Child Care in Louisiana:
A Short Report on
Subsidies, Affordability, and Supply
This report summarizes recent child care information for the state of
Louisiana. The first section provides new information on
child care subsidies, based on eligibility estimates
generated by the Urban Institute and state administrative data reported to
the U.S. Department of Health and Human Services (HHS). The second
two parts, on affordability and
supply, draw on state and local data collected by the
Urban Institute during the summer of 1999 under contract with HHS.
A companion document to the national report entitled
"Access to Child Care for Low-Income
Working Families," the Louisiana report is one in a series of nine state
reports. [The other reports are:
California, Connecticut,
Delaware, Florida,
Michigan, Pennsylvania,
Texas, and Utah]
Figure 1. Child Care and Development Fund (CCDF) Eligibility and
Receipt in Louisiana
Sources: Urban Institute simulations and state administrative
data reported to the Child Care Bureau.
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451,000 children under age 13 (or under age 18 if disabled) live in
families where the family head (and spouse if present) is working or is in
an education or training program, as shown in Figure 1. Children across all
family income levels are included in this estimate. Most of these children
(428,000) are under age 13 and living with working
parents.1
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220,000 of these children, and 143,000 families, are estimated to
meet the Louisianas income guidelines for child care assistance under
the Child Care and Development Fund (CCDF) October 1997 state plan.
Louisianas income eligibility limit is equal to the maximum level allowed
under Federal law, 85 percent of State Median
Income.2
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To be eligible under Louisianas October 1997 state plan, a family of
3 had to have income at or below $29,580.
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A large majority of eligible children (87 percent) live in families with
annual income below 200 percent of the Federal poverty threshold and 45 percent
are living in poverty. About 11 percent live in families that report receiving
cash welfare.
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Most (198,000) eligible children are under age 13 with working parents; the
remaining children have parents in education/training programs or are disabled
youth under 18.
-
35,000 children in Louisiana received child care subsidies funded
by CCDF in an average month in 1998. This estimate suggests that 16 percent
of the eligible population under both state limits and the Federal maximum
limits were served with CCDF
funds.3
-
The Child Care and Development Fund (CCDF) is the major source of Federal
funding allocated to states to subsidize the child care expenses of low-
and moderate-income families so they can work, or attend education or training
programs. Using CCDF dollars along with state funds, Louisiana has designed
its own child care program within broad parameters specified under federal
law. CCDF-funded subsidies, and the number of children that the state reported
were served with these subsidies, are highlighted in this report because
CCDF is a primary source of funding in most states. Also, CCDF administrative
data is the most comparable source of child care data across states. It should
be noted, however, that Louisiana, like many other states, also uses other
funding sources to provide child care subsidies.
-
No waiting list for government subsidies has been maintained since
1996-97. All families who currently apply receive subsidies. However, state
staff believe that there are eligible families that do not apply for
subsidies.4
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Prices for child care vary considerably, by such factors as geographic area,
type of provider and age of child. Figure 2 shows the average monthly prices
for child care in New Orleans, Louisiana. Given that these are average prices,
it is clear that many families pay more or less than this amount.
-
Centers in New Orleans, Louisiana charge an average of $303 per month
for preschool care and $325 per month for infant care, as shown in
Figure 2. This means that a family with $15,000 in income and one preschool
child in an average-priced center would spend close to one-quarter (24 percent)
of its total monthly income on child care expenses. Average-priced infant
care would represent a slightly higher share (26 percent) of monthly income
for a family earning $15,000.
-
Accredited care costs even more, $390 per month for a preschooler
in center-based care, or about 31 percent of family income for families with
$15,000 in income.* Families
with an infant in an accredited center would pay $412, or about 33
percent of family income for families earning $15,000.
-
Family child care homes in New Orleans, Louisiana charge an average of
$217 for both preschool-age children and infants. This means that
a family with $15,000 in income and one child in an average-priced family
child care home would spend 17 percent of its monthly income on care for
either a preschool-age child or for an infant.
-
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 Louisiana ranges from 10 to 70
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 or infant
in an average-priced center in Louisiana would be charged a monthly co-payment
of $29, or 2.3 percent of monthly income, as shown in Figure 2.
-
Louisiana does not require families with monthly incomes at or below $1,100
to make co-payments.
-
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 preschool center
care in New Orleans Louisiana is $286 per
month,6 which is $17 less than
the $303 average price shown in Figure 2. If the $17 differential is paid
by the family, the total cost to the family is $46 per month, more than the
official co-payment of $29 shown in Figure 2. If the fee is not charged to
the family, the provider loses $17 per month for providing service to a
subsidized child. The differential could be much larger than $17 for some
child care centers, including accredited centers and other centers with higher
than average rates.
Figure 2. Child Care Prices and Co-Payments for a Hypothetical New
Orleans,
Louisiana Family of Three Earning $15,000 with One Child in Care
|
WITHOUT SUBSIDY |
WITH SUBSIDY |
Average Monthly Rates
(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 |
$325 |
26.0% |
$29 |
2.3% |
Accredited center-based |
$412 |
32.9% |
$29 |
2.3% |
Family child care home |
$217 |
17.3% |
$22 |
1.7% |
PRESCHOOLER (4 years) |
Center-based |
$303 |
24.3% |
$29 |
2.3% |
Accredited center-based |
$390 |
31.2% |
$29 |
2.3% |
Family child care home |
$217 |
17.3% |
$22 |
1.7% |
* State policy does not prevent providers from charging parents
additional amounts, above the co-payment, if the providers rates exceed
the state reimbursement level. Figures in this table represent the minimum
co-payment.
** Co-payments in Louisiana are based on a percentage of the
cost of care, which was assumed equal to average monthly prices (shown in
column 1) or maximum CCDF reimbursement rates, whichever was lower.
Source: Data collected by the Urban Institute from the Agenda
for Children-Child Care Resources, a child care resource and referral agency
serving the area in and around New Orleans, summer 1999.
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Not all providers in Louisiana accept children who receive subsidies. Of
the providers registered with the Agenda for Children-Child Care Resources,
which serves 11 of the 64 parishes in the state, 57 percent of centers and
45 percent of family child care homes accept subsidies. Only 50 percent of
accredited centers serve subsidized children.
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Providers may be unwilling to accept subsidized children, or may limit their
enrollment, when the state reimbursement rates are lower than their prices
(see the example in section II). As a result, families receiving subsidies
may have limited choices of caregivers.
-
Staff from the resource and referral agency report shortages in the supply
of various types of care in the 11 parishes they serve in Louisiana. Staff
believe that the most severe areas of need are for infant care, school-age
care, care during odd hours and care for children who have special needs
or are ill. Specifically:
-
School-age care is limited to some child care centers and some schools
in many of the parishes in Louisiana served by the Agenda for Children-Child
Care Resources. To participate in school-based care, children must attend
a school that provides a school-age child care program.
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Care during odd hours is very scarce in Louisiana. For example, only
4 of 447 centers in Orleans and Jefferson parishes provide care during
non-traditional hours.
-
Care for sick children is not available from any of the centers in
the Agency for Children-Child Care Resources database, which covers
11 Louisiana parishes.
1. Estimate based on microsimulations using the
Urban Institute's TRIM3 model, guidelines in the state's 1997-99 CCDF state
plan, and three years of Current Population Survey data (calendar years
1995-97). Back to text
2. Ibid. Back to text
3. Estimates based on state administrative data
reported to the Child Care Bureau and adjusted to reflect children funded
through CCDF only. 1998 figures based on April-September 1998.
Back to text
4. Waiting list data were obtained and compiled
by the Urban Institute from the Louisiana Department of Social Services,
the state child care agency. Back to text
5. Information in this section was obtained and
compiled by the Urban Institute from Agenda for Children-Child Care Resources
(AC-CCR) (a child care resource and referral agency in Louisiana).
AC-CCR covers 11 of the 64 parishes in the state: Assumption, Jefferson,
Orleans, Lafourche, Plaquemines, St. Bernard, St. Charles, St. James, St.
John, St. Tammany, and Terrebone. These 11 parishes are concentrated
primarily in and around New Orleans. Back to text
6. State maximum rates were obtained and compiled
by the Urban Institute from the Louisiana Department of Social Services,
summer 1999. Back to text
7. Information in this section was obtained and
compiled by the Urban Institute from Agenda for Children-Child Care
Resources. Back to text
* Providers are accredited by national organizations
based on criteria designed to measure quality. Accreditation is one
indication that a provider has a demonstrated commitment to providing quality
care. Back to text
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