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: Prospective payment is a generally-accepted payment practice in licensed child care. However, in order for DCYF to pay prospectively in the CCDF subsidy program, the Legislature's approval and budget is required. The 2025 legislative session is the next opportunity for this to occur. Payment practices for non-relative, in-home and relative care (FFN) are by hour and after services are provided. Further, payment practices for FFN providers are bargained with SEIU 925. Also, FFN providers are typically relatives and do not collect payment when care is not provided. DCYF intends to apply for a waiver for this provision. 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: When a child who has been approved for subsidy attends at least one day in the calendar month within an authorization period, the provider is eligible to claim absent days that month. Absent days are days that a child was scheduled to attend and was absent. This is based on the schedule the parent has with the provider and not on what schedule DCYF has in its system. Providers may not claim for payment for more days than authorized for that month. Licensed family home providers are authorized a monthly unit which providers may claim when the child attends care during the month. Payment practices for non-relative, in-home and relative (FFN) care are by hour. No absent days or hours are allowed for FFN care as payment based on enrollment is not a generally-accepted practice for this type of care -- most FFN providers are relatives who do not collect payment when care is not provided, and in cases and the generally accepted payment practice for this form of care in the private market is by the hour. Furthermore, FFN payment rates are collectively bargained with SEIU 925 and bargaining has never broached the subject of paying FFN providers based on enrollment. DCYF requires additional time to comply with the requirement as to center and family home provider types for whom it is a generally accepted practice. DCYF will therefore request a waiver as to this provision. 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: Licensed Centers are paid on a full-day or half-day bases, Licensed family homes are paid a monthly unit, Unlicensed Family, Friends, and Neighbors (FFN) providers are paid an hourly rate and their rates are collectively bargained. The payment methods are different for the three provider types, of which two are represented by SEIU 925. SEIU 925 is responsible for representing Licensed Family homes and Family, Friend & Neighbor providers. 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: CCSP pays registration fees for all licensed providers of up to $50 per child per calendar year and field trip fees to licensed family home and Family, Friends, and Neighbors providers of up to $30 per child per month as agreed upon in the collective bargaining agreement. [ ] 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: DCYF has provider billing guides specific to all provider types, these guides provide billing instructions, payment practices and who to contact for payment issues. Additionally, DCYF authorizes payment and provides written notice to the provider including the type of payment (base rate or registration fee, for example), the rate, number of units, and authorization time period. The authorization letter includes some basic billing instruction and instructs the providers to contact the provider line for technical assistance. 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 status changes, the associated authorization for payment closes with a 10-day notice. This generates immediate notice to the provider of the change via e- mail if available, or physical mail. DCYF sends notice the same day of the change. e. Describe the Lead Agency’s timely appeal and resolution process for payment inaccuracies and disputes: Payment inaccuracies and disputes can be reviewed by any worker, or, if escalated, a supervisor. DCYF review is immediately available during business hours. If the DCYF worker or supervisor is unable to resolve a dispute, it can be addressed through the administrative hearing process. Consumers may request an administrative hearing up to 90 days after the date of decision. Payment inaccuracies resulting in provider overpayments are addressed by DCYF with thorough review and provider repayments on a timely basis. f. Other. Describe any other payment practices established by the Lead Agency: NA 4.4.3 Payment practices and parent choice How do the Lead Agency’s payment practices facilitate provider participation in all categories of care? DCYF's CCSP payment practices support equal access to a range of providers by ensuring quick turnaround of payment (within one day of services in some cases), by paying on full- and part-time bases in full-day and half-day units, by allowing licensed providers to bill for any days a child is absent in a month so long as the child attends at least one day, by paying registration and field trip fees and bonuses for care during nonstandard hours. All these policies and processes incentivize providers to care for children receiving subsidy, thereby ensuring equal access.