STATE OF WISCONSIN
Department of Health and Family Services
Division of Children and Family Services
Division of Economic Support

     MEMO SERIES DCFS 96-01 /ACTION
     MEMO SERIES DES-96- 25 /ACTION
      June 26, 1996
      Re:    W-2 CHILD CARE PROGRAM
               IMPLEMENTATION

To:

Area Administrators/Assistant Area Administrators
County Child Care Coordinators
County Departments of Human Services Directors
County Departments of Social Services Directors
County Economic Support Managers/Lead Workers/
     Supervisors
JOBS Administrative Agencies
Tribal Chairpersons/Human Services Facilitators
Tribal Economic Support Directors

From:

Susan Dreyfus
Administrator
Division of Children and Family Services

 

J. Jean Rogers
Administrator
Division of Economic Support

DOCUMENT SUMMARY

This memo issues directives for implementing the new child care policies established in the Wisconsin Works legislation signed by Governor Thompson on April 25, 1996. This memo also describes future child care program changes.

This Administratorsí memo advises county/tribal child care agencies of the program policy changes contained in the recently-enacted Wisconsin Works (W-2) law and to provide information on the Departmentís implementation plan for the new program. Some changes are to be put into effect immediately upon receipt of this administratorís memo.

 Introduction and Purpose

The state's new Welfare Reform law (Assembly Bill 591, enacted as 1995 Wisconsin Act 289), also known as Wisconsin Works (or "W-2"), will result in many major changes to all the affected programs. While many of the law's provisions will not be fully implemented until 1997, the changes to the child care program are slated for implementation beginning as soon as May 10, 1996, the day after the publication of Act 289. The purpose of this memo is to issue the first directives for implementing the changes to the child care funding program, as contained in Act 289, and to advise you of future program changes which are being planned.

SUMMARY TABLE

The following table summarizes the policy and procedural changes which will be implemented under the Wisconsin Works (W-2) child care program.

POLICY CHANGE

EFFECTIVE DATE

FUNDING SOURCE(S) AFFECTED

1. Income eligibility limit set at
   165% of Federal Poverty
    Level for new applicants.

Immediately

Low Income Child
Care Transitional
Child Care

2.  Postsecondary education no
     longer an allowable activity
     for child care for new
     applicants.

Immediately

Low Income Child Care

3.  Postsecondary education no
     longer an allowable activity
     for child care for individuals
     currently receiving services.

End of the current school term, but not later than June 15, 1996.

Low Income Child Care

4.  Criminal background checks
     required for all new
    applicants for certification
    and any other adults
    having regular contact with
    children.

Immediately

Low Income Child
Care Transitional Child Care
JOBS Child Care
Consolidated AFDC
Child Care
Tribal Child Care

5.  New copayment schedule
     for new applicants applying
     for W-2 child care.

August 1, 1996

Low Income Child Care
Transitional Child Care

6.  Phase-in copayment formula
     for families currently
     receiving child care.

August 1, 1996

Low Income Child Care
Transitional Child Care

7.  Redefinition of provisional
     certification category of
     regulation.

August 1, 1996

Low Income Child Care
Transitional Child Care
JOBS Child Care
Consolidated AFDC
Child Care
Tribal Child Care

8.  Revising the maximum
     reimbursement rates for
     regular certification and
     provisional certification.

August 1, 1996

Low Income Child Care
Transitional Child Care
JOBS Child Care
Consolidated AFDC
Child Care 

9.  Child care payment
     restrictions:
  • a provider caring only for relatives cannot be reimbursed beyond the level of provisional certification;
  • no payments shall be made to an individual who lives in the same home as the family receiving care.

August 1, 1996

Low Income Child Care
Transitional Child Care
JOBS Child Care
Consolidated AFDC
Child Care

10.  New maximum rate age
       group categories: Zero up
       to age 2 and age 2 through
       age 12.

January 1997

Low Income Child Care
Transitional Child Care
JOBS Child Care
Consolidated AFDC
Child Care

11.  New basic policy changes
       for making child care
       payments to providers:
  • payments to licensed providers based on enrollment;
  • payments to certified providers based on attendance (plus a 10% add-on factor to account for absences);
  • hourly unit of service.

January 1997

Low Income Child Care
Transitional Child Care
JOBS Child Care
Consolidated AFDC
Child Care

NOTE: Manual material describing these policy and procedure changes in more detail will be issued in the near future. Also, training sessions covering these W-2 child care changes will be held throughout the state during June and July, 1996. Meanwhile, this Administratorís Memo is to be considered sufficient authority for your county/tribe to implement the following three directives.

Changes in certification apply to Tribal Family Services Plan Funds used for child care. If tribes are administering Transitional Child Care, JOBS Child Care or Consolidated AFDC Child Care, policies in this memo which relate to eligibility, copayment and reimbursement apply.

The following three policy changes are to be implemented immediately upon receipt of this memorandum.

EFFECTIVE IMMEDIATELY:

CHILD CARE INCOME ELIGIBILITY FOR LOW INCOME CHILD CARE-- LIMIT SET AT 165% OF POVERTY

Effective immediately, any new applicant for Low Income Child Care or Transitional Child Care whose gross income exceeds 165% of the federal poverty level for their family size, is ineligible for child care funding services. A family whose Transitional Child Care has ended and who applies for Low Income Child Care is not considered a new applicant. This family is considered a current client and should be treated like an ongoing Low Income Child Care recipient. Following are monthly income levels, according to family size, which correspond to the new income eligibility limit of 165% of the federal poverty level:

Family Size

Monthly Income = 165% of federal poverty level

2

$1,425

3

$1,785

4

$2,145

5

$2,505

6

$2,866

7

$3,226

8

$3,586

9

$3,946

10

$4,307

 

EFFECTIVE IMMEDIATELY:

CHILD CARE -- POSTSECONDARY EDUCATION ELIGIBILITY ENDED FOR LOW INCOME CHILD CARE

Effective immediately, any new applicant requesting child care services from the Low Income Child Care fund while attending a postsecondary course of education is not eligible for child care funding services. Individuals currently receiving Low Income Child Care services while attending postsecondary education or training will no longer be eligible for funding effective June 15, 1996, or the end of the current session, whichever is earlier.

Funding will remain available to provide child care services to teen parents attending high school or its equivalent, assuming the family meets the income eligibility requirements.

Two-parent families in which one parent is employed and the second parent is not available to care for their children due to attending postsecondary education are not eligible for child care funding under either the Low Income or the Transitional Child Care programs.

Note: The effect of the W-2 legislation on postsecondary education within the JOBS program was disseminated to local agencies in DES Administratorís Memo Series 96-15, dated April 4, 1996. The W-2 law ended postsecondary education as an acceptable activity within the JOBS program, effective upon the day following publication (May 10, 1996). However, the law also included a grandfathering provision for individuals who, as of December 1, 1995, are enrolled in postsecondary education and participating satisfactorily. This grandfathering provision does not apply after June 30, 1997. Child care services for families with individuals enrolled in postsecondary education under the JOBS program are limited to those grandfathered families. The JOBS agency is responsible for identifying these qualifying families.

EFFECTIVE IMMEDIATELY:

CHILD CARE CERTIFICATION - CRIMINAL BACKGROUND CHECKS REQUIRED ON ALL NEW APPLICANTS WISHING TO BECOME CERTIFIED CHILD CARE PROVIDERS AND OPTIONAL ON ALL CURRENTLY CERTIFIED PROVIDERS

Effective immediately, any individual applying to become a certified child care provider, any individual employed by a certified child care provider or applying for such employment, and any adult individual residing in the home of the provider and having regular contact with children in care, shall be subject to a criminal background check conducted through the Department of Justice. At local agency option, criminal background checks may be conducted at the time of review and/or at any other time considered appropriate. Fees may be charged to providers in order to recover the costs of conducting these investigations. More detailed information regarding this program requirement will be available in the manual material which will be issued in the near future.

The following policy changes will be effective August 1, 1996

CHILD CARE COPAYMENTS - Effective August 1, 1996

Effective August 1, 1996, any family newly applying for, and found eligible for, Low Income Child Care or Transitional Child Care funding services will be required to pay their provider a copayment according to the attached schedule.

Effective August 1, 1996, any family currently receiving Low Income Child Care or Transitional Child Care funding services, at the time of their next review, will be required to pay their provider a copayment amount calculated according to a special copayment phase-in formula.

The phase-in copayment amount will be determined using the factors of monthly family income, family size, and date of review. The amount is a calculated result based on the difference between what the familyís copayment would be under the current schedule and the amount under the new W-2 schedule. A percentage of this difference, determined according to the date of review, is added to the familyís copayment under the current schedule which yields the familyís phase-in copayment amount.

Detailed instructions for the calculation of the phase-in copayment amount will be issued with the manual material. The Department may also offer local agencies a special software program on a diskette which will electronically calculate the phase-in copayment as well as the full W-2 copayment amount.

NOTE: The new W-2 copayment schedule shall NOT be used before the effective date of August 1, 1996, without the prior approval of the Office of Child Care.

PROVISIONAL CERTIFICATION - Effective August 1, 1996

Effective August 1, 1996, any child care provider applying for certification and who has met all certification standards and requirements, but who has not completed the required 15 hours of training, shall be considered provisionally certified (Level II). Once a provisionally certified provider has met the training requirements and remains in compliance with all other certification standards, the provider is eligible for regular (Level I) certification.

CHILD CARE PAYMENT RESTRICTIONS - Effective August 1, 1996

Effective August 1, 1996, a child care provider caring only for relatives cannot be reimbursed beyond the provisional certification level, regardless of training.

Effective August 1, 1996, no payments shall be made to an individual who lives in the same home as the family receiving child care funding for providing care to the child(ren) of that family.

REIMBURSEMENT RATE CHANGES - Effective August 1, 1996

Effective August 1, 1996, the following reimbursement rates will apply to certified providers:

For regularly certified providers, 75% of the licensed family day care maximum hourly rate;

For provisionally certified providers, 50% of the licensed family day care maximum hourly rate;

Child care administrative agencies may choose to increase rates for regular certified and provisionally certified providers by 10% to account for absences, instead of applying the current absence policy (see payment policy changes below effective January 1997).

These reimbursement rate changes will apply to all child care funding sources.

  

The following changes to the child care payments process will be effective January 1997, and will form the basis for the conversion to a statewide child care automated eligibility and payment system. At your countyís/tribeís option, and with notification to the Office of Child Care, some or all of the changes may be implemented at any time prior to 1997. We encourage local agencies to consider making these changes sooner versus later.

 

 CHANGES IN MAXIMUM RATE AGE GROUP CATEGORIES - EFFECTIVE JANUARY 1997

Effective January 1997, the following age groupings shall be used in establishing maximum county/tribal reimbursement rates:

Age 0 up to age 2 (Infant and Toddler Care)

Age 2 through age 12 (Pre-School and School-Age Care)

The Fall 1996 survey of licensed child care providers, used to establish county maximum rates to be effective January 1, 1997, will reflect these two age categories. Local agencies may, upon notification to the Office of Child Care, elect to implement the use of these two categories in 1996. For these counties electing to use the two age categories in 1996, in establishing the maximum hourly reimbursement rate for the new combined pre-school and school-age care category, using the 1996 maximum rates for your county/tribe, the county/tribe shall use the highest hourly rate of the three current categories, i.e., pre-school, school-age while school is in session, and school-age while school is not in session. These reimbursement rate changes will apply to all child care funding sources.

PAYMENT POLICY CHANGES - Effective January 1997

All payments made to licensed child care providers on behalf of eligible families will be based on enrollment. A weekly or biweekly amount of reimbursement will be authorized. The authorized dollar amount and cost of care copayment will remain the same, irrespective of actual attendance, until a new authorization is completed. If a familyís work schedule, or need for child care, is so widely-varying as to be determined unpredictable by the local child care staff, the payment will be based upon attendance.

All payments made to certified child care providers, and those licensed providers serving families with widely-varying work schedules, will be based upon actual attendance, as reported by the provider on a weekly or biweekly basis. All payments based on actual attendance shall be increased by a factor of 10% to account for absences. This 10% add-on will be applied to the reimbursement rate paid to the provider. The current absence policy will be ended.

A single unit of service - one hour - will be used to calculate the payment due the provider. All payments, regardless of whether they are based on enrollment or attendance, shall be calculated by multiplying the number of hours of care (either authorized or actual) by the hourly reimbursement rate for that provider, or the county/tribal maximum rate, whichever is less. All payments made by the county/tribe will be the total due the provider less the amount of the copayment which is the responsibility of the family.

Under the future statewide child care automated payment system, payments to providers will be made on a bi-weekly basis. Counties/tribes are encouraged to move in the direction of a bi-weekly payment system in advance of this change.

 

IMPLEMENTATION STRATEGY

While county/tribal agencies are planning for the implementation of these program changes, they should pay particular attention to such areas as staff resources, scheduling case review dates, setting appropriate authorization periods, and, perhaps most important, preparing families and providers involved in the current program for the impending changes.

Additional information regarding the implementation of the W-2 child care program will be issued through Operations Memos.

REGIONAL OFFICE CONTACT:

Area Administrators

CENTRAL OFFICE CONTACT:

David B. Edie, Director
Office of Child Care

Attachment

cc

Bureau Directors
Child Care Resource and Referral Agencies
Child Support Agencies
County Board Chairpersons
County Departments of Community Programs Directors
County Departments of Developmental Disabilities 
     Services Directors
Program Office Directors/Section Chiefs

 


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