Defense Department Adjusts Child Care Fees, Expands Flex Spending to Increase Military Access to Quality Child Care

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WASHINGTON, September 13, 2023 - The Defense Department is adjusting how much service members pay in child care fees for the 2023-2024 school year to reduce the burden on lower income families and meet the intent of Executive Order 14095.

Executive Order 14095, "Increasing Access to High-Quality Care and Supporting Caregivers," signed April 18, 2023, directs the DOD to improve the affordability of child care on military installations.

Adjustments include a reduction in the number of fee categories from fourteen to eleven, modification of the Total Family Income categories and an increase in the highest TFI category to $160,001 and above. These adjustments provide a more equitable division of fees based on total family income. The adjustment also includes an increase in the fee assistance provider rate cap for both community-based providers and military-certified family child care providers to $1,800 per child per month, from $1,700.

"Changes to the fee policy will ensure that DOD can continue to invest in our service members by providing quality, affordable child care through both installation-based programs and community-based fee assistance. The Defense Department remains steadfast in its mission to provide a range of options to meet military families' child care needs," Grier Martin, performing the duties of the assistant secretary of defense for Manpower and Reserve Affairs, said. "We recognize the importance of providing military families and DoD civilians with access to quality and affordable child care, and we're committed to addressing the increased demand and challenges for this critical issue which directly impacts the readiness of the Total Force."

The Department's actions to restructure fees to better meet military families' needs is informed by routine holistic assessments of child care fees. Current changes were developed to make child care fees more equitable and more affordable for families with the greatest economic need by reducing the percentage of income that lower income families devote to their child care needs.

DOD is also expanding eligibility to Service members for Dependent Care Flexible Spending Accounts (DCFSAs). Service members can enroll during the 2023 Federal Benefits Open Season in mid-November through mid-December 2023, and accounts will start for enrolled Service members on January 1, 2024.

The expansion of DCFSA eligibility to Service Members is another aspect of the Department's commitment to supporting military families and aligns with Executive Order 14100, Advancing Economic Security for Military and Veteran Spouses, Military Caregivers and Survivors. Service members can contribute up to $5,000 per household per year for eligible dependent care services. Service members receiving DOD child care fee assistance can also participate in a DCFSA.

Overall, these child care fee policy changes will help to the Department continue providing quality child development services to military families, "which is consistent with our ongoing efforts to both improve the affordability of child care and recruit and retain CDP workers," Martin said.

Military families can contact their child development centers or school-age care programs to learn how these fee changes will impact individual households. Military families can learn more about DCFSAs and how to enroll through the Office of Financial Readiness.