CAPS is funded by the Child Care and Development Fund (CCDF). The CAPS funding model has three main cost drivers: the base rate, a family fee, and Quality Rated tiered reimbursement. Out of pocket costs for CAPS families are also impacted by the provider rate.
Base Rate: The base rate is the lesser amount between the provider’s published rate and the state maximum reimbursement rate. The state maximum reimbursement rate based upon the location where care is provided, the type of child care provider selected, the age of the child, and the type of care being provided. Maximum reimbursement rates can be found in CAPS Policy Appendix C.
Family Fee: This is the portion of the CAPS base rate that each family is responsible for paying on a weekly basis directly to the child care provider. The assessed fee is based on family size and income for all children in care. Family fee is waived for some populations.
- Calculation: Effective September 2018, the weekly family fee = annual gross applicable income x .03, .05, or .07 (3, 5, or 7% based on ratio of income to poverty), divided by 52 weeks, rounded to nearest whole dollar amount. The family fee will be calculated using this method on existing cases at redetermination or when a change in family size or income is reported. Until such time, the family fee determined by the retired family fee chart will remain in effect.
- Quality Rated Discount: Effective July 2018, the weekly family fee is discounted by 15% for children at a Quality Rated provider. For cases with multiple providers, the discount only applies to children at Quality Rated providers.
Weekly family fee with discount = weekly family fee x .85, rounded down to whole dollar amount
The resulting family fee is divided among all children in care.
Quality Rated Tiered Reimbursement: Tiered reimbursement is a quality bonus awarded to programs that have achieved a Quality Rated star rating and provide child care for families that participate in CAPS. Quality Rated tiered reimbursements began on July 1, 2013. The quality bonus is a percentage amount added to the state subsidy payments based on the program’s star level. Programs currently receive a 10% bonus for one star, a 20% bonus for two stars, and a 40% bonus for three stars. The current bonus percentages have been in effect since October 1, 2018. The percentage is calculated on the net CAPS reimbursement due to the provider (base rate minus the assessed family fee).
Provider Rate: A child care provider’s published rate may be higher than the state maximum reimbursement rate. Any amount charged by the child care provider above what is authorized to be paid on the child care scholarship may be charged to the family.
Example of the CAPS Funding Model applied
Part 1: Family Fee
- $25,000 (gross applicable income for family of 4) x
5% (based on ratio of income to poverty) = $1,250 annual fee =
$24 weekly fee
- With 2 children in care: $12 weekly fee per child
With 15% Quality Rated discount: $10 weekly fee per child (assuming both children are in Quality Rated care)
Part 2: Amount Due to Provider
- Location: Zone 3
- Type of provider: Family Child Care Learning Home, One Star Quality Rated
- Child’s Age: 2
- Type of Care: Full-time
- Base Rate: $76
- Family Fee (from example above, with 15% discount applied): $10
- Quality Rated Bonus: 10%
- CAPS to provider = $73 (base rate of $76 minus $10 family fee = $66, plus 10% QR Bonus of $7)
- Provider rate: $100
- Difference between provider rate and CAPS base rate: $100 - $76 = $24
- Family Responsibility = maximum $34 ($10 family fee + up to $24 for rate difference)