability

Today, the U.S. Department of Health and Human Services (HHS), through the Administration for Children and Families (ACF), announced a new proposed rule that will help more families access the child care they need and better support child care providers in the essential work they do for communities across the country. The proposed rule will lower costs for families, increase financial stability for providers, and reduce paperwork for families trying to access subsidies.

“Our country cannot function without a strong child care system,” said HHS Secretary Xavier Becerra. “Child care is vital to the health and well-being of our nation’s families, our businesses, and our economy. With today’s announcement, we are taking important steps to ensure that parents, children, and the child care providers who care for them have the support they need to thrive.”

The proposed rule strengthens key policies in the Child Care and Development Fund, a program that subsidizes child care costs for 1.5 million children and impacts 230,000 child care providers who receive subsidies. If enacted in a final rule, the proposed policies would reduce the amount that families receiving child care subsidies pay for child care and expand child care options for parents. The proposed policies would ensure timely and more stable payments for child care providers to encourage better payment rates.

“Parents need affordable and high-quality child care options so they can work, go to school, participate in training programs, and support their families. This proposal will help many families access that care in communities across the country,” said ACF Office of Child Care Director Ruth Friedman. “These proposed rules will build a better child care subsidy program for families and providers and strengthen this essential sector.”

Specifically, the proposed rule puts forward proposals for public comment that will lower families’ child care costs, increase parent child care options, and improve the financial stability of child providers so that parents can find child care when and where they need it. The NPRM proposes changes to:

• Lower Families’ Child Care Costs: Reduces the significant financial strain that high co-payments can cause for families receiving child care assistance by capping co-payments for all families to no more than 7% of their income and allowing states to waive co-payments entirely for families at or below 150% of the federal poverty level.
• Increase Parents’ Child Care Options and Strengthen Payment Practices: Increases parents’ child care options by stabilizing operations for participating providers and encouraging more providers to participate in CCDF, ensuring payments are timely and stable and encouraging higher payment rates to better cover the cost of care.
• Reducing Paperwork and Bureaucracy for Parents: Encourages CCDF Lead Agencies to streamline eligibility and enrollment processes to make it easier for families to receive child care assistance faster and make program bureaucracy less likely to disrupt parent employment, training, and education and impede access to child care. This includes proposals to allow states to extend presumptive eligibility to families, and encouraging states to allow all families to enroll for CCDF benefits online.

The public is invited to submit comments on these proposed rules, which are due 45 days after publication on July 13, 2023.