4.3 Adequate Payment Rates

The Lead Agency must set CCDF subsidy payment rates in accordance with the results of the current MRS or ACF pre-approved alternative methodology and at a level to ensure equal access for eligible families to child care services comparable with those provided to families not receiving CCDF assistance. Lead Agencies are also required to provide a summary of data and facts to demonstrate how payment rates ensure equal access, which means the Lead Agency must also consider the costs of base level care and higher quality care as part of its rate setting. Finally, the Lead Agency must re-evaluate its payment rates at least every 3 years. The ages and types of care listed in the base payment rate tables are meant to provide a snapshot of the categories of rates and are not intended to be comprehensive of all categories that might exist or to reflect the terms used by the Lead Agency for particular ages. If rates are not statewide, please provide all variations of payment rates when reporting base payment rates below. Base rates are the lowest, foundational rates before any differentials are added (e.g., for higher quality or other purposes) and must be sufficient to ensure that minimum health, safety, quality, and staffing requirements are covered. These are the rates that will be used to determine compliance with equal access requirements. 4.3.1 Payment rates a. Are the payment rates that the Lead Agency is reporting in 4.3.2 set statewide by the Lead Agency? [x] Yes. i. If yes, check if the Lead Agency: [ ] Sets the same payment rates for the entire State or Territory. [x] Sets different payment rates for different regions in the State or Territory. [ ] No. ii. If no, identify how many jurisdictions set their own payment rates: b. Provide the date the current payment rates became effective (i.e., date of last payment rate update based on most recent MRS or ACF pre-approved alternative methodology as reported in 4.2.1). 10/1/2024 c. If the Lead Agency does not publish weekly rates, then how were the rates reported in 4.3.2 or 4.3.3 calculated (e.g., were daily rates multiplied by 5 or monthly rates divided by 4.3)? The Lead Agency publishes weekly rates. 4.3.2 Base payment rates a. Provide the base payment rates in the tables below. If the Lead Agency completed a market rate survey (MRS), provide the percentiles based on the most recent MRS for the identified categories. If the Lead Agency sets different payment rates for different regions in the State or Territory (and checked 4.3.1aii), provide the rates for the most populous region as well as the region with payment rates set at the lowest percentile. Percentiles are not required if the Lead Agency also conducted an ACF pre-approved alternative methodology but must be reported if the Lead Agency conducted an MRS only. The preamble to the 2016 final rule states that a benchmark for adequate payment rates is the 75th percentile of the most recent MRS. The 75th percentile benchmark applies to the base rates. The 75th percentile is the number separating the lowest 75 percent of rates from the highest 25 percent. Setting rates at the 75th percentile, while not a requirement, would ensure that eligible families can afford three out of four child care providers. In addition to reporting the 75th percentile in the tables below, the Lead Agency must also report the 50th percentile and 60th percentile for each identified category. If the Lead Agency conducted an ACF pre-approved alternative methodology, provide the estimated cost of care for the identified categories, as well as the percentage of the cost of care covered by the established payment rate. If the Lead Agency indicated it sets different payment rates for different regions in the State or Territory in 4.3.1.a, provide the estimated cost of care and the percentage of the cost of care covered by the established payment rate for the most populous region as well as the region with rates established at the lowest percent of the cost of care. For each identified category below, provide the percentage of providers who are receiving the base rate without any add-ons or differential payments. Provide the full-time weekly base payment rates in the table below. If weekly payment rates are not published, then the Lead Agency will need to calculate its equivalent. i. Table 1: Complete if rates are set statewide. If rates are not set statewide, provide rates for most populous region. Percentiles are not required if the Lead Agency also conducted an ACF pre-approved alternative methodology but must be reported if the Lead Agency conducted an MRS only. Care Type Base payment rate (specify unit, e.g., per day, per week, per month) % of providers receiving Base rate Full-Time Weekly Base Payment Rate What is the percentile of the rate? (MRS) What is the 50th percentile of the rate? (MRS) What is the 60th percentile of the rate? (MRS) What is the 75th percentile of the rate? (MRS) What is the estimated cost of care? (Alternative Methodology) What percent of the estimated cost of care is the rate? Center Care for Infants (6 months) 167.00 Per Week 100.00 167.00 75.00 144.00 150.00 167.00 Family Child Care for Infants (6 months) 140.00 Per Week 100.00 140.00 75.00 120.00 125.00 140.00 Center Care for Toddlers (18 months) 160.00 Per Week 100.00 160.00 75.00 135.00 145.00 160.00 Family Child Care for Toddlers (18 months) 131.00 Per Week 100.00 131.00 75.00 120.00 125.00 131.00 Center Care for Preschool ers (4 years) 150.00 Per Week 100.00 150.00 75.00 127.00 135.00 150.00 Family Child Care for Preschool ers (4 years) 125.00 Per Week 100.00 125.00 75.00 110.00 120.00 125.00 Center Care for School- Age (6 years) 130.00 Per Week 100.00 130.00 75.00 110.00 115.00 130.00 Family Child Care for School- Age (6 years) 115.00 Per Week 100.00 115.00 75.00 90.00 100.00 115.00 ii. Table 2: Do not complete if rates are set statewide. If rates are not set statewide, provide rates for region with payment rates set at the lowest percentile. Percentiles are not required if the Lead Agency also conducted an ACF pre-approved alternative methodology but must be reported if the Lead Agency conducted an MRS only. Care Type Base payment rate (specify unit, e.g., per day, per week, per month) % of providers receiving Base rate Full-Time Weekly Base Payment Rate What is the percentile of the rate? (MRS) What is the 50th percentile of the rate? (MRS) What is the 60th percentile of the rate? (MRS) What is the 75th percentile of the rate? (MRS) What is the estimated cost of care? (Alternative Methodology) What percent of the estimated cost of care is the rate? Center Care for Infants (6 months) 140.00 Per Week 100.00 140.00 75.00 125.00 130.00 140.00 Family Child Care for Infants (6 months) 128.00 Per Week 100.00 128.00 75.00 100.00 110.00 128.00 Center Care for Toddlers (18 months) 135.00 Per Week 100.00 135.00 75.00 120.00 125.00 135.00 Family Child Care for Toddlers (18 months) 125.00 Per Week 100.00 125.00 75.00 100.00 106.00 125.00 Center Care for Preschool ers (4 years) 125.00 Per Week 100.00 125.00 75.00 120.00 120.00 125.00 Family Child Care for Preschool ers (4 years) 120.00 Per Week 100.00 120.00 75.00 95.00 100.00 120.00 Center Care for School- Age (6 years) 120.00 Per Week 100.00 120.00 75.00 110.00 110.00 120.00 Family Child Care for School- Age (6 years) 95.00 Per Week 100.00 95.00 75.00 75.00 76.00 95.00 b. Does the Lead Agency certify that the percentiles reported in the table above are calculated based on their most recent MRS or ACF pre-approved Alternative Methodology? [x] Yes. [ ] No. If no, what is the year of the MRS or ACF pre-approved alternative methodology that the Lead Agency used? What was the reason for not using the most recent MRS or ACF pre-approved alternative methodology? Describe: 4.3.3 Tiered rates, differential rates, and add-ons Lead Agencies may establish tiered rates, differential rates, or add-ons on top of their base rates as a way to increase payment rates for targeted needs (e.g., a higher rate for serving children with special needs). a. Does the Lead Agency provide any rate add-ons above the base rate? [ ] Yes. If yes, describe the add-ons, including what they are, who is eligible to receive the add-ons, and how often are they paid: [x] No. b. Has the Lead Agency chosen to implement tiered reimbursement or differential rates? [ ] Yes. [x] No. Tiered or differential rates are not implemented. If yes, identify below any tiered or differential rates, and, at a minimum, indicate the process and basis used for determining the tiered rates, including if the rates were based on the MRS or an ACF pre-approved alternative methodology. Check and describe all that apply: i. [ ] Differential rate for non-traditional hours. Describe: ii. [ ] Differential rate for children with special needs, as defined by the Lead Agency. Describe: iii. [ ] Differential rate for infants and toddlers. Note: Do not check if the Lead Agency has a different base rate for infants/toddlers with no separate bonus or add-on. Describe: iv. [ ] Differential rate for school-age programs. Note: Do not check if the Lead Agency has a different base rate for school-age children with no separate bonus or add-on. Describe: v. [ ] Differential rate for higher quality, as defined by the Lead Agency. Describe: vi. [ ] Other differential rates or tiered rates. For example, differential rates for geographic area or for type of provider. Describe: vii. If applicable, describe any additional add-on rates that you have besides those identified above. Does the Lead Agency reduce provider payments if the price the provider charges to private-pay families not participating in CCDF is below the Lead Agency’s established payment rate? [ ] Yes. If yes, describe: [x] No. 4.3.4 Establishing payment rates Describe how the Lead Agency established payment rates: a. What was the Lead Agency’s methodology or process for setting the rates or how did the Lead Agency use their data to set rates? Using the most recent MRS data, the Lead Agency set reimbursement rates based on the 75th percentile based on age groups served, children with special needs, metropolitan/non-metropolitan counties, center- based/family-home based care. 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 (NCSIA). Rates were calculated using five age groups that were determined by MDHS: infant, toddler, 2 years old, preschool, and school age. Participants were able to provide rates in their preferred time unit: hourly, daily, weekly, monthly, or yearly. Most respondents (84%) provided full-time rates in a weekly format. Therefore, prices given in other units were converted to weekly prices as follows: Hourly prices were multiplied times 40 for full-time care, daily prices were multiplied times 5, monthly prices were divided by 4.33, and yearly prices were divided by 52.1429. b. How did the Lead Agency determine that the rates are adequate to meet health, safety, quality, and staffing requirements under CCDF? Over 65% of child care providers in Mississippi accept subsidy. Of that 65% of child care providers, many rely heavily on CCDF income to stabilize their child care program. To ensure broad access to child care programs (i.e., licensed non-residential child care, family home child care, and in-home care), the Lead Agency has set payment rates which are sufficient to ensure equal access based on 2024 MRS data statewide. Payment rates are set at the 75th-percentile for all types of care and in all geographic locations based on the results of the most recent MRS which is a requirement of the CCDF final rule. By setting our subsidy rate at the 75th percentile, the Lead Agency is allocating as much of the CCDF funding received by the state to go to direct services as possible while still meeting the 12% quality spending requirement as well. Only child care providers that are CCDF eligible (i.e., currently meeting all health, safety, quality, and staffing requirements of CCDF) were included in the most recent market rate survey. Providers responded by reporting their current tuition rates. Since these providers are all meeting all CCDF requirements, and the lead agency is setting reimbursement rates at the 75th percentile the lead agency has determined that these rates are adequate to meet health, safety, quality, and staffing requirements under CCDF. c. How did the Lead Agency use the cost of care, either from the narrow cost analysis or the ACF pre-approved alternative methodology to inform rate setting, including how using the cost of care promotes the stabilization of child care providers? The Lead Agency used 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. The Lead Agency would be unable to continue to provide support for the number of child care providers that are currently being supported by the subsidy program would lead to the de-stabilization of the child care industry in Mississippi. Therefore, the Lead Agency used results of the recent Market Rate Survey to establish subsidy rates. Over 65% of child care providers in Mississippi accept subsidy. Of that 65% of child care providers, many rely heavily on CCDF income to stabilize their child care program. To ensure broad access to child care programs (i.e., licensed non-residential child care, family home child care, and in-home care), the Lead Agency has set payment rates which are sufficient to ensure equal access based on 2024 MRS data statewide. Payment rates are set at the 75th-percentile for all types of care and in all geographic locations based on the results of the most recent MRS which is a requirement of the CCDF final rule. By setting our subsidy rate at the 75th percentile, the Lead Agency is allocating as much of the CCDF funding received by the state to go to direct services as possible while still meeting the 12% quality spending requirement as well. d. How did the Lead Agency account for the cost of higher quality while setting payment rates? Under Mississippi's current Family-Based Unified and Integrated Early Childhood System, level of quality is defined based on the Standard Center Designation. To be classified as a standard center, a child care center must meet minimum federal and state standards. Standard centers must meet the following requirements. First, all staff are required to go through mandatory training as required by the Child Care and Development Block Grant (CCDBG) Act of 2014. Second, all staff are required to have 15 hours of continuing professional development each year as prescribed by the act. The professional- development areas include health and safety; educational standards and best practices; recognizing signs, symptoms, or behaviors of child abuse and neglect; professional development that addresses social-emotional and behavioral development, mental health, expulsion, and exclusionary discipline practices in child care settings; and developmental and behavioral screenings. The curriculum implemented in these centers must align with the state early learning guidelines for infants and toddlers and the state early learning standards for three- and four-year-olds. These centers must also engage in an annual self-assessment process. Health and safety training, continuous professional development, and self-assessment, along with any required technical assistance, are all provided at no cost to child care providers. The market rate survey collected information from licensed, center-based standard providers on the cost of providing care, and specifically included questions about curriculum, a key element of ensuring quality under the standard designation. The survey also gauged the cost of quality by collecting information on health, mental health, nutrition, and family support services offered by providers. The data collected from the MRS were used to develop a baseline rate for monthly full-time standard center-based child care at 75 percent of the distribution by age group. Further analysis of the market rate survey data showed that the 75th-percentile market rate accounts for the cost of quality and accounts for variation in cost across geographic regions. e. Identify and describe any additional facts (not covered in responses to 4.3.1 – 4.3.3) that the Lead Agency considered in determining its payment rates to ensure equal access. N/A