4.2 Assess Market Rates and Analyze the Cost of Child Care

To establish subsidy payment rates that ensure equal access, Lead Agencies must collect and analyze statistically valid and reliable data and have the option to conduct either a (1) market rate survey (MRS) reflecting variations in the price to parents of child care services by geographic area, type of provider, and age of child, or (2) an ACF pre-approved alternative methodology, such as a cost estimation model, which estimates the cost of care by incorporating both data and assumptions to estimate what expected costs would be incurred by child care providers and parents under different scenarios. All Lead Agencies must analyze the cost of providing child care through a narrow cost analysis or pre-approved alternative methodology. Prior to conducting the MRS or pre-approved alternative, Lead Agencies must consult with the State Advisory Council on Early Childhood Education and Care (designated or established pursuant to the Head Start Act (42 U.S.C. 9837b(b)(1)(A)(i)) or similar coordinating body, local child care program administrators, local child care resource and referral agencies, and other appropriate entities; and organizations representing child care caregivers, teachers, and directors. Prior to conducting the MRS or pre-approved alternative methodology, Lead Agencies must consult with the State Advisory Council on Early Childhood Education and Care (designated or established pursuant to the Head Start Act (42 U.S.C. 9837b(b)(1)(A)(i)) or similar coordinating body, local child care program administrators, local child care resource and referral agencies, and other appropriate entities; and organizations representing child care caregivers, teachers, and directors. Note: Any Lead Agency considering using an alternative methodology instead of a market rate survey to set payment rates, is required to submit a description of its proposed approach to OCC for pre-approval in advance of developing and conducting the alternative methodology. Advance approval is not required if the Lead Agency plans to implement both an MRS and an alternative methodology to set rates at a percentile of the market rate, but a Lead Agency conducting a limited market rate survey and using it to inform their cost model would need pre-approval for this approach. In its request for ACF pre-approval, a Lead Agency must provide details on the following elements of their proposed alternative methodology: • Overall approach and rationale for using proposed methodology • Description of stakeholder engagement • Data collection timeframe (if applicable) • Description of the data and assumptions included in the methodology, including how these elements will yield valid and reliable results from the model • Description of how the methodology will capture the universe of providers, and reflect variations by provider type, age of children, geographic location, and quality 4.2.1 Completion of the market rate survey or ACF pre-approved alternative methodology Did the Lead Agency conduct a statistically valid and reliable MRS or ACF pre-approved alternative methodology to meet the CCDF requirements to assess child care prices and/or costs and determine payment rates? Check only one based on which methodology was used to determine your payment rates. a. [x] Market rate survey. i. When were the data gathered (provide a date range; for instance, September – December 2023)? February 2024 ￿ April 2024. The full Market Rate Survey report will be completed and disseminated to the public by June 30, 2024. b. [ ] ACF pre-approved alternative methodology. i. [ ] The alternative methodology was completed. ii. [ ] The alternative methodology is in process. If the alternative methodology was completed: When were the data gathered and when was the study completed? Describe any major differences between the pre-approved methodology and the final methodology used to inform payment rates. Include any major changes to stakeholder engagement, data, assumptions or proposed scenarios. If the alternative methodology is in progress: Provide a status on the alternative methodology and timeline (i.e., dates when the alternative methodology activities will be conducted, any completed steps to date, anticipated date of completion, and expected date new rates will be in effect using the alternative methodology). c. Consultation on data collection methodology. Describe when and how the Lead Agency engaged the following partners and how the consultation informed the development and execution of the MRS or alternative methodology, as appropriate. iii. State Advisory Council or similar coordinating body: Members of the State Early Childhood Advisory Council were invited to participate in public meetings where child care providers, parents, and other stakeholders were given the opportunity to provide feedback on the Market Rate Survey including the survey itself and the process by which the survey information was collected. Local family resource representatives participated in these meetings. The MRS instrument was shared with the State Early Childhood Advisory Council Workforce committee for comment. No feedback was provided from the committee. iv. Local child care program administrators: The Lead Agency contracted with a local university to conduct focus groups with statewide child care program administrators in order to obtain feedback about the Market Rate Survey Instrument. The first focus group helped to provide ideas for questions and topic areas for the supplement survey questions. The second focus group helped to review draft surveys and provide comments for revisions. v. Local child care resource and referral agencies: Local resource and referral agencies were invited to participate in public meetings where child care providers, parents, and other stakeholders were given the opportunity to provide feedback on the Market Rate Survey including the survey itself and the process by which the survey information was collected. Local family resource representatives participated in these meetings. vi. Organizations representing child care caregivers, teachers, and directors from all settings and serving all ages: A draft of the Market Rate Survey Instrument was distributed to child care provider organizations. These stakeholders were asked to test the online survey and submit feedback to the Lead Agency. vii. Other. Describe: Prior to implementation of the Market Rate Surveys, three virtual public meetings were held for interested stakeholders from November 8-16, 2023. Invitations were sent to all licensed child care providers in the state, as well as home-based providers participating in the Nurturing Homes Initiative (approximately 85 providers). A total of 114 participants, representing 136 facilities, attended one of the three sessions. Of the 93 attendees who specified whether they accepted subsidies, 86 reported that they accepted child care subsidies, and seven reported that they did not. At each meeting, five representatives from the SSRC presented information on the 1) goals and purposes of the MRS, 2) benefits of the MRS to child care providers, 3) survey implementation plan, 4) survey analysis plan, 5) survey results reporting plan, and 6) topics covered in the survey. After this presentation, SSRC and MDHS representatives fielded questions from participants. Providers expressed concern about participating in the survey since they accept subsidies, fearing they would skew the results. They also expressed confusion about subsidy policies impacting tuition rates and concerns over differences between metro and non-metro rates. The concerns and confusion was addressed in the public meetings by clarifying survey and tuition requirements and policies. Additionally, future recruitment efforts included language to address these concerns. Regarding metro and non- metro rates, analyses were conducted using several classifications of rural/urban status to ensure accuracy. Due to low participation, the lead agency sent out direct emails to child care centers that signed up for a survey appointment but missed it. The Lead Agency also sent out email blasts to all subsidy participating child care centers stressing the importance of participating in the MRS. The university contracted to conduct the survey also made follow up phone calls to child care centers to urge participation as well. d. An MRS must be statistically valid and reliable. An MRS can use administrative data, such as child care resource and referral data, if it is representative of the market. Please provide the following information about the market rate survey: i. When was the market rate survey completed? 4/30/2024 ii. What was the time period for collecting the information (e.g., all of the prices in the survey are collected within a three-month time period)? All of the prices were collected in a 3-month time period: February - April 2024. iii. Describe how it represented the child care market, including what types of providers were included in the survey: All CCDF eligible providers (i.e., licensed center-based, licensed family home, registered license-exempt center and family home providers) were contacted to participate in the survey. iv. What databases are used in the survey? Are they from multiple sources, including licensing, resource and referral, and the subsidy program? The Mississippi State Department of Health Licensure database and the Nurturing Homes Initiative database of non-licensed home-based providers. v. How does the survey use good data collection procedures, regardless of the method for collection (mail, telephone, or web-based survey)? Telephone and web-based surveys were administered to child care providers listed in the licensure database maintained by MSDHS. The telephone survey was administered by trained interviewers employed by an established survey call center affiliated with Mississippi State University (MSU). The online survey was administered using Qualtrics software. Human subjects protocols were followed. A sampling frame with contact information for 1,452 child care providers was obtained from the Mississippi State Department of Health Bureau of Licensure and Regulations and provided by MDHS. In the process of administering the survey, 167 child care providers were excluded due to closure; disconnected phone numbers; or being a duplicate, group or home-based facility, or Head Start/no fee provider. The final sampling frame included 1,285 qualified licensed (or license-exempt) center-based providers. The methodology described below was approved by Mississippi State University’s Institutional Review Board for the Protection of Human Subjects in Research prior to data collection, and each member of the research team was trained in human subjects research. An email was sent to licensed providers by MDHS to inform providers that the Market Rate Survey was being conducted and to encourage participation in the survey. The survey was administered between February and April 2024 by the SSRC’s Wolfgang Freese Survey Research Laboratory (SRL) using Computer Assisted Telephone Interviewing (CATI). An initial call was made by SRL staff to schedule an appointment for the interview, and a follow-up call was made to conduct the interview. For providers who did not answer when called, the SRL left a message that additional attempts would be made to contact them. In response to many providers being unable to keep their scheduled appointments, a second email was sent by MSDH to encourage provider participation. In advance of their appointments, providers were sent a list of documents they might need to answer survey questions, such as enrollment records, tuition rates, and operational expenses. Providers were also informed that they would receive a $25 incentive in the form of a gift card from Amazon or Walmart upon completion of the survey and that they would be entered into a drawing for $500 in gift cards. In response to a continued low cooperation rate, a second method for collecting center-based MRS surveys was established and implemented in early April. Due to the busy schedules of providers, the SCL recognized a need to provide a phone line so providers could call at their convenience to complete the survey. This ￿hotline￿ was operated by SCL staff. Flyers were emailed to providers to inform them about the hotline number. When providers called the hotline to request an appointment to complete the survey, calendar invitations, reminder emails, and reminder texts were sent. Additionally, a third method for collecting center-based MRS surveys was established. Thecenter-based MRS instrument was loaded into Qualtrics in the form of an online survey, and the survey link was mailed to all remaining center- based providers mid-April. Throughout the January-April recruitment period, SCL and MDHS partners assisted in the promotion of the MRS though listservs and social media. vi. What is the percent of licensed or regulated child care centers responding to the survey? 51.00 vii. What is the percent of licensed or regulated family child care homes responding to the survey? 100.00 viii. Describe if the survey conducted in any languages other than English: Analyses to determine price per child were not performed in languages other than English. ix. Describe if data were analyzed in a manner to determine price of care per child: Weights were constructed to ensure the sample was representative of the sampling frame. As such, weights were utilized to adjust how much a given child care provider counted relative to others. For example, if small facilities were less likely to participate in the survey (e.g., because they had less free time), the responses of the small facilities that did participate would carry more weight to compensate for those that did not. These adjustments aimed to align the sample responses more closely with what would be expected with a 100% response rate. Specifically, weights were constructed using reported capacity (five levels: 1-40 children; 41-64 children; 65-100 children; 101+ children, or unknown), whether a facility was listed as a CCPP-participating provider (2 levels: yes; no), and 13 county groupings based on previously established Early Childhood Academy service areas (see Figure below). Due to empty cells in the cross-tabulation of these variables, inverse propensity weighting could not be used. Therefore, raking, a common weighting technique, was used to balance the sample on these variables. The weights produced were within a target range (1.25-4.57). Analyses to determine price per child were not performed. Prior to calculating the market rates, the data were cleaned to remove any outlier values that appeared unusually high or low. Rates of zero were removed from the analysis, as well as any rate below the nominal fee cutoff of $600 per calendar year. A small number of rates that were provided in inappropriate or unusable formats were also removed from the analysis. Weekly market rates were calculated by age group for the state of Mississippi based on procedures outlined by the National Center on Subsidy Innovation and Accountability. Rates were calculated using five age groups that were determined by MDHS: infants (ages 0-11 months), toddlers (12-23 months), two-year-olds (24-35 months), preschoolers (3-4 years old), and school-age children (5 or more years old). Providers were able to specify their tuition rates in their preferred time units: hourly, daily, weekly, monthly, or yearly. Most providers (80%) provided full-time rates in a weekly format. This analysis reports market prices in a weekly format. (Monthly prices are shown in Appendix A). Therefore, prices given in other units were converted to weekly prices as follows: Hourly prices were multiplied by 40 for full-time care, Daily prices were multiplied by 5, Monthly prices were divided by 4.33, Yearly prices were divided by 52.1429. The market rates were adjusted using the sampling weights described above and were also weighted by the number of slots in each age group. The number of children currently being served in each age group was used as a proxy for the number of slots. Although some market rate analyses weight rates by programs’ total licensed capacity, there can be a disparity between the capacity and the actual number of children being served. It should be noted that the results of this market rate analysis were similar regardless of whether the sampling weights were applied or whether the rates were weighted by the number of slots. x. Describe if data were analyzed from a sample of providers and if so, how the sample was weighted: Weights were constructed using reported capacity (5 levels: 1-40 children; 41- 64 children; 65-100 children; 101+ children, or unknown), whether a facility was listed as a subsidy provider (2 levels: yes; no), and 13 county groupings based on the Early Childhood Academy service areas (see Figure below). Due to empty cells in the cross-tabulation of these variables, inverse propensity weighting could not be used. Therefore, raking, a common weighting technique, was used to balance the sample on these variables. The weights produced were in a reasonable range (1.25-4.57). Rates were calculated using five age groups that were determined by MDHS: infants (ages 0-11 months), toddlers (12-23 months), two-year-olds (24-35 months), preschoolers (3-4 years old), and school-age children (5 or more years old). Providers were able to specify their tuition rates in their preferred time units: hourly, daily, weekly, monthly, or yearly. Most providers (80%) provided full-time rates in a weekly format. This analysis reports market prices in a weekly format. (Monthly prices are shown in Appendix A). Therefore, prices given in other units were converted to weekly prices as follows: Hourly prices were multiplied by 40 for full-time care, Daily prices were multiplied by 5, Monthly prices were divided by 4.33, Yearly prices were divided by 52.1429. The market rates were adjusted using the sampling weights described above and were also weighted by the number of slots in each age group. The number of children currently being served in each age group was used as a proxy for the number of slots. Although some market rate analyses weight rates by programs’ total licensed capacity, there can be a disparity between the capacity and the actual number of children being served. It should be noted that the results of this market rate analysis were similar regardless of whether the sampling weights were applied or whether the rates were weighted by the number of slots. e. Price variations reflected. The market rate survey data or ACF pre-approved alternative methodology data must reflect variations in child care prices or cost of child care services in specific categories. i. Describe how the market rate survey or pre-approved alternative methodology reflected variation in geographic area (e.g., county, region, urban, rural). Include information on whether parts of the State or Territory were not represented by respondents and include information on how prices or costs could be linked to local geographic areas. Each facility was categorized according to its location into 13 different county groupings based on the Early Childhood Academy service areas. A secondary analysis took the unweighted frequency counts for each of these 13 county groupings and compared them to the expected counts of the sampling frame. This ￿goodness-of-fit￿ test revealed that the geographic variation of the sample did not differ from the population even before applying the weights. Rates were estimated separately for centers in metropolitan (urban) and nonmetropolitan (rural) areas. Centers were classified into metropolitan (large central metro, large fringe metro, medium metro, and small metro) and nonmetropolitan (micropolitan and noncore) areas using the 2013 National Center for Health Statistics Urban-Rural Classification Scheme for counties. This includes four metropolitan categories (large central, large fringe, medium, and small) and two nonmetropolitan categories (micropolitan and non-core). These were combined to compare metropolitan and nonmetropolitan areas. Based on this scheme, 46% of providers were located in metropolitan counties, and 54% were located in nonmetropolitan counties. The rates were higher in metropolitan areas compared to nonmetropolitan areas. Weekly center-based rates have increased since 2021 for both metro and non-metro areas, but the increases have not been as great in nonmetro areas. ii. Describe how the market rate survey or pre-approved alternative methodology reflected variation in type of provider (e.g., licensed providers, license-exempt providers, center-based providers, family child care home providers, home based providers). Surveys were administered and analyzed separately for a) licensed and licensed-exempt center based (n=660), which represents 51.4% of licensed and license-exempt center based child care providers, and b) home based (n=102) child care providers. The percentage of the population of family child care home providers and home based providers is unknown as the total population of family child care home providers and home based providers is unknown. However, the 102 home based child care providers represents 100% of home based child care providers that participate in the subsidy program. iii. Describe how the market rate survey or pre-approved alternative methodology reflected age of child (e.g., infant, toddler, preschool, school-age): Rates were calculated using five age groups that were determined by MDHS: infants (ages 0- 11 months), toddlers (12-23 months), two-year-olds (24-35 months), preschoolers (3-4 years old), and school-age children (5 or more years old). Providers were able to specify their tuition rates in their preferred time units: hourly, daily, weekly, monthly, or yearly. Most providers (80%) provided full-time rates in a weekly format. This analysis reports market prices in a weekly format. (Monthly prices are shown in Appendix A). Therefore, prices given in other units were converted to weekly prices as follows: Hourly prices were multiplied by 40 for full-time care, Daily prices were multiplied by 5, Monthly prices were divided by 4.33, Yearly prices were divided by 52.1429. The market rates were adjusted using the sampling weights described above and were also weighted by the number of slots in each age group. The number of children currently being served in each age group was used as a proxy for the number of slots. Although some market rate analyses weight rates by programs’ total licensed capacity, there can be a disparity between the capacity and the actual number of children being served. It should be noted that the results of this market rate analysis were similar regardless of whether the sampling weights were applied or whether the rates were weighted by the number of slots. iv. Describe any other key variations examined by the market rate survey or ACF pre- approved alternative methodology, such as quality level: Rates are summarized separately for centers located in metropolitan (urban) and nonmetropolitan (rural) areas. 4.2.2 Cost analysis If a Lead Agency does not complete a cost-based pre-approved alternative methodology, they must analyze the cost of providing child care services through a narrow cost analysis. A narrow cost analysis is a study of what it costs providers to deliver child care at two or more levels of quality: (1) a base level of quality that meets health, safety, staffing, and quality requirements, and (2) one or more higher levels of quality as defined by the Lead Agency. The narrow cost analysis must estimate costs by levels of quality; include relevant variation by provider type, child’s age, or location; and analyze the gaps between estimated costs and payment rates to inform payment rate setting. Lead agencies are not required to complete a separate narrow cost analysis if their pre-approved alternative methodology addresses all of the components required in the narrow cost analysis. Describe how the Lead Agency analyzed the cost of child care through a narrow cost analysis or pre-approved alternative methodology for the FFY 2025–2027 CCDF Plan, including: a. How did the Lead Agency conduct a narrow cost analysis (e.g., a cost model, a cost study, existing data or data from the Provider Cost of Quality Calculator)? The Mississippi Department of Human Services partnered with Prenatal to Five Fiscal Strategies (P5FS) to carry out their narrow cost analysis. The process involved building a child care cost model for Mississippi. The Mississippi Child Care Cost Model uses a similar methodology to the Provider Cost of Quality Calculator but is customized to the state context. The development of the cost model was supported by cost study activities including adding cost questions to the Market Rate Survey and provider input sessions where qualitative factors of cost and program operations were explored. These cost study activities engaged both center and family child care programs. Through the survey process, 1,360 center based programs participated and 102 home based, or family child care programs, participated. As cost questions were not required for completion of the survey, the data on cost was not gathered from every participant. In addition, eleven input sessions were held at different times and days of the week in early 2024, this process generated additional input on cost and operations from 71 center-based providers and seven home based programs. b. In the Lead Agency’s analysis, were there any relevant variations by geographic location, category of provider, or age of child? The Mississippi Child Care Cost Model includes variations for provider type, covering child care centers and family child care sites. The model also includes variation by age of child, aligned with Mississippi’s licensing definitions, and variation by program type. The model also includes geographic variation in the cost estimate, following the state categories of Metro and Non-Metro. Counties are organized in to these two groupings and access subsidy rates based on these categorization. Cost information gathered from programs was analyzed following these geographic breakdowns. Additionally, extant data from sources including the Bureau of Labor Statistics and the MIT Living Wage Calculator was analyzed according to the Metro and Non-Metro categories, in order to understand differences in cost by geography. As demonstrated in the tables included with this memo, the differences in cost of care at the licensing level and with current salaries are the greatest across the ages of children served. The regional differences for Metro and Non-Metro regions are not as significant at the licensing level, even once the cost of care is informed by the cost-of-living wage data. The other demonstrable difference in cost is seen when measures of higher quality are used. The cost difference between licensed care and child care meeting Early Head Start/Head Start Performance Standards or higher compensation levels is the biggest increase in cost. c. What assumptions and data did the Lead Agency use to determine the cost of care at the base level of quality (e.g., ratios, group size, staff compensations, staff training, etc.)? The Mississippi Child Care Cost Model uses the state’s child care licensing regulations as the definition of the base level of quality. P5FS reviewed the licensing regulations and identified the key cost drivers associated with meeting this standard. In the model, these standards are used to determine the ratio and group size assumptions, the required training, and the materials and physical space required to meet the needs of children in the program. The staffing model for centers is based on the typical staffing model identified to meet Mississippi's licensing requirements. Annual training/professional development is included at 24 hours per teaching staff member per year to meet licensing requirements. Default data from the PCQC is used to determine values for nonpersonnel expenses, including classroom materials. Occupancy costs are based on licensing requirements for square foot per child of indoor space and outdoor space. Salary assumptions are informed by data analysis from the survey for current salaries, Bureau of Labor Statistics as an extant source representing the current market for positions in the field, and the MIT Living Wage Calculator for salaries representing the cost of living in the state. In the family child care setting, an annual salary is built into the model for the provider/owner. While many home-based providers do not pay themselves a salary, the Mississippi Child Care Cost Model includes a salary to ensure the cost estimates for home- based care incorporate the need for provider/owners to make a living, and not rely solely on what is left over after all expenses have been paid. During the survey process, current salary information was collected from a small number of providers. The analysis of survey data showed salary rates far below the state minimum wage of $7.25 per hour, at $2.30 an hour for Non-Metro areas and $4.30 an hour for Metro. In addition to using the current salary information from the survey, the model includes a provider/owner in a home receiving an hourly rate equivalent to the average of a Director and Assistant Director in center-based setting. Benefits are included at the base level in the model for licensed providers, in recognition of the need for providers to offer a competitive compensation package. At the base level, the model includes 10 days paid sick leave and 10 days paid leave as well as a contribution to health insurance. Paid time off is accounted for as a cost in the model by including the cost of a floater or substitute to cover while the employee is on leave. The cost of the employer contribution to health insurance is based on data from the Kaiser Family Foundation for the average employer contribution to employee health insurance in Mississippi. These benefits apply in both the licensed child care center and licensed home- based models. Default scenarios were created for each setting. In the center-based programs, the default scenario includes five classrooms, serves infants, toddlers, twos, preschoolers, and school- age children, and has a total capacity of 74 at the licensing level. For the purposes of understanding the cost of quality in the state, which does not have a quality rating system, quality was defined as meeting Early Head Start/Head Start Program Performance Standards; the default scenario at this higher level of quality has four classrooms, infants, toddlers, twos, and preschoolers, serving 41 children. The small family home setting uses a default capacity of six children, including two school-age children. The large family home setting uses a default capacity of 12 children, including four school-age children. d. How does the Lead Agency define higher quality and what assumptions and data did the Lead Agency use to determine cost at higher levels of quality (e.g., ratio, group size, staffing levels, staff compensation, professional development requirements)? A Lead Agency can use a quality improvement system or other system of quality indicators (e.g., accreditation, pre-Kindergarten standards, Head Start Program Performance Standards, or State-defined quality measures). After review of current state quality regulations, Head Start Program Performance Standards review, and data analysis from the survey and input sessions, a determination was made to analyze higher quality from two perspectives in the narrow cost analysis with the assumption that programs meeting Head Start standards and programs paying their teachers a living wage would be a higher level of quality than only meeting licensing standards. The first measure of quality used are the Early Head Start/Head Start Program Performance Standards. An additional measure of quality is the consideration of higher staff compensation in the cost of care, as research has shown that higher compensation can lead to staff retention which can have a direct positive impact on the caregiver-child relationship to have consistency in their caregiver. The state does not have a stand alone Quality Rating and Improvement System. The following adjustments are made in the model to account for higher quality under Early Head Start and Head Start: In centers the group size for infants, toddlers, and two- year-olds is capped at eight total children, with a teacher to child ratio of 1 to 4. The preschool group size is reduced from 20 at licensing to 17 under Performance Standards, and a 1 to 8 ratio for teacher to children. There were no changes to group size or ratio for family child care settings, as the number of birth to three children in these scenarios already meets Early Head Start regulations. An additional 96 hours of professional development is included annually for all staff/providers. The cost of a floater or substitute is included to cover the time that staff are engaged in professional development. Three family-teacher conferences annually are included under Early Head Start/Head Start. The model includes time for the teacher to prepare and lead the conference, with the cost of a floater or substitute included to maintain ratios/group size while the teacher is leading a conference. Planning release time is included to provide teachers with dedicated time to plan lessons and analyze data. For lead teachers in a child care center and provider/owners in a home- based program, three hours per day is included in the model under Early Head Start/Head Start. An additional two hours per day is included for assistant teachers. The cost of this time is accounted for through a substitute or floater to cover the classroom while the teachers are engaged in planning. The cost of educational materials and equipment to meet Performance Standards is included at $300 per child and an additional $3,000, annually, per classroom or home. For child health requirements under Performance Standards, $200 per child annually is included, as well as staff time for a health consultant. To meet inclusion requirements under Early Head Start/Head Start Program Performance Standards, $250 per child, per year, is included, along with 10 hours of aid time per week, per child. developmental screening is included for all children at the higher quality level. For considering higher compensation as a feature of a higher qualified staff, or a higher quality program, the MIT Living Wage Calculator values for all of the positions in the programs (director, assistant director, teachers, assistants, floaters, and provider/owners) have been utilized. e. What is the gap between cost and price, and how did the Lead Agency consider this while setting payment rates? Did the Lead Agency target any rate increases where gaps were the largest or develop any long-term plans to increase rates based on this information? The Lead Agency used the Mississippi Child Care Cost Model to estimate the true cost to provide licensed child care and to meet higher quality standards as defined by Early Head Start/Head Start Program Performance Standards and higher compensation for staff. Based on the results of the analysis, there is a significant gap between Mississippi's current CCDF payment rates and the estimated cost of care, based on the cost model at both the licensing level and the higher-quality level. The analysis identified the cost and gap at both Metro and Non-Metro, for centers, small, and large family homes. Costs and subsidy amounts are based on full-time care for infants, toddlers, and preschoolers. School-age costs are based on 60% attendance over the course of a year (accounting for before/after school only during school year) and are therefore compared to the part-time subsidy rate. The the results of the narrow cost analysis, with comparisons of the monthly cost of care to the current subsidy rates are included below. Note, the gap indicates by how much subsidy is under the cost of care, except for school age, where a positive gap was identified. For infants there was an identified gap range across different types of care of $240-$990 when compared with subsidy rate and licensing standards, a gap range of $1,406-$2,849 between the subsidy rate and cost of living wage levels, and a gap range of $559-$1,649 between the subsidy rate and Head Start Standards. For toddlers there was an identified gap range across different types of care of $240-$990 when compared with subsidy rate and licensing standards, a gap range of $1,406-$2,849 between the subsidy rate and cost of living wage levels, and a gap range of $559-$1,649 between the subsidy rate and Head Start Standards. For twos there was an identified gap range across different types of care of $220-$745 when compared with subsidy rate and licensing standards, a gap range of $1,282-$2,871 between the subsidy rate and cost of living wage levels, and a gap range of $537-$1,671 between the subsidy rate and Head Start Standards. For preschool there was an identified gap range across different types of care of $220- $545 when compared with subsidy rate and licensing standards, a gap range of $997- $2,871 between the subsidy rate and cost of living wage levels, and a gap range of $537- $1,671 between the subsidy rate and Head Start Standards. For school-age the gap between the subsidy rate ranged from $42 above the licensing level to $43 below the licensing level. The gap between the subsidy rate ranged from $184 below the cost of living wage level to $1,587 below the cost of living level. The gap between the subsidy rate ranged from $537 to $1,041 below Head Start Standards. At this time, the Lead Agency will not be increasing subsidy rates based on the results of the Narrow Cost Analysis. The Lead Agency intended to conduct the Narrow Cost Analysis for the public of information gathering only at this point. The Lead Agency will be using the results of the Narrow Cost Analysis to examine what the subsidy reimbursements would look like if the state were to move in the direction of using a cost of quality model vs. a market rate-based model for establishing reimbursement rates. At present, the Lead Agency has determined that setting rates based on cost of quality vs. the market-rate without additional funding would create a situation in which the attrition of participation in the Child Care Payment Program would be too great. Therefore, the Lead Agency will be using the results of the recent Market Rate Survey to establish subsidy rates. The full Narrow Cost Analysis Report can be viewed at https://www.mdhs.ms.gov/eccd/reports-archives/. 4.2.3 Publicly available report on the cost and price of child care The Lead Agency must prepare a detailed report containing the results of the MRS or ACF pre- approved alternative methodology and include the Narrow Cost Analysis if an ACF pre-approved alternative methodology was not conducted. The Lead Agency must make this report widely available no later than 30 days after completion of the report, including posting the results on the Lead Agency website. The Lead Agency must describe in the detailed report how the Lead Agency took into consideration the views and comments of the public or stakeholders prior to conducting the MRS or ACF pre-approved alternative methodology. a. Describe how the Lead Agency made the results of the market rate survey or ACF pre-approved alternative methodology report widely available to the public by responding to the questions below. i. Provide the date the report was completed: 6/30/2024 ii. Provide the date the report containing results was made widely available (no later than 30 days after the completion of the report): 6/30/2024 iii. Provide a link to the website where the report is posted and describe any other strategies the Lead Agency uses to make the detailed report widely available: https://www.mdhs.ms.gov/eccd/reports-archives/ iv. Describe how the Lead Agency considered partner views and comments in the detailed report. Responses should include which partners were engaged and how partner input influenced the market rate survey or alternative methodology: The Mississippi Department of Human Services partnered with Prenatal to Five Fiscal Strategies (P5FS) to carry out their narrow cost analysis. The process involved building a child care cost model for Mississippi. The Mississippi Child Care Cost Model uses a similar methodology to the Provider Cost of Quality Calculator but is customized to the state context. The development of the cost model was supported by cost study activities including adding cost questions to the Market Rate Survey and child care provider input sessions where qualitative factors of cost and program operations were explored. Child care providers were allowed to provide specific feedback on which factors of quality should be included in the analysis. These cost study activities engaged both center and family child care programs. Through the survey process, 1,360 center based programs participated and 102 home based, or family child care programs, participated. As cost questions were not required for completion of the survey, the data on cost was not gathered from every participant. In addition, eleven input sessions were held at different times and days of the week in early 2024, this process generated additional input on cost and operations from 71 center-based providers and seven home based programs.