Management Bulletin 12-18

Early Learning and Care Division

Subject: Timely Provider Payments

Number: 12-18

Date: September 2012

Expires: Until Rescinded

Authority: California Code of Regulations, Title 5, sections 18065, 18119, and 18224

Attention: All Alternative Payment and CalWORKs Contractors

Purpose

The purpose of this Management Bulletin (MB) is to clarify the process by which Alternative Payment (AP) and CalWORKs contractors best ensure providers selected and utilized by eligible families receive timely payment for services.

Background

California Code of Regulations, Title 5 (5 CCR) requires AP and CalWORKs contractors to develop and implement a plan for timely payment to providers. 5 CCR, Section 18224 (a) requires contractors to give all providers information, including a schedule for the payment of services. The provider must sign an acknowledgment they have received and read this information.

Direction

In order to meet the regulatory requirements noted above, the California Department of Education, Early Learning and Care Division (ELCD) directs the following:

1. All contractors must have a schedule for payments to providers pursuant to 5 CCR Section 18224 (a) (4). This schedule must note when a payment will be made upon receiving the child’s complete and accurate attendance record. This schedule should clearly state a date by which the attendance record should be received in order for the provider to receive a timely payment.
   
   The ELCD strongly recommends contractors establish a schedule for payments to providers that ensures that payment is made no later than 30 days after the month in which care was provided when the attendance record is submitted in accordance with the contractor’s schedule and is complete and accurate. A more optimum schedule is preferable. For example:
   
   When complete and accurate attendance records are received by the contractor by the 5th of the calendar month after the month of service, provider payments will be mailed or otherwise delivered no later than the 20th of the month.
   
   The ELCD strongly recommends contractors have more than one date by which payments would be made. For example:
   
   When complete and accurate attendance records are received by the contractor by the 5th of the calendar month after the month of service, provider payments will be mailed or otherwise delivered no later than the 20th of the month. For records received after the 5th, but no later than the 20th of the month, provider payments will be mailed or otherwise delivered no later than the last day of the month. Records received after the 20th of the month will be paid using the next month’s schedule.
   
   The ELCD also strongly recommends contractors have a final date by which attendance records must be submitted in order to have a payment made. For example:
   
   Complete and accurate attendance records must be submitted no later than two (2) months after the month of service in order for payments to be made.
   
   
2. Contractors must communicate the schedule for payments to all providers pursuant to 5 CCR, Section 18224 (a) (4) at the time the provider(s) begins providing care, and any other time, upon request. If there is a change in the payment schedule, providers should be notified at least 30 days before the change goes into effect.
   
   
3. When a parent(s) has certified days and hours of care, the reimbursement to the provider is based on the approved level of service for which the family is eligible. In other words, the payment to the provider for the month of service should reflect the certified need of the parent.
   
   
4. When a parent(s) has a variable work schedule, providers are reimbursed based on the child(ren)’s attendance. 5 CCR, Section 18086(b) (2) (D) states that families with unpredictable hours will be authorized “for a variable schedule for the actual hours worked”. Using the attendance record, the contractor would reimburse the provider for the hours the parent works or is in a work activity, plus approved travel time.
   
   
5. The exception to numbers three and four above is the reimbursement process for part-time care offered by license-exempt providers. When a parent(s) selects a license-exempt provider and needs care for less than 30 hours per week, the license-exempt provider would be reimbursed based on attendance and pursuant to 5 CCR, Section 18074.2, that provides direction for in-home and license-exempt rate ceilings when there is no reimbursement rate category.
   
   
6. Any change to the parent’s approved level of service must be done through a Notice of Action (NOA) process pursuant to 5 CCR, Section 18119. Any change that may impact the reimbursement amount a provider receives should also be communicated to the provider in writing.

The ELCD recommends contractors review various methods of payment to providers, which could include checks, direct deposit, and debit cards to determine the most effective method(s) in meeting payment schedules and the least burdensome administratively.

Contractors are reminded that 5 CCR, Section 18065 places the responsibility for the completion of the attendance record on the parent. If the attendance record indicates the parent did not complete the sign-in and sign-out sheet daily, that someone other than the parent or the parent’s authorized representative completed it, or the hours of care vary substantially from the certified hours, the contractor must contact the parent. Please refer to MB 14-04 at http://www.cde.ca.gov/sp/cd/ci/mb1404.asp on Attendance Records for more detail on the contractor’s responsibility when actual hours are broadly inconsistent with certified hours of need.

The payment to the provider should not be withheld or reduced because the hours of care utilization are broadly inconsistent with the certified need of the parent. Contractors do not have the authority to reduce or withhold payments in the absence of a NOA. Any reduction to the parent’s benefit level, including a reduction due to the parent’s violation of program rules, can only be effected through a NOA. For example:

The parent is certified for full-time care of nine hours each workday of the month. The agency receives an attendance record that reflects a consistent utilization of five hours of care each workday of the month. The contractor contacts the parent to verify and determine if their work schedule has changed. If the schedule has changed, the contractor, in accordance with the agency-established reporting requirements, issues a NOA that identifies the reduction in certified need.

For the month of care for which the attendance record is submitted, the provider is paid on the original certification of need. Only after the NOA is effective is the provider paid on the new certification of need.

If a contractor receives an attendance record that clearly reflects misleading or deceitful information, the contractor must follow their written polices and take appropriate action. If the attendance record(s) has been fraudulently completed, the contractor should take immediate steps to terminate services or the business relationship with the responsible party.

Contractors should not make payment to a provider if they have information that might include, but is not limited to, the following:

• The provider was incarcerated during the time s/he claimed to have provided care.
  
  
• The provider was out-of-state during the time s/he claimed to have provided care and did not meet the requirements of the Manual of Policies and Procedures, Title 22, Section 102417 (a).
  
  
• A licensed provider lost their license and was directed to cease providing care but did not.
  
  
• A provider claimed a relationship to the child that would have precluded TrustLining but, in fact, the relationship did not exist, or the provider had been previously TrustLine denied.
  
  
• A provider used a false identity.

The ELCD is aware contractors have questions about meeting regulatory requirements regarding the completion of attendance records and the utilization of these records for reimbursement purposes. As mentioned above, attendance records should not be utilized to reduce or withhold payments to providers. Please see MB 14-04 at http://www.cde.ca.gov/sp/cd/ci/mb1404.asp on Attendance Records that addresses the appropriate completion of attendance records, and actions that must be taken by a contractor when these requirements are not met.

Questions regarding the information in this MB should be addressed to your ELCD Field Services Consultant http://www.cde.ca.gov/sp/cd/ci/assignments.asp or by phone at 916-322-6233.

This Management Bulletin is mandatory only to the extent that it cites a specific statutory and/or regulatory requirement. Any portion of this Management Bulletin that is not supported by a specific statutory and/or regulatory requirement is not prescriptive pursuant to California Education Code Section 33308.5.