study of the effects of making families eligible for subsidies in illinois

Study of the Effects of Making Families Eligible for Subsidies In Illinois

Draft Results

October 2009

Evaluation of Child Care Subsidy Strategies: Illinois 2

Research Partners

• One of four random-assignment studies that are part of the Child Care Subsidy Evaluation, funded by OPRE

• Abt Associates is the prime contractor with partners MDRC and National Center for Children in Poverty

• MDRC is taking primary responsibility for the impact study analysis


• Overview:

– Illinois Dept of Human Services and the Illinois Action for Children worked closely with us to do the study. Illinois DHS was willing to commit $6 million for the initiative.

– Families over income eligibility ceiling in Cook County, IL were randomly assigned to be eligible for subsidies for 2 years.

– 1/2 of the program group had a 6-month redetermination period; the other half had a 12-month redetermination period.

– 1884 families in the study, includes applicants and re-applicants.

– Incomes between 50-65% of SMI ($18,000 - $24,000/year).

• Research Questions:

– What is the effect of receiving child care subsidies on child care, employment, and income?What is the effect of receiving child care subsidies on child care, employment, and income?

– What is the effect of extending the redetermination period on the stability of subsidy receipt?What is the effect of extending the redetermination period on the stability of subsidy receipt?

• Data Sources:Data Sources:

– Administrative records from Unemployment Insurance, public assistance, and child care Administrative records from Unemployment Insurance, public assistance, and child care subsidy programsubsidy program

– Telephone interview with parentsTelephone interview with parents

Research Design


Data Sources

• Baseline data from subsidy applicationBaseline data from subsidy application

• Data from administrative recordsData from administrative records

• Child care subsidiesChild care subsidies

• Unemployment insurance (employment and earnings)Unemployment insurance (employment and earnings)

• Public assistance (TANF and Food Stamps)Public assistance (TANF and Food Stamps)

• Data from survey (conducted about two years after random Data from survey (conducted about two years after random assignment) assignment)

• Child care history since random assignment (e.g., type, interruptions Child care history since random assignment (e.g., type, interruptions in care, hours)in care, hours)

• Child care reliability, flexibility, satisfaction, and out-of-pocket costsChild care reliability, flexibility, satisfaction, and out-of-pocket costs

• Employment history since random assignment (e.g., hourly wage, Employment history since random assignment (e.g., hourly wage, fringe benefits)fringe benefits)

• Income at the time of the surveyIncome at the time of the survey

• Issues with the survey: varied follow-up period with subsidy group Issues with the survey: varied follow-up period with subsidy group responding earlier & recall and bias issues. We limited the follow-up responding earlier & recall and bias issues. We limited the follow-up period and weighted the responses.period and weighted the responses.


Community

Quantity and quality of child

care supply

Employment characteristics

Social Networks

Consumer Education /qualitative information

Preferences:

Dynamic set of parent opinions

Opportunities

Constraints

Barriers

(As perceived by parent) Child Care

Arrangement(s) Used

NumberTypeHours

Price/costsStability

Perception of Quality

Financial Assistance UsedCHANGE OF ELIGIBILITY

For CCDF SubsidyStabilityAmount

Other Financial Assistance

Parental Employment

Outcomes

Family and Child Outcomes

Family

Parent & Child

Characteris-tics

Parent Values, Beliefs, & Definitions

Parental Child Care Decision-Making: Conceptual Model

Model comes from merge of products created by Child Care Policy Research Consortium (2003) and the Minnesota Child Care Research Partnership (2008).


Please note that these results are preliminary. Please note that these results are preliminary. A final report will be available in the next few months.A final report will be available in the next few months.


Context – Characteristics of Families

Characteristic

Parent: Female (%) 96.6

Average age 30.9 years

Average hourly wage $12.59

Monthly earnings $2,558

Number of children in subsidized care 1.5

Age of youngest child in subsidized care 3.7 years

African-American (%) 72.7

Hispanic (%) 16.2

Received TANF in prior year (%) 4.2

Received food stamps in prior year (%) 31.0

Received child care subsidies in prior year (%) 65.0


Context – Characteristics of Community

• Cook County, IL

• Chicago and surrounding areas

• Between 2005-2008


Context: Characteristics of the Subsidy at Time of the Study

• Income-eligibility ceiling for subsidies in Illinois: 50% of SMI

• Illinois serves all eligible applicants

• Standard 6-month redetermination period

• Co-payment is tied to income and number of children in care


Co-Payment and Reimbursement Rates, 2005

Copayment and provider reimbursement 1 child in care 2 children in care

Copayment amounts by income as a percent of state median income ($)

Standard child care subsidy eligibility1 2

8.4% to 12.5% 3 412.5% to 16.7% 5 716.7% to 20.9% 8 1220.9% to 25.0% 11 1625.0% to 29.2% 15 2229.2% to 33.4% 20 3433.4% to 37.6% 25 4437.6% to 41.7% 31 5441.7% to 45.9% 37 6445.9% to 50.0% 43 74

Expanded income eligibility for current study50.0% to 55.0% 49 84

55.0% to 60.0% 55 9460.0% to 65.0% 61 104

Reimbursement rates ($)

Center careChild under 2 1/2 years old 169 338

Child over 2 1/2 years old 122 243

Licensed home careChild under 2 1/2 years old 108 215Child over 2 1/2 years old 103 205

Unlicensed home care 47 95

Weekly Copayments and Reimbursement Rates in Illinois, 2005

SOURCE: MDRC calculations from State of Illinois Department of Human Services.

NOTES:


Subsidy Receipt Among Program and Control Group


Effects of Extended Redetermination Period on Subsidy Receipt

Outcome6-Month

Redetermination12-Month

Redetermination

Months of subsidy receipt in Year 1 7.2

*** 8.2

***

Months of subsidy receipt in Year 2 3.8 5.3

Total months of subsidy receipt 11 13.5

Received subsidies for 7 straight months (%) 55.1%

*** 73.2%

***

Received subsidies for 13 straight months (%) 32.4%

*** 39.7%

***


Quarters Employed for Program and Control Group


Child Care: Program and Control Group

OutcomeProgram

GroupControlGroup

Impact(Difference)

Standard Error

Ever Used as a Primary Provider (%)

Any Nonparental Care 62.8 63.1 -0.3 2.9

Center care 45.6 38.4 7.2 ** 3.0

Relative Child Care 14.2 18.8 -4.6 * 2.4

Family Child Care, Nonrelative 5.4 9.7 -4.4 *** 1.6

Child Care Stability (%)

Had any interruption in primary care 7.8 11.6 -3.7 *

Sample size 664 573


Child Care: Program and Control Group

OutcomeProgram

GroupControl

GroupImpact

(Difference)Standard

Error

Child Care Satisfaction and Job-Related Problems

Satisfaction with primary care provider (Scale of 0 to100) 78.4 70.9 7.4 *** 1.2

Ever had job problems due to child care arrangement (%) 37.8 51.4 -13.6 *** 2.7

Average Weekly Out-of-Pocket Costs for Child Care (%)**

Under $50 26.8 30.2 -3.4

$50 to $100 32.8 28.1 4.6

Over $100 33.8 38.0 -4.2

Sample size 699 631


Summary of Study

• For families in the sample (Cook County, average monthly incomes $2600), eligibility for subsidy receipt did not affect earnings.

• Eligibility did affect amount of months subsidy receipt, type of care, satisfaction, amount paid, job-related problems.

• This can be thought of a test of a specific group of families of specific aspects of a child care and employment decisionmaking conceptual model.


Next Steps

• This is one of two random assignment studies testing the effects of subsidy policy “levers.” (Washington co-payment study is the other.)

• We need more rigorous tests of different aspects of the conceptual model (experimental, quasi-experimental).

• A comprehensive research agenda could be proposed to test different “arms” of the model.

• Many values of further developing the model (parent selection of care factor in virtually every descriptive study of child care and early education that we do and complicates our understanding of findings).

study of the effects of making families eligible for subsidies in illinois

Documents

child care subsidy evaluation

subsidy group

hourschild care reliability

subsidy applicationdata

stability of subsidy

illinois action

illinois dhs

illinois draft resultsoctober