Cover: Using a Narrow Cost Analysis to Inform Payment Rates

Using a Narrow Cost Analysis to Inform Payment Rates

A Brief for CCDF Lead Agencies

Published in: Office of Planning, Research and Evaluation website (2022)

Posted on rand.org Oct 16, 2023

by Pia Caronongan, Katie Gonzalez, Lynn A. Karoly, Julia Isaacs, Peter Willenborg

This brief describes how Child Care and Development Fund (CCDF) Lead Agencies can use cost data when setting payment rates. It covers two main topics: 1. Analyzing gaps between costs and payment rates; 2. Exploring strategies to close gaps. This brief draws on our discussions and interviews with Child Care and Development Fund (CCDF) Lead Administrators and experts within and outside the Office of Child Care (OCC). We also reviewed state examples of narrow cost analyses (summarized in appendix A). We define italicized key terms in a glossary at the end of the brief.

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