Early Termination of Child Care Services

Program Violations

Policy Concept

Background

The Child Care and Development Block Grant Act of 2014 (CCDBG Act), as amended,requires that lead agencies ensure that once a child is determined eligible for services through the Child Care and Development Fund (CCDF), the child shall be considered eligible and shall receive services for a minimum of 12 months.

The Notice of Proposed Rule Making (NPRM) issued by the Administration for Children and Families (ACF), the federal administrator of the CCDBG Act, on December 15, 2015, allowed termination of care before 12 months only in situations in which:

  • a change in family income causes family income to exceed 85 percent SMI; or
  • a parent experiences aloss of work or cessation of attendance at a job training or educational program that is not a temporary change in accordance with NPRM §98.21(a)(1)(ii).

Consistent with the CCDBG Act and the NPRM, the Texas Workforce Commission’s (TWC) amendments to Chapter 809 Child Care Services rules, effective October 1, 2016, included the above circumstances as the only reasons for terminating care within the 12-month eligibility period.

In response to the requirement for 12-month eligibility, many Local Workforce Development Boards (Boards) have expressed concerns about the appropriate use of limited funds in situationsin which:

  • a child in care has excessive absences, indicating that services may no longer be needed or that the parent is unable or unwilling to use the services; or
  • a parent fails to pay the parent share of cost and that failure is not a result of economic hardship but a deliberate program violation.

However, current TWC Child Care Services rules, as recently amended, do not allow care to be terminated for the above reasons.

Federal Clarification on Terminating Care Prior to 12 Months

TWC amended the Child Care rules effective October 1, 2016, to comply with the directive imposed by ACF in its proposed rules requiring states to demonstrate compliance with the 12-month eligibility requirements of the CCDBG Act by October 1, 2016. To ensure that the rules were effective by October 1, 2016, TWC had to adopt its rules before that date. TWC adopted its rules on September 6, 2016. However, the CCDF final rules were issued on September 23, 2016. In the final rules,ACFprovided clarification on terminating care prior to 12 months, guidance that was not provided before the final rules were issued. Specifically, ACF provided certain limited reasons for which a lead agency may discontinue assistance prior to the next scheduled redetermination.

Section 98.21(a)(5)(i) of the final rules included the provision that states may terminate care in circumstances in which there have been “excessive unexplained absences despite multiple attempts by the lead agency or designated entity to contact the family and child care provider, including prior notification of possible discontinuation of assistance.”

Additionally, §98.21(a)(5)(iii) of the final rules allows states to terminate care for “intentional program violations that invalidate prior determinations of eligibility.”ACF further clarified, in a recent frequently asked questions (FAQ) document, that states have flexibility to define nonpayment of parent share of cost as an intentional program violation:

“Can a state terminate a family’s eligibility for not paying the family’s co-payment?”

Section 98.21(a)(5)(iii) of the final rules gives lead agencies the option to discontinue assistance before the next redetermination in limited circumstances, including “substantiated fraud or intentional program violations that invalidate prior determinations of eligibility.” Lead agencies define “intentional program violation” and what actions rise to that definition.

Note also that §98.45(k)(3) of the final rules states that a lead agency’s sliding fee scale shall provide for “affordable family co-payments that are not a barrier to families receiving assistance under this part.” Therefore, if lack of payment becomes a common occurrence, and lead agencies are frequently ending assistance to families for not paying their co-payment, the lead agency may want to reexamine its sliding fee scale to ensure that it is not in violation of this requirement by being a barrier to assistance.

Reference: Child Care and Development Fund Final Rules Frequently Asked Questions

Issues

Issue 1:Terminating Care forExcessive Absences

New federal rules at 45 CFR Part 98 permit states to terminate care within a 12-month eligibility period for excessive unexplained absences. Section 98.21(a)(5)(i)of the final rules requires that before terminating care for excessive absences, multiple attempts must be made to contact the family and provider, including notification of possible discontinuation of assistance. Thefinal rules require states to define the number of unexplained absences that shall be considered excessive. The preamble to the final CCDF rules also provides the following guidance:

Regarding termination due to excessive unexplained absences, we stress that every effort should be made to contact the family prior to terminating benefits. Such efforts should be made by the Lead Agency or designated entity, which may include coordinated efforts with the provider to contact the family. If a State chooses to terminate for this reason, the Lead Agency must define how many unexplained absences would constitute an “excessive” amount and therefore grounds for early termination. The definition of excessive should not be used as a mechanism for prematurely terminating eligibility and must be sufficient to allow for a reasonable number of absences.It is ACF’s view that unexplained absences should account for at least 15 percent of a child’s planned attendance before such absences are considered excessive.This 15 percent aligns generally with Head Start’s attendance policy and ACF will consider it as a benchmark when reviewing and monitoring this requirement.

BecauseChapter 809 Child Care Services rules were published before the final CCDF rules providing this new flexibility were issued, they did not include allowance for early termination for excessive absences.

Current TWC rules also define acceptable attendance standards as having fewer than five consecutive absences or 10 absences within a month. Failure to meet these attendance standards may result in suspension of care (at the concurrence of the parent) or be grounds for determining that a permanent change has occurred in the parent’s participation in work, job training, or education program.Failure to meet these attendance standards does not result in termination of care.

TWC rules currently limit future eligibility for children who exceed 65 absences within a 12-month eligibility period. Under this policy, limited funds may be underutilized when children do not consistently attend child care. Current TWC rules also exclude the following types of absences from the attendance standards:

  • A child’s documented chronic illness;
  • Absences for a child with disabilities; and
  • Absences due to court-ordered custody and visitation arrangements.

Decision Points

Staff recommends amending the Child Care rules to allow Boards to terminate child care services during the 12-month period in instances in which there have been excessive absences.

Consistent with the federal requirement for the lead agency to define what constitutes “excessive absences,” and with the guidance in the preamble of the CCDF final rule regarding the 15 percent attendance standard, staff recommends establishing a statewide definition of excessive absences to be40 absences within a 12-month eligibility period (that is, 15 percent of a standard 260 to 262-day child care year). Staff recommends retaining the current rule provision that excludes absences due to court-ordered visitation,chronic illness, or a disability as an absence from counting toward this definition.

Staff also recommends that the TWCChild Care rules require Boards to develop procedures to ensure that before terminating care for excessive unexplained absences, a contractor makes multiple attempts to contact the family in order to determine why the child is absent and to explain the importance of regular attendance. Specifically, staff recommends that the rule require, at a minimum:

  • documented attempts at reasonable timesor through established communication channels to contact the parent and provider when a child has five consecutive absences;
  • documented attempts to contact the parent at reasonable timesor through established communication channels when a child has reached 15 and 30 absences within an eligibility period; and
  • documented contact with the provider when the parent cannot be reached.

Staff further recommends that the Child Care rules require Boards to suspend the child care authorization for services if a child is absent four consecutive weeks.

Finally, staff recommends that the Child Care rules require Boards to ensure that child care does not continue during the appeal of a termination due to excessive absences.

Issue 2:Terminating Care for Unpaid Parent Share of Cost

New federal guidance permits states to define failure to pay the parent share of cost as an “intentional program violation” that may result in termination of care during the 12-month eligibility period. However, Chapter 809 Child CareServicesrules became effectivebefore the federal clarification and, therefore, do not include allowance for early termination for failure to pay the parent share of cost.

TWC rules currently only limit future eligibility for children when the parent owes a recoupment to a Board for unpaid parent share of cost. Under this policy, parents may deliberately not pay their share of cost and continue to receive services for the full 12-month eligibility period.

Under current rule, future eligibility is only limited if the Board has a policy to reimburse providers for unpaid parent share of cost. Many Boards do not have such policies in place due to 12-month eligibility and the associated financial risk of having to pay for up to a year of unpaid parent fees.

Decision Points

Staff recommends amending Chapter 809 Child Care Servicesrules to allow for the early termination of care when a parent fails to pay the parent share of cost and it has been determined that the cost is affordable for the parent.

Additionally, staff recommends that TWC policy require that when parents fail to pay their share of cost, the Board must ensure that, if appropriate, the parents’ assessedshare of cost is reviewed for a possible temporary reduction pursuant to §809.19(d).

Staff also recommends retaining the provision in rule that prohibits a child’s future eligibility when a parent owes a parent share of cost repayment to a Board if the Board has a policy in place that reimburses providers for parents’ unpaid fees. Given the ability to terminate carebefore 12 months when a parent fails to pay the parent share of cost, the financial risks associated with reimbursing providers will be substantially lower and limited.

For Boards that do not have a policy to reimburse providers for the parent failure to pay the parent share of cost, staff recommends that the rule language allow Boards to require parents to repay the provider before being eligible for future child care services.

Issue 3: Mandatory Waiting Periods after Termination Due to Program Violations

Because the NPRM and TWC rules eliminated the option to terminate care due to program violations, mandatory waiting periods were also struck from the Child Care rules. Under current rule, a customer may immediately reapply for services after care is terminated.

Decision Points

Staff recommends amending TWC’s Child Care Services rules to requirea mandatory waiting period of 60 days after termination of services due to excessive absences or unpaid parent share of cost.

However, to ensure full alignment between Child Care Services and the requirements of the Choices program, staff recommends that the mandatory waiting period not apply to individuals who, during the 60-day waiting period:

  • become Choices participants who require child care to participate in Choices; or
  • are on Choices sanction status and require child care to demonstrate participation in Choices.

Additionally, staff recommends eliminating the current12-month waiting period for children who exceed 65 absences within an eligibility period.This rule will be superseded by the ability to terminate care immediately after 40 absences as well as the reinstatement of a mandatory waiting period.

PC– Early Termination of Child Care Services (05 2317)Notebook1