New York State lawmakers recently settled on a budget for the 2024-2025 Fiscal Year. In addition to a commitment to significantly increase state spending on the Child Care Assistance Program (CCAP), the budget agreement also contained several changes to New York’s reimbursement rates for children receiving care in certain circumstances. 

Providers meeting criteria established by the state can qualify for a “differential” CCAP payment rate. These rates are intended to recognize the additional costs associated with serving particular children and serve as an incentive to encourage providers to take certain actions and support children who qualify for differentials. Differentials include: 

• Children receiving care during non-traditional hours (evenings, nights, and weekends) 
• Children experiencing homelessness 
• The provider being nationally accredited  

There is also an enhanced rate for providers who care for children who have special needs.  

The budget agreement included two positive measures that will strengthen these differential rates and should increase provider reimbursement in certain instances. 

First, in her Executive Budget, Governor Hochul proposed broadening the definition of a “quality” child care program beyond being an accredited program to also include licensed and registered programs participating in QualityStars (New York’s Quality Rating & Improvement System), and programs that have completed training and are an active participant in the Office of Children and Family Services’ Non-Patient Epinephrine Auto-Injector Initiative. This measure will certainly expand the number of providers eligible for at least a 5% differential, although we do not currently know how many will be affected by the change. This proposal was included in the final budget agreement. 

In addition, a version of a bill sponsored by Assemblymember Sarah Clark and Senator Jabari Brisport was included in the final budget agreement. This change will bring the differential rate for non-traditional hour care and care for children experiencing homelessness to a 10% minimum, up from the current 5%. Non-traditional hour care is defined as any time outside of 6:00am to 7:00pm Monday-Friday. The non-traditional hour differential rate applies when care is needed and the child meets two conditions: (1) receives care through the Child Care Assistance Program (CCAP), and (2) parents/caregivers work outside of the traditional hours. Once implemented, by April 2025, differential rates will range from 10% to 15%. 

Those counties who are currently providing 5% differentials will begin paying providers an additional $12.60-$17.25 weekly for each eligible child weekly over the previous differential rate. Of the 58 social service districts in New York State, 34 will be impacted by this change. The remaining 28 counties already had differentials at 10% or 15% and are unaffected by this change.  

The below map shows the additional amount that each county will pay to non-traditional hours providers and children experiencing homelessness on top of the existing market rate once this goes into effect. These numbers differ across the state based on the market rate in a county and the differential they currently have in place. 

This policy change will allow providers to earn more money when they accept children whose caregivers work during non-traditional hours. This will hopefully encourage more providers to offer this service, in turn allowing more children to receive the care they need in order for their caregiver(s) to work. Not all jobs run on a 9 to 5 schedule, something this new policy acknowledges. Having a reliable, safe, and enriching child care environment whenever a family needs it is key to including parents and caregivers in the workforce.  

As positive as this increased differential is, the rest of the 2024-2025 New York State budget was not as favorable as The Children’s Agenda hoped. The budget did not include other key supports that would strengthen the child care sector, including a permanent workforce compensation fund, the decoupling of a caregiver’s work hours from the amount of time their child can receive care, and presumptive eligibility to shorten the time from when a caregiver applies for and begins receiving child care assistance.  

Emily Rathbun is a Research and Policy Analyst at The Children’s Agenda.