Tennessee to increase childcare reimbursements

The Tennessee Department of Human Services (TDHS) is providing a majority of licensed child care agencies with increased reimbursement rates under the Child Care Certificate Program. Under the Child Care Certificate program, the state pays a reimbursement rate directly to child care providers on behalf of families who are enrolled and meet the income and work or education requirements of the program. In collaboration with the University of Tennessee's Boyd Center for Business & Economic Research (UT-CBER), TDHS has conducted a comprehensive Market Rate Survey (MRS) to inform rate adjustments within the Child Care Development Fund budget to adjust funding support for child care providers participating in the state’s Child Care Payment Assistance Programs to at least the 60th percentile of the Market Rate Survey.  To further address deficits in capacity, TDHS has also updated a comprehensive mapping of child care deserts in partnership with the University of Tennessee - Social Work Office of Research and Public Service. This mapping has identified areas with a deficit of 250+ child care slots to meet the demand of children under age 6 with all parents in the labor force. These findings will result in adjustments to the counties identified that will receive the 15% Child Care Desert differential. While also recognizing the higher costs associated with infant and toddler care, TDHS introduced a 15% Infant/Toddler differential, effective October 1, 2023, to incentivize child care agencies offering this essential service and expanding access for families in need.