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: As The Lead Agency does not pay providers prospectively for any child care provider; instead, as a best practice, the Lead Agency seeks to issue payment within ten (10) business days. The Lead Agency has requested a waiver regarding this provision. 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: The Lead Agency allows for payment of reasonable mandatory registration fees that a provider may charge to private- paying parents. The Lead Agency pays for registration fees up to $100 two times per year, and also paying of an annual registration fee of up to $100 annually (if a provider charges such a fee). [ ] 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: The Lead Agency maintains a contract with each child care provider that participates in the Child Care Payment Assistance/Certificate Program. The contract includes information regarding payment terms and conditions, e.g., payment methodology, payment rates, payment and attendance, payment reductions, deductions, methods of collection of overpayments, etc., and the Lead Agency administrative review process facilitating dispute resolution. 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: Lead Agency staff are trained to provide same-day provider notification of any change(s) to a family’s eligibility status that could impact payments. e. Describe the Lead Agency’s timely appeal and resolution process for payment inaccuracies and disputes: The Lead Agency is the final decisionmaker of any payment disputes and can deny payments as defined in among the terms and conditions of the Lead Agency contract to participate in the Child Care Payment Assistance/Certificate Program. The Lead Agency offers a payment dispute resolution process allowing contracting child care providers to request an administrative review related to adverse administrative actions, i.e., disallowed costs, refused payments, or payment reductions, as defined in at Policy 11.36 Provider Requested Child Care Certificate Program Administrative Review. Requests for administrative review must be received in writing by the Lead Agency’s Division of Appeals and Hearings no later than 15 calendar days after a date management decision notification is issued. The Division of Appeals and Hearings will acknowledge receipt of the request within five (5) business days. A child care provider has 20 calendar days to provide all supporting written documentation. 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? Lead Agency payment practices ensure timely and dependable reimbursement and reduce barriers for child care providers participating in the Child Care Payment Assistance/Certificate Program.