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Providers warn Birth‑to‑3 program may collapse without immediate rate increases and gap payment
Summary
Multiple birth‑to‑3 agencies and early‑childhood advocates told the committee that stagnant rates, proposed tiering and the proposed elimination of the general administrative (gap) payment threaten programs that serve infants and toddlers with developmental delays.
Birth‑to‑3 providers, clinicians and parents urged the Appropriations Committee to accelerate funding and preserve the program’s administrative payment, saying the system is at a breaking point.
Several agencies reported recent closures and said two programs have folded in the past few years because they could not sustain operations under current reimbursement rates. Witnesses pointed to a state rate study showing an average cost to provide professional hours at $167 per hour, while the current professional rate is $120 per hour and has not been increased since 2017.
Providers asked that any new rate structure begin in fiscal year 2026 rather than 2027. They also urged retention of the gap (general administrative payment), which funds travel, service coordination, electronic records and other non‑billable overhead that programs cannot recover from Medicaid‑style billable hours alone.
Several speakers said the governor’s draft budget includes some new funding but that the proposed multi‑tiered professional reimbursement would add complexity, require new credentialing for staff and would not reach the true cost of services. Programs said a multi‑tier system as currently described risks inequities and could delay increases to wages that would attract and retain clinicians.
Early intervention testimony included personal stories from parents who said timely services prevented later, more costly special‑education placements. State data cited by witnesses showed roughly half of children who receive birth‑to‑3 services do not proceed to preschool special education—an outcome providers said creates long‑term savings for districts and state systems.
Witnesses asked the committee to fund a single professional rate in FY26 at or near the $167 identified in the 2022 cost study, preserve the gap payment, and avoid a delayed or complex tiered roll‑out that would keep providers and families at risk.
The committee took testimony and did not adopt formal changes during the hearing. Members asked several technical questions about timelines and implementation.
