The development of the positions of nurse practitioner and physician assistant is a good example of differentiating staffing and practice to meet individual needs in an effective and cost-efficient way. This type of differentiation has been confined to the healthcare industry, principally to health maintenance organizations, but perhaps those in education can draw some lessons for meeting the needs of the nation's children with scarce resources. This article summarizes the implications of two recent studies: (1) Losing Ground in Early Childhood Education: Declining Workforce Qualifications in an Expanding Industry, 1979-2004, by the Economic Policy Institute; and (2) Is the Achievement Gap in Indiana Narrowing?, a September 2005 study from the Indiana University Center for Evaluation and Education Policy. The article concludes that so far, states have addressed the question of how to effectively compensate schools and educators to increase student performance primarily through school-based rewards for achievement. However, policymakers are speaking more frequently of differentiated staffing and compensation. While the compensation part of models such as that of the nurse practitioner carries a good deal of baggage with it and continues to generate debate, one can expect it to exist in many states in the near future.