I am opening my family daycare in January..yay, and I was wondering what the pros and cons of accepting clients who receive subsidy through the state. Is it worth it for me to look into accepting it or not? I am all for helping people or for people getting help if they need it and I'm not intending to sound any other way, I just am wondering what experiences you have had.
Thanks

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One FCCP I used to work for and at one point she did accept the substidized program but one of the families on it (5 kids- cousins: 2 from one sister and 3 from the other) and they always turned in their paper work late so she was always paid late and sometimes they didn't even fill out the forms so she didn't get paid, she let it go on for so long becuase one of the girls were in her preschool the rest have graduated from her preschool and she was really close to all of the kids but eventually she just had to kick them out because the parent's weren't doing their part (when they didn't even have to pay out of pocket!) and after that she is very causious of doing substidized care. But she has also been in business for so long that she get's families from word of mouth- she doesn't even advertise.

I know some other providers around her that do a substidized/referral/accreditation program thing where they need to take certain classes/ certain amount of units in child development/ECE to be elligable to participate (the population is low here and their are a lot of home daycares and centers so everyone who is serious tries whatever it takes to get more kids).

I haven't started my business yet but plan to within a year after I get my AA (about one more year), my only advise is what I plan to do. At first I would accept them but put in the contract under payments that substidized families that do not turn in their paperwork on time after the second offense will either have to pay late payment fees out of pocket (if program doesn't because most do not) or be terminated. In my FCC administration class the teacher (she did FCC before she became the college daycare center director and college instuctor) gave everyone a tip: charge a full time/part time weekly rates rather than daily rates because if the child is absent some programs won't pay for that day even if it is your contract and most likely the parents can't (or just wont) pay it. also let it be known that some programs require them to pay a percentage and that they must keep up to date on their part of payments as well as turning in the paper work on time and any failure to do so will result in termination.

Also make it clear in your contract that some programs won't pay for extra things (like "date nights", field trips, registration fees, late fees, etc.) and some programs only give parents about a 1/2 hour cusion for pick up/drop off from their work hours to cover contract hours so that does NOT mean that they can go shopping when they get off work early and then pick up their kid a little later just because you will still be open or that is their hours- it only pays when they are working. In this case let them know that they are responsible for any fees that daycare assistance program will not pay for- and that they are responsible for any fees that remain on their balance after departure from your child care program (if they refuse you can take them to small claims court- they signed a legal business contract).

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In all honesty we have only had problems with state subsidy

In our state the reimbursement rate is only 40% of our private pay rate, and it is illegal to Have the client pay the difference. Plus, there is no pay for sick or absent days.

I'm going to be very politically incorrect, and say that most of the families we had that were on subsidy were not ideal clientele. Lots of drama, inconsistency, missed days, and flakey behavior.

If you do decide to take subsidy, my only advice would be to make it clear that you are accepting them as full-time only, and make sure that they are on attendance the minimum number of hours they need for you to be paid for full-time.

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I'm all for it. In my state the first payment comes about a month later, but is well worth it. (It's back paid to the voucher date in my state.) It's direct deposited into my account twice a month. To me, it's less headaches then reminding parents to pay EVERY week. I have kids who would probably not get healthy balanced meals otherwise. I am also on USDA's Child and Adult Care Food Program which subsidizes the cost of my meals. Sure both programs take some paperwork & hoops to jump, but most things do.

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If you choose to accept it, I wouldn't allow subsidy to consume more than 25% of your total income.

Most families that receive subsidy (in my state) tend to be unreliable and irresponsible. They lose the subsidy and you as the provider don't get your required notice or they have accept irregular jobs that have odd hours or bounce from low-end job to low-end job.

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First, Check on your states rules regarding it. If it's illegal for you to charge the remaining balance then I wouldn't! Find out what days they pay for and what days they don't....

Second, in MD you DO charge the remanding balance. Lets say the state will only pay for $75 a week and my fee is $185, well then they owe $110.

I will allow one or two clients with subsidy. However, they must pay until their vouchers kick in. Here in MD it can take a month or more!!

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I take them since it allows me to have my niece. It doesn't pay well but I dint mind and we have to be licensed to watch more than four kids here anyway

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It really depends on how your state's subsidy program works. In my state there are several rules I have before accepting subsidy payments

• Never provide services without the actual paperwork in hand state EXACTLY when services will begin being covered and how much will be coveres.
  
• Never allow the family to go over their allotted hours without pre-payment
  
• Never take the clients word about any of it. Always require paperwork or a direct approval from the worker
  
• Require the family to pay their co-pay BEFORE services are provided for that service period.
  
• I allow

no more than 2 children to be on subsidy at any one time.

I would check with your state and see what the rules are for the program. Check out what the provider responsibilities are and what the client responsibilities are as well. Our state handbook just for subsidy is over 50 pages long.

There are some pros to taking subsidy but there are also some risks as well.

I USED to prefer it but due to some of the cons, I would rather not. But in order to be rated 4 or 5 stars in our state we have to at least accept one family using subsidies for payments

Here is a link to TONS of respurces that pretty much explain and walk you through the entire subsidy program (VERY impressed with the Michigan site...) Hopefully this helps you find your answers http://michigan.gov/dhs/0,4562,7-124...149---,00.html

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Yes, like everyone said, find out everything you can. I am what they call a "neighbor/relative provider" bc I am unlicensed and only accept 3 kids (legal limit for unlicensed). They will only pay $13 a day for people like me and parents are required to pay the balance of my charges plus a copay that the state doesn't cover... Most people that are qualified for subsidy can't afford that. I took ONE family and since they came from a large center, she didn't know the pay difference so when the time came, she couldn't pay! The state allowed me to start watching him while I was going through the paperwork and I didnt find out until I had been watching the child for 3 weeks! Needless to say, I told her what she owed and she flipped! I had to term her bc she said not only could she not pay the balance, but there was no way she could pay future payments. Here, a parent may not continue care (according to subsidy) if they fall behind. I had the case worker calling me asking me to accept a percentage of the balance to let her off the hook, I finally agreed (better than nothing!) and she never showed to pay me! I waited for 3 different times that she agreed to come! I called the worker and said I wanted the full amount now and she can just deal. she claimed I wasn't home! Lies! Yea, so find out all you can FIRST!

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I love my subsidy fam.. i know some can be problems, but they are a young couple and they are VERY much on top of things for their son, diapers, communicating with me, paying their copays on time etc.. ALOT better than some of my paying customers who sometimes feel they can push the rules i guess cuz they are paying??? i dunno. I was actually a subsidy participant while i went to college, my future husband and i were just starting and used the assistance as long as we could WHICH REALLY helped.. I was a young mother so im sure i wasnt as great as a seasoned mom, but we took care of our business.. and this fam does too..
I agree you do have to stay in the know when it comes to their case because of their renewals and things like that. but my main complaint is getting paid after services.. Ive only been in business a few months so I guess i will get used to it.. but i keep thinking that i could have a cash paying customer paying now while im waiting on the State LOL.. HOWEVER.. i dont have any calls right now soooooo LOL
that alone is why i will stay on their list.. If ever i have trouble filling a spot, at least i know i dont have to turn down someone because i dont take subsidies.

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I don't think anyone was impying that families who use subsidy are bad or undesireable as clients...I think the OP was looking for opinions about the subsidy payments and the process itself.

I have never declined or accepted a family based on whether they are on subsidy and have had both fantastic and horrible clients who were on subsidy as well as fantastic and horrible cash paying clients as well

Subsidy is definitely NOT something that defines a good or bad family in my opinion.

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i wasnt implying that anyone was.. there is a comment here that said in their experience that the families were a certain type of way.. and i am only giving a different perspective from my own experience.. I wasnt put off by the comment and didnt mean to look defensive at all.. just discussing..
i did understand the OP's question however and thats why I explained my issues with the processing and payments and my reasoning to continue to accept them in the second paragraph.

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I will only allow one family at a time being that I'm only licensed for 6 kids. I haven't had any problems so far, to avoid late payments I send in my dcp's paperwork in with mine.

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It's all good...

I missed the comment from pp about families on subsidy. I didnt realize you were replying to them.

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I will add, that we have had 2/3 wonderful daycare families who were on subsidy. But as a whole, much more no-shows or families who just drop off the planet and never call, or who come inconsistently (and in Oklahoma those days arent paid for), and you aren't allowed to charge the family for the difference. I think a lot of the problems we have had with subsidy families comes from the way OK state subsidy works.

From Reading Everyone else's responses here, I can see that our state subsidy works very differently from most. We are not allowed to charge the family the difference between subsidy reimbursement and our actual rates - so the family pays very little if anything toward their childcare and are typically a lot less invested and have very little to lose by pulling no-shows/no-calls etc.

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..
i totally understand..thats why i didnt reply specifically to you because i didnt want you to feel i was scolding you, just putting info out in the atmosphere .. im sure the longer im in this business, i will have a lot more different kind of experiences myself LOL but I really like getting paid up front alot better so i dunno how many more i will have

oh and its like that where i live too.. we are not allowed to charge the difference between our tuition and what the State pays..
some parents do have copays though because they are only eligible for a certain level of assistance with their income.. so like for her age child they only allow me to charge $90 for subsidy families, even if my tuition is $100.. but they will only pay $80 of that amount for her income level, so she has a copay of $10/ week.. and im not allowed to terminate her untill after she is 5 days behind on her copays..

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Of course the downside is you can do nothing if they call and decide they want to keep their child home with them that day cause they are do lazy to go get a full time job and are inconsiderate that their child is your income source! Like my niece's mommy today.

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I too had to be on assistance when my daughter was little because her dad chose alcohol over us and didn't pay anything, but I was one to pay what I needed to pay..in MI parents have to pay the difference. On another hand, I just came out of working for a center for 14 years and where I am at there are a lot of people who are on assistance and do not pay what they are supposed to and some can get very angry because the state won't pay all of it. I was just wondering if it was different for homes. Good point though, why not be on the list just in case! Thanks!

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Well she didnt have gas for her car today to drive her to daycare.... guess ill accept that. Since she did help me with the twins while i went to the dentist.

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