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Insights into the black box of child care supply: An examination of provider participation in the child care subsidy system

Description:
High quality child care providers that accept subsidies are the linchpin to supporting parental employment and the child development needs of low-income families. However, there is growing concern at the federal level that fewer providers are participating in the subsidy system, leaving subsidy-recipient families with limited access to and/or choice of child care. Little is known about which providers agree to participate in the subsidy system and what factors may influence their participation. This mixed-method three-paper dissertation uses cross-sectional administrative data and qualitative interview data on licensed Massachusetts child care providers to identify factors associated with subsidy system participation. Paper 1: The first paper establishes a conceptual model of predictors of provider participation in the subsidy system based on the economic theory of the firm, non-profit strategic management principles and extant literature on the subsidy system. The model is tested empirically using cross-sectional administrative data on licensed Massachusetts child care providers and logistic regression analyses. Results suggest that lower administrative capacity, higher private pay prices and higher local market household income act as barriers to subsidy system participation. Thus, states seeking to increase their supply of subsidized care should consider reducing administrative barriers to participation, implementing targeted recruitment of providers more likely to participate and utilizing incentives to induce participation. Paper 2: Among subsidy system participating providers, Paper 2 identifies predictors of participation in different subsidy mechanisms (contracts versus vouchers only). Using cross-sectional administrative data and logistic regression analysis, the study finds that while providers that are members of umbrella organizations/family child care systems or have been in business longer are more likely to participate in contracts compared to vouchers only, providers located in more competitive markets are less likely participate in contracts. In order to incentivize participation in contracts, these findings suggest that states consider 1) streamlining the administrative responsibilities of contracts, 2) promoting cooperative agreements for shared administrative capacity among providers and 3) increasing awareness of contracts through information dissemination. Paper 3: Using qualitative data from interviews with 75 administrators from 48 licensed Massachusetts child care centers, Paper 3 identifies factors that motivate or hinder participation in 1) the child care subsidy system and 2) contracts versus vouchers. While the results support the findings around barriers to participation in the subsidy system in general and contracts in particular (identified in Papers 1 and 2), key motivators of participation in the subsidy system in general also emerged. Altruism and low-income focused mission statements spurred participation. These findings suggest that states should both seek to reduce administrative and informational barriers and capitalize on motivating factors through targeted recruitment in order to expand subsidy system participation. To ensure that low-income families have equal access to child care, results of this dissertation highlight the need for increased federal funding for subsidies and suggest that states take active steps to 1) identify shortages in care, 2) engage in targeted recruitment and information dissemination, 3) reduce administrative barriers to participation, 4) ensure that subsidy system entry processes are accessible and 5) implement incentives for participation. (author abstract)
Resource Type:
Reports & Papers
Country:
United States
State(s)/Territories/Tribal Nation(s):
Massachusetts

Related resources include summaries, versions, measures (instruments), or other resources in which the current document plays a part. Research products funded by the Office of Planning, Research, and Evaluation are related to their project records.

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