Child Care State Reports . II. Affordability [6]

12/01/1999

  • Prices for child care vary considerably, by such factors as geographic area, type of provider and age of child. Figure 3 shows the average monthly prices for child care in Delaware. Given that these are average prices, it is clear that many families pay more or less than this amount.
  • Centers in Delaware charge an average of $390 per month for preschool care and $473 per month for infant care, as shown in Figure 3. This means that a family with $15,000 in income and one preschool child in an average-priced center would spend close to one-third (31 percent) of its total monthly income on child care expenses. Average-priced infant care would represent an even higher share (38 percent) of monthly income for a family earning $15,000.
    • Accredited care costs even more, $444 per month for a preschooler in center-based care, or about 36 percent of family income for families with $15,000 in income.*  Families with an infant in an accredited center would pay $553, or about 44 percent of family income for families earning $15,000.
  • Family child care homes in Delaware charge an average of $353 for preschool children and $385 per month for infants. This means that a family with $15,000 in income and one child in an average-priced family child care home would spend 28 percent of its monthly income on care for a preschool child or 31 percent of income for an infant.
Figure 3. Child Care Prices and Co-Payments for a Hypothetical Delaware Family of Three Earning $15,000 with One Child in Care
  WITHOUT SUBSIDY WITH SUBSIDY
Average Monthly Prices
(Full Time Care)
% of Income
(Family Income of $15,000 Annually)
Monthly Co-Payments*
(If receive subsidy)
% of Income*
(Family Income of $15,000 Annually)
INFANT (1 year)
Center-based $473 37.8% $98 7.8%
Accredited center-based $553 44.2% $98 7.8%
Family child care home $385 30.8% $75 6.0%
PRESCHOOLER (4 years)
Center-based $390 31.2% $81 6.5%
Accredited center-based $444 35.5% $81 6.5%
Family child care home $353 28.2% $74 6.0%

* State policy does not prevent providers from charging parents additional amounts, above the co-payment, if the providers’ rates exceed the state reimbursement level.

Source: Data collected by the Urban Institute from The Family and Workforce Connection, a statewide child care resource and referral agency in Delaware, summer 1999.

  • Families who receive child care subsidies usually pay much smaller monthly co-payments rather than the full market rate. Such co-payments are established under a sliding fee schedule, and are based on family size, income and the cost of care. The official fee in Delaware ranges from 1 percent to 46 percent of the cost of care up to certain state-set maximum rates.
    • For example, a family with $15,000 in income and one preschooler in an average-priced center in Delaware would be charged a monthly co-payment of $81, or 6.5 percent of monthly income, as shown in Figure 3.
    • In Delaware, a co-payment is not charged to families with income below 40 percent of the poverty level, families receiving cash welfare assistance, and families receiving protective services.
  • State policy does not prevent providers from charging parents additional amounts, above the co-payment, if the providers’ rates exceed the state reimbursement level. For example, the maximum CCDF rate for infant center care in the New Castle region of Delaware is $426 per month7, which is $47 less than the $473 average price shown in Figure 3. If the $47 differential is paid by the family, the total cost to the family is $145 per month, more than the official co-payment of $98 shown in Figure 3. If the fee is not charged to the family, the provider loses $47 per month for providing service to a subsidized child. The differential could be much larger than $47 for some child care centers, including accredited centers and other centers with higher than average rates.