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CCDF Child Care Payments: States with Prospective and Enrollment Based Approaches

The Improving Child Care Access, Affordability, and Stability in the Child Care and Development Fund (CCDF) rule for the Child Care and Development Fund (CCDF) was published in the Federal Register on March 1, 2024, and took effect on April 30, 2024. The rule is designed to strengthen the child care industry by ensuring providers receive reliable and timely payments. It also aims to make it easier for families to access child care assistance by cutting down on delays and unnecessary bureaucracy. These changes support the goal of providing fair and equal access to child care for families who rely on this assistance.

The rule requires states to align CCDF provider payment practices with how private-pay families typically pay for child care, including:

  • Prospective payments – Families who pay out of pocket typically pay before services are provided.
  • Pay by enrollment – Private-paying families are usually charged a set fee, regardless of how many hours their child actually attends.

When submitting their 2025-27 CCDF State Plans, states had to outline how they would meet these new payment requirements. The Administration for Children and Families (ACF), Office of Child Care (OCC) released these Plans on December 19, 2024. States could also request a waiver if they needed more time to comply.

A review of the 2025-27 CCDF State Plans and Appendices found that seven states—Hawaii, Kansas, Maryland, North Dakota, South Carolina, Utah, and Wisconsin—are already meeting both prospective payment and pay-by-enrollment requirements.

This paper highlights the key policies and practices these seven states have adopted to ensure CCDF providers receive payments that are timely, consistent, and aligned with private-pay standards.

Hawaii

Administering Agency: Department of Human Services Benefit, Employment and Support Services Division

Hawaii’s child care subsidy program operates under the Department of Human Services. Authorized families are issued funds at the beginning of the month that are to be used to pay the provider for care.  The funds can be deposited in one of three ways: 

  • Deposit to a state issued, electronic benefits transfer (EBT) card  
  • Direct deposit to the family bank account  
  • Direct deposit to the provider’s bank account, if the provider opts in 

Initial payments are calculated from the date of eligibility to the end of the month, potentially covering a partial month. Monthly payments are recalculated prospectively if changes are reported during the eligibility period.

Families are responsible for paying any costs exceeding their subsidy amount. Only one child care provider per eligible child is authorized per month. If more than one provider is used, the family must decide which provider is paid.

Due to confidentiality laws, providers cannot access family eligibility details without written consent, making families responsible for communicating their subsidy status. If overpayments occur, families are notified and may have their future child care payments adjusted for recovery. Families can challenge payment determinations through a formal appeals process.

Families and providers can access training and support materials online through the department website.

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Administering Agency: Kansas Department for Children and Families, Economic & Employment Services

In Kansas, child care subsidies are managed through the Department for Children and Families (DCF), using the Kansas Benefits card, an electronic benefit transfer (EBT) system. Authorized families are issued funds at the beginning of the month that are to be used to pay the provider for care. Families can only use their EBT cards to pay DCF-approved providers using the POS devices.

Unused funds can carry over to subsequent months. Families are responsible for costs exceeding the subsidy amount. The state does not intervene in payment disputes that are related to family co-pays and overages.

Providers must enroll in the EBT system to receive payments.  Same day notifications are sent to providers if the status of a child’s eligibility changes. Providers are required to keep attendance records for 3 years for monitoring and audit purposes.

Kansas implements robust auditing practices, including data analysis, mail in audits, and on-site visits, to verify attendance and prevent fraud. Families have 33 days to appeal overpayment findings.  Kansas provides a child care provider manual, FAQs, and other online training and support materials to help families and providers navigate the system.

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Administering Agency: Maryland State Department of Education (MSDE)

Maryland’s child care scholarship payments are overseen by the Maryland State Department of Education.  Providers receive advance payments for children enrolled in the child care scholarship program.  Enrollment is determined by the number of children on the provider’s invoice by the last Saturday of the previous month. Providers must submit an invoice through an online portal by the last Saturday of the previous month.  Payments are made on the 1st and 15th of each month.  Providers can choose to be paid through electronic deposit or a paper check.

Families and providers receive advance written notice of benefit reductions or terminations, ensuring continuity of care. The state allows children to be absent for up to 60 days per year without affecting provider reimbursement.

Providers are required to maintain attendance records for five years and 25% of provider invoices are audited every two weeks to verify compliance. Providers are responsible for repaying overpayments.  Providers are afforded an appeals process for payment decisions. Training sessions are offered to help providers comply with subsidy program requirements. Maryland’s online portal enables providers submit invoices and track payments efficiently and allows families to view important information about their case and eligibility status.

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Administering Agency: North Dakota Department of Health and Human Services

North Dakota’s Child Care Assistance Program (CCAP), administered by the Department of Health and Human Services, allows providers to be paid at the start of each month. Payments are made directly to providers via direct deposit.  Paper checks may be issued under special circumstances, such as when garnishments apply. Providers must use the CCAP self-service portal to record attendance for the previous month and to certify the child enrollment roster for the next month. To receive payment by the 1st of the month, providers must certify by the second to last working day of the previous month.  If a child does not attend at least 8 hours in a month, an overpayment may result.

Families receive detailed notices outlining their subsidy contributions and can track the status of their case and provider payments using the CCAP self-service portal. Providers can also track payments through the CCAP self-service portal. Should an overpayment occur, recovery is handled by reducing future payments to the provider or through direct repayment. Providers may use a formal appeal process for disputes about payment decisions.  Online training and resources are available to assist providers with billing and payment processes and using the CCAP self-services portal.

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Administering Agency: Department of Social Services (DSS)

South Carolina’s Department of Social Services (DSS) manages child care subsidy payments and went live with the new payment process in January 2025.  In order to be paid directly and in advance of services, providers must complete a service voucher log (SVL) and identify those children that are enrolled and expected to attend each week during the next payment period.  Providers may fill out the SVL through an online portal or mail in a paper copy. 

Providers are required to use the SVL to report any children who have not attended for 3 consecutive weeks.  Providers must also use the SVL to report any previous month instances where a child did not attend the full month as expected. These instances may be subject to recoupment of payment. 

Providers are subject to internal audits to verify enrollment and payments and are required to keep attendance records onsite for each child. To prepare for the new payment process, DSS conducted provider surveys to better understand their needs and preferences.  Additionally, DSS offered webinars and office hours to facilitate a smooth transition.  

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Administering Agency: Utah Department of Workforce Services (DWS) 

Utah’s Department of Workforce Services (DWS) manages child care subsidy payments. Providers are issued direct deposit payment for all enrolled, eligible children at the beginning of each month.  Paper checks may be issued in some circumstances.  For children who enroll in the middle of the month, payment is issued the same day that the child was authorized.  

Licensed providers use the Child Care Provider Portal (CCPP) to certify enrollment and attendance information prior to the end of each month. Providers must maintain attendance records for three years for future audit purposes. Providers must report significant changes, such as a child attending fewer than eight hours in the first month of care. Providers must report these changes within 10 days: 

  • A child attended less than eight hours in the first month of subsidy and is not expected to return.
  • A child attended less than eight hours in the first month the subsidy was paid, but attended or is expected to attend at least eight hours the next month.
  • A child did not attend eight hours in the current month.
  • A child is not expected to attend eight hours in the next month.
  • A provider ended care for a child (termination reason must also be reported).
  • A provider charged less than the full subsidy amount for a child’s care.
  • A child returned after previously reporting that they stopped attending.

If overpayments occur, the state notifies providers and offers repayment options, including withholding future payments. Providers have 30 days to appeal an overpayment finding. 

Online training resources for providers are offered in the CCPP to assist with billing and payment processes, and to understand attendance and certification requirements. Additionally, a helpline is available to support providers with any questions or concerns.

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Administering Agency: Wisconsin Department of Children and Families (DCF) 

The Wisconsin Department of Children and Families (DCF) manages child care subsidy payments.  Eligible parents are issued an electronic benefit transfer (EBT) card and funds are loaded onto the card at the beginning of each month. Funds must be used within 90 days, or they will expire.  An Administrative Rule prohibits providers from possessing EBT cards and a parent’s subsidy information. Additionally, providers and parents are required to sign written agreements specifying payment terms, including costs, schedules, and dispute procedures.  

Providers must follow the payment dispute resolution process outlined in the written payment agreement with parents. If a provider disagrees with a payment decision, they may file an appeal with DCF. Wisconsin offers online training and resources to help providers navigate the subsidy system requirements, track and manage payments and ensure transparency. 

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Summary

Each of these states has adopted payment policies that prioritize predictability and stability for providers while aligning with private-pay market practices. By ensuring payments are based on enrollment, streamlining processes through online portals, maintaining rigorous accountability measures, and providing robust training resources these states help create a more sustainable child care subsidy system for families and providers alike. 

Thank you to the following state policy makers for taking the time to review and finalize this Informational Brief!

  • Hawaii – Stacie Tonouchi and Loreen Okamura
  • Kansas – Nichelle Adams
  • Maryland – Keisha Maxwell, Tara Phillips, and Sarah Neville-Morgan
  • North Dakota – Erin Kern
  • South Carolina – Michele Bowers and Christi Jeffcoat
  • Utah – Heather Thomas
  • Wisconsin – Priya Bhatia

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