Pennsylvania Raises Child Care Bonuses; Medicaid Covers Over 26 Percent

The additional $5 million will provide at least $540 per employee annually to licensed Child Care Works providers, the Pennsylvania Department of Human Services says. The program, created in the 2025-26 budget, first offered at least $450 retention bonuses. More than 4,300 child care providers applied in its first year, resulting in bonuses going to nearly 39,000 child care workers. $540 is an increase over last year's initial estimate by about $100 per employee.

The bonus is one workforce support. An updated Georgetown Center for Children and Families brief says Medicaid covered over 26 percent of child care workers in 2024. In twelve states—CA, IN, LA, MT, NJ, NM, NY, OR, RI, SD, VT, and WV—the share was a third or more. The brief also says more than 1 in 10 child care workers across the country are uninsured. Among the 10 states that have not expanded Medicaid, the uninsured rate nearly doubles. About 43 percent of early educator families rely on one or more public safety net program such as Medicaid or SNAP, the brief says.

Pennsylvania's budget includes an additional $3.5 million for Pre-K Counts to help providers raise wages and stabilize the early educator workforce. Georgetown says nearly half of surveyed educators reported feeling more burned out this year, and 22 percent indicated they were considering leaving the field. Its cited RAPID survey found that 74% of families with children under age six had difficulty finding a spot in a center or home-based program; of these families, 81% said it impacted their ability to work. The brief identifies workforce shortage caused by burn out and low wages, lack of affordability, waitlists, limited hours, and safety concerns as factors in the child care crisis. The sources describe different supports: bonus payments, wage funding, and health coverage.