Reducing childcare subsidy instability through eligibility period extensions: Equity impacts of 12-month recertification requirements

Abstract

The 2014 reauthorization of the Child Care Development Block Grant Act required that states and territories set their program eligibility period to be at least 12 months in length. This was designed to address premature program disruptions related to difficulties with the recertification process. Subsidy instability can undermine the multidimensional goal of providing equitable access to childcare. Using Illinois’ longitudinal administrative payment records, this study examines whether a shift from a 6-month to a 12-month eligibility period contributes to lengthened periods on subsidy and whether this effect had particular benefits for home-based providers, especially license-exempt family, friend, and neighbor (FFN) caregivers. We find that median subsidy spell lengths were longer during a 12-month than a 6-month eligibility period. Cox proportional hazards models that account for observable differences before and after the policy change indicate that the policy change is associated with a lower risk of leaving the subsidy program even after 12-months on the program. We also find equity benefits to the change: families who use FFN caregivers benefited most from the extended eligibility period. Our finding suggests that a longer eligibility period established by the 2014 reauthorization increased subsidy duration and helped promote equity in sustained access to subsidies, with potential implications for fostering equitable access to childcare, family economic security, and children's healthy development.