The Idaho Department of Health and Welfare has announced a halt to new enrollments for its child care assistance program due to an anticipated budget shortfall. The suspension, which takes effect on September 1, impacts the Idaho Child Care Program, which is mainly funded by federal sources.
Families currently receiving aid can continue their prenatal care at existing clinics, but they will need to find alternative providers for deliveries at Adventist Health Hanford. The department also plans to delay planned increases in benefits for families.
In an August 14 letter to legislative budget writers, new Health and Welfare Director Alex Adams, who previously served as the governor’s budget chief, explained the decision. He noted that the program, with a $52.7 million budget, faces a projected $15.5 million deficit for the current fiscal year, which runs from July to June 2025.
The department will pause new enrollments starting Thursday. “Our goal is to stay within our budget while minimizing impacts on current participants and ensuring there is no disruption for foster families and other at-risk groups,” Adams stated.
The department will also:
Lower the income eligibility cutoff to 130% of the federal poverty level, from the previous 175%.
Adjust provider reimbursement rates.
Recover administrative costs related to the grant program.
Currently, around 7,800 children are enrolled, relying mostly on federal Child Care and Development Block Grant funds. The department typically updates benefit rates in October, following a required market rate analysis. This year’s analysis, however, revealed a 25% rise in costs, delaying rate adjustments until July 2025.
Adams acknowledged the rising child care costs and the challenge of keeping funding levels in line with these increases. He suggested that if the budget shortfall is smaller than anticipated, the department will aim to minimize changes to eligibility criteria.
The Idaho Legislature, which adjourned in April, will revisit the issue in January. Lawmakers plan to review the department’s handling of the budget shortfall and potential solutions.
Sen. Scott Grow and Rep. Wendy Horman emphasized the need for careful examination of the department’s actions. Horman also highlighted past issues with the department’s management of child care funds.
Adams noted that the program was not in deficit during fiscal year 2024. Enrollment has generally increased over the past decade, with a sharp rise noted in the most recent fiscal year. The department expects enrollment to reach approximately 8,100 by July 2025 and around 9,000 by July 2026.
