Maryland Child Care Subsidy Payment Processing

Child Care Subsidy
Provider Information
Orientation and Overview
• This presentation is an orientation and
overview of The Child Care Subsidy Program.
• As you go through the slides you will learn
– The Child Care Subsidy Program
– The types of child care providers
– The responsibilities of the provider, family, the
Local Department of Social Services (LDSS) and
the Maryland State Department of Education
– Getting paid for the services you provide
– Payment policies
– Developing your business practices
– Who do you contact with a question or problem
Child Care Subsidy
• Welcome to Maryland’s Child Care
Subsidy program.
• Our program is a partnership between
parents, providers, and the Division of
Early Childhood Development of the
Maryland State Department of
• Thank you for providing care for
children whose families receive Child
Care Subsidy.
Provider Types
• In Maryland, parents have a range
of choices available to them when
choosing a child care provider.
• Formal Care, which consists of
Registered Family Child Care Homes
and Licensed Child Care Centers
• Informal Care, which is relative
care, in-home care, and babysitting
Provider Types
• Formal Child Care:
– The Office of Child Care Licensing Branch
monitors and licenses family child care homes
and child care centers.
• Informal Child Care:
– The parent has set up a legal child care
arrangement. The provider is required to
submit a signed affirmation of compliance
with child care health and safety standards.
They are not required to be licensed,
however, they must:
• Be a relative, or
• Provide care in the child’s own home.
Providers are Independent
• This means:
– MSDE - Maryland Child Care Subsidy is not the
child care provider’s employer
• The parent is the employer
– Maryland’s Child Care Subsidy program does not
determine your hours of operation, cost of child
care and/or how child care services are provided
– Maryland’s Child Care Subsidy program does not
withhold or pay income or payroll taxes and/or
provide fringe benefits for child care providers
– Maryland issues subsidy reimbursement to child
care providers on behalf of families enrolled in
the Child Care Subsidy Program.
Provider Responsibilities
• The provider is responsible for:
– Maintaining a facility that is licensed
– Maintaining health and safety standards
– Keeping accurate attendance and financial
– Completing the invoices with accurate
information based on attendance records,
and return them in a timely manner
– Communicate with the families of children
in care to ensure vouchers are renewed
Family Responsibilities
• Families are responsibilities include:
– Report to LDSS any changes in provider,
family income, or parent activity
– Pay the weekly co-payment to the
– Provide to the LDSS information to
determine the family’s eligibility and
authorize child care correctly
– Understand their contractual obligations
to the child care provider.
LDSS Responsibilities
• The Local Department of Social
Services is responsible for:
– Establish a family’s eligibility for
subsidized child care
– Giving a family and provider 5 days
advance notice if their child care benefits
are being reduced, terminated or
– Assist in answering questions regarding
MSDE Responsibilities
• The Maryland State Department of
Education is responsible for:
– Oversight of the Child Care Subsidy
– Payment of invoices submitted by child
care providers through Maryland Child
Care Subsidy Payment Processing
Getting Paid for Services
• Invoices are mailed to providers for each
two-week service period.
• All children with receipted vouchers are
pre-printed on the invoice.
• If a child name does not appear on the
invoice, speak with the parent to make
sure the signed voucher was returned to
the LDSS.
– If the voucher was returned, the child’s name
will appear on an adjusted invoice
– Do not write in the name of the child on your
Getting Paid
• To initiate payment:
– As soon as the service period is over
the invoice must be accurately
completed, signed and sent to
P.O. Box 17543
Baltimore, MD 21297-1543
Getting Paid
• The Invoice Processor at MDCCSPP will
review the invoice to ensure that it is
filled our completely and signed by the
• The invoice data is entered into the Child
Care Automated Tracking System (CCATS)
• Errors on the invoice are a common reason
for payment delays, so it is important to
take a few extra minutes to double check
the information before sending in for
Getting Paid
• Once the Invoice Processor has signed off on the invoice,
the Supervisor reviews the information and gives the final
approval in CCATS.
• After the invoice is approved by MDCCSPP, the request
for payment is processed through the Comptroller’s
Office which will take 7-10 business days
• Invoice Detail Report
– Once the payment is approved and the payment processed
through the Comptrollers’ Office, providers will be sent an
invoice detail report.
– The report will specify payment for each child receiving
child care subsidy.
– Review the report carefully to ensure that proper payment
has been issued for each child.
– It is good business practice to keep copies of all detail
reports for tax purposes.
Payment Policy
• Reimbursement rates are based on a
market rate survey on the cost of child
• The rate established for each payment
region is determined by the information
provided by providers about the amount
they charge to families in care.
• Rates are grouped by type of care and
areas of the State based on fees charged
to families.
• For information on payment rates visit
Payment Policy
A provider is paid only for the time authorized by the terms
stated on the voucher.
If the fee you charge to families is more than the amount on the
voucher, you are responsible for ensuring that families are
aware of the difference in the amount of the voucher and the
fee charged to families
Families must be informed of any additional fees they may be
charged above the amount the State is agreeing to reimburse
the provider on behalf of the family
For example:
• If the voucher issued is for $100 and the assigned parent co-pay amount
is $10, but the provider charges $150 for the child care slot – there is a
difference of $40.
• It is the responsibility of the provider and parent to agree as to the fee.
The State has determined that the parent is required to pay a copayment in the amount of $10. However, the provider may add the
difference of $40 to the amount required of the parent for the care of
their child.
• The provider may not charge a family receiving a child care subsidy
voucher more than another family in care. Therefore, if your tuition is
$110 per week, then this same family would not have an additional amount
due to you. The State reimbursement and parent co-pay would cover the
entire cost of care for the child.
Payment Policy
• Family Child Care and Child Care Center
Providers are paid for:
– Six holidays each year including:
• New Year’s Day, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas Day
– Day the State or local government declares a
weather emergency
– Voluntary closure days when child care services
are not provided as long as the parent is given at
least two weeks written notice of the closure and
the information is provided to MDCCSPP
– Child absences up to 60 days per calendar year.
Payment Policy
• Informal Providers are:
– Paid for only the time the child
receives care
– Not paid for any holidays or child
Parent Co-Pay
• The intent of the Child Care Subsidy Program is to
assist eligible families with the cost of child care.
• Most subsidy customers will be assessed an
assigned co-payment based on their income
• The assigned co-pay is federally mandated to
assure that families are contributing to the cost
of child care
• The amount of the co-payment will show on the
voucher issued to the parent
• Parents are responsible for paying the co-pay
directly to the provider, as well as any additional
fee agreed upon
Developing Your Business
• Whether you are a licensed child care
provider or an informal provider, you can
benefit from developing good business
practices such as:
– Entering into a contract with parents
– Keeping appropriate and complete
– Establishing a method to track and pay taxes
on the money earned, and
– Participating in professional development
activities and, if eligible The Maryland Child
Credential Program
• A contract between you and a family
can prevent misunderstandings about
payment expectations and other issues
such as hours and days of care, food
service, child guidance practices, fees,
closure days, and other child care
policies and practices.
• Contracts should be established
before care is provided and updated
as needed, but at least once per year.
• Maintaining copies of vouchers, invoices,
Invoice Detail Reports and payment
records is good business practice
• Setting up a filing system will help you
keep organized
• Monitoring when a voucher will expire is
important and communicating with parents
about a voucher ready to expire can
eliminate late reimbursement payments or
denial of reimbursement.
• The Maryland State Comptroller’s Office will
automatically mail a 1099 Form to you each January
for income tax purposes if the amount paid to you
during the previous calendar year was $600 or more.
• It is important for you to comply with all Internal
Revenue Service (IRS) regulations. For questions or
specific filing information contact the IRS at 1-800829-1040
• The Maryland State Department of Education does
not withhold taxes from child care reimbursement
payments. You are self-employed and responsible
for all tax liability to the State and Federal
Professional Development
• Professional development, completing training, is good
for you and the children for whom you are providing
• Training is categorized into six major areas known as
the Core of Knowledge:
Child Development
Health, Safety and Nutrition
Special Needs
Professionalism, and
Community (knowing your community resources and diversity)
• Taking training in a variety of areas helps you develop
skills and knowledge to improve your business and your
day-to-day interactions with the children in your care
and their families
Professional Development
• The Maryland Child Care Credential Program is
available to all licensed and registered child care
• It recognizes individuals working directly with
children for their education (training),
experience and professional activity.
• It is a voluntary program, but by participating you
could be eligible for bonuses and monetary
support to take additional training
• For more information about the Maryland Child
Care Credential program visit:
Tiered Reimbursement
• Tiered Reimbursement:
– Is a voluntary program for all licensed and
registered child care providers.
– Recognizes child care programs that go beyond
the requirements of State licensing regulations.
– Provides incentives in the form of additional
quality payment amounts based on each child
receiving child care subsidy in the program.
• For more information on Tiered
Reimbursement visit:
Provider Resources
• Provider Helpline:
– Phone: 1-866-243-8796
– E-mail:
• Electronic Funds Transfer (EFT)
– Tired of waiting for the mail. Sign up for
EFT. The Comptroller’s Office will deposit
your money directly into your bank account.
For more information visit:
More Resources
• Child and Adult Care Food Program
– The program is a key source of support
for child care providers and programs.
– This program provides reimbursement for
food and meal preparation costs, ongoing
training, and onsite technical assistance.
For additional information visit:
or call 410-767-0199
SEIU 500 – Kids First
Family Child Care Providers who participate in the Child
Care Subsidy program are represented by a Union.
SEIU Local 500 Kids First Union represents family
child care providers (both informal and formal) in the
state of Maryland. The Union can offer family child
care providers:
mentoring for assistance in licensing and credentialing,
a place to meet other providers,
a voice in your profession, and
discounts on training, computers and other essential items.
For information about the Union or to join call 301-740-7100
For more information visit:
Child Care Associations
Child care associations provide child care
providers with support, networking, training
and information about child care practices
and standards. There are statewide and
local organizations. The statewide
organizations include:
– Maryland Child Care Association (center
association) or 1-877-820-9196
– Maryland State Family Child Care Association or 240-529-6556
• Providers have access to the
following forms to assist with child
care subsidy record keeping:
– Parent’s Consent to Release
– Parent’s Change Reporting Form (392)
• See next slide for more
Form Uses
• Parent’s Consent to Release
Information – allows the provider hotline
and LDSS staff to share voucher
information about the children in care
• Parent’s Change Reporting Form (392)–
allows the parent and the provider to
indicate whether or not any copayment is
owed when a parent changes providers
Form Availability
• Providers can obtain these forms
from an LDSS, the provider hotline,
or the MSDE website at: