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Missouri child care providers wait months for payment

For Aaliyah Bailey, a single mother in St. Peters, Missouri’s child care subsidy program wasn’t there when she needed it most.

The first time she applied for the subsidy, which offers a sliding scale payment system for eligible low-income families and foster children, was in December. But she contracted COVID and missed the 10-day window to provide additional paperwork needed for her application.

“So between myself being sick and then also not having the child care support, I ended up leaving my job,” said Bailey, who worked as an integrated health specialist at Compass Health Network.

Bailey’s COVID infection lingered for a month and a half. At the same time, she worked to continue her online master’s program in health care administration, start her own consulting business while applying for jobs and care for her 2-year-old daughter.

When Bailey tried applying again in January, the state employee she spoke with questioned why Bailey would need child care if she’s in an online master’s program that allows her to take classes from home. After that, Bailey said, she never received the necessary paperwork and her calls went unanswered.

“It’s been very stressful,” Bailey said. “Poverty is a full-time job, and that is 100 percent true.”

It was only after reaching out to state lawmakers for help that Bailey received a response days later. She didn’t qualify, the state said, because she was pursuing a master’s degree and the subsidy is available only to those at a bachelor’s level or lower — a point she insists was never made clear in the application process.

“It kind of makes me feel like because I’m struggling and all of that, that my time doesn’t matter,” Bailey said. “And by extension of that, like I don’t matter, or like my daughter doesn’t matter. That’s hard to contend with.”

Bailey’s struggle with Missouri’s child care subsidy program isn’t unique. And it’s not reserved only for parents. Child care providers receive payments from the state for serving low-income families, and months-long delays amid pandemic-depleted enrollment has put many in danger of permanent closure.

Hundreds of emails obtained by The Independent through a records request under Missouri’s Sunshine law show that at one time in late October, the Department of Social Services had a backlog of nearly 5,400 outstanding payment resolution requests to process.

The emails offer a glimpse behind the scenes of a program that has struggled to overhaul its system during a heightened need. And they lay bare the frustration among child care providers and parents, who have been voicing concerns for months about how the state is administering the program.

Child care providers previously said the delays forced them to make difficult budget decisions as they waited for tens of thousands of dollars in reimbursements from the state for care provided months ago. They say the situation has started to improve, but delays persist.

“That’s just the ongoing saga,” said Deidre Anderson, the CEO of United Inner City Services, whose three facilities in the Kansas City area serve a majority of subsidy eligible families.

The backlog

It’s typical for providers who serve eligible low-income families through the subsidy program to receive payments from the state a month after they’ve been offered. But a new reporting system, KinderConnect, was rolled out statewide in March, increasing payment issues just as the pandemic began causing absences to skyrocket.  

The Department of Social Services conducted a survey to assess the pandemic’s impact on jobs, and in the first week of August received responses from more than 4,300 Missourians. Of the 1,230 respondents who said they were unable to work full-time, 16 percent cited child care as the reason.

Many were unable to pay for child care after losing their jobs, while others saw the providers they relied on close their doors.

Emails show DSS working to overhaul a backlog of delayed payments to providers over the course of September into November. 

An Oct. 22 weekly update sent to some of DSS’ most senior officials provides a snapshot into the scope of the backlog.

At the time, there were 5,339 pending payment resolution requests, 276 outstanding COVID subsidy payments, a backlog of 661 emails from providers and 306 voicemails that hadn’t been returned.

Two weeks later in a Nov. 5  update, pending payment resolution requests had decreased to 4,185. Meanwhile, outstanding COVID payments had risen to 320.

In late October, the department offered overtime to staff in the Family Support Division in an attempt to work through the delays. That required training, in addition to scanning paper payment resolution requests into an electronic system to allow staff working overtime to help process them remotely.

The goal of those helping was to dedicate three to four hours out of their workday in order to resolve payment requests for at least five to 10 children each day.

“We appreciate the support and the willingness to learn a new process,” wrote Justin Logan, a cross-function division manager in DSS’ Workforce Development Unit. “This isn’t a long-term process as we should complete the backlog in a few weeks with all the assistance.”

DSS hoped to be able to issue payments within 30 days of receiving the resolution request, with the possibility of cutting that down even shorter, Courtney Stalter, a budget manager for DSS wrote to department leadership in response to an inquiry from House Appropriations in late October.

In the fall, Rebecca Woelfel, a spokeswoman for DSS, said the department hoped to have all payment resolution requests through September completed by Nov. 6. 

Woelfel did not immediately respond to questions Wednesday on whether that goal was met.

‘A super delayed process’

Anderson, the CEO of United Inner City Services, said that there had always been issues with the subsidy system — but that amid the pandemic they have only gotten worse.

Niqui Hill of United Inner City Services in Kansas City, tends to children in her care.

“All the waiting on hold forever, people that can’t answer questions, faxing documents multiple times,” Anderson said. “I mean, it’s just a super delayed process.”

Anderson said she submitted reimbursement requests for a portion of the $10 million in CARES Act funds Gov. Mike Parson released specifically for child care providers in October.

She didn’t receive the roughly $15,000 in emergency relief until last week.

“Emergency implies we need it right now,” Anderson said.

Casey Hanson, the director of outreach and engagement for Kids Win Missouri, a coalition of organizations that advocate for child well-being, said that while some payment resolution delays have improved, many providers are now facing issues being reimbursed for absences due to COVID exposures. Absences are still being submitted and processed as the decision was announced late last year.

“There’s a lengthy delay,” said Toni Jackson, the center director of Cornerstone Center for Early Learning in St. Louis. “And of course there’s not a delay on the bills. Payroll is still there, and you still have to keep the lights on.”

In September, records show that DSS asked child care providers to share examples of issues they’ve experienced amid the pandemic. Some described families struggling with unclear instructions and a lack of info, causing them to have a difficult time navigating the subsidy system and ultimately resulting in financial hardship. 

Those financial difficulties extended to providers, too.

But whether issues were on a provider or parent side, frustration was the throughline.

“My business partner and I haven’t been able to pay ourselves since July,” one provider in Kansas City who was experiencing payment delays wrote to DSS in September.

Others said delays around payments for the subsidy program made them consider dropping out of the program altogether.

“I’m really not sure how much longer that I want to continue taking subsidy,” an owner of a child care center outside of Springfield wrote. “As you can tell with this email, I’m extremely frustrated from the lack of support, lack of answers, and lack of payment.”

Long-term impacts

Amid the pandemic, child care payments through the subsidy program have dropped considerably. 

At its peak in May, $16.2 million of child care payments had been paid through the subsidy program, with nearly 30,900 children participating. Payments dropped from August to September, when the number of children participating fell to 18,874 and payments fell to $7.4 million.

Payments have picked up slightly from those reduced levels. For February 2021, nearly $9.5 million was paid through the subsidy program, serving 20,763 children.

DSS says the drop stems from a decision to return to the pre-pandemic policy of basing payments on attendance instead of enrollment.

Child care providers say enrollment has started to slowly pick back up but remains stubbornly low.

In a February survey of child care providers by Kids Win, nearly 80 percent of the 387 providers who responded had seen a decrease in enrollment since the pandemic began, with 53 percent of providers now less than 60 percent full. Nearly 40 percent had less than one month of operating expenses available.

The top two worries for providers: being able to pay and retain their staff, and keep their doors open.

For some, the delays in subsidy payments made them ponder ending their businesses altogether.

“Honestly, if I did not have a grandchild, I don’t think I would even do child care anymore,” a St. Joseph provider wrote to the department. “I can understand why so many of the licensed home providers do not accept state subsidy.”

But case managers within the department weren’t always sympathetic to the concerns.

One provider described the frustration of not getting paid due to issues marking COVID-related absences in KinderConnect — the system used to track attendance.

Forwarding along the concern to another staff member, Marianne Dawson, a social services manager in the Children’s Division, posed, “At what point are providers held accountable for reading the user manuals for the system?”

Dawson stressed that even though the system was new, if providers had questions they needed to seek the answers.

But some child care providers said the department had failed to reach out proactively before changes were implemented — making them feel they aren’t in a collaborative partnership with the state.

“A lot of the unique challenges that centers in marginalized, disinvested communities experience — those issues were not taken into account,” said Cortaiga Collins, the owner of Good Shepherd Preschool and Infant/Toddler Center in St. Louis, which serves nearly entirely children in the subsidy program, “which makes it more challenging for us to comply with the requirement of using the KinderConnect system.”

Some of advocates and providers’ biggest requests have not been acted on — such as returning to a system of payments based on enrollment, which would essentially pay for the full amount of children covered by the program regardless of attendance. Hanson said the department had acknowledged that issues exist and seemed open to exploring a new payment model.

The state has taken steps to help assist providers, including providing $12 million in funding to help boost rates and offset income loss for some subsidy program providers due to low attendance.

The state’s new Office of Childhood, in the works, is also inspiring hope that solutions are on the horizon. But its full launching is still months away.

A student at a United Inner City Services child care center in the Kansas City area focuses on an art project.

“We are a long way from resolution,” Collins said. “And I still believe that Missouri needs to place a higher priority, and value access to early childhood more.”

Advocates and providers have warned that the pandemic’s long-term impacts may crumble the state’s child care infrastructure, hindering efforts to rebuild the economy.

Surveys by nonprofits have already found hundreds of child care providers have closed their doors amid the pandemic.

Meanwhile administrative issues, delays in payments and a lack of clear communication have had real implications for families such as Bailey’s.

As Bailey waited to see if she qualified for the subsidy program, she returned her daughter to daycare to ensure she had access to early childhood education. Bailey has already seen the amount her daughter has grown by being back.

But now, without the subsidy, Bailey may have to take her daughter out of daycare — bumping her to the end of a long waitlist to rejoin when Bailey does find her next job.

The whole process has made Bailey wary of trying to apply for the subsidy again.

“I think at the end of the day, it’s the state failing us,” Bailey said. “I don’t think it’s an issue that’s necessarily on the shoulders of the providers or on the parents.”

This article by Tessa Weinberg is published by permission of The Missouri Independent.

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