Gifford Health Care raises rates and reduces hours on its employee daycare center

Hillary McAllister-Bove works as a social worker at Gifford Primary Care in Randolph because of its daycare, the Robin’s Nest.

She learned of the job opening at her first midwifery appointment at the hospital, when she was pregnant with her first child in 2022. The subsidized employee childcare center, posted as a benefit, caught her eye.

“I became a parent with the support of Robin’s Nest,” she said. Since then, her family has grown and so has her love for the on-site daycare, where 40 other children of employees are enrolled. McAllister-Bove described being able to visit her baby and breastfeed during the work day. It’s worth it, she said, to drive the nearly 50 minutes from their home in Middlesex. Her second child, who was born in July 2024, soon followed her first to the daycare. Both kids have grown to love school and the teachers who look after them there.

So when she gave birth to her third child in September, it felt like a no-brainer to enroll in the Robin’s Nest yet again.

But, on Oct. 12, McAllister-Bove and the 30 other employee families who send their children to Gifford’s daycare center received an update that alarmed her.

Starting in January, their rates would increase — drastically. For McAllister-Bove and her husband, Greg Bove, that meant an increase from paying $68 a day for both of their two older children to $181 a day, plus $99 for their infant at the new rates. 

McAllister-Bove’s struggle to thread the needle between affording childcare and maintaining her role in primary care at Gifford Medical Center speaks to the larger, competing pressures facing families and hospitals to juggle the high costs of healthcare, childcare, gas and groceries. 

Gifford is not alone among the region’s employers who see childcare services as a key to attract and retain talent: A number of Dartmouth Health affiliates, ski mountains, including Smugglers Notch and other large employers, such as the electric airline company Beta Technologies offer some kind of childcare for their employees. All of it is set against the backdrop of Vermont’s major expansion of financial-assistance for children to enroll in daycares through legislation passed in 2023.

Vermont’s Legislature, hospitals and main healthcare regulator have put a heavy emphasis on recruiting and retaining a healthcare workforce of professionals who want to work — and can afford to live and build their families — in rural parts of the state. And at the same time, the state’s hospitals are struggling to reduce their costs, cut expenses and still stay solvent.

“I think we’re entering a period of hard trade-offs in healthcare, and this is one of them,” Michael Costa, Gifford’s CEO, told VTDigger. “This is part of a larger story about Gifford’s future and about rural hospitals. All of us are trying to find a way to remain sustainable and strong for our communities.”

The Randolph medical center, which has 25 inpatient beds, has been working for years to claw itself out of a major budget deficit and threats of closure. In a late July email to staff, Costa addressed the hospital’s efforts to course correct. 

“Two years ago, Gifford was in crisis,” he wrote. “Today, the story is different because of our hard work. Our FY2026 budget was the Turnaround Budget, built from scratch to reflect reality. It has worked. After nine months, revenue is within 0.2% of plan and operating income is within $46,000 of target. We continue to improve and fight for our patients and our community. Now, what’s next?”

Cutting the major losses at the Robin’s Nest daycare was among those next steps to creating a more sustainable budget for 2027.

An October estimate from hospital executives said the daycare resulted in $589,000 in losses for this fiscal year. In an announcement to staff that month, Gifford executives laid out a plan to bring those losses down to $54,000, with changes set to take effect at the start of 2027.

Families, including McAllister-Bove’s, raised concerns that it left them with hardly over two months to plan.

Chief among those changes are new, higher rates: to $495 a week for infants, $465 a week for toddlers and $439 for preschoolers. With Vermont state law capping annual daycare price increases, the hospital needed special approval from the Vermont Department for Children and Families. The new rates are set to align with the maximum subsidies the state provides through its Child Care Financial Assistance Program for families that qualify.

Additionally, Gifford cut the daycare’s hours from operating 11 hours a day to 10, closing an hour earlier at 4:30 p.m. after an internal survey found that the last hour of the day was the least used.

The hospital is also changing how the daycare provides breakfast and lunch to children. The meal program loses nearly $81,000 a year, hospital executives estimated, and state subsidies only cover a fraction of the expense. Initially, Gifford intended to cut the program entirely, but after strong backlash from parents, the hospital reevaluated.

Instead of having an independent food program within the Robin’s Nest, Gifford plans to extend the food program in its hospital and senior living facilities to include the daycare. The change cuts the amount the hospital is spending subsidizing the food program in half, Costa said.

“We believe the community and Gifford are much better off if we have a daycare center than if we don’t have a daycare center,” Costa told VTDigger. “The only way that we can ensure that it is always there is if it breaks even each year.”

Calculating how that expense reduction translates into lower prices for patients and for Vermonters who buy health insurance through commercial insurers is harder, Costa said. 

Instead, he’s been focused on the overall effort to keep costs down and to request less in reimbursement from commercial insurers. The hospital decreased its rate with BlueCross BlueShield of Vermont this year, he said, which helps reduce premiums for some Vermonters. 

Still, he worries about the tradeoffs it will force families at Gifford to make, especially those who cannot rely on state childcare subsidies — families who earn up to 575% of the federal poverty level ($13,091 a month for a family of three, $15,813 a month for a family of four) are eligible for some subsidy.

“If you’re asking me if I’m nervous that staff will leave over this, I would say, ‘Yes,’” Costa said. 

McAllister-Bove and her husband expect to receive support from the state’s Child Care Financial Assistance Program in order to send all three of their children to the daycare in 2027, she said, but not without feeling bruised by the process Gifford went through.

“Prior to this, I believed the best choice for my family was to continue with Robin’s Nest. We now do need to consider my tenure with Gifford differently in support of what best meets the needs of my family,” she said.

Read the story on VTDigger here: Gifford Health Care raises rates and reduces hours on its employee daycare center.