Agencies outline timetable and $18.7 billion estimate to shift to a 'cost‑of‑care' rate model Department of Social Services and education officials described plans to replace market‑based rates with an alternative 'cost‑of‑care' methodology, estimated transition work would take roughly 24 months after statute and funding are set, and CDSS reported a July 2025 estimate of roughly $18.7 billion in direct service costs under the alternative methodology.

California is set to revolutionize its child care funding with a bold shift to a $18.7 billion 'cost-of-care' model, but it won't be easy—prepare for a complex transition ahead!

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