WSR 17-19-112 PROPOSED RULES DEPARTMENT OF EARLY LEARNING [Filed September 20, 2017, 10:24 a.m.] Original Notice. Preproposal statement of inquiry was filed as WSR 17-11-107. Title of Rule and Other Identifying Information: Amending WAC 170-290-0003 Definitions, 170-290-0266 Payment discrepancies—Generally, 170-290-0268 Payment discrepancies—Provider overpayments, 170-290-0271 Payment discrepancies—Consumer overpayments, 170-290-0275 Payment discrepancies—Providers covered under collective bargaining and 170-290-0280 Right to request an administrative hearing; and new WAC 170-290-0277 Provider program violations and suspected fraud, 170-290-0279 Program violation sanctions, and 170-290-3857 Program violations and suspected fraud. Hearing Location(s): On October 25, 2017, at 10:30 a.m., at 1110 Jefferson Street S.E., Room 113, Olympia, WA. Request to participate by telephone by contacting the rules coordinator at rules@del.wa.gov or 360-725-4670 on or before October 20, 1027 [2017]. Date of Intended Adoption: October 27, 2017. Submit Written Comments to: Rules Coordinator, P.O. Box 40970, Olympia, WA 98504-0970, email rules@del.wa.gov, fax 360-725-4925, by October 26, 2017. Assistance for Persons with Disabilities: Contact rules coordinator, phone 360-725-4670, fax 360-725-4925, email rules@del.wa.gov, by October 20, 2017. Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: Proposals: (1) Define fraud and intentional program violations as those terms relate to providers participating in working connections child care and seasonal child care subsidy programs; (2) establish a progressive disqualification process for repeat intentional program violations; (3) clarify that all overpayments must be repaid; and (4) clarify sanctions that may result from intentional program violations. Reasons Supporting Proposal: Proposals comply with SSB 5883 (2017-19 operating budget) directive to define fraud and intentional program violations as they relate to providers participating in working connections child care and seasonal child care subsidy programs and establish a progressive disqualification process for repeat intentional program violations. Proposals also comply with federal requirements to promote program integrity, align agency rules with federal policies and the department of early learning's (DEL) 2016-18 CCDF plan submitted to the United States Administration for Children and Families. Rule is not necessitated by federal law, federal or state court decision. Name of Proponent: DEL, governmental. Name of Agency Personnel Responsible for Drafting: Phi Ly, Subsidy Policy Analyst, DEL State Office, P.O. Box 40970, Olympia, WA 98504, 360-725-3522; Implementation and Enforcement: DEL/DSHS, statewide. A school district fiscal impact statement is not required under RCW 28A.305.135. A cost-benefit analysis is not required under RCW 34.05.328. DEL is not among the agencies listed as required to comply with RCW 34.05.328 (5)[(a)](i). Further, DEL does not voluntarily make that section applicable to the adoption of this rule. This rule proposal, or portions of the proposal, is exempt from requirements of the Regulatory Fairness Act because the proposal: Is exempt under RCW 19.85.025(3) as the rules relate only to internal governmental operations that are not subject to violation by a nongovernment party; and rules adopt, amend, or repeal a procedure, practice, or requirement relating to agency hearings; or a filing or related process requirement for applying to an agency for a license or permit. September 20, 2017 Heather Moss Director
AMENDATORY SECTION (Amending WSR 17-12-013, filed 5/26/17, effective 6/26/17)
WAC 170-290-0003 Definitions.
The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
"Able" means being physically and mentally capable of caring for a child in a responsible manner.
"Authorization" means the transaction created by DSHS which allows the provider the ability to claim payment during a certification period. The transaction may be adjusted based on the family need.
"Available" means being free to provide care when not participating in an approved activity under WAC 170-290-0040, 170-290-0045, 170-290-0050, or 170-290-0055 during the time child care is needed.
"Benefit" means a regular payment made by a government agency to a person qualified to receive it.
"Calendar year" means those dates between and including January 1st and December 31st.
"Capacity" means the maximum number of children the licensee is authorized by the department to have in care at any given time.
"Collective bargaining agreement" or "CBA" means the most recent agreement that has been negotiated and entered into between the exclusive bargaining representative for all licensed and license-exempt family child care providers as defined in chapter 41.56 RCW.
"Consumer" means the person receiving:
(a) WCCC benefits as described in part II of this chapter; or
(b) SCC benefits as described in part III of this chapter.
"Copayment" means the amount of money the consumer is responsible to pay the child care provider toward the cost of child care, whether provided under a voucher or contract, each month.
"Days" means calendar days unless otherwise specified.
"DEL" means the department of early learning.
"DSHS" means the department of social and health services.
"Early achievers" means a program that improves the quality of early learning programs and supports and rewards providers for their participation.
"Eligibility" means that a consumer has met all of the requirements of:
(a) Part II of this chapter to receive WCCC program subsidies; or
(b) Part III of this chapter to receive SCC program subsidies.
"Employment" or "work" means engaging in any legal, income generating activity that is taxable under the United States Tax Code or that would be taxable with or without a treaty between an Indian Nation and the United States. This includes unsubsidized employment, as verified by DSHS, and subsidized employment, such as:
(a) Working in a federal or state paid work study program; or
(b) VISTA volunteers, AmeriCorps, JobCorps, and Washington Service Corps (WSC) if the income is taxed.
"Existing child care provider" means a licensed or certified provider who received a state subsidy payment between July 1, 2015, and June 30, 2016.
"Fraud" means an intentional deception or misrepresentation made by a person with the knowledge that the deception could result in some unauthorized benefits to himself or herself or another person. See RCW 74.04.004.
"Homeless" means homeless as defined by the McKinney-Vento Homeless Assistance Act of 1987.
"In-home/relative provider" or "license-exempt provider," referred to in the collective bargaining agreement as "family, friends and neighbors provider" or "FFN provider," means a provider who meets the requirements in WAC 170-290-0130 through 170-290-0167.
"In loco parentis" means the adult caring for an eligible child in the absence of the biological, adoptive, or step-parents, and who is not a relative, court-ordered guardian, or custodian, and is responsible for exercising day-to-day care and control of the child.
"Intentional" means the likelihood of willfulness or done on purpose.
"New child care provider" means a licensed or certified provider who did not receive a state subsidy payment between July 1, 2015, and June 30, 2016.
"Night shift" means employment for a minimum of six hours between the hours of 8 p.m. and 8 a.m.
"Nonschool age child" means a child who is six years of age or younger and is not enrolled in public or private school.
"Phase out period" means a three-month eligibility period a consumer may be eligible for at reapplication when the consumer's household income is greater than two hundred percent of the federal poverty guidelines (FPG) but less than two hundred twenty percent of the FPG.
"Preschool age child" means a child age thirty months through six years of age who is not attending kindergarten or elementary school.
"Private school" means a private school approved by the state under chapter 28A.195 RCW.
"Program violation" means an act contrary to program rules and regulations and includes failure to adhere to program requirements.
"Sanction" means deterrent action imposed by the department to address a program violation finding.
"SCC" means the seasonal child care program, which is a child care subsidy program described in part III of this chapter that assists eligible families who are seasonally employed in agriculturally related work outside of the consumer's home to pay for licensed or certified child care.
"School age child" means a child who is between five years of age through twelve years of age and who is attending public or private school or is receiving home-based instruction under chapter 28A.200 RCW.
"Seasonally available agricultural related work" means work that is directly related to the cultivation, production, harvesting or processing of fruit trees or crops.
"Self-employment" means engaging in any legal income generating activity that is taxable under the United States Tax Code or that would be taxable with or without a treaty between an Indian Nation and the United States, as verified by Washington state business license, or a tribal, county, or city business or occupation license, as applicable, and a uniform business identification (UBI) number for approved self-employment activities that occur outside of the home. Incorporated businesses are not considered self-employment enterprises.
"Suspected fraud" means evidence supporting a finding of fraud. Suspected fraud can result in a criminal investigation by law enforcement.
"Unintentional" means not done willfully or on purpose.
"Waiting list" means a list of applicants or reapplicants eligible to receive subsidy benefits but funding is not available.
"WCCC" means the working connections child care program, which is a child care subsidy program described in part II of this chapter that assists eligible families in obtaining subsidy for child care.
AMENDATORY SECTION (Amending WSR 16-09-059, filed 4/15/16, effective 5/16/16)
WAC 170-290-0266 Payment discrepancies—Generally.
(1) Payment discrepancies include both underpayments and overpayments.
(2) For ((providers or)) consumers not covered under WAC 170-290-0267 through 170-290-0275, payment discrepancies are subject to chapter 388-410 WAC.
(3) For providers covered under the collective bargaining agreement, all other payment discrepancy issues are covered under WAC 170-290-0275 and 170-290-0277.
(4) For all providers, payment discrepancies resulting from program violations or suspected fraud are covered under WAC 170-290-0277 and 170-290-0279.
AMENDATORY SECTION (Amending WSR 17-12-035, filed 5/31/17, effective 7/1/17)
WAC 170-290-0268 Payment discrepancies—Provider overpayments.
(1) An overpayment occurs when a provider receives payment that is more than the provider is eligible to receive. Provider overpayments are established when that provider:
(a) Bills and receives payment for services not provided;
(b) Bills without attendance records that support their billing;
(c) Bills and receives payment for more than they are eligible to bill;
(d) Provides care in a location other than what was approved at the time of authorization;
(e) With respect to license-exempt in-home/relative providers, commonly known as "family, friends, and neighbor" providers, bills the state for more than six children at one time during the same hours of care; or
(((e))) (f) With respect to licensed or certified providers:
(i) Bills the state for more than the number of children they have in their licensed capacity; or
(ii) Is caring for a WCCC child outside their licensed allowable age range without a DEL-approved exception; or
(((f))) (g) With respect to certified providers caring for children in a state bordering Washington:
(i) Is determined not to be in compliance with their state's licensing regulations; or
(ii) Fails to notify DSHS within ten days of any suspension, revocation, or change to their license.
(2) DEL or DSHS ((may)) will request documentation from a provider when preparing to establish an overpayment. The provider has ((fourteen)) twenty-eight consecutive calendar days from the date of the written request to supply any requested documentation. ((Beginning July 1, 2017, or upon ratification of the 2017-19 collective bargaining agreement with SEIU 925, whichever occurs later, the records must be supplied within twenty-eight consecutive calendar days of the date of a written request from either department.))
(3) ((Providers are)) A provider is required to repay any payments ((that)) which they were not eligible to receive.
(4) ((If an)) Provider overpayments defined in subsection (1) of this section are deemed as program violations as described in WAC 170-290-0277.
(5) A provider is required to repay any overpayment ((was)) made through a departmental error((, the provider is still required to repay that amount)).
AMENDATORY SECTION (Amending WSR 16-19-107, filed 9/21/16, effective 10/22/16)
WAC 170-290-0271 Payment discrepancies—Consumer ((overpayments)).
(1) DSHS establishes overpayments for past or current consumers when the consumer:
(a) Received benefits ((when)) in an amount greater than the consumer was ((not)) eligible to receive;
(b) ((Was)) Is determined eligible at application or reapplication based on the consumer's participation in an approved activity and used benefits ((while never participating)), but did not participate in said activity;
(c) Failed to report changes under the requirements of WAC 170-290-0031 to DSHS ((resulting)) which result in an error in determining eligibility, amount of care authorized, or copayment;
(d) Used a provider ((that was not eligible per)) who did not meet the eligibility requirements under WAC 170-290-0125;
(e) Received benefits for a child who was not eligible per WAC 170-290-0005, 170-290-0015 or 170-290-0020; or
(f) ((Failed to enter their approved activity at the end of the fourteen-day wait period;
(g) Failed to have TANF approved and enter an approved WorkFirst activity; or
(h))) Failed to return, by the sixtieth day, the requested income verification of new employment as provided in WAC 170-290-0012.
(2) DEL or DSHS may request documentation from a consumer when preparing to establish an overpayment. The consumer has fourteen consecutive calendar days to supply any requested documentation.
(3) Consumers are required to repay any benefits paid by DSHS that they were not eligible to receive.
(4) If an overpayment was made through departmental error, the consumer is still required to repay that amount.
(5) If a consumer is not eligible under WAC 170-290-0030 through 170-290-0032 and the provider has billed correctly, the consumer is responsible for the entire overpayment, including any absent days.
AMENDATORY SECTION (Amending WSR 09-22-043, filed 10/28/09, effective 12/1/09)
WAC 170-290-0275 Payment discrepancies—Providers ((covered under collective bargaining)).
(1) This section applies to ((any provider covered under the collective bargaining agreement)) all child care providers.
(2) For in-home/relative and licensed family home child care providers, disputes regarding underpayments ((shall be)) are grievable.
(3) ((Beginning July 1, 2007, there are different time frames for how far back a)) Payment ((discrepancy)) discrepancies may be corrected((. The time frames, as provided in this subsection are based on)) based on time frames for payment. Correction of payment discrepancies depends on the following circumstances:
(a) ((When services were provided;
(b) When the request for the underpayment was made; and
(c) The type of provider: Family home or in-home/relative provider.
(4) Family home and in-home/relative)) Providers must submit a ((claim)) billing invoice for payment ((no later than)) within twelve months ((after)) of the date of service. (("Submitting a claim for payment" means turning the original invoice in to DSHS for services no later than twelve months after the date of service.)) Any invoice submitted more than twelve months from date of service will not be processed.
(b) If the ((claim)) billing invoice for payment is made within the twelve-month period, the time limits for correcting payment errors are:
(((a))) (i) Two years back if the error is on rates paid by age ((and/or)) or region, unless the error is discovered by a federal audit((. This means)), in which case the provider has up to ((two years)) twenty-four months after the date of service to ask for a corrected payment; or
(((b))) (ii) Three years back if the error was for any other reason, including ((those)) an error discovered by a federal audit((. This means)), in which case the provider has up to three years after the date of service to ask for a corrected payment.
PROGRAM VIOLATIONS AND SUSPECTED FRAUD
NEW SECTION
WAC 170-290-0277 Provider program violations and suspected fraud.
Eligible child care providers described in WAC 170-290-0125 must comply with all provider responsibilities listed in WAC 170-290-0034. Failure to comply resulting in a provider overpayment will result in a program violation finding and may cause the agency to impose sanctions.
(1) Administrative errors are payment discrepancies which result from a departmental mistake. Provider overpayments caused by administrative error still require repayment of ineligible amounts. Administrative errors will not result in a finding of a program violation.
(2) An unintentional program violation is an overpayment resulting from a provider's error and not caused with willful knowledge.
(a) An unintentional program violation can include a provider's unfamiliarity with program rules and requirements.
(b) Any unintentional provider error resulting in an overpayment will result in department consultation with the provider.
(c) The department tracks all unintentional program violations in order to identify program improvement areas.
(d) Unintentional program violations require provider repayment of ineligible funds.
(3) An intentional program violation is an overpayment caused by a provider's willful failure to comply with program rules.
(a) Any repeated misrepresentation of invoices or other information submitted to the department or failure to submit documentation upon request is an intentional program violation.
(b) If a provider has been consulted by the department for billing concerns and overpayment but then continues to have overpayment findings, then the department will impose sanctions as listed in WAC 170-290-0279.
(c) Overpayments caused by intentional program violations require provider repayment of ineligible funds.
(d) All intentional program violations are cited by the department, and providers with more than three instances of intentional program violations will be subject to review for program ineligibility.
(i) The department has discretion to impose additional sanctions if a provider has more than three instances of intentional program violations.
(ii) As per WAC 170-290-0280 and 170-290-0285, a provider can dispute the department's finding of program ineligibility.
(4) Suspected fraud is a departmental determination resulting in referral to the office of fraud and accountability (OFA) at the department of social and health services (DSHS).
(a) Program fraud is defined in RCW 74.04.004. Program staff at the department of early learning and DSHS do not criminally investigate fraud. OFA conducts criminal investigations and pursues prosecution of program fraud.
(b) Departmental program staff will identify instances of suspected fraud when facts available to the department indicate the provider willfully violated program rules. This includes repeated instances of misrepresentation.
(c) Program staff will not inform the provider when suspected fraud is referred to OFA.
(d) Providers convicted for program fraud are permanently barred from future participation in the program as a child care provider or consumer.
NEW SECTION
WAC 170-290-0279 Program violation sanctions.
(1) The department will inform and consult child care providers when intentional and unintentional program violations result in provider overpayments.
(2) Sanctions are imposed to ensure providers comply with program rules and to mitigate repeat violations which result in overpayments. Provider sanctions may include:
(a) Submission of corrected information;
(b) Review of child care program rules and publications; or
(c) Any other provider action which conveys the provider's compliance with program rules.
(3) Providers with at least three intentional program violations will be subject to review for child care subsidy program ineligibility. See WAC 170-290-0277 (3)(d).
AMENDATORY SECTION (Amending WSR 16-09-059, filed 4/15/16, effective 5/16/16)
WAC 170-290-0280 Right to request an administrative hearing.
(1) WCCC consumers have a right to request a hearing under chapter 388-02 WAC on any action affecting WCCC benefits.
(2) ((Licensed or certified)) Child care providers ((or in-home/relative providers)) may request hearings under chapter 388-02 WAC only for WCCC overpayments. A provider's burden of proof is a preponderance of the evidence.
(3) To request a hearing, a consumer((, the licensed/certified provider,)) or ((in-home/relative)) provider:
(a) Contacts the DSHS office which sent them the notice; or
(b) Writes to the office of administrative hearings, P.O. Box 42489, Olympia, WA 98504-2489; and
(c) Makes the request for a hearing within:
(i) Ninety days of the date a decision is received for consumers; or
(ii) Twenty-eight days of the date a decision is received for providers.
(4) The office of administrative hearings administrative law judge enters initial or final orders as provided in WAC 388-02-0217. Initial orders may be appealed to a DSHS review judge under chapter 388-02 WAC.
(5) To request a hearing under the seasonal child care program, see WAC 170-290-3860 and 170-290-3865.
NEW SECTION
WAC 170-290-3857 Program violations and suspected fraud.
WAC 170-290-0277 and 170-290-0279 apply to the seasonal child care program.
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