OKDHS - OAC 340:40-13-5. Child care provider contracts

340:40-13-5. Child care provider contracts

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Revised 6-1-11

(a) Criteria. In order for the Oklahoma Department of Human Services (OKDHS) to purchase out-of-home child care services, a provider must have a current Form 08CC001E, Child Care Provider Contract, signed by both the owner of the facility and the OKDHS Director or designee on file with the Family Support Services Division (FSSD) Child Care Subsidy Section staff. OKDHS assures all persons that OKDHS or any provider of contractual services, does not take into account a person's race, color, religion, sex, national origin, or disability in the selection or eligibility of persons to receive services and in the manner of providing them. Age may be a factor only to the extent that certain services are designed for a particular age group.

(1) Written complaints of noncompliance with the assurance in (a) of this Section may be made to the Director of OKDHS or to the Secretary of Health and Human Services, Washington, D.C., 20201.
(2) Local Oklahoma Child Care Services (OCCS) licensing staff provides initial information about contracts for child care facilities. The provider contacts the child care liaison to request a contract.
(3) Child care contracts are valid for a maximum of one year. Contracts are automatically renewed for successive one year terms, under the same terms and conditions, unless the child care provider or OKDHS gives written notice of its intent not to renew to the other party at least 30 calendar days prior to the expiration of the current term.

(b) License and star status for child care centers and homes. OKDHS does not contract with child care providers located out-of-state unless the provider had a contract in effect on January 1, 2010. • 1 Child care providers may only obtain an OKDHS contract after they are licensed or permitted. • 2

(1) A child care center requesting a contract must have a license or permit and have a one plus and higher star status. The child care center provider may sign Form 08CC001E if a one plus and higher star status shows on the child care licensing system (CCLS) within 30 calendar days.
(2) A child care home provider requesting a contract must have a license or a permit.

(A) If licensed, the child care home provider may sign Form 08CC001E if one star status or higher shows on CCLS.
(B) If on permit, the child care home provider may sign Form 08CC001E if one star plus status or higher shows on CCLS within 30 calendar days.

(c) Procedure for obtaining child care contracts. The procedures in (1) through (5) of this subsection are used to obtain child care contracts.

(1) OCCS licensing staff gives the child care provider a flyer titled "Obtaining a Contract with OKDHS for Child Care Subsidy Payments." The provider is instructed to contact the child care liaison to obtain the compact disk (CD) titled "Orientation to Child Care Subsidy Contracts" for training and review of the contracting requirements. The CD includes instructions on how to complete the training, take the proficiency test, and print the certificate of completion.
(2) When contacted by the owner or authorized signor of a child care facility, the child care liaison explains that the owner or authorized signor must view the required training CD, pass the proficiency test, and provide the certificate of completion before signing a contract. • 3 The date on the certificate of completion must be within 30 calendar days of the date the contract is signed. Directors are not required but are highly encouraged to view the training. • 4
(3) Once the certificate of completion is provided, the child care liaison types all identifying information on Form 08CC001E. The child care liaison gives Form 08CC001E to the provider and explains that the earliest date a contract is valid is the date of approval by the OKDHS Director or designee. • 5
(4) The owner or authorized signor signs the contract and returns the contract to the child care liaison. The owner or authorized signor must also provide:

(A) proof of his or her identity;
(B) a copy of the owner's or authorized signor's Social Security card; • 6
(C) a copy of the Oklahoma State Bureau of Investigation (OSBI) background investigation report for the owner or authorized signor of a center or a child care home; • 7
(D) proof of the employer identification number (EIN) for a child care center provider and any home provider who is not a sole proprietor; and
(E) a copy of the certificate of completion of the required CD training.

(5) The child care liaison sends Form 08CC001E, the Contract Routing Checklist, and the documents listed in (c)(4)(A-E) of this Section to the FSSD Child Care Subsidy Section staff for approval or denial.

(A) If approved, the FSSD Child Care Subsidy Section staff assigns a contract number and sends a copy of the signed contract back to the provider. • 8
(B) If denied, the FSSD Child Care Subsidy Section staff sends a letter to the provider advising it is not in the best interest of OKDHS to contract with the provider. • 9
(C) If the child care provider signs Form 08CC001E but fails to complete other contracting requirements within 30 calendar days, the child care liaison attaches Form 08CC001E to the Contract Routing Checklist and sends it to the FSSD Child Care Subsidy Section staff for denial.

(d) Changes that must be reported. Form 08CC001E advises child care providers of changes they must report to the FSSD Child Care Subsidy Section staff no less than 30 calendar days prior to the effective date of any changes. When the provider fails to report the anticipated change timely and a new contract is needed, a gap may occur in the child care subsidy payment to the provider. Changes that must be reported include:

(1) collaborations or agreements;
(2) anticipated sale of the business;
(3) change of legal business entity;
(4) change of physical or mailing address;
(5) change in facility status;
(6) legal name change;
(7) plan to stop caring for children;
(8) change of phone number; and
(9) reduction of star status.

(e) Changes that do not require a new contract. Changes that do not require a new contract include a:

(1) legal name change;
(2) change of location. When a child care center or home provider changes the location of his or her child care business, the provider must notify FSSD Child Care Subsidy Section staff of the new location and sign a new license application agreeing to care for children at the new location. • 10 The provider's license and contract remain open with the same:

(A) begin date;
(B) number assigned; and
(C) star status;

(3) facility status change from a child care home to a large child care home or from a large child care home to a child care home as long as the same license number is used; and
(4) facility status change from a child care home to a child care center or a child care center to a child care home if the business entity stays the same.

(f) Changes that require a new contract. Changes that require a new contract are included in (1) through (2) of this subsection. When a new contract is required, procedures in (c) of this Section are used to complete and submit child care contract requests.

(1) Change in ownership. • 11 When the owner of a child care center or child care home changes, the new owner or authorized signor may sign Form 08CC001E if the: • 2

(A) child care center:

(i) has a new license or permit application is pending; and
(ii) meets or is anticipated by OCCS licensing staff to meet one plus star status or higher within 30 calendar days; or

(B) child care home:

(i) has a new license application pending; and
(ii) is anticipated by OCCS licensing staff to meet one star status or higher within 30 calendar days.

(2) Change of legal business entity. • 12 Examples of changing legal business entity include changing from a sole proprietor to a corporation, partnership, or limited liability company.

(A) When a child care center changes the business entity, a new license application is required. A child care center provider may sign Form 08CC001E if the: • 2

(i) new license or permit application is pending; and
(ii) provider meets or is anticipated by OCCS licensing staff to meet one plus status or higher within 30 calendar days.

(B) When a child care home changes the business entity, a new license application is required. A child care home provider may sign Form 08CC001E if the: • 2

(i) license application is pending at any star status; or
(ii) permit application is pending and the provider meets or is anticipated by OCCS licensing staff to meet one plus status or higher within 30 calendar days.

(g) Providing care at a different site than is authorized. When the child care provider signs the child care contract, he or she agrees to provide care only at the physical address designated in the contract. In certain circumstances, a child care center provider who owns more than one child care center may move children receiving subsidized child care benefits to an alternate center only after he or she receives prior approval in writing from the FSSD Child Care Subsidy Section staff authorizing him or her to move the children and the point-of-service (POS) machine to the alternate site for a designated period of time. FSSD Child Care Subsidy Section staff may give approval when (1) through (4) are met.

(1) The same owner or legal business entity owns the alternate site.
(2) The alternate site is licensed and contracted at the same star level and the provider has adequate licensed capacity at the alternate site.
(3) There is a legitimate business reason for providing care in another location.
(4) The provider advises FSSD Child Care Subsidy Section staff how he or she is ensuring that parents are aware their children are being cared for at a different location.

(h) Renewal of child care contracts. Contracts automatically renew for successive one year terms, under the same terms and conditions, unless the provider or OKDHS gives written notice of its intent not to renew to the other party at least 30 calendar days prior to the expiration of the previous term. A contract is not renewed when a provider fails to complete required contract training or to provide any other information or documents requested during the contract renewal period.

(i) Contract violations. When the child care provider signs Form 08CC001E, the provider is agreeing to abide by the terms of the contract. When human services center (HSC) staff becomes aware that a provider is violating the terms of the contract, he or she sends an e-mail to FSSD Child Care Subsidy Section staff advising of the circumstances. • 13 HSC staff may also complete Form 19MP001E, Referral Form, to report the violation to the Office of Inspector General. Examples of contract violations include, but are not limited to:

(1) discriminating against persons seeking services either by charging a discriminatory rate or violating a person's rights as listed in the Civil Rights Act of 1964 as amended, the Rehabilitation Act of 1973 as amended, or the Americans with Disabilities Act of 1990, as amended;
(2) failing to maintain a drug-free workplace;
(3) operating over licensed capacity;
(4) possessing or swiping a client's electronic benefit transfer (EBT) card;
(5) knowing a client's personal identification number;
(6) refusing unlimited access by a parent or caretaker to the areas of the facility used for child care during the hours of operation;
(7) failing to ensure accurate time and attendance information was recorded by the parent or caretaker on the POS machine. The attendance, not time, of a child approved for the part-time or blended unit type is recorded on the POS machine by the parent or caretaker during the school year;
(8) charging a client receiving subsidized child care more than the OKDHS rate for days and hours within the client's plan of service; • 14
(9) charging a client receiving subsidized child care an allowable fee not charged to non-OKDHS participants; • 15
(10) failing to post all of the facility's rates and fees;
(11) charging a client or requiring a client to swipe attendance for days and hours outside of client's plan of service when those days and hours are a requirement of the provider, not a choice of the client; • 14
(12) failing to advise and provide OKDHS a completed copy of any agreement the provider enters into within 30 calendar days of entering into a collaboration or agreement. This includes agreements with Head Start, Early Head Start, public schools, or any other programs receiving state or federal funding;
(13) claiming or receiving payment from OKDHS for any hours of care the provider is not charging all parents for care because provider receives state or federal funds for those hours. Refer to OAC 340:40-5-1(7) for policy on collaborations;
(14) claiming payment for care given for any hours in an unlicensed collaborative classroom;
(15) moving the children from the agreed upon location shown in the contract for reasons other than field trips and claiming for services at the other location without prior written approval from the FSSD Child Care Subsidy Section staff;
(16) moving the POS machine without receiving prior written approval from the FSSD Child Care Subsidy Section staff per subsection (g) of this Section;
(17) failing to inform OKDHS of a change in facility status, location, legal business entity, or ownership of the business at least 30 calendar days in advance of the change;
(18) failing to inform OKDHS in writing within ten calendar days of any person who has an ownership or controlling interest in, or is an agent or managing employee of the child care business, who has been convicted of a criminal offense related to such person's involvement under Titles XVIII, XIX, or XX of the Social Security Act;
(19) not maintaining written records for manual claims filed during the last three years;
(20) not maintaining written attendance records which include in and out times for the last three years;
(21) refusing to make available to OKDHS all business records that document proper fiscal and program management by the provider within an hour of request by any OKDHS representative;
(22) failing to allow full access to the facility's premises and personnel to investigate a complaint;
(23) failing to report the income from the child care business within ten calendar days to his or her Family Support Services (FSS) worker if receiving benefits;
(24) claiming payment for care given by a home provider for his or her employee's child. Refer to OAC 340:40-5-1(7); • 16
(25) subcontracting services to another provider; and
(26) breaching the contract signed by the provider with the OKDHS EBT contractor.

(j) Cancellation of child care provider contracts. FSSD Child Care Subsidy Section staff initiates the cancellation by issuing a notice to the provider. • 17

(1) Contracts may be cancelled:

(A) with cause. The effective date of cancellation is 13 calendar days after FSSD staff mails the notice. This allows three calendar days for mailing time. The notice must contain a reference to the grounds for cancellation including the specific contract provision(s) that was violated; or • 18
(B) without cause. The effective date of cancellation is 33 calendar days after FSSD staff mails the notice. This allows three calendar days for mailing time. • 19

(2) The FSSD Child Care Subsidy Section staff communicates with the child care liaison when a contract is being cancelled to ensure that HSC staff has sufficient time to plan with clients to find another facility, if necessary. When it is necessary to cancel authorizations with a child care provider, the provider is notified by use of a computer-generated notice. FSSD Child Care Subsidy Section staff closes all authorizations with the provider whose contract is cancelled except for Child Welfare (CW) authorizations. An e-mail is sent to the KIDS Help Desk notifying them of the contract cancellation requesting closure of CW authorizations.

INSTRUCTIONS TO STAFF 340:40-13-5

Revised 6-1-11

1. If a client states he or she wishes to use an out-of-state provider, the worker advises the client the Oklahoma Department of Human Services (OKDHS) does not contract with out-of-state providers. The worker asks the client to choose an in-state contracted provider.

2. The child care liaison monitors the license status of all providers requesting a contract by accessing Oklahoma Child Care Services (OCCS) Licensing Services information on the Child Care Licensing System (CCLS). The CCLS is located on the InfoNet under OKDHS Tools. Refer to the Family Support Services Division (FSSD) Child Care Subsidy Section Web site for detailed instructions on accessing the CCLS. The child care provider gives his or her license number to the liaison. The liaison uses the provider number to access the provider's CCLS information. Once the provider's information is showing, the liaison chooses Report, Case Summary, and Case Action. The license status is found under the Case Action tab by reading the line titled "License/Permit Status" and the "effective date." The Star Status can be found by choosing the Case Summary Overview, Case Action, and Star tabs.

3. An owner or authorized signor is defined as the person who is designated to obligate the business. Refer to OKDHS Appendix L-7.

4. The "Orientation to Child Care Subsidy Contracts" training CD and the flyer titled, "Obtaining a Contract with OKDHS for Child Care Subsidy Payments," are given to the provider upon request at any time.

5. The dates in Part One and Part Two of Form 08CC001E are left blank for entry by FSSD Child Care Subsidy Section staff. The earliest date entered is the date approval of the contract is granted.

6. The owner or authorized signor must provide photo identification (ID) to the child care liaison. The child care liaison checks on the Contract Routing Checklist that he or she has seen photo ID that confirms the owner's or authorized signor's identity. A copy of the photo ID is not sent to FSSD Child Care Subsidy Section staff.

7. (a) In order to obtain a license, the owner or authorized signor of a child care facility must undergo an Oklahoma State Bureau of Investigation (OSBI) background check. All providers applying for a new contract must provide a copy of his or her OSBI background check to the child care liaison. An existing OSBI background check will only be accepted if issued within the past 12 months. The OSBI background check must be a name based search and include all search results and dispositions.

(b) The OSBI background check is not required for providers that are making an entity or facility status change, as long as the person signing the contract remains the same.

(c) The FSSD Child Care Subsidy Section programs manager may waive the requirement for a federally recognized tribe that has a cooperative agreement with OCCS.

8. (a) FSSD Child Care Subsidy Section staff enters information about the provider on the Daycare Contracts/Registrations screen (PCU) on the Information Management System (IMS) when the contract is initially approved and as changes occur. FSSD Child Care Subsidy Section staff notifies the child care liaison by e-mail of the contract number and the approval date for the contract. The child care liaison then notifies the new contracted provider and appropriate human services center (HSC) staff of the new contract number and approval date for the contract.

(b) HSC staff accesses information about contracted child care providers by using transaction PCI on IMS. Enter PCI space and the contract number. The PCI screen gives information about the child care provider such as the provider's name, location, and mailing addresses, contract begin date, and the name of the owner. If the contract number is unknown, the worker obtains the number by using the PCX transaction or Child Care Locator.

(1) To use PCX the worker enters PCX space and up to the first eight letters of the child care center name or child care home provider's first name. The PCX transaction displays the names of all child care providers with those beginning letters. HSC staff enters PCI next to the contract number on the list displayed to obtain information about the provider. To view instructions and filter options for these transactions, enter M space and the transaction code. Example: M space PCX.

(2) Child Care Locator is available on the InfoNet under OKDHS Tools. The worker clicks on Child Care Locator, chooses the county where the facility is located, and enters the name of the facility for a child care center or the first and last name of the owner for a child care home. A gray ball appears in front of the names of providers with child care contracts. The worker obtains the contract number by hovering their cursor over the gray ball.

(c) FSSD Child Care Subsidy Section staff sends a copy of the "Contracting with OKDHS for Child Care Subsidy Payments" handbook to the provider after contract approval.

9. FSSD Child Care Subsidy Section staff notifies the child care liaison by e-mail that the provider's contract request has been denied.

10.FSSD Child Care Subsidy Section staff changes the provider's address on IMS and sends an e-mail to OCCS licensing staff when address changes are reported.

11.OKDHS staff works to avoid or reduce any gap in the child care subsidy payment. If the new owner does not provide a contract and all required verifications to the FSSD Child Care Subsidy Section staff at least 30 calendar days prior to the ownership change, there may be a gap in the child care subsidy payment.

12.OKDHS staff works to avoid or reduce any gap in the child care subsidy payment. When the provider does not submit a contract and all required verifications to the FSSD Child Care Subsidy Section staff at least 30 calendar days prior to the business entity change, there may be a gap in the child care subsidy payment.

13. (a) FSSD Child Care Subsidy Section staff reviews the circumstances and whether the provider has agreed to stop the practice. Depending on the circumstances, FSSD staff may:

(1) decide no further action is needed;

(2) initiate a corrective action plan;

(3) request that HSC staff completes Form 19MP001E, Referral Form, to start an investigation; or

(4) decide to cancel the child care provider's contract.

(b) When FSSD Child Care Subsidy Section staff recommends completion of Form 19MP001E, HSC staff puts as much detail as possible about the violation on the form. This includes who reported the violation, what was alleged, the provider's comments when called about the violation, and a telephone number to reach this person. The HSC staff attaches any written documentation that supports the allegation to the Form 19MP001E. When a client reports a violation, the client may provide a written statement.

14.There are providers who require that all children be in attendance by a certain time every morning, for instance 9:00 a.m., regardless of the client's work or school schedule. Reasons given by the provider may include limiting disruptions to program content, so all children can participate fully in the quality content of the child care program, or to reduce transportation costs for the provider. If, based on the client's work or school schedule, care is not needed until 11:00 a.m., the client swipes attendance by entering a previous in for 11:00 a.m. on the point-of-service (POS) machine when the child is picked up at the end of the day. The provider must not charge the client for the additional two hours of care. If the client chooses to drop the child off at the child care provider earlier than the approved plan of service hours or leaves the child later for personal reasons, the provider can charge the client for those additional hours.

15.Some examples of non-allowable fees are vacation fees when a child is absent or termination fees when the child stops attending the facility.

16.It is not a contract violation when a child in foster care attends the child care home prior to the child care provider or the child care provider's employee becoming the child's foster parent.

17.When OKDHS cancels a provider contract, FSSD Child Care Subsidy Section staff sends an e-mail regarding contract cancellation proceedings to:

(1) OCCS;

(2) Legal Division;

(3) Finance Division Electronic Payment Systems (EPS) Unit;

(4) Office of Inspector General (OIG);

(5) Children and Family Services Division (CFSD);

(6) Department of Education, Child Care Food Program; and

(7) the local county director and child care liaison where the provider is located.

18.When OKDHS cancels a contract with cause, the reason is included in the provider's cancellation letter. The provider is advised OKDHS will no longer make child care payments 13 calendar days from the date FSSD Child Care Subsidy Section staff mails the notice to the provider.

19.(a) When OKDHS cancels a contract without cause and the child care facility was recently audited or investigated by OKDHS OIG, the provider is reminded in the cancellation letter of the audit or investigation and that the OIG auditor or investigator advised the provider that he or she met the criteria for contract cancellation. The provider is also advised in the letter that OKDHS no longer makes child care payments 33 calendar days from the date FSSD Child Care Subsidy Section staff mails the notice to the provider. Reasons a contract might be cancelled following an OIG audit or investigation include violations listed at (i) of this Section.

(b) Other reasons a provider contract may be cancelled without cause include, but are not limited to, when:

(1) OCCS staff revokes the provider's child care license;

(2) persons whose contracts have previously been cancelled following an OIG audit or investigation are now owners, authorized representatives, or materially involved in the business of a new facility at the same address;

(3) the provider has an outstanding overpayment debt with OKDHS either as a client or as a provider;

(4) the provider receives benefits as an OKDHS client and his or her benefits are closed as he or she was found to have committed fraud or willful misrepresentation;

(5) it comes to the attention of FSSD Child Care Subsidy Section staff that a provider has been convicted of a felony verified by the OSBI or the Oklahoma Supreme Court Network (OSCN);

(6) it comes to the attention of FSSD Child Care Subsidy Section staff that a provider has been debarred, suspended, disqualified, proposed for debarment, or declared ineligible by any federal department or agency, or convicted of a fraud-related crime;

(7) the provider is convicted of food benefit trafficking;

(8) the provider requests cancellation of the contract;

(9) the ownership of a facility changes;

(10) a one star center provider no longer has open child care authorizations;

(11) the provider commits a contract violation brought to the attention of FSSD Child Care Subsidy Section staff and refuses to correct it; or

(12) the provider shows a history of non-compliance with OKDHS policies and procedures.

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