DHS Child Care Payment in Michigan: Rates, Copays, and Eligibility

Michigan’s DHS child care payment program, formally the Child Development and Care (CDC) program run by the Michigan Department of Health and Human Services, pays providers on a two-week billing cycle. Maximum payments range from about $147 to $864 per period for licensed providers, depending on provider type, the child’s age, and whether the provider carries a quality rating. License-exempt caregivers, including relatives, are paid hourly at $2.95 to $4.95. Eligibility depends on your household income, your family size, and a qualifying reason for care such as work or school.

What Providers Get Paid Every Two Weeks

Licensed child care centers receive the highest reimbursement. Payments come in blocks based on hours billed over each two-week period. Base rates, before any quality bonus, look like this:

Infant or toddler (birth through age 2½): $214.50 for 1–30 hours, $429.00 for 31–60 hours, $643.50 for 61 or more hours.
Preschool (age 2½ through 4): $151.50 for 1–30 hours, $303.00 for 31–60 hours, $454.50 for 61 or more hours.
School-age (5 and older): $147.00 for 1–30 hours, $294.00 for 31–60 hours, $441.00 for 61 or more hours.

Licensed group homes and family homes are paid slightly less per period:

Infant or toddler: $171.00, $342.00, $513.00 across the three hour blocks.
Preschool: $147.00, $294.00, $441.00.
School-age: $144.00, $288.00, $432.00.

License-exempt providers are paid by the hour rather than in blocks. The base hourly rate is $2.95 regardless of the child’s age. Providers who complete additional training qualify for Level 2 rates of $4.95 per hour for infants and toddlers or $4.40 for preschool and school-age children.¹ These rates are effective as of September 2024 and are updated periodically, so confirm the current figures with MDHHS.

Licensed providers receive payment directly from the state. For license-exempt providers, the state pays the parent, who then pays the caregiver.² If your provider’s usual charge is higher than the state maximum, you owe the difference on top of any copayment.

How a Quality Rating Changes What Michigan Pays

Michigan’s Great Start to Quality system assigns providers a star level. Providers rated three stars or higher earn a premium. A five-star licensed center caring for a toddler full time receives $864.00 per two-week period, compared with $643.50 at the base rate — about a 34% premium.¹

The rating also affects your out-of-pocket cost. If your child attends a center, group home, or family home rated three stars or higher, your family copayment is waived entirely.²

What Your Family Pays

Most approved families owe a “family contribution” based on household income. It is charged per child for each two-week pay period and ranges from $0 to $78, with a per-family cap so households with multiple children don’t pay more than a set maximum.² Federal rules prohibit any state from setting copayments above 7% of family income, no matter how many children receive assistance.³

Two situations remove the copayment entirely. Children in CDC Protective Services categories, including foster care, have no copayment. Families using a provider rated three stars or higher also pay $0.

Who Qualifies

Income Limits

To qualify at application, your household’s gross monthly income cannot exceed the entry-level threshold for your family size. Under the September 2024 rate schedule:

Family of 2: $3,526 per month (about $42,312 annually).
Family of 3: $4,442 per month (about $53,304 annually).
Family of 4: $5,358 per month (about $64,296 annually).

These thresholds were updated effective October 2025 and may be higher now.² Income limits do not apply for children in foster care or receiving Children’s Protective Services.

Once approved, you get 12 months of continuous eligibility. Benefits continue for the full period even if your income fluctuates, as long as it stays below a higher “exit level.” Benefits end mid-period only if your income exceeds that exit level and is expected to stay that high for more than six months.⁴

A Qualifying Need for Care

You must show a qualifying activity. Approved activities include employment, job training, high school completion or GED programs, undergraduate college courses, and approved counseling or treatment programs.⁵

The Child

The child must be under 13 at application or redetermination. Children with documented special needs can qualify up through age 26. A child who turns 13 during an active eligibility period stays covered through the end of that 12-month period. The child must also be a U.S. citizen or a qualified noncitizen. MDHHS is not permitted to ask about the immigration status of parents or other household members; only the child’s status matters.⁶

How to Apply

The fastest way to apply is online through the MI Bridges portal at michigan.gov/MiBridges.⁷ You can also file a paper application by mail or in person at a local MDHHS office. Have these ready:

Social Security numbers for household members applying, plus birth certificates, state ID cards, or passports.
Recent pay stubs, tax returns, unemployment statements, or bank statements dated within the last 30 days.
Documentation of employment, school enrollment, or another approved activity.
A lease, utility bill, or similar proof of residency.
Your provider’s name, address, phone number, and license number if applicable.

You and your provider must also complete the Child Development and Care Provider Verification form (MDHHS-4025). As of June 2025, this form no longer requires the provider’s signature.⁸

A specialist may contact you for a phone or in-person interview. Processing takes up to 45 days.⁹ Once approved, you receive an authorization letter (DHS-198) showing your start date and approved hours.

Keeping Your Benefits Active

Report changes to your household within 10 days. That includes a new job, a raise, reduced hours, job loss, changes in household size, school enrollment changes, or a change in provider.¹⁰ Late reporting can reduce or end your benefits.

Your child does not need to attend care every scheduled day for the provider to be paid. Michigan reimburses licensed providers for up to 360 absence hours per fiscal year (October through September), with a cap of 10 consecutive paid absence days. After 10 consecutive absences, billing continues but payment stops until the child returns.¹¹

If You’re Overpaid

If MDHHS finds you received more than you were entitled to, the overpayment must be repaid. State law requires the department to take all necessary steps to recover overpayments, including administrative action or court proceedings, and cases involving intentional misrepresentation can be referred for criminal prosecution.¹²

MDHHS may waive recovery in limited circumstances: when the cost of collection would exceed the overpayment, when the department itself caused the error, or when repayment would cause undue hardship (except where federal rules prohibit the waiver). Under federal CCDF rules, substantiated fraud can also result in immediate termination of benefits before the next scheduled redetermination.¹³

1
State of Michigan. CDC Reimbursement Rates – Part-Time and Full-Time
2
State of Michigan Department of Health & Human Services. CDC Income Eligibility Scale and Provider Rates
3
The Administration for Children and Families (ACF). CCDF Family Co-Payments by State
4
State of Michigan Department of Health & Human Services. BEM 505 – Prospective Budgeting/Income Change Processing
5
Department of Health & Human Services. Verification
6
Child Care Technical Assistance Network. Understanding Federal Eligibility Requirements
7
State of Michigan. Child Care Assistance
8
State of Michigan. Providers
9
State of Michigan. How Long Does It Take to Process an Application?
10
State of Michigan. DHS-Pub-280 Reporting Changes When, How and What to Report
11
State of Michigan. Provider Billing Guidance
12
Michigan Legislature. Michigan Compiled Laws Section 400.43a
13
eCFR. Part 98 – Child Care and Development Fund