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)? [x] Yes. If yes, describe: The Lead Agency plans on implementing prospective payments by October 1, 2024. The Lead Agency will be requesting an implementation waiver as a safeguard in the event there are unanticipated delays. The process for prospective payments wil be that from the date the Service Voucher Log (payment form) generates, any unpaid weeks up to the generation date will be pulled plus the dates through the first Sunday following 28 calendar dates. The Lead Agency has a service period of one week, Monday to Sunday to pull full weeks at a time. The provider will certify that they anticipate the children on the SVL to be enrolled for the time period printed on the SVL. If the provider indicates any period of time that the children will not be enrolled, the system will allow the provider to document the reason the child will no longer be enrolled and the last date of expected payment. When the payment for the prospective services have paid, the provider will be given a validation notice to confirm that the payments were made correctly before the next SVL generates. [ ] 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: b. Does the Lead Agency pay based on authorized enrollment for all provider types? [x] 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: [ ] 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: 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)? [x] Yes. [ ] 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: 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: An annual registration fee per child is paid by Lead Agency after the third week of paid child care services for children with CCDF-funded subsidies. [ ] 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: Providers are paid in accordance with written provider enrollment agreements that include payment policies, approved payment rates, schedules, fees, and the dispute resolution process. This information is also included in child-specific service connection letters that are sent to families and providers when a family chooses a provider as their child(ren)'s caregiver. 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: When a family's eligibility for child care services will end due to an adverse action, the Lead Agency sends a termination notice to the provider and family two weeks prior to services ending to give ample notice of that adverse action. In that termination notice, the parent is informed of their rights to an appeal if they disagree with the decision. Sixty (60) days prior to the end of child care services, the Lead Agency sends an "end of services" notice to the provider and family to remind them of the last day of their current services. That end of service notice specifies the date that services end and that payments for that eligible child will stop on that ending date. e. Describe the Lead Agency’s timely appeal and resolution process for payment inaccuracies and disputes: When a provider has a payment discrepancy, they call the 1(800) number to the Child Care Scholarship Program Control Center. Many payment issues can be resolved prior to the need for an appeal. Payment issues may include: a child has been connected incorrectly, a registration fee needs to be assessed, incorrect start date, etc. If there are child enrollment issues between two different providers, the control center will request a copy of the provider's attendance roster to compare and make a determination of payment for the provider. A provider has the right to request a fair hearing regarding any negative action taken by the Child Care Scholarship Program. Negative actions include but are not limited to termination from the ABC Program and de-enrollment of a specific care type. The provider must request the fair hearing within 30 days of the negative action by submitting the request in writing to the Division of Individual and Provider Rights (DIPR). Upon receipt of the request, DIPR will schedule the fair hearing and coordinate with SCDSS legal staff as well as the provider and the provider's legal representative as appropriate. ABC Quality staff are responsible for representing the Child Care Scholarship Program at fair hearings for Level A, B and C Providers. State Office Child Care Services staff are responsible for representing the Child Care Scholarship Program at fair hearings for: All FFN Providers - The files are pulled and reviewed by that designated staff person and a response is made back to Individual and Provider Rights. If cases are reviewed and it is determined that a case can be reinstated or other resolutions made, Individual and Provider Rights will notify the client of the outcome. If upon the review, the adverse action is upheld, Individual and Provider Rights will notify the client and will proceed with scheduling a hearing if desired. 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? Paying providers prospectively as opposed to a reimbursement process and based on enrollment as opposed to attendance, incentivizes child care providers to participate with the Child Care Scholarship Program through ABC Quality. Since providers are paid ahead of the dates of service, this allows for stabilization of child care programs and lessens the financial burdens on the programs. The Child Care Scholarship Program also pays a differential rate of $20 per week for eligible special needs children as well as a differential rate of $30 per week for children in foster care.