This bill mandates the Commissioner of Human Services to implement a quality-based reimbursement system for registered family child care providers participating in New Jersey's subsidized child care assistance program and the Grow NJ Kids initiative. It allows these family child care providers to receive enhanced reimbursements based on their quality ratings, similar to those received by center-based child care providers. The bill specifies that state subsidies for family child care providers will be increased in accordance with the same percentage as those for center-based providers with equivalent quality ratings under the Grow NJ Kids program.

The legislation aims to address the significant decline in registered family child care homes in New Jersey, which has dropped by 59% over the past 15 years. The sponsors believe that low subsidy rates and a lack of financial incentives for quality improvement have contributed to this decline. By providing higher reimbursement rates for family child care providers who achieve improved quality ratings, the bill seeks to incentivize participation in the Grow NJ Kids program and make becoming a registered family child care provider more appealing, ultimately enhancing the availability of quality child care options for families in the state.