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Medicaid is a Critical Support for the Early Childhood Education Workforce

[Editor’s Note: Last Updated July 22, 2026]

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Medicaid is an important source of health coverage for the early childhood education professionals who support child development and care for children while parents work, and for the children and families these educators serve. Twelve states cover a third or more of the child care workforce through Medicaid, making the program an essential part of ensuring the health and well-being of child care professionals.1 In turn, a healthy early childhood workforce can most effectively support the positive development of children in their earliest years. Threats to Medicaid coverage for early childhood educators would likely further deepen a child care crisis driven in large part by inadequate compensation for this critical workforce. To address the root of this problem, the child care workforce needs higher wages and access to quality benefits which requires significant, robust, and sustainable public investments. Until this core problem is addressed, many workers necessarily rely on Medicaid and SNAP.

Medicaid Covers a Large Share of the Nation’s Early Childhood Educators and Child Care Professionals, Whose Overall Compensation is Far Too Low

Most child care programs operate as small businesses and exist within a broken market with historic under-investment.2 For these small employers, offering health insurance to staff can be prohibitively expensive, leaving most child care workers without access to affordable employer-sponsored coverage. A lack of adequate public investment in child care, combined with the high cost of providing high quality care and education– still unaffordable for many families–means that many programs are forced to sacrifice educator wages and benefits in order to keep their doors open. More than half of U.S. workers across industries have access to employer-sponsored health insurance.3 By comparison, fewer than 1 in 4 early childhood educators employed outside of public schools can access employer-sponsored coverage.4 This lack of affordable coverage options translates to a high uninsurance rate of 10.8 percent of child care workers nationally.5 Without Medicaid, this rate would be even higher.

Over 26 percent of child care workers are covered by Medicaid, with state shares ranging from 12.1 in Georgia to 71.1 in Rhode Island.6 The National Association for Family Child Care’s annual report found that 28 percent of family child care respondents rely on Medicaid or Medicare for their health insurance.7 These coverage rates are reflective of the overall low levels of compensation available to early childhood educators. The median wage for early childhood educators is lower than 97 percent of all other occupations in the US.8 And while women of color make up 17.8 percent of the overall workforce, they account for 40.9 percent of the child care workforce, as of 2021.9 These low wages are further exacerbated by wage gaps within the early childhood field, specifically center-based programs—Black and Latina women are paid less than Asian and White colleagues with equivalent degrees, and educators working exclusively with the youngest kids (zero to three) are paid less than those working with older age groups.10 As a result of low wages, 43 percent of early educator families rely on one or more public safety nets such as Medicaid or SNAP to make ends meet.11 Notably, health insurance was ranked one of the top challenges faced by family child care educators in NAFCC’s 2025 survey (also see box below).12

Lack of access to adequate compensation, including both wages and benefits, is a leading driver of the child care supply challenges communities face across the country. Additional reductions in access to benefits could exacerbate child care access challenges. A recent NAEYC survey of more than 7,000 early childhood educators found that close to half of ECE programs cannot enroll their preferred number of children.13 Respondents pointed to staffing shortages as a leading reason for limited capacity, with over half of program leaders indicating not being able to afford the compensation needed to recruit and retain qualified staff.14 Nearly half of educators surveyed reported being more burned out than in the prior year, with 22% indicating they were considering leaving the field in the next year.15 In contrast, respondents who reported having access to professional benefits, including health insurance, were more likely to report an intention to remain in the child care field compared to respondents reporting inadequate benefits.16

State Medicaid Expansions Have Boosted Coverage for the Child Care Workforce 

In states that have not expanded Medicaid under the Affordable Care Act (ACA), many child care workers fall into what is known as the “coverage gap,” with incomes too low to qualify for ACA marketplace assistance, but without access to Medicaid coverage.17 In the 10 states that have not expanded Medicaid, this coverage gap is the widest.18  Five percent of working adults in the coverage gap are employed as child care workers, home health aides, personal care aides, and nursing assistants.19 In states that have not adopted Medicaid expansion, 20.5 percent of child care workers are uninsured–nearly three times higher than states with expansion.20

Congress Created New Barriers to Medicaid in 2027, Allowed ACA Marketplace Premiums to Increase

A new Child Trends survey on Maryland’s Early Care and Education Workforce found that nearly one third of ECE workers—both center-based and family child care (FCC)—receive health insurance through Medicaid or Medicare and an additional 12 percent of center-based and 21 percent of FCC workers rely on the federal Affordable Care Act (ACA) Marketplace.21 The 2025 reconciliation package, H.R. 1, requires nearly all states to add red tape barriers for Medicaid expansion adults, notably work reporting requirements and more frequent renewals, starting in 2027.22,23 With new red tape and work reporting requirements looming in Medicaid and the expiration of enhanced premium tax credits (ePTC) raising costs for Marketplace enrollees, protecting affordable health coverage options for the child care workforce is more important than ever.24,25

A study by the Urban Institute estimates up to 10.1 million people could lose coverage by 2028 due to the work reporting requirement and 6-month redeterminations.26 A large swath of those who will lose coverage will lose it due to system errors, difficulty navigating the documentation requirements, and other burdens that come from added red tape.27 So even ECE workers meeting or exceeding the 80-hour requirement are at high risk of losing their health coverage under these policies—a risk that could be elevated depending on states’ implementation decisions.28 The work reporting requirement is notably complicated for home-based child care providers, who often do not have access to formal documentation of income to show compliance and may work irregular hours.29

Since the expiration of ePTCs, the average deductible has increased by 37% and enrollment has seen the largest single year drop in Marketplace history.30 Current predictions estimate an enrollment drop between 17-26% year over year.31 These higher costs limit who is able to afford coverage through the Marketplace, further narrowing options for populations like early childhood educators who rely on these programs for comprehensive health coverage.

Medicaid Supports Healthy Early Childhood Development 

Medicaid is a major coverage source for young children, covering 40 percent of children under 6 in 2024.32 Many studies have linked childhood Medicaid coverage to improved health, education and employment outcomes well into adulthood.33 But health coverage is also important for those who care for young children, since relationships and interactions with adults are a core component of strong early development. The first few years of a child’s life are some of the most impactful in their brain and emotional development that supports lifelong health– this is heavily influenced by their interactions with caregivers, whether at home or in child care.34 Medicaid helps ensure more child care workers – many of whom spend the full day with young children while parents work –  have health coverage and improved access to the care they need to work each day helping children create meaningful and supportive connections.35

When educators leave their programs as a result of burnout or low compensation, however, those connections can be disrupted in ways that negatively impact young children’s cognitive development.36,37 Research has shown that reliability in the relationship between young children and their caregivers helps protect against excessive stress that, early in life, can harm biological and psychological health in the long-term.38,39

In addition to the ways in which Medicaid supports access to health coverage for the child care workforce, Medicaid plays a critically important role in filling gaps in support for young children with disabilities and developmental delays. Infants and toddlers with disabilities have access to critical early intervention services through a combination of state and federal funding streams, but as federal funding has failed to keep up with the rising need for support, most states rely on Medicaid to help finance these necessary services. By supporting access to early intervention services, Medicaid further supports the ECE workforce by helping children with disabilities and developmental delays thrive in inclusive care settings.40 According to NAEYC’s recent ECE workforce survey more than one in three educators in under-enrolled programs attribute low enrollment to children needing specialized services that their program does not offer.41 These data suggest disruptions to children’s access to critical early intervention services as a result of Medicaid cuts are happening at a time of increased need and could further worsen child care program stability by lowering enrollment.

Medicaid is Essential for the Child Care Workforce, Families, and the Economy 

Medicaid is not only essential for children and families, but also for the many early childhood educators who rely on it. A lack of access to competitive wages and benefits contributes greatly to the retention and recruitment challenges experienced in the ECE workforce, which could be worse without Medicaid coverage available. Health insurance and retirement benefits are consistently identified as major challenges affecting recruitment, retention, and workforce stability. Supporting family child care and early childhood educators’ access to these necessities also means supporting long term business sustainability.42

Many lawmakers and state leaders are working to strengthen access to professional compensation for early childhood educators.  Until payment and benefits can be improved, Medicaid plays an important role in providing health coverage for this critical workforce. A strong, well-supported early childhood education workforce plays a critical role in supporting young children’s healthy development and parents’ ability to work. Medicaid helps to prevent further destabilization of the early childhood education workforce, added staff burnout and turnover, and more limits on families’ access to high-quality care that meets their needs.

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Endnotes

  1. Georgetown University Center for Children and Families analysis of U.S. Census Bureau 2023 and 2024 American Community Survey (ACS) Public Use Microdata Sample (PUMS). Data include citizen, non-elderly adult (19-64) workers who identified as childcare workers according to ACS occupation codes. ↩︎
  2. “The Economics of Child Care Supply in the United States,” (U.S. Department of the Treasury, September 2021) available here. ↩︎
  3. Banerjee, A., Gould, E., and Sawo, M., “Setting Higher Wages for Child Care and Home Health Care Workers is Long Overdue,” (Economic Policy Institute, November 18, 2021) available here. ↩︎
  4. Banerjee, A., Gould, E., and Sawo, M., “Setting Higher Wages for Child Care and Home Health Care Workers is Long Overdue,” (Economic Policy Institute, November 18, 2021) available here. ↩︎
  5. Georgetown University Center for Children and Families analysis of U.S. Census Bureau 2024 American Community Survey (ACS) Public Use Microdata Sample (PUMS).  Data include citizen, non-elderly adult (19-64) workers who identified as childcare workers according to ACS occupation codes. ↩︎
  6. Georgetown University Center for Children and Families analysis of U.S. Census Bureau 2024 American Community Survey (ACS) Public Use Microdata Sample (PUMS).  Data include citizen, non-elderly adult (19-64) workers who identified as childcare workers according to ACS occupation codes. ↩︎
  7. “NAFCC 2025-2026 Annual Survey Report” (National Association for Family Child Care, 2026) available here. ↩︎
  8. “Early Childhood Workforce Index 2024” (Center for the Study of Child Care Employment, 2024), Early Educator Pay & Economic Insecurity Across the States, available here.  ↩︎
  9. Banerjee, A., Gould, E., and Sawo, M., “Setting Higher Wages for Child Care and Home Health Care Workers is Long Overdue,” (Economic Policy Institute, November 18, 2021) available here. ↩︎
  10. “Early Childhood Workforce Index 2024” (Center for the Study of Child Care Employment, 2024), Early Educator Pay & Economic Insecurity Across the States, available here.  ↩︎
  11. “Early Childhood Workforce Index 2024” (Center for the Study of Child Care Employment, 2024), Early Educator Pay & Economic Insecurity Across the States, available here.  ↩︎
  12. “NAFCC 2025-2026 Annual Survey Report” (National Association for Family Child Care, 2026) available here. ↩︎
  13. “A Year of Tough Choices” (National Association for the Education of Young Children, February 2026) available here.  ↩︎
  14. “A Year of Tough Choices” (National Association for the Education of Young Children, February 2026) available here.  ↩︎
  15. “A Year of Tough Choices” (National Association for the Education of Young Children, February 2026) available here.  ↩︎
  16. “A Year of Tough Choices” (National Association for the Education of Young Children, February 2026) available here.  ↩︎
  17. Lukens, G. and Harker L., “Closing Medicaid Coverage Gap Would Help Diverse Groups and Reduce Inequities,” (Center on Budget and Policy Priorities, July 2024) available here. ↩︎
  18. “Status of State Medicaid Expansion Decisions,” (KFF, May 21, 2026) available here. ↩︎
  19. Lukens, G. and Harker L., “Closing Medicaid Coverage Gap Would Help Diverse Groups and Reduce Inequities,” (Center on Budget and Policy Priorities, July 2024) available here. ↩︎
  20. Georgetown University Center for Children and Families analysis of U.S. Census Bureau 2024 American Community Survey (ACS) Public Use Microdata Sample (PUMS). Data include citizen childcare workers under 138% FPL. ↩︎
  21. Ulmen, K., Lin, Y., Madill, R., and Banghart Gottesman, P., “One in Three ECE Workers in Maryland Receive Health Insurance Through Medicaid or Medicare,” (Child Trends, March 5, 2026) available here. ↩︎
  22. Park, E. and Corlette, S. “Medicaid, CHIP, and Affordable Care Act Marketplace Cuts and Other Health Provisions in the Budget Reconciliation Law, Explained,” (Georgetown University Center for Children and Families, July 22, 2025) (Updated August 13, 2025) available here. ↩︎
  23. Brooks, T. et al, “New Federal Medicaid Work Reporting Requirements Rule Threatens Coverage for Vulnerable Americans: An Explainer of the Interim Final Rule,” (Georgetown University Center for Children and Families, July 16, 2026) available here. ↩︎
  24. Kaneb, N., “Who Cares for Our Nation’s Children? Federal Medicaid Cuts Will Magnify Challenges for Child Care Workforce and the Young Families They Support,” (Georgetown University Center for Children and Families, September 11, 2025) available here. ↩︎
  25. Pogue, S. and Davenport, K., “Clues in State Data Suggest Declines in Early Marketplace Enrollment Data May Be Just the Tip of the Iceberg,” (Georgetown University Center on Health Insurance Reforms, January 28, 2026) available here. ↩︎
  26. Buettgens, M. et. al, “Projected Reductions in Medicaid Expansion Enrollment Under OBBBA’s Work Requirements and Six-Month Redeterminations,” (Urban Institute, March 25, 2026) available here. ↩︎
  27. Zhang, E. and Lukens, G., “Medicaid Work Requirements Will Take Away Coverage from Millions: State and Congressional District Estimates,” (Center on Budget and Policy Priorities, July 22, 2025) available here. ↩︎
  28. “Tracking Implementation of H.R.1 Medicaid Work Reporting Requirements,” (Georgetown University Center for Children and Families) available here. ↩︎
  29. Cardona, M. and Hamm, K. “DEEP DIVE: Making Medicaid Work Requirements Work for Home-Based Child Care Providers” (Education Counsel, July 13, 2026) available here. ↩︎
  30. McGough, M., Ortaliza, J., Lo, J., and Cox, C., “What We Know So Far About 2026 ACA Marketplace Enrollment, Premiums, and Deductibles,” (KFF, May 19, 2026) available here. ↩︎
  31. Anderson, M., Yi Chin, C., and Cohen, M., “Who Paid, and Who Stayed? Early 2026 Enrollment Trends in the Individual Market,” (Wakely, April 2026) available here.   ↩︎
  32. Georgetown University Center for Children and Families analysis of U.S. Census Bureau 2024 American Community Survey (ACS) Public Use Microdata Sample (PUMS). ↩︎
  33. Park, E., Alker, J., and Corcoran, A., “Jeopardizing a Sound Investment: Why Short-Term Cuts to Medicaid Coverage During Pregnancy and Childhood Could Result in Long-Term Harm,” (The Commonwealth Fund, December 8, 2020) available here.  ↩︎
  34. Wright Burak, E., “Parents’ and Caregivers’ Health Insurance Supports Children’s Healthy Development” (Society for Research in Child Development, June 2019), available here.   ↩︎
  35.  “The Case for Better Compensation of Early Educators,” (ZERO TO THREE, June 2023), available here.  ↩︎
  36. “The Case for Better Compensation of Early Educators,” (ZERO TO THREE, June 2023), available here.   ↩︎
  37. “Staff Turnover in the Early Childhood Workforce,” (Institute of Education Sciences, January 2020), available here. ↩︎
  38. “Connecting the Brain to the Rest of the Body: Early Childhood Development and Lifelong Health Are Deeply Intertwined,” National Scientific Council on the Developing Child, (Center on the Developing Child, Harvard University, June 2020) Working Paper 15, available here. ↩︎
  39. “Toxic Stress,” (Center on the Developing Child, Harvard University), available here. ↩︎
  40. “Medicaid Provides Early Intervention for Infants and Toddlers with Disabilities and Developmental Delays,” (Georgetown University Center for Children and Families, March 2025) available here.  ↩︎
  41. “A Year of Tough Choices” (National Association for the Education of Young Children, February 2026) available here. ↩︎
  42. “NAFCC 2025-2026 Annual Survey Report” (National Association for Family Child Care, 2026) available here. ↩︎

Additional Resources 

  • Austin, L., Edwards, B., and Whitebook, M., “Racial Wage Gaps in Early Education Employment” (Center for the Study of Child Care Employment, December 2019), available here. 
  • Chien, N. and Macartney, S. “Health Care and Child Care Costs Contribute to the Unsustainable and Growing Cost of Raising a Family in America” (U.S. Department of Health and Human Services, March 2025), available here.  
  • “Four Years of Listening to Caregiver Voices Shows Increasing Economic Hardship and Emotional Distress Among Those Providing Child Care to Young Children,” RAPID Survey Project, (Stanford Center on Early Childhood, October 6, 2025), available here.
  • “How America’s Child Care Crisis Impacts Parents” (ZERO TO THREE, June 2024), available here.  
  • Kashen, J., “Beyond Health: Threats to Medicaid Funding Would Endanger Child Care Too,” (The Century Foundation, March 5, 2025) available here. 
  • Mefferd, E. and Dow, D., “The US Child Care System Relies on Women of Color, but Structural Barriers Systematically Disadvantage Them,” Urban Wire, (Urban Institute, June 14, 2023), available here. 
  • Rudich, J., Sugar, S., Chien, N., Peters, C., Sommers, B., “Assessing Uninsured Rates in Early Care and Education Workers” (Assistant Secretary for Planning and Evaluation, November 2021), as cited in Wikle, S. and Wright Burak, E., “State Opportunities to Improve Health Care Coverage for Child Care Professionals” (Georgetown University Center for Children and Families, November 2022), available here.  

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