The Child and Adult Care Food Program

1. Serious Deficient (FDCH) What does it all mean? The Child and Adult Care Food Program playing a vital and integral role in improving the overall quality of care and daily nutritional health of participants

2. SERIOUS DEFICIENCY • Serious Deficient means the status of an institution or a day care home that has been determined to be non-compliant in one or more aspects of its Program operation. • It is NOT THE END OF WORLD!! • It is the first step in successfully addressing the non-compliance, ensuring that Program uniformity and Program integrity is being met.

3. The Process: State, Sponsor & Provider • Proper implementation of the serious deficiency process includes the development of a Corrective Action Plan (CAP). • The CAP must demonstrate that the deficiencies will be fully and permanently corrected. • Sponsor can terminate home agreement for cause if sponsor determined home committed one or more SD • During this process, both sponsor & provider will continue to participate in the Program and receive technical assistance. • Sponsor and provider must work hard to achieve compliance • SA will work with sponsor—sponsor will work with provider

4. How does it begin?

5. Next Steps….

6. The SD Notification…….

7. The SD Notification…….

8. SA….USDA…..Sponsor….CAP…..

9. Acceptable CAP….Sponsor & Provider • Each party must submit CAP within the allotted time frame • Remember: sponsor has no more than 90-calendar days from receipt of SD notification to finalize corrections BUT provider has only 30-calendar days to correct deficiencies. • CAP must include supporting documentation and describe the: • What • Who • When • Where • How

10. Acceptable CAP….Sponsor & Provider • CAP addresses each deficiency ensuring full and permanent correction • SA/Sponsor send letter that: • CAP has been submitted timely • CAP fully and permanently detailed how compliances will be met • Sponsor/Provider is in a “temporarily deferred” status • Anytime in future, SA/Sponsor can visit to ensure actions are being taken to correct deficiencies • HOWEVER, if same deficiencies are identified during follow-up, SA/Sponsor can move to immediately Propose to Terminate and Disqualify—this action is appealable

11. Unacceptable CAP….Sponsor & Provider • Not submitting a CAP • Not submitting a timely CAP • Not responding to each deficiency identifying actions to fully and permanently correct • SA/Sponsor must move to send Notice to Propose to Terminate and Disqualify— this action can be appealed

12. Notice of Proposed Termination and Disqualification • SA/Sponsor will send detailed letter informing respective parties that: • CAP was submitted timely but inadequate/ unacceptable • Failed to ensure full and permanent correction of each deficiencies • Right to appeal this action—SA/sponsor attach hearing procedures • Written notification must be received by SA within 15-calendar days of receipt of proposed actions--- not later than close of business (5 pm) on the deadline date • Same procedures for providers must be applied uniformly except receipt time. • SA sends copy to USDA—Sponsor sends copy to SA

13. Suspension of FDCH • A Sponsor must immediately suspend the providers CACFP participation if: • Home has been cited for health or safety violations by a State licensing official • Sponsor determines there is an imminent threat to health and safety of any participants • Home has/is engaged in activities that threaten public health or safety and licensing officials cannot conduct an immediate visit • Sponsor must issue a notice of suspension, serious deficiency and propose to terminate the day care home’s agreement

14. Suspension Notice to FDCH • The notice must: • Specify the serious deficiencies found and home’s opportunity to appeal proposed termination • State that participation (including all Program payments) will remain suspended until the administrative review is conducted • Inform home if administrative review official overturns suspension, home may claim for eligible meals during the suspension • Termination will result in placement on NDL • Voluntarily termination after receipt of notice will be terminated for cause and disqualified

15. Sponsor’s Suspension Due to False/Fraudulent Claims • Sponsor knowingly submits false or fraudulent claims • SA: • issues notice to propose to suspend participation and payment • Identify effective date of suspension • Duration of suspension—up to 120 days

16. False/Fraudulent Claims • Inform sponsor---action can be appealed • sponsor must submit written appeal request • Notify USDA • Must ensure that sponsored facilities continue to receive reimbursement for eligible meals served during the suspension period. • Must pay any valid unpaid claims for eligible meals served AND allowable administrative costs incurred during the suspension

17. Notice of “Final” Termination and Disqualification • Sponsor/provider didn’t appeal Notice of Proposed Termination and Disqualification OR Suspension • Sponsor/provider appealed Notice of Proposed Termination and Disqualification OR Suspension • Hearing Official upheld SA/sponsor decision • SA/sponsor must immediately notify respective parties of decision • Effective date of termination and disqualification • If sponsor/provider owes debt, must be repaid • Sponsor/provider/responsible parties are placed on (NDL) National Disqualifying List

18. National Disqualifying List Question: How long does the sponsor/provider and the responsible individual remain on this list? • 3 years • 5 years • 7 years Answer: 7 years If sponsor/provider/RPI owes a debt, remain on list until debt is paid in full (interest in accrued); Less than 7 years, if sponsor request re-application, only after acceptable CAP is submitted; USDA and SA must both concur; home must submit request to SA

19. What happens if Sponsor/Provider’s Appeal is Upheld? • Hearing Official renders decision upholding the sponsor/provider • SA/sponsor must immediately notify the respective parties---the proposed termination and disqualification is “rescinded” • No further action is necessary---sponsor/provider is in good standings again • Suspension is overturned • SA must notify sponsor and disburse all suspended administrative payments; same rule applies for home.

20. RECAP

21. What Actions Can Be Appealed? • Under the Serious Deficiency Process: • Suspension to participate due to submission of false/fraudulent claims • Suspension of payment due to submission of false/fraudulent claims • Adverse fiscal sanctions resulting from administrative review/technical assistance/follow-up visit • Proposed to Terminate and Disqualify

22. What Actions CANNOT Be Appealed? Under the serious deficiency process: • Declared Serious Deficient • Determination that CAP is unacceptable • Final Termination and Disqualification

23. Main Objective • Stay in Program compliance • When in doubt of Program operations, STAY in contact with your Specialist; sponsor stays in touch with provider • SA/sponsor here to assist and provide technical assistance • If declared SD, submit timely CAP that addresses all deficiencies ensuring internal controls to fully and permanently correct problem areas • It’s Still Not the End of the World? • If you appeal adverse actions—make sure your case is strong-bring any and all documentations

24. Summary • WIN Appeal • You’re in good standings, adverse action is rescinded

25. Summary • LOSE Appeal • SA/sponsor must complete serious deficiency process • Proposed to terminate and disqualify • Final termination and disqualification • Placed on National Disqualifying List

26. Summary • SA/sponsor: • wants respective parties to remain in good standings • wants respective parties to maintain appropriate records • wants to help in any way possible to stay in compliance • doesn’t want any sponsor/provider to lose money and to go through the Serious Deficient process