First 5 Power of Preschool: Lessons from an Experiment in Tiered Reimbursement

Irene Lam and Susan Muenchow

In 2003, First 5 California approved $100 million to establish the Power of Preschool (PoP) Demonstration Program over a period of five to seven years in selected communities across the state. Designed not only to expand access but also to provide financial incentives to improve the quality of preschool, the PoP program can be viewed as a California-based pilot that offers many features of a tiered reimbursement system.

The First 5 PoP Projects are voluntary, high-quality, part-day preschool programs universally accessible to all preschoolers within a specified area, such as a school district, city, or county. The projects focus on three- and four-year-olds, and give priority to neighborhoods previously underserved by preschool programs and those with low-performing schools.

With support from the David and Lucile Packard Foundation, AIR examined the PoP reimbursement structure in the nine counties participating in the PoP demonstration program. Researchers also interviewed providers participating in the PoP projects to obtain their insights on program reimbursement rates.

This brief addresses what lessons can be learned from the PoP demonstration projects to help inform the development of reimbursement rates, not only for the potential continuation of the First 5-funded programs, but also for other publicly financed efforts designed to serve preschool children.