4.4 Payment Practices to Providers

Lead Agencies must use subsidy payment practices that reflect practices that are generally accepted in the private pay child care market. The Lead Agency must ensure timeliness of payment to child care providers by paying in advance or at the beginning of delivery of child care services. Lead Agencies must also support the fixed cost of child care services based on paying by the child’s authorized enrollment, or if impracticable, an alternative approach that will not undermine the stability of child care programs as justified and approved through this Plan. Lead Agencies must also (1) pay providers based on established part-time or full-time rates rather than paying for hours of service or smaller increments of time, and (2) pay for reasonable, mandatory registration fees that the provider charges to private-paying parents. These policies apply to all provider types unless the Lead Agency can demonstrate that in limited circumstances the policies would not be considered generally-accepted payment practices. In addition, Lead Agencies must ensure that child care providers receive payment for any services in accordance with a payment agreement or an authorization for services, ensure that child care providers receive prompt notice of changes to a family’s eligibility status that could impact payment, and have timely appeal and resolution processes for any payment inaccuracies and disputes. 4.4.1 Prospective and enrollment-based payment practices Lead Agencies must use payment practices for all CCDF child care providers that reflect generally- accepted payment practices of providers serving private-pay families, including paying providers in advance or at the beginning of the delivery of child care services and paying based on a child’s authorized enrollment or an alternative approach for which the Lead Agency must demonstrate paying for a child’s authorized enrollment is not practicable and it will not undermine the stability of child care programs. Lead Agencies may only use alternate approaches for subsets of provider types if they can demonstrate that prospective payments and authorized enrollment-based payment are not generally-accepted for a type of child care setting. Describe the Lead Agency payment practices for all CCDF child care providers: a. Does the Lead Agency pay all provider types prospectively (i.e., in advance of or at the beginning of the delivery of child care services)? [ ] Yes. If yes, describe: [x] No, it is not a generally-accepted payment practice for each provider type. If no, describe the provider type not paid prospectively and the data demonstrating it is not a generally-accepted payment practice for that provider type, and describe the Lead Agency’s payment practice that ensures timely payment for that provider type: Ohio pays providers at the frequency they determine, up to 4 weeks after service. A child is authorized to a provider and attendance is tracked. Upon the provider submitting the attendance the payment will be issued. Ohio provides weekly payments if the business elects to submit attendance at that rate. Ohio tracks data on both authorization and utilization. Monthly, between 15 percent to 30 percent of the children authorized to attend a program never utilize a single day. To safeguard payment for no service Ohio utilizes attendance tracking prior to payment but allows for holidays and absent days to count toward the payment category. This applies to all provider types. The Department of Children and Youth (DCY) will be analyzing the fiscal impact for all of the federal child care payment rules that became effective in April 2024. DCY will plan to request a 2-year waiver while legislative and rule changes are identified and funding estimates are completed. The State's biennial budget process will begin in the fall of 2024, with the Governor preparing his proposed operating budget for the legislature by early 2025. The final statute and funding will not be known until July 1, 2025. Ohio will then begin implementing the policies that were modified and funded through the state budget process. b. Does the Lead Agency pay based on authorized enrollment for all provider types? [ ] Yes. The Lead Agency pays all providers by authorized enrollment and payment is not altered based on a child’s attendance or the number of absences a child has. [ ] No, it is not a generally-accepted practice for each provider type. If no, describe the provider types not paid by authorized enrollment, including the data showing it is not a generally-accepted payment practice for that provider type, and describe how the payment policy accounts for fixed costs: [x] It is impracticable. Describe provider type(s) for which it is impracticable, why it is impracticable, and the alternative approach the Lead Agency uses to delink provider payments from occasional absences, including evidence that the alternative approach will not undermine the stability of child care programs, and thereby accounts for fixed costs: Ohio currently pays based on attendance with the exception that each child is eligible for up to 20 absent days every 6 months. Additionally, Ohio tracks data on both authorization and utilization. Monthly, between 15 percent to 30 percent of the children authorized to attend a program never utilize a single day. To safeguard payment for no service Ohio utilizes attendance tracking prior to payment but allows for holidays and absent days to count toward the payment category. This practice is currently under further review to ensure alignment with the new federal rules. The Department of Children and Youth (DCY) will be analyzing the fiscal impact for all of the federal child care payment rules that became effective in April 2024. DCY will plan to request a 2-year waiver while legislative and rule changes are identified and funding estimates are completed. The State's biennial budget process will begin in the fall of 2024, with the Governor preparing his proposed operating budget for the legislature by early 2025. The final statute and funding will not be known until July 1, 2025. Ohio will then begin implementing the policies that were modified and funded through the state budget process. Ohio is currently piloting payment on enrollment via the Child Care Choice Program. On April 26, 2024, the Child Care Choice Program was introduced. In his State of the State speech, Governor DeWine announced child care choice program, which will be paid upon enrollment. The goal of this pilot is to expand an additional 8,000 vouchers to serve children from 146 percent of the federal poverty level (FPL) to 200 percent of the FPL. 4.4.2 Other payment practices Lead Agencies must (1) pay providers based on established part-time or full-time rates rather than paying for hours of service or smaller increments of time, and (2) pay for reasonable, mandatory registration fees that the provider charges to private-paying parents, unless the Lead Agency provides evidence that such practices are not generally-accepted for providers caring for children not participating in CCDF in its State or Territory. a. Does the Lead Agency pay all providers on a part-time or full-time basis (rather than paying for hours of service or smaller increments of time)? [ ] Yes. [x] No. If no, describe the policies or procedures that are different than paying on a part- time or full-time basis and the Lead Agency’s rationale for not paying on a part-time or full-time basis: Ohio currently has an hourly rate of payment for children that attend a program less than 10 hours a week. Ohio has these 3 payment categories for each setting. The categories were updated in Ohio Revised code as a part of House Bill 96. This became effective 9/30/2025. If a child is in care for fewer hours, then the authorized category, the payment is issued based on the time the child is in care. DCY also provides for an enhanced payment rate for programs serving special needs children or programs operating during non-traditional hours. The intent of the "hourly" category of authorization is for the following types of situations: 1. A child has a full time or part time authorization to a primary provider and needs a second provider for just a few hours a week. 2. The child needs just before or just after school care each week. 3. The parent is self-employed and the authorization is determined by dividing income by federal minimum wage (income left after deducting work expenses). Often the reported income is so low that only a few hours can be authorized. 4. Wrap-around care for Head Start. Ohio does not layer funds but does allow providers to do wrap-around care to supplement the Head Start day. This is similar to the before/after care scenario - sometimes only a few hours are left unpaid in the day and child care can make up that difference. This practice is currently under further review to ensure alignment with updated federal requirements. b. Does the Lead Agency pay for reasonable mandatory registration fees that the provider charges to private-paying parents? [x] Yes. If yes, identify the fees the Lead Agency pays for: Ohio pays a $25 registration fee to programs that have a provider agreement in place to provide publicly funded child care (PFCC) services on January 1 of each year. The program will be paid a registration fee for each child receiving PFCC services who had at least one day of attendance in the previous calendar year. Additionally, the provider is not permitted to ask a caretaker to pay the difference between the registration fee paid for the child by The Department of Children and Youth (DCY) and the provider's customary registration fee charge to the public when the customary registration fee is higher. The requirement to be paid the registration fee also includes an indicator by the program that they charge registration fees. [ ] No. If no, identify the data and how data were collected to show that paying for fees is not a generally-accepted payment practice: c. Describe how the Lead Agency ensures that providers are paid in accordance with a written payment agreement or an authorization for services that includes, at a minimum, information regarding provider payment policies, including rates, schedules, any fees charged to providers, and the dispute-resolution process: Programs electronically sign a provider agreement that includes information regarding provider payment policies, rates, schedules, and the dispute-resolution process. This signed provider agreement must be in place before the Department of Children and Youth (DCY) automated system will allow for attendance to be paid. The provider agreement directs providers to payment policies rates and schedules listed in OAC 5180:2-16 or 5180:6-1 which include the following: Chapter 5180:2-16 - Ohio Administrative Code | Ohio Laws- https://codes.ohio.gov/ohio- administrative-code/chapter-5180:2-16 and Chapter 5180:2-6- Ohio Administrative Code: https://codes.ohio.gov/ohio-administrative-code/chapter-5180:6-1 Rates: https://codes.ohio.gov/ohio-administrative-code/rule-5180:6-1-10 Schedules: https://codes.ohio.gov/ohio-administrative-code/rule-5180:2-16-09 Payment is issued timely, once a child is authorized and care is received, in one of the following categories: 1) hourly rate is paid for services provided from 1-9.9 hours (hourly authorization category) 2) part time rate is paid for services provided from 10 - 32.9 hours (part time authorization category) 3) full time rate is paid for services provided from 33 hours or more (full time authorization category). Ohio has these 3 payment categories for each setting. Ohio has these 3 payment categories for each setting. The categories were updated in Ohio Revised code as a part of House Bill 96. This became effective 9/30/2025. If a child is in care for fewer hours, then the authorized category, the payment is issued based on the time the child is in care. DCY also provides for an enhanced payment rate for programs serving special needs children or programs operating during non-traditional hours. The intent of the "hourly" category of authorization is for the following types of situations: 1. A child has a full time or part time authorization to a primary provider and needs a second provider for just a few hours a week. 2. The child needs just before or just after school care each week. 3. The parent is self-employed and the authorization is determined by dividing income by federal minimum wage (income left after deducting work expenses). Often the reported income is so low that only a few hours can be authorized. 4. Wrap-around care for Head Start. Ohio does not layer funds but does allow providers to do wrap-around care to supplement the Head Start day. This is similar to the before/after care scenario - sometimes only a few hours are left unpaid in the day and child care can make up that difference. Payment of registration Fees: Ohio pays a $25 registration fee to programs that have a provider agreement in place to provide publicly funded child care (PFCC) services on January 1 of each year. The program will be paid a registration fee for each child receiving PFCC services who had at least one day of attendance in the previous calendar year. Additionally, the provider is not Ohio permitted to ask a caretaker to pay the difference between the registration fee paid for the child by DCY and the provider's customary registration fee charge to the public when the customary registration fee is higher. The provider agreement includes the following: The Provider agrees that all services and obligations referred to in this agreement are for services provided to children determined eligible for PFCC pursuant to chapter 5101:2-16 of the OAC and/or ECE grants pursuant to Section 423.40 of House Bill 33 of the 135th General Assembly (Am. Sub. H.B. No. 33, and/or any special projects. This agreement is subject to the provisions in Ohio Revised Code (ORC) Section 9.27. The signature of the Provider attests to an agreement to: • Provide PFCC, ECE grants, and/or special projects to eligible individuals on authorized days and hours, regardless of race, color, sex, religion, national origin, disability, age, or ancestry. • Meet the requirements of an eligible provider of PFCC pursuant to Section 5104.31 and 5104.32 of the ORC and any rules promulgated pursuant to Section 5104.31 of the ORC or Section 423.40 of House Bill 33 of the 135th General Assembly as it pertains to ECE grants. • Provide PFCC, ECE grants, and/or special/projects only at the address that has been approved by DCY by issuance of a license pursuant to chapters 5101:2-12, 5101:2-13 and 3301-37 of the OAC, by issuance of a border state provider approval pursuant to chapter 5101:2-16 of the OAC, or by issuance of a child day camp approval pursuant to chapter 5101:2-18 of the OAC. Provide PFCC as an in-home aide only at the address approved by a county agency by the issuance of an in-home aide certificate pursuant to chapter 5101:2-14 of the OAC. • Acknowledge and agree that the provider agreement is valid for the license, certification, or approval number, the address associated with that number, and any care provided at that address. Payment will not be authorized if care is provided at an address not approved by DCY. If payment has already been made for care provided at an unauthorized address, the provider agrees to repay the total amount of payment received. • Submit attendance data and fees only for authorized early care and education services that meet the requirements for payment. • Submit data to DCY for payment that is no more than the Provider's customary charge to other individuals for the same services or based on the ECE grant reimbursement total. • Acknowledge and agree that payment for all programs is contingent upon the availability of federal and appropriated state funds. • Submit accurate attendance data and fees for authorized early care and education services provided to eligible individuals following procedures required by DCY. Data that contains errors, incorrect rates, or non-covered services is subject to correction. • Acknowledge and agree that the provider agreement may be terminated if the Provider or a resident of a family child care home has a prohibited offense or if the Provider employs staff with a prohibited offense under chapters 3301-37, 5101:2-12, 5101:2-13, 5101:2-14, 5101:2-16 or 5101:2-18 of the OAC. • Acknowledge and agree that if DCY terminates a provider agreement as a result of findings from a program integrity review because the Provider has failed to comply with the requirements of the Child Care and Development Block Grant Act of 2014 and/or the ECE grant or because the Provider's license or certification has been revoked, another agreement shall not be issued to the owner of the program until five years have elapsed from the date the agreement was terminated or five years from the end of the revocation process if revocation was initiated. The definition of owner includes a firm, organization, institution, or agency, as well as any individual governing board members, partners, or authorized representatives of the owner. • Accept the payment amount for authorized PFCC services per chapter 5101:2-16 of the OAC or the ECE grant reimbursement rate defined by DCY. • Accept payment for all covered services as payment-in-full for PFCC or special projects. The Provider shall not seek payment from the eligible individual for the difference between the payment rate and the Provider’s customary charge when the customary charge is higher. The ECE grant may charge families with incomes above 100% FPL based on a sliding scale. • Collect the assigned copayment in accordance with chapter 5101:2-16 of the OAC for PFCC. The ECE grant and special projects may adopt their own rules for copayment and family payment requirements. • Maintain all records required in chapters 3301-37, 5101:2-12, 5101:2-13, 5101:2- 14, 5101:2-16, 5101:2-17, and 5101:2-18 of the OAC to fully disclose the extent of early care and education services provided. The Provider shall maintain such records for three years from the date of receipt of payment based upon those records or until any initiated audit is completed, whichever is longer. • Retain all records in accordance with any litigation holds provided to them by DCY and actively participate in the discovery process if required to do so at no additional charge. Litigation holds may require the Provider to keep the records longer than the three years in Article 14. If the Provider fails to retain the pertinent records after receiving a litigation hold from DCY, the Provider agrees to pay all costs associated with any cause, action, or litigation arising from such destruction. • Furnish DCY any information maintained under Article 14 for audits or any other purpose as required by DCY. Failure to provide requested records may result in a determination that no records exist for payment paid to the Provider for early care and education services reportedly rendered. Such a determination shall result in the recoupment of all payments made for which no records are provided. • Cooperate with any PFCC program integrity review outlined in chapter 5101:2-16 of the OAC. Failure to cooperate with a review may result in suspension or termination of this agreement. Failure to provide requested records within the time frame defined in chapter 5101:2-16 of the OAC for a PFCC program integrity review may determine that no records exist for payment paid to the Provider for the child care reportedly rendered. Such determination shall result in the recoupment of all payments made for which no records are provided. • Accept responsibility for receiving, replying to, and/or complying with any audit finding by an appropriate state or federal audit or any identified exception directly related to the performance of this agreement. Responsibility includes repayment as follows: o The Provider agrees to repay the total payment received for services not covered by this agreement in the time frame defined by DCY. o The Provider agrees to repay the total payment received for duplicate or erroneous payments, deceptive claims, attendance tracking misuse, or falsification. ￿Deceptive￿ means knowingly deceiving another or causing another to be deceived by misleading representation, by withholding information, by preventing another from acquiring information, or by other act, conduct, or omission which creates, confirms, or perpetuates a false impression in another, including a false impression as to the law, value, state of mind or other objective or subjective fact. • Adhere to all applicable rules in chapters 5101:2-12, 5101:2-13, 5101:2-14, 5101:2-16, 5101:2-17, 5101:2-18 and 3301-37 of the OAC. • Complete and submit any necessary agreements with the vendors that contract with DCY for the automated early care and education system. • Record attendance via the automated early care and education system or other processes as required by DCY. • Acknowledge and agree that DCY will withhold all legally required deductions from a Provider's payment. • Furnish DCY with information detailing the customary charges to other individuals for the same service to assist in the accurate evaluation of market rates for early care and education services by completing the required information and data requirements for payment in the early care and education automated system. Changes to the information in the early care and education automated system may be completed without prior notice and do not constitute an amendment to this agreement. • Acknowledge and agree that DCY may terminate this agreement upon 30 days written notice. The notice will state the effective date of termination and may include any basis of settlement. The Provider shall cease providing PFCC under this agreement on the effective date of termination. DCY may terminate the Provider agreement immediately without written notice if: (1) the Provider's child care business closes; (2) the Provider fails to maintain licensure, certification, or day camp accreditation/approval; (3) there is a determination of illegal conduct; (4) appropriated state or federal funds are unavailable; or (5) violation of state, federal or local laws and regulations. Denials or terminations are not appealable. • Agree that in the event of termination, the Provider shall be entitled to compensation, upon submission of all necessary data, for work performed prior to the termination and based on the payment rates in this agreement. DCY shall not be liable for any further claims. • The effective date of this agreement shall be the date the Provider submits the form to DCY or the date that the Provider becomes an eligible provider pursuant to 5101:2-16 of the OAC, whichever is later, if applicable. This agreement will remain in effect unless terminated by either the Provider or DCY. Fees charged to providers: DCY does not charge fees to providers. Dispute Resolution: DCY has a process that allows providers to request payment adjustments after a payment has been issued by submitting a request for payment adjustment in the automated child care system within four weeks of the payment date. No new attendance may be submitted for payment adjustments. If the incorrect payment amount is because of a county agency data entry error, the provider should contact the county agency to request correction of the error before the provider submits the request for payment adjustment. The request for adjustment may exceed four weeks from the original payment date. A provider may request in writing to DCY that a reconsideration review be conducted for any identified overpayment that is subject to recoupment. The written request must be received by DCY no later than fifteen calendar days after the date the provider receives an overpayment notice. d. Describe how the Lead Agency provides prompt notice to providers regarding any changes to the family’s eligibility status that could impact payments, and such a notice is sent no later than the day that the Lead Agency becomes aware that such a change will occur: DCY provides information regarding eligibility status through an automated system which allows providers to view future authorizations in the automated system up to 3 days in advance of the authorization begin date. Additionally, programs can run a report from the automated system that includes future authorizations. Changes could be to authorization level (part-time/full-time), termination, change of authorization to another program or copayment change. Due to Manual Procedure Letter (MPL) 172 "JFS 01115 Publicly Funded Child Care Release of Information" created November 13, 2023, providers can now also reach out to the Child Care Policy Help Desk at childcarepolicy@jfs.ohio.gov or 1-877-302-2347, option 4, to get the status of a family’s application. MPL 172 JFS 01115 "Publicly Funded Child Care Release of Information" states the following: Background: Child care providers often request case information to assist families who are submitting an application for publicly funded child care (PFCC) and to determine when the provider may expect payment for care provided. The Ohio Department of Job and Family Services (ODJFS)/county department of job and family services (CDJFS) is not permitted to provide child care case information to anyone without permission of the caretaker or their designated authorized representative. Implementation: The JFS 01115 "Publicly Funded Child Care Release of Information" is now available to assist child care providers with obtaining child care application information on the families they serve. Caretakers can submit this form to their CDJFS or through the Ohio Benefits Self-Service Portal (SSP) to allow their child care provider to receive child care case information from their county agency and ODJFS. A child care provider cannot require the family to complete this form as part of their enrollment process and/or to receive child care. The following applies to caretakers who submit an application for PFCC benefits or have entered the recertification process for PFCC benefits. Scenario -When should the caretaker complete the JFS 01115 and submit it? Procedure - A caretaker may complete the JFS 01115 when a child care provider accepts their children into their program for care AND their application for PFCC benefits or recertification has not been completed. Scenario - Why should the caretaker complete the JFS 01115? Procedure-PFCC benefit case information is not allowed to be shared with anyone outside of ODJFS/CDJFS. The form will grant permission for child care providers to receive information concerning pending applications. Scenario -How can the JFS 01115 be cancelled? Procedure -The JFS 01115 consent may be canceled by the caretaker or caretaker’s Authorized Representative at any time by providing notice in writing to the county agency or through the SSP. Scenario - What information is ODJFS/CDJFS able to share about the status of an application if your child care program is listed on the PFCC application and the JFS 01115 has been submitted by the caretaker? Procedure -ODJFS/CDJFS may share the following: • Primary caretaker first and last name, address and phone number • First and last name and date of birth of children needing care. • Application information: • Application status, including denied without PAD (payment after denial) and pending application. • Verification documents needed. • Eligibility begin and end date. • Authorization information Scenario -What if the JFS 01115 has been submitted by the caretaker giving permission for a specific provider to have access to information, but this specific provider is not listed on the PFCC application? Procedure -If the caretaker has already submitted their PFCC application through the SSP and the provider identified by the family needs to be changed, then the caretaker can submit a change of provider through the SSP. If the caretaker has already submitted their PFCC application to the county and the provider identified by the family needs to be change, then the caretaker will have to contact the county to report the change in provider, unless their SSP account is already linked to their case in Ohio Benefits. The most recent version of the ODJFS form referenced in this procedure letter can be accessed through Forms Central. Please contact the Child Care Policy Help Desk at childcarepolicy@jfs.ohio.gov or 1877-302-2347, option 4, if you have any questions e. Describe the Lead Agency’s timely appeal and resolution process for payment inaccuracies and disputes: The Ohio Department of Children and Youth (DCY) payment system allows programs to electronically submit a message to DCY the same day the program discovers a payment issue or inaccuracy. Process: DCY allows providers to request payment adjustments after a payment has been issued by submitting a request for payment adjustment in the automated child care system within four weeks of the payment date. No new attendance may be submitted for payment adjustments. If the incorrect payment amount is because of a county agency data entry error, the provider should contact the county agency to request correction of the error before the provider submits the request for payment adjustment. The request for adjustment may exceed four weeks from the original payment date. A provider may request in writing to DCY that a reconsideration review be conducted for any identified overpayment that is subject to recoupment. The written request must be received by DCY no later than fifteen calendar days after the date the provider receives an overpayment notice. f. Other. Describe any other payment practices established by the Lead Agency: 4.4.3 Payment practices and parent choice How do the Lead Agency’s payment practices facilitate provider participation in all categories of care? Ohio’s payment practices allow for the provider participating in the publicly funded child care (PFCC) program to receive payment weekly if they choose. Ohio’s automated Time, Attendance and Payment (TAP) system allows families to easily check children participating in the PFCC program in and out, recording time in attendance. The program can submit this attendance weekly or the system will collect it after four weeks from the last day of the service week child care was provided. The TAP system calculates payments within a week. The TAP system is easy to use for families and programs and eases the administrative burden to the program. Having the TAP system has encouraged more programs to participate in the PFCC program. Programs are issued a free tablet for every 50 children enrolled in the PFCC program for families to record attendance