COVID relief passes with aid for millions of children
Child Abuse & Neglect Child Care Child Rights Early Childhood Education Federal Budget Health Nutrition Poverty & Family Economics
Biggest policy gain for children in decades
The American Rescue Plan passed just moments ago by the House of Representatives marks the biggest policy gain for children in the United States in decades.
“This legislation does more for our country’s children than any since Congress passed the Children’s Health Insurance Program in 1997,” said Bruce Lesley, president of First Focus Campaign for Children. “The American Rescue Plan will cut child poverty by more than half this year alone. Its child care, nutrition, education, mental health, tax credits, and other provisions will vastly improve the lives of our kids, which have been completely derailed by the pandemic and its social and economic aftermath. We must ensure that these benefits reach Black and brown children, who have been disproportionately affected, and that Congress moves quickly to make these poverty-cutting measures permanent.”
The Children’s Health Insurance Program, first authorized in 1997, insures more than 10 million low-income children.
Among the American Rescue Plan’s most important provisions for children:
Tax Code improvements:
- Child Tax Credit: One-year expansion of the Child Tax Credit makes it fully refundable to reach children in low- and no-income households; increases the credit from $2,000 to $3,000 for older children (a category that now includes 17-year-olds), and up to $3,600 for children under age 6. The improvements also allow the credit to be distributed monthly to qualifying taxpayers.
- Child and Dependent Care Tax Credit (CDCTC): One-year improvements make the credit refundable for the first time; increase the credit rate to 50% (from 35%); increase the phaseout threshold to $125,000 (from $15,000); and increase the amount of eligible child care expenses to $8,000 for one qualifying child and $16,000 for two. Current law allows $3,000 for one child and $6,000 for two or more.
- Earned Income Tax Credit (EITC): One-year expansion increases the credit rate and the maximum credit for childless workers; and reaches more vulnerable populations by dropping the qualifying age to 19 years old (from 25) in general, and to 18 years old for qualified former foster youth and qualified homeless youth.
Child Care and Early Learning funding: The American Rescue Plan brings total child care funding to $50 billion, the amount requested by advocates to meet urgent needs, by adding the following to the $10 billion included in the December 2020 relief package:
- $25 billion for a child care stabilization fund
- $15 billion for the Child Care and Development Block Grant
- $1 billion for Early Head Start/Head Start
- $1 billion in additional funding for Tribal child care programs and supports
Home Visiting program support: $150 million for the Maternal, Infant, and Early Childhood Home Visiting program, which will allow home visiting programs to continue providing critical services to families.
Mental Health funding: Within the bill’s total funding for mental health, significant amounts are specifically designated to address the needs of children:
- $10 million for the National Child Traumatic Stress Network
- $30 million for Project AWARE
- $20 million for youth suicide prevention
- $80 million for Pediatric Mental Health Care Access
Services for Homeless Children and Youth: $800 million will be used to identify and provide homeless children and youth with wrap-around services to address the challenges presented by the pandemic and its economic fallout.
Additional stimulus payments:
- Authorizes additional $1,400 recovery rebates to individuals, with all dependents qualifying for the full amount, regardless of age.
- Payments will be available to all children with a Social Security number, regardless of the status of their parents and guardians.
Note: Payments phase out to zero at $80,000, $120,000 and $160,000 for individuals, head of households and couples respectively.
Health Care Coverage improvements:
- Requires Medicaid and the Children’s Health Insurance Program (CHIP) to fully cover the cost of COVID-19 vaccines.
- Creates an option for states to extend postpartum coverage to new mothers for 12 months, in place of the current 60 days; the option will be available for five years. States that choose this option must apply the coverage in both Medicaid and CHIP (if they currently cover pregnant women in their CHIP plan). This provision will impact Black mothers, who die disproportionately during the first year after a pregnancy.
- Increases Medicaid FMAP by five percentage points for two years for states that initiate Medicaid expansion, encouraging the enrollment of children, who gain coverage when their parents get covered.
- Includes a one-year 10% increase in federal Medicaid matching funds for home- and community-based services (HCBS), which allow children with disabilities to remain at home and in their communities with support from their families and community service providers.
- Provides more than $6 billion for Native health services, including funding for mental and behavioral health and to improve telehealth services as part of a $31.2 billion investment in Native communities.
Expansion of nutrition benefits:
- Extends through September 2021 a 15% increase in Supplemental Nutrition Assistance Program (SNAP) benefits
- Funds fruit and vegetable outreach and innovation in the Women, Infants and Children (WIC) program
- Ensures Pandemic-EBT will be available for duration of pandemic, including over the summer
- Provides $1 billion of additional funding for nutrition programs in the territories
- Provides $25 million for SNAP online purchasing and technology improvements
Enhanced unemployment benefits:
- Extends through September 6, 2021 the $300 per week pandemic unemployment benefits
- Exempts $10,200 of benefits from income tax, up to incomes of $150,000
TANF Assistance for Tribal Communities: Provides $75 million for Tribal TANF grantees to assist families in need through the Pandemic Emergency Assistance Fund
Supports for K-12 Education:
- Calls for more than $125 billion to help reopen schools
- Local Education Agencies (LEAs) must dedicate 20% of funding to addressing learning loss
- $7.2 billion for E-rate to support broadband access and close the digital divide
- Offers approximately $1.1 billion in funding for Native education programs
Child Welfare Efforts:
- Makes available $250 Million for Community Based Grants for the prevention of child abuse and negelct — nearly five times the amount appropriated in FY 2020 — until September 30, 2023.
- Increases to $100 Million funding for State grants for child abuse or neglect prevention and treatment programs, available until September 30, 2023.