Biden's child, elder care proposals come with a hefty price tag. But can they transform the industry?
WASHINGTON – The coronavirus pandemic laid bare the deep fissures within the care industry, a strained sector that disproportionately relies on millions of women of color who are paid little to look after children, disabled people and the country's growing population of older Americans.
The longstanding challenges spiraled into a public crisis last year as COVID-19 shuttered thousands of schools and day care centers and forced parents, some who could no longer afford child care, to leave their jobs and shoulder the burden at home. Care workers – among the lowest paid in the country – were sidelined as day care centers were forced to cut costs, while other workers left for higher paying jobs.
But those circumstances could change for millions of families and care workers as Democrats hash out the details of a sweeping $3.5 trillion social spending package. The centerpiece of President Joe Biden's agenda would expand access to quality child-care programs and home or community-based care for seniors, provide free preschool, and improve wages and benefits for caregivers.
While the size and scope of the package is still being debated by Congress, experts say even a trimmed down social spending plan would mark one of the largest ever federal investments in the care sector, a sea change in a largely undervalued and often invisible part of the U.S. economy that could shift the fortunes for millions of American families.
"It is a historic change in the way that we care for people in our country," said Lisa Guide, co-founder of Women Effect Action Fund, a group that advocates for economic gender equality and women’s rights. "We're placing our money where our values are if we truly care about people."
The economic toll of the pandemic has been crippling in all corners of the care industry.
The U.S. child care crisis is estimated to cost $57 billion annually in lost earning productivity and revenue, according to a report published in January by ReadyNation, a nonprofit advocacy group of business executives. Child care providers are facing staffing shortages while nearly 1.6 million women with school-aged children who left the workforce during the pandemic haven't returned, according to recent U.S. monthly jobs data.
Meanwhile, the demand for home health aides has skyrocketed, with the number of Americans age 65 and older expected to grow from about 54 million to 95 million by 2060, according to the U.S. Census Bureau.
"Care issues have kind of been seen as private issues for families and are mostly handled by women," Guide said. "But with COVID, they're become obvious public ones."
More: Parents desperately need child care. But day cares are struggling to retain workers.
What's in Biden's social infrastructure plan?
Democrats are aiming to spend around $450 billion on child care in the social infrastructure package, including raising wages for child-care workers, reducing the cost of child care for low- and middle-income families through federal subsidies, and providing universal pre-kindergarten for all 3- and 4-year-olds.
Democrats are also seeking to extend until 2025 the expansion of the Child and Dependent Care Tax Credit, which allows taxpayers to deduct expenses incurred for child care – a move advocates say could be a key step in making the credit permanent.
More: Finding day care was already a 'confusing and frustrating maze.' Coronavirus made it worse.
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The president has also called for spending $400 billion on home- and community-based care for older and disabled Americans. The plan aims to expand a Medicaid program that allows elderly and disabled Americans to stay in their homes rather than move into assisted living facilities. It would also increase wages and provide benefits and training for home health aides.
The House Energy and Commerce Committee has so far only allocated $190 billion for Medicaid’s Home and Community Based Services program in the current bill, but advocates are pushing for at least $250 billion, according to Nicole Jorwic, senior director of public policy at The Arc, a nonprofit that advocates for people with intellectual and developmental disabilities.
"Without at least that much funding there is a real possibility that both access to services for people on waiting lists (for home health aides) and better pay and support for workers can't be accomplished," Jorwic said.
The administration has also asked for $225 billion over 10 years to create a federal paid family leave system, giving Americans up to 12 weeks to care for a new child or family member or to recover from a serious medical condition. Workers would also be given three paid days for bereavement.
While nine states and Washington, D.C., have created a paid family leave program, the U.S. is the only country among 41 developed nations that doesn't provide paid leave for new parents, according to data compiled by the Organization for Economic Cooperation and Development.
What would it do for families?
Abbey Conley of Henrico County, Virginia, never intended to stop working after she gave birth to her first child in 2017. The small, nonprofit veterinary clinic where she was employed didn't have a maternity leave policy and with so few employees, it was not required to provide unpaid leave for new parents.
Conley was eventually granted 12 weeks of unpaid leave but a doctor recommended she stop working a month before her due date over concerns about high blood pressure. Her husband had merely a few days at home after she delivered. Conley returned to work after two months at home with her newborn, a struggle that left her falling asleep at the wheel while driving.
"The expectation is that you'll come back and you'll come back 100%. And stay late and be there early when it's like, you just can't," she said.
Conley's husband was also forced to find a new job.
"You wouldn't think you having a child would derail your two careers," she said.
The 39-year-old eventually moved to a part-time role before leaving the job months later. She found another part-time job before leaving the workforce altogether in 2020 after losing child care during the pandemic. The couple constantly worried about finances and the experience has led them to decide not to have another child. She also has no plans to return to the workforce.
"We can't go through that again. We're still dealing with the fallout of the bills and the lack of pay," she told USA TODAY. "It's still been almost four years and we're just kind of getting those credit cards back into control and it has long lasting effects."
More: COVID-19 made child care deserts even worse in 2021, leaving working parents to scramble
More: The Backstory: When women are pushed out of workforce, it impacts far more than just the women themselves
Earlier this month, a Treasury Department report detailed an "unworkable" child care system that hinders parents' ability to contribute to the U.S. economy. Years of underinvestment led to an unaffordable system that doesn't accommodate all who need it and where workers are grossly underpaid, according to the report.
“Child care is a textbook example of a broken market, and one reason is that when you pay for it, the price does not account for all the positive things it confers on our society," Treasury Secretary Janet Yellen said in a statement following the report's release.
An average family spends about 13% of household income to pay for child care for young children, the report found. Meanwhile, fewer than 20% of children who are eligible for the Child Care Development Fund, one of the largest federal assistance programs for low-income families, actually receive the funding.
Most of the time, the subsidy isn't generous enough to cover the full cost, leaving families who can't afford child care to make up the difference, according to Rasheed Malik, associate director of research for Early Childhood Policy at the Center for American Progress.
The House legislative proposal – which is still fluid – would cap parents' contribution to child care at 7% of their annual income. A family making below 75% of their state's median income – which hovers between $50,000 and $80,000 in most states – would receive free child care.
A typical family would save more than $100 per week in 32 states under the proposal, according to Malik. For families who struggle with the cost but need child care in order to pay their bills, that has a "huge impact on the status of their checking account and in their overall annual take home pay," he added.
The bill also would address the dearth of child care providers across the country, including in more rural settings or in non-native English-speaking communities. States would need to develop a plan to increase supply of not only existing programs but also services that focus on priorities like people with disabilities.
"The challenge for everybody is going to be scaling up providers, getting these programs stood up, getting states to buy in and participate fully in planning," Malik said.
He points to Congress passing the Lanham Act, which provided subsidized care for hundreds of thousands of children whose mothers went to work in defense production factories during World War II.
"This would be kind of on the scale of a wartime effort," he said.
Mario Cardona, chief of policy and practice at Child Care Aware of America, also points to economic reverberations later in life. Mothers who are forced to work part-time or leave their jobs entirely to care for their children aren't able to put more money into their 401(k) plan or other mechanisms that exist to support retirement.
An average woman with two children could see an increase in lifetime earning of $97,000 with access to affordable child care, according a report from Columbia University and the National Women's Law Center released earlier this year. About 1.3 million women in the U.S. could see a collective $130 billion boost in incomes over their lifetimes.
"By not providing affordable, accessible high-quality child care for folks to take advantage of, it hurts decades later when they're looking at retirement because they weren't able to save as much as they could have potentially by being engaged in the labor force," he said.
A federal paid family leave policy would help Americans who were made jobless by the pandemic get back to work, according to a survey released earlier this month by the Bipartisan Policy Center and Morning Consult. The survey found 37% of Americans said they could go back into the workforce if their employer offered paid family leave - including 45% of unemployed caregivers.
Nearly 80% of workers said they do not have access to paid family leave while 60% do not have access to paid medical leave, according to the Bipartisan Policy Center.
As for home care, advocates point out the initiative would save federal dollars in the long term. The annual cost to keep an individual in assisted living is estimated to be $90,000 compared to $26,000 to keep them in home care, according to Mia Ives-Rublee, director of the Disability Justice Initiative at the Center for American Progress.
The federal cash injection could also help relieve the backlog of people waiting for home and community-based services as states only offer a certain amount of slots due to funding constraints, according to Ives-Rublee. About 820,000 Americans are on waitlists for Home and Community Based Services program.
What would it do for caregivers?
Even as parents return to work, day centers are still struggling to keep doors open. A July survey found that 4 out of 5 child care centers are grappling with staffing shortages, according to the National Association for the Education of Young Children.
Congress in March approved $39 billion in COVID-19 relief funds to help child care providers pay their rent and rehire workers made jobless by the pandemic, as well as make child care more accessible and affordable for low-income families. But the relief program, which White House officials acknowledged was a starting point, has already stalled as only 18 states have so far made applications available for child care centers to get the funding, according to the Department of Health and Human Services.
A federalized policy approach would incentivize states to guarantee certain levels of quality and equitability, Malik said. The bill also would require states to set up a system to ensure a living wage for early educators, who on average make $12.50 an hour. The policy aims to create a "wage ladder" and better training to encourage professionals to stay in the field.
While the federal cash infusion would fortify the industry and help providers rehire workers who were made jobless or forced to quit during the pandemic, it's also estimated to create 1.1 million jobs in health care, child care and elder care services, according to an Economic Policy Institute report released earlier this month.
One analysis, cited by Sen. Bob Casey, D-Pa., said the federal investment would not only raise wages for caregivers but create 500,000 new home care positions.
The plan could offset costs in other social safety net programs, too, according to Ives-Rublee. An estimated 53% of home care workers receive some form of public assistance, including 27% who rely on food and nutrition assistance and 32% who are covered by Medicaid insurance, according to data compiled by PHI,, a national nonprofit that advocates for home health aides.
"A lot of these individuals have to work second jobs just to make ends meet and that's just unfair because they're working long hours and often are on call during the night time," Ives-Rublee said. "It's not just the personal care assistance but it's also vocational training, transportation and a wide variety of things that help keep individuals within a community setting."
Conley, the mother from Virginia, said while it may be too late for her to reap the benefits of maternity leave, the legislation could reshape the next phases of her life.
"I went through that maternity pay challenge where it would have been a tremendous boost and kept things going. But now I'm dealing with child care where I can't really afford child care, or work, and I'm coming up on that need for parent help and potentially special services in the future for my child," she said.
"I've never really heard of a bill where everything would directly affect me so I think it's important and touches on a lot of people. It would be a really big shame if they cut that."
Early childhood education coverage at USA TODAY is made possible in part by a grant from Save the Children. Save the Children does not provide editorial input.
This article originally appeared on USA TODAY: Child care, elder care a key piece of Biden reconciliation ask