40 TAC §809.231
The Texas Workforce Commission (Commission) proposes an amendment
to §809.231, relating to access to child care services.
Purpose: The purpose of the amendment is to make available more flexibility
for Boards to implement child care. More specifically, the purpose of the
amendment is to remove language that requires all Boards to ensure that child
care provider rates meet or exceed the 75th percentile of the market rates
and instead permits each Board to determine the rates that are appropriate
for the Board's local workforce development area (workforce area) that would
ensure equal access to child care services as described in the federal regulations.
Because the federal regulations merely set the 75th percentile as a recommended
benchmark but not necessarily a required level of payment for providers, a
Board may exercise local control by factoring additional criteria in setting
provider rates. Once a Board determines the appropriate rates for the workforce
area, the Board will submit those rates to the Commission in the Board's integrated
strategic and operational plan for approval by the Commission with explanation
of the justification of the rates.
The amendment to the rule is intended to provide Boards with maximum flexibility,
in accordance with state and federal laws and regulations, to design a service
mechanism that will assist the greatest number of families in accessing the
most affordable, accessible, and quality child care in each workforce area.
Boards have established policies on several child care subjects ranging from
income eligibility to reimbursement rates. In their role as policy makers,
Boards ensure that parents, providers, contractors and potential contractors,
employers, and the public in general have the opportunity to participate and
comment on proposed child care administrative policies through open meetings.
The enhanced flexibility afforded to Boards ensures that the policies maximize
the use of funds by tailoring the management of child care services to meet
the specific needs of each workforce area.
Background: Child Care services are provided to low-income families to
create and promote long-term self-sufficiency, by enabling parents to work,
attend skills training for work, or increase educational levels by offering
affordable, accessible, and quality child care that supports the physical,
social, emotional, and intellectual development and safety of children. Recognizing
that parents best understand the needs of their children, these services empower
parents to make informed choices regarding child care that best suits the
family's needs. The Commission also advocates improvements in the affordability,
accessibility, and quality of child care while supporting health, safety,
licensing, and regulatory standards for child care providers.
Access to child care services that meets the needs of individual families
is critically important to parents and children, to schools, to the workplace,
and to other community institutions that interface with families. The Commission's
intent is that Boards comply with the federal requirement to provide parental
choice in accessing child care services as expressed by the Administration
for Children and Families (ACF) in the preamble to the federal regulations
(63 FedReg 39935) regarding 45 CFR § 98.43 Equal Access.
The federal statute relating to the Child Care and Development Fund (CCDF)
(42 U.S.C.A. §9858
et seq.
) requires
that provider payment rates are sufficient to permit access by eligible families
to child care services that are comparable to those services available to
families that do not receive subsidies. The Child Care and Development Block
Grant Act (CCDBG) §658E(c)(4) (42 U.S.C.A. 9858(e)(4)) requires that
a summary of the facts upon which the determination of the sufficiency of
payment rates to ensure equal access are based. The applicable federal regulations
provide that access to child care services is accomplished when Boards ensure
the following:
(1) access to the full range of child care providers,
(2) adequate payment rates, and
(3) affordable copayments.
A Board shall demonstrate in the integrated strategic and operation plan
that it has considered these following three key elements in determining that
its child care program provides equal access for eligible families to child
care services.
The first element of equal access to child care services is choice from
a broad array of categories and types of providers, e.g., the categories of
center-based, group, family, in-home care (relative care), and types of providers
such as for-profit and nonprofit providers, sectarian providers, and relative
providers as already required by 45 CFR §98.30. Federal guidance on what
constitutes equal access as it relates to choice of providers is as follows:
All working parents, regardless of income, need the full range of categories
of care and types of providers from which they may choose their child care
services. This is because child care needs vary considerably according to
the child's age and special needs, the parent's work schedule, provider proximity,
cultural values and expectations. Therefore, the ACF guidance indicates that
the statutory requirement of equal access means that low-income working parents
receiving CCDF-subsidized care must have a full range of the categories and
types of providers from which to choose care that they believe best meets
their needs and those of their children.
The second element of equal access to child care services is adequate payment
rates, based on a local market survey conducted no earlier than two years
prior to the effective date of the current Child Care Plan filed with the
United States Department of Health and Human Services (DHHS). Federal guidance
on what constitutes equal access to child care services as it relates to adequate
payment rates is as follows: The Personal Responsibility and Work Opportunity
Reconciliation Act (PRWORA) eliminated the requirement that, in establishing
payment rates, Boards take into account variations in the cost of providing
care in different categories of care, to different age groups, and to children
with special needs. While eliminating the requirement for different payment
rates for different categories of care, Boards are required to provide a summary
of the facts relied upon by the Board to determine that such rates are sufficient
to ensure equal access.
The federal statute indicates that if families receiving child care subsidies
under the CCDF are to have equal access to local child care, the payment rates
established by a Board should be comparable to those paid by families who
are not eligible for subsidies. In other words, the payment rates should reflect
the child care market. Although the requirement for specified rate categories
has changed, the reality remains that the market reflects differences along
several dimensions.
The focus of PRWORA on work further highlights the need for Boards to establish
payment rates that support work. Child care is often the major factor which
determines whether parents are able to work, and access to a variety of child
care arrangements is necessary both to support today's increasingly diverse
workforce and workplace demands and to ensure that the healthy development
of children is not compromised.
If payments for child care are to be sufficient to provide equal access
to child care services in the open market, then payments must be established
in the context of market conditions. A survey, in that it reflects market
realities, is an essential and critical factor--but not the only factor--that
must be considered when a Board establishes rates. It is because survey findings
are so central to understanding and gauging what level of payment might provide
equal access that the ACF has made the requirement.
The Commission notes that ACF cautions against narrowly interpreting the
survey requirement. For example, as suggested, up-to-the-minute vacancy data
from Child Care Resource and Referral Agencies (CCR&Rs) or licensing bureaus
could be used in conjunction with market rate survey information to make quick
and frequent adjustments to the payments to providers. In setting or adjusting
rates, the Commission reminds Boards of the general principle that Federal
subsidy funds cannot pay more for services than is charged to the general
public for the same service.
At this time, however, a survey is an essential part of the
type-name="italic">facts'' upon which payment rates are established.
The Commission notes that ACF has used the 75th percentile as a reference
point against which a Board can judge if its provider payment rates afford
equal access. It must be presumed that a rate that provides access to at least
three-quarters of all care does, in fact, provide equal access. The ACF has
not, however, required that payments be set at the 75th percentile, hence,
it cannot be characterized as an arbitrary limit.
When establishing rates, the Commission expects that a Board will take
into account survey results showing variations in charges for different categories
of care. But, because there may be other facts that a Board considers, the
Commission believes such a prescriptive requirement would contradict the intent
of the statute.
A payment rate which provides for equal access does not necessarily provide
access to every provider, irrespective of the provider's charge. There is
no statutory basis for preventing a family from choosing a particular provider
whose charges exceed the Board's payment rate. Nor is there an obligation
on the part of the Board to pay an amount that is higher than the rate it
determined is sufficient to provide equal access. In cases such as these,
some States have created a contractual requirement that the provider will
not charge the family the difference between its usual charge and the Board's
rate. By offering the provider speedy, assured payments, the Board has been
able to convince the providers to accept this stipulation. Payments for child
care services for children with disabilities must also provide for equal access.
The third essential element of equal access is that any copayment or fee
paid by the parent is affordable for the family and sliding fee scales should
not be designed in a way that limits parental choice. Federal guidance on
what constitutes equal access as it relates to copayments is as follows: The
Commission emphasizes that Boards have flexibility in establishing their sliding
fee scales. Information regarding the parent fee or copayment provision is
contained in preambles applicable to 40 TAC §§809.45 and 809.46.
The elements must be addressed in the summary of facts submitted in a Board's
integrated strategic and operational plan. Boards are free to include additional
facts they used in determining rates that ensure equal access.
For purposes of this preamble, the term "Agency" refers to the daily operations
of the Texas Workforce Commission under the direction of the executive director,
and the term "Commission" refers to the three-member body of governance composed
of Governor-appointed members.
The amended rule enables Boards to more fully exercise local control by
setting integrated or service-specific provider fee structures for child care
and to establish provider fee policies in a manner as determined by the Board
to best meet the needs of the population being served in the workforce area
and eliminates a state requirement that goes beyond federal requirements.
Randy Townsend, Director of Finance, has determined that for each year
of the first five years the rule will be in effect, the following statements
will apply:
there are no additional estimated costs to the state and to local governments
expected as a result of enforcing or administering the rule;
there are no estimated reductions in costs to the state and to local governments
as a result of enforcing or administering the rule;
there are no estimated losses or increases in revenue to the state or to
local governments as a result of enforcing or administering the rule;
there are no foreseeable implications relating to costs or revenue of the
state or local governments as a result of enforcing or administering the rule;
and
there are anticipated economic costs to persons required to comply with
the rule in that Boards may set a provider fee policy at a higher or lower
amount than currently in place in the Board area. The guidance on setting
provider rates is set forth in the preamble applicable to the Child Care and
Development Fund relating to 45 CFR §98.43.
Mr. Townsend has also determined that there is no anticipated adverse impact
on small businesses as a result of enforcing or administering the rule because
small businesses are not regulated or required to do anything by the rule.
Mark Hughes, Director of Labor Market Information, has determined that
there is no foreseeable negative impact upon employment conditions in this
state as a result of the proposed amendment.
Barbara Cigainero, Director of Workforce and Development, has determined
that for each year of the first five years the rule is in effect, the public
benefit anticipated as a result of enforcing the rule will be to help ensure
access to child care for families in Texas and to encourage local control
by Boards relating to child care.
Comments on the proposal may be submitted to Nancy Hard, Texas Workforce
Commission Building, 101 East 15th Street, Room 130T, Austin, Texas 78778,
(512) 936-0474. Comments may also be submitted via fax to (512) 463-5067 or
e-mailed to: Nancy.Hard@twc.state.tx.us. Comments must be received by the
Agency within thirty days from the date of the publication in the
Texas Register
.
The amendment to the rule is proposed under Texas Labor Code §§301.061
and 302.002, which provide the Texas Workforce Commission with the authority
to adopt, amend, or repeal such rules as it deems necessary for the effective
administration of Agency services and activities.
The rule affects Texas Labor Code, Chapter 302, and Texas Human Resources
Code, Chapters 31 and 44.
§809.231.Provider Reimbursement Rates.
(a)
Based on a market rate survey provided by the
Agency,
[
Commission,
] a Board shall establish the reimbursement
rates for purchased child care to ensure that the rates provide
equal
access to [
at least three fourths of all
] child care services
in the local market and in a manner consistent with state and federal statutes
and regulations governing child care.
(b)
The Board or its contractor shall not reimburse a provider
retroactively for new reimbursement rates.
(c)
A Board or its contractor shall ensure that providers who
are reimbursed for additional staff needed to assist in the care of a child
with disabilities are paid a rate up to 190% of the provider's reimbursement
rate for a child of that same age.
(1)
The higher rate, which may be called an inclusion assistance
rate, is an increased provider reimbursement rate to provide for additional
staff to assist in the care of a child with disabilities, which shall take
into consideration the estimated cost of the additional staff needed by a
child with disabilities.
(2)
The Board shall ensure that a professional, who is familiar
with assessing the needs of children with disabilities, certifies the need
for the inclusion assistance rate.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of
the Secretary of State, on July 14, 2000.
TRD-200004874
J. Randel (Jerry) Hill
General Counsel
Texas Workforce Commission
Earliest possible date of adoption: August 27, 2000
For further information, please call: (512) 463-8812