Serious Deficiency Process and Corrective Action Plan for Day Care Home Sponsors

The Child and Adult Care Food Program (CACFP) regulations define seriously deficient as the status of a day care home (DCH) provider that has been determined to be noncompliant in one or more aspects of its operation of the program. The serious deficiency process offers a way for sponsoring organizations to take required action while allowing DCH providers to correct serious program problems and ensuring due process. The serious deficiency process protects program integrity by terminating DCH providers who are unable or unwilling to correct serious programmatic problems and disqualifying those who are noncompliant in program requirements.

The serious deficiency process includes six steps that begin when the sponsoring organizations identifies a serious deficiency.

1. Identify the serious deficiency(ies)
2. Issue a notice of serious deficiency
3. Receive and review the DCH provider’s corrective action plan (CAP)
4. Issue a notice of temporary deferral of the serious deficiency if the CAP is approved, or issue a notice of proposed termination and disqualification, including appeal procedures, if the CAP does not fully and completely correct the identified serious deficiencies (or if no CAP is received)
5. Provide an appeal hearing, if requested, of the proposed termination and disqualification
6. Issue a notice of final termination and disqualification if the appeal is denied or if the allotted time for the appeal request passes without receiving an acceptable CAP, and submit the DCH provider’s information to the CDSS to forward to the USDA to be placed on the National Disqualified List (NDL); or issue a notice of temporary deferral if the appeal is upheld.

The purpose of this page is to review the steps of the serious deficiency process for DCH providers in detail, which can be accessed directly from choosing one of the links below:

• Identifying and Determining Serious Deficiencies for DCH Providers
• Valid Operating License and Serious Deficiencies
• Corrective Action Plan for DCH Providers
• Proposed Termination and Proposed Disqualification
• Administrative Review (Appeal)
• Termination and Disqualification
• Terminating a Provider in CNIPS
• Removal from the National Disqualified List
• Questions and Answers from USDA

Identifying and Determining Serious Deficiencies for DCH Providers

A DCH provider may be declared seriously deficient when the sponsoring organization finds program violations or issues of noncompliance with CACFP requirements. Serious deficiencies that are not permanently corrected will result in the proposed termination and disqualification of the DCH provider. However, if the serious deficiencies involve an imminent threat to the health and safety of the participants, the sponsoring organization must immediately propose to terminate and disqualify the provider.

Sponsoring organizations should become familiar with the serious deficiencies. The following are noncompliance issues that rise to the level of a serious deficiency:

1. Submission of false information of the provider’s application
   
2. Submission of false claims for reimbursement
3. Simultaneous participation under more than one sponsor
4. Noncompliance with the CACFP meal pattern
5. Failure to keep the required records
6. Conduct or conditions that threaten the health or safety of children in care, or the public health and safety
7. A determination that the provider has been convicted of any activity that occurred during the past seven years and that indicated a lack of business integrity
8. Failure to participate in training
9. Any other circumstance related to non-performance under the sponsoring organization’s DCH provider agreement

A sponsoring organization has the authority to determine when a violation rises to the level of a serious deficiency. Sponsoring organizations should consider the following questions in deciding if the violation should be a serious deficiency:

• The severity of the problem. Is the noncompliance on a minor or substantial scale? Are the violations a recurring problem? Are the problems systematic?
• The degree of provider responsibility. Can the sponsoring organization determine whether the violations were inadvertent errors of an otherwise responsible DCH provider? Is there evidence of negligence or conscious indifference to regulatory requirements? Is there evidence of deception or intentional noncompliance?
• The provider’s history of participation. Are problems of noncompliance frequently recurring?
• The nature of the requirements that relate to the problem. Are the violations a clear violation of the program requirements? Has the provider failed to implement new CACFP policies appropriately?
• The degree to which the problem impacts program integrity. Are the violations undermining the intent or purpose of the CACFP?

Once the sponsoring organization has determined that a serious deficiency has occurred, it must begin the serious deficiency process. The notice of serious deficiency must be written as clearly as possible, and must include:

1. The serious deficiencies, including the corresponding citations from the CACFP regulations
   
2. The actions to be taken by the DCH provider to correct all the serious deficiencies
3. The allotted time to correct the serious deficiencies, not to exceed 30 days
4. That the serious deficiency determination is not subject to administrative review (appeal)
5. That failure to fully and permanently correct the serious deficiencies within the allotted time period will result in the proposed termination and proposed disqualification of the DCH provider
6. That the DCH provider’s voluntary termination of its agreement after being notified of a serious deficiency determination will result in the provider’s formal termination by the sponsoring organization, and placement of the provider on the NDL

At the same time a notice is issued, the sponsoring organization must also provide a copy of the notice to the CDSS.

A Failure to Have a Valid Operating License Is Not a Serious Deficiency

Federal regulations offer DCH providers flexibility to demonstrate compliance with applicable state or local childcare standards, or CACFP childcare standards if the licensing option is not available. DCH providers may participate in the CACFP if they are licensed, demonstrate compliance with applicable state or local childcare standards, or demonstrate compliance with CACFP childcare standards to the state agency or to federal, state, or local authorities if licensing is not available.

The California Department of Social Services’ (CDSS) agreement between a sponsoring organization and a DCH provider includes language to make sure the providers comply with state and local authorities.

The provider must agree to adhere to one or more of the following:

• CDSS licensing regulations
• Trustline Registry established requirements
• Military license regulations
• Tribal authority policies




However, if a new DCH provider does not comply with the language in the agreement, or an existing DCH provider fails to renew a license, it becomes an issue of eligibility and not a serious deficiency. Therefore, the DCH is not eligible to participate in the CACFP.


If the DCH can demonstrate compliance with applicable state or local child care standards, CACFP child care standards, or state or local established health and safety standards, then the DCH provider may be considered for participation in the CACFP and approved for participation provided that all CACFP requirements are met.

Unless exempt under California Health and Safety Code, Section 1596.792, Section 1596.792, all family DCHs must obtain a license to operate in accordance with California Health and Safety Code Chapter 3.6, Section 1597.54 Chapter 3.6, Section 1597.54.

Corrective Action Plan for DCH Providers

In response to a notice of serious deficiency, a DCH provider must submit a CAP within 30 days (or less) that details the process they implemented to ensure that the serious deficiencies have been fully and permanently corrected. The sponsoring organization must evaluate the CAP to determine whether it is acceptable. An acceptable CAP must include:

1. Name of the provider(s) associated with the serious deficiencies
   
2. Address of the DCH
3. Provider(s) date of birth
4. Details of the serious deficiencies
   • What are the serious deficiencies and the procedures that were implemented to address the serious deficiencies?
   • Who addressed the serious deficiencies? List DCH personnel responsible for each task
   • When was the procedure for addressing the serious deficiencies implemented? Provide a timeline for implementing the procedure (if necessary).
   • Where is the CAP documentation retained?
   • How will the provider ensure that the CAP corrects the deficiency and continues to be implemented?

A successful CAP has enough detail explaining what will be done, how it will be done, when it will be done, and by whom it will be done. The CAP also describes where the changes will be housed, for example, maintained in the DCH provider’s administrative procedures manual. Access the following link for an example of an acceptable CAP provided by the USDA from DCH Provider Example CAP Letter.

DCH providers must include additional supporting documentation with the CAP which may include copies of income eligibility forms, enrollment forms, enrollment rosters, menus, Child Nutrition labels or manufacturers’ product analysis sheets or recipes, attendance records, meal count forms, itemized food receipts, etc.

If the provider submits corrective action that corrects the serious deficiency to the sponsoring organization’s satisfaction, the serious deficiency determination will be temporarily deferred, and the sponsoring organization will send the provider a notice of temporary deferral. A copy of the notice must also be sent to the CDSS.

Proposed Termination and Proposed Disqualification

If a DCH provider fails to implement timely corrective action to fully and permanently correct cited serious deficiencies, the sponsoring organization must issue a notice proposing to terminate the DCH provider’s agreement, and proposing to disqualify the DCH provider from future CACFP participation by placing their name and information on the NDL. The notice must specify:

1. That the sponsoring organization is proposing to terminate the DCH provider’s agreement and to disqualify the DCH provider from the CACFP
   
2. That the DCH provider may appeal this action
3. That the DCH may continue to participate and receive CACFP reimbursement for eligible meals served until a requested appeal has concluded
4. That the termination of a DCH provider’s agreement will result in the DCH provider’s termination for cause and the DCH provider’s disqualification
5. That if the DCH provider voluntarily terminates its agreement with the sponsoring organization after receiving the notice of proposed termination and disqualification, it will still be placed on the NDL.

The sponsoring organization must provide a copy of the notice to the CDSS.

Administrative Review (Appeal)

If the provider submits documentation to the sponsoring organization prior to, or with a request for appeal, the sponsoring organization may consider the documentation. If the sponsoring organization determines that the documentation permanently corrects the serious deficiency findings, the sponsoring organization may withdraw the proposed termination and proposed disqualification actions and temporarily defer the serious deficiency determination.

If the request for appeal has been forwarded to the sponsoring organization’s hearing officer, and the provider submits documentation to the hearing officer that the officer identifies as acceptable, the hearing officer may refer the documentation back to the sponsoring organization for their review and approval. If the sponsoring organization accepts the provider’s documentation, they must notify the hearing officer in writing that they accept the provider’s documentation. The hearing officer will then issue a letter to the sponsoring organization and provider that dismisses the appeal.

If the hearing officer determines that the sponsoring organization’s findings are unsubstantiated or, without input from the sponsoring organization, determines that the provider’s documentation permanently corrects the serious deficiency, they may make a determination to overturn the sponsoring organization’s proposed actions. If the hearing officer determines that the sponsoring organization has properly implemented the serious deficiency process and the provider has not provided adequate proof to overturn the proposed actions, the hearing officer must uphold the proposed actions.

The hearing officer must be independent and impartial, and although they may be an employee of the State agency or an employee or board member of the sponsoring organization, they must not have been involved in the action that is the subject of the administrative review, or have a direct personal or financial interest in the outcome of the administrative review.

The hearing officer’s decision must be based on the information provided by the sponsoring organization, the DCH provider, and any relatable federal and state laws, regulations, policies, and procedures governing the CACFP.

However, the authority of the hearing officer does not include interpreting the intent or expanding the meaning of federal regulations. If questions or concerns are raised regarding the intent or interpretation of the federal regulations during an administrative review hearing, they should consult with the USDA FNS legal counsel to ensure an interpretation of federal regulation is appropriately applied to the case. The determination made by the hearing officer is final.

Termination and Disqualification

When the time for requesting an appeal expires, or when the appeal official upholds the sponsoring organization’s proposed termination and disqualification, the sponsoring organization must immediately:

1. Notify the DCH provider that its agreement has been terminated and that the DCH provider has been disqualified
   
2. Provide a copy of the notice, with the provider’s address, date of birth, and the full amount of any determined debt to the CDSS

The CDSS will send the termination notice and DCH provider information to the USDA FNS for placement on the NDL.

If the DCH provider corrects the serious deficiencies and pays in full any debts owed, the DCH provider may request to be removed from the NDL. See the Removal from the NDL section of this page for more information.

Terminating a Provider in the CNIPS

The sponsoring organization must access the Child Nutrition Information and Payment System (CNIPS) and terminate the provider on the date the sponsoring organization: (1) determines a provider is terminated; or (2) receives the hearing officer’s decision to uphold the sponsoring organization’s proposed termination action.

Sponsoring organizations must complete the following steps in the CNIPS to ensure that the provider is immediately identified as terminated and disqualified, which prevents the provider from joining another sponsor during any lapse of time before the sponsoring organization notifies the CDSS of the termination. Follow these steps to terminate the provider in the CNIPS:

1. Sign into the CNIPS
   1. Select Applications
   2. Select Application Packet—DCH Sponsor
   3. Select Provider Application(s)
2. Select Provider
   1. Select Details
   2. Drop Provider
      1. In the empty box, enter cancellation date (this date is either the day after the appeal deadline or in the case of an appeal, the date the hearing officer issues the decision)
      2. Enter cancellation code (select Provider Terminated)
      3. Enter cancellation reason (SD)
   3. Select Save

Removal from the National Disqualified List

CACFP regulations require that a disqualified DCH provider remain on the NDL for seven years or until any outstanding debt is fully repaid, whichever is longer. When both the seven years has passed, and any debt, if applicable, is repaid, the DCH provider will be automatically removed from the NDL and may again apply to participate in the CACFP.

DCH providers currently on the NDL who have completed acceptable corrective action and paid off any debts may submit a request for early removal from the NDL. See below for instructions regarding three different situations where a provider is requesting removal from the NDL.

1. Terminating sponsoring organization requesting NDL removal for a provider that they were responsible for terminating and disqualifying:
   1. The disqualified provider must submit a written request to be removed from the NDL to the sponsoring organization that terminated and disqualified the provider. The request must include a CAP detailing how and by when the provider will ensure compliance with federal regulations and program guidance.
      Note: If the sponsoring organization does not accept the provider’s written request, the sponsoring organization must respond to the provider in writing detailing why they denied the request.
   2. If the sponsoring organization agrees that the submitted documentation permanently corrects the serious deficiency, the sponsoring organization must forward a written request to the CDSS, asking that the provider be removed from the NDL. The request must include a copy of the provider’s written request and CAP.
   3. If the CDSS or the USDA does not accept the sponsoring organization’s written request, the CDSS will notify the sponsoring organization in writing detailing why the request is denied.
   4. If the CDSS and the USDA agree to remove the provider from the NDL, the provider will be removed from the NDL. The CDSS will notify the sponsoring organization in writing, and the sponsoring organization must notify the provider in writing.
   5. Once the provider has been removed from the NDL, the provider may apply for participation in the CACFP.
2. New potential sponsoring organization requesting NDL removal for a provider that they were not responsible for terminating and disqualifying:
   1. The new potential sponsoring organization wishing to add a provider that has been terminated and disqualified by another sponsoring organization must contact the CDSS. The CDSS will provide the new potential sponsoring organization with documentation from the terminating sponsoring organization related to the provider’s serious deficiencies.
   2. If, after review of the serious deficiency documentation, the new potential sponsoring organization is interested in adding the terminated provider to their program, the potential sponsoring organization must require that the provider submit a CAP.
      Note: If the CAP submitted by the provider is not considered acceptable by the new potential sponsoring organization, they must notify the provider in writing.
   3. If the new potential sponsoring organization accepts the provider’s CAP, they will forward a written request to the CDSS asking that the provider be removed from the NDL. The request must include a copy of the provider’s CAP.
   4. If the CDSS or the USDA does not accept the sponsoring organization’s written request, the CDSS will notify the potential sponsoring organization in writing detailing why the request is denied.
   5. If the CDSS and the USDA agree to remove the provider from the NDL, the provider will be removed from the NDL. The CDSS will notify the sponsoring organization in writing, and the sponsoring organization must notify the provider in writing.
   6. Once the provider has been removed from the NDL, the provider may apply for participation in the CACFP.
3. Provider currently living in California was terminated and disqualified by a sponsoring organization in another state and wants to be removed from the NDL to join a new sponsoring organization:
   1. The new potential sponsoring organization wishing to add a provider that has been terminated and disqualified by a sponsoring organization in another state must contact the CDSS. The CDE will contact the USDA’s Western Regional Office to request information on the serious deficiencies that led to the provider’s termination and disqualification in another state.
   2. The CDSS will forward the information provided by the USDA to the new potential sponsoring organization. If, after review of the serious deficiency documentation, the new potential sponsoring organization is interested in adding the terminated provider to their program, the new potential sponsoring organization must require that the provider submit a CAP.
      Note: If the CAP submitted by the provider is not considered acceptable by the new potential sponsoring organization, the sponsoring organization must notify the provider in writing.
   3. If the new potential sponsoring organization accepts the provider’s CAP, the sponsoring organization will forward a written request to the CDSS asking the provider be removed from the NDL. The request must include a copy of the provider’s CAP.
   4. If the CDSS or the USDA does not accept the sponsoring organization’s written request, the CDSS will notify the sponsoring organization in writing detailing why the request is denied.
   5. If the CDSS and the USDA agree to remove the provider from the NDL, the provider will be removed from the NDL. The CDSS will notify the sponsoring organization in writing, and the sponsoring organization must notify the provider in writing.
   6. Once the provider has been removed from the NDL, the provider may apply for participation in the CACFP.

Please note: A sponsoring organization is not required to seek removal of a terminated and disqualified provider from the NDL prior to seven years. Sponsoring organizations may evaluate a request on a case-by-case basis or implement a policy that is communicated to enrolled providers which states that their agency will not consider early removals from the NDL.

A provider who wishes to be removed from the NDL but does not have either the terminating sponsoring organization or a potential new sponsoring organization’s support will not have the opportunity to be removed from the NDL prior to seven years. The CDSS will not take requests for removal from the NDL directly from the provider.

Questions and Answers

The following questions and answers were developed by the USDA FNS to advise sponsoring organizations of the changes to the CACFP termination processes and the appeal rights of providers required by the Agriculture Risk Protection Act (ARPA) of 2000. They address important issues related to the establishment of termination and appeal procedures, including what constitutes an independent and impartial appeal official and whether provider payments must be continued during an appeal.

Procedures Relating to Termination of Day Care Home Providers' Program Agreements

What procedures must sponsoring organizations establish for terminating the agreement of a day care home?

The procedures we are establishing for the termination of a provider’s agreement parallel the procedures used by State agencies for terminating an institution’s agreement. These procedures apply only to termination of a provider’s agreement “for cause” (see the discussion below on the meaning of “termination for cause”). At a minimum, the sponsoring organization must:

1. Give written notice to the day care home (with a copy to the State agency) that the sponsor has declared the provider seriously deficient and specify the serious deficiency(ies). The written notice must also inform the provider:
   
   • of the actions it must take to correct the serious deficiency(ies)
   • of the period of time allotted to correct the deficiency (unless the serious deficiency is related to health or safety issues, as discussed below)
   • that failure to fully and permanently correct the serious deficiency(ies) within the allotted period of time will result in the termination of the provider’s agreement and placement of the provider on the National disqualified list (see below for further discussion of the "National disqualified list");
2. At the end of the period allotted for corrective action, determine whether corrective action has been taken that fully and permanently corrects the serious deficiency
3. If the sponsor determines that the provider has not taken corrective action to fully and permanently correct the serious deficiency within the allotted time, give the provider written notice of intent to terminate the agreement for cause. The written notice must also:
   • inform the provider that it may request an administrative review of the proposed termination;
   • give the provider the procedures for seeking an administrative review;
   • inform the provider that, if termination for cause occurs, the provider will be placed on the National disqualified list; and
   • unless Program participation has been suspended because the serious deficiency is related to health and safety issues, as discussed below, inform the provider that it may continue to participate in the Program and receive Program reimbursement for eligible meals served until its administrative review is completed.

Does that mean that a provider continues to receive Program payments during the period of its appeal?

Yes. With the exceptions discussed in the next paragraph, the sponsoring organization must continue to pay any claims for reimbursement for eligible meals served until the provider's agreement is terminated, including the period of any administrative review.

May a sponsor suspend a provider’s participation, including Program payments, during the appeal process if the intended termination is based on the submission of a false or fraudulent claim?

No. ARPA provides for suspension of a provider’s Program participation only when the sponsor determines there is an imminent threat to the health and safety of the children at the day care home, or that the day care home has engaged in activities which threaten the public health or safety. In these cases, the sponsor must declare the provider seriously deficient, provide written notice of intent to terminate the provider’s agreement for cause, and suspend Program payments pending the completion of the provider's administrative review. The provider does not have the opportunity to correct the serious deficiency(ies) in these cases. Unlike false or fraudulent claims submitted by institutions, false or fraudulent claims made by providers were not addressed in the amendment to ARPA made by the Grain Standards and Warehouse Inspection Act of 2000, Public Law 106-472.

However, it is always the case that a sponsor may not pay any claim, or any portion of a claim, that it believes to be invalid. This is not a “suspension” of Program participation, but a denial of a claim based on the sponsor’s normal process for reviewing claims. Even if the provider’s claim is denied at the same time that the sponsor issues a notice of intent to terminate the provider’s agreement, payment has not been “suspended” because the sponsor will continue to pay any valid claims received during the appeal process.

Provider Appeal Rights

Does ARPA require administrative reviews for providers when the sponsoring organization takes actions other than terminating the provider’s agreement for cause?

No. Section 243(c) of ARPA amended section 17(d) by requiring only that a day care home have the opportunity to request an administrative review prior to the termination of its agreement for cause. The law does not, for example, require an administrative review to be offered when claims for reimbursement are denied or overpayments are recovered.

What if a State agency or a sponsor already has an administrative review system that permits providers to receive a hearing on actions other than termination?

There is no reason for State agencies or sponsoring organizations to modify systems that exceed the minimum requirements of the law.

Does termination of a provider's agreement by a sponsor "for convenience" require the sponsoring organization to offer an administrative review?

No. Termination for convenience by the sponsor means that the sponsor has terminated the agreement for reasons unrelated to the provider’s performance under the contract. Because termination for convenience is not based on the “fault” of the other party, providers who have had their Program agreement terminated for convenience are not placed on the National disqualified list. In addition, if a provider’s agreement is terminated for convenience by its sponsor, the provider may participate in the Program under another sponsor, and their participation would not be subject to the provider transfer limits established by State agencies pursuant to ARPA.

However, although a sponsoring organization may terminate a provider’s agreement “for convenience” without giving the provider the opportunity for an administrative review, termination for convenience may not be used by sponsoring organizations in instances where the termination is actually for cause (i.e., is based on the provider’s failure to comply with the terms of its agreement with the sponsoring organization). Improper use of termination for convenience by the sponsor constitutes an attempt to circumvent the law’s intent in requiring the placement of providers terminated for cause on the National disqualified list.

If a sponsoring organization could abuse this process (by terminating a provider for convenience instead of for cause), why is it not reasonable to infer that the law intended to grant the provider appeal rights for any termination action?

There are a number of circumstances under which a sponsoring organization could legitimately determine that it had to terminate a provider’s agreement for convenience. For example, if a sponsoring organization operated the Program in 200 homes in 4 counties, but 2 of the homes were located in the most remote county and were farthest from the sponsor’s offices, the sponsor might conclude that it was no longer cost-effective to sponsor these providers. Therefore, in order to maintain the sponsoring organization’s financial viability, as required under section 17(d)(1)(A)(i) of the NSLA, as amended, the sponsoring organization could legitimately terminate the provider’s agreement “for convenience”. To offer a provider an administrative review in this instance would substitute a review officer’s judgment for that of the sponsoring organization regarding the decisions necessary to manage the CACFP consistent with ARPA’s requirement that the sponsor be financially viable.

What is the "national disqualified list"?

Section 243(c) of ARPA amended section 17(d)(5) of the NSLA to expand what is currently called “the List of Seriously Deficient Institutions” to include family and group day care homes and individuals as well as institutions. The new list will be referred to as the “National disqualified list”.

How, if at all, has a provider's ability to terminate its agreement with the sponsor "for convenience" been affected by the law?

A provider will continue to have the right to terminate its agreement with the sponsoring organization for convenience, subject to any stipulations by the State agency, as set forth at Section 226.18(b)(8) of the regulations.

However, Section 243(f) of ARPA amended section 17(f)(3) of the NSLA to prohibit providers from transferring to a new sponsoring organization more than once a year. Thus, if a provider who has transferred within the past year terminates its agreement for convenience (i.e., the provider, not the sponsor, initiates the termination of the agreement for convenience), it would be ineligible to participate under another sponsor until a full year had passed since the transfer. Similarly, if a State agency had implemented an annual “open season” for transfers, and the provider chose to terminate its agreement for convenience outside of the “open season,” it would be ineligible to participate until the next open season. In either of these circumstances, the State agency could waive the transfer policy if it were convinced that “good cause” for a waiver existed.

When is a provider’s termination appealable?

The written notice of serious deficiency is not subject to administrative review. The provider may request an administrative review only when the sponsor issues the notice of intent to terminate the provider’s agreement "for cause."

When must a provider be terminated "for cause"?

A provider’s agreement must be terminated for cause when the provider has been declared seriously deficient and has not taken action to fully and permanently correct the serious deficiency within the allotted time. However, in cases in which the serious deficiency is related to health or safety issues, the sponsor must initiate action to terminate the provider’s agreement without first providing an opportunity for corrective action.

Can you provide examples of serious deficiencies which, if not corrected, would result in the provider’s termination for cause?

Yes. Examples include:

• misrepresentation of information submitted on the application;
• submission of false claims for reimbursement;
• simultaneous participation under more than one sponsoring organization;
• noncompliance with the Program meal pattern;
• failure to keep required records; or
• any other circumstance related to non-performance under the sponsor-provider agreement, as specified by the sponsoring organization or the State agency.

Please note that, in any serious deficiency involving imminent threat to the health or safety of a child or an activity of a provider that poses a threat to public health or safety (such as falsification of health or licensing certifications and conduct which threatens the safety of children), the sponsor would issue a written notice of serious deficiency that does not allow for corrective action and would simultaneously issue a written notice of intent to terminate that would also include an immediate suspension of Program participation (including Program payments) to the provider, based on the "threat to health or safety" provisions in ARPA. Providers may seek an administrative review of the proposed termination and the suspension and, if the provider prevails in the administrative review, may claim retroactive reimbursement for eligible meals served during the suspension period.

May an employee or board member of the sponsoring organization be considered "independent and impartial" for the purpose of conducting an administrative review?

The only requirement is that the review official be independent and impartial and not involved in the decision to propose to terminate the provider’s agreement. The review official must be “independent and impartial” in the sense that he or she was not involved in the proposed termination and does not have a direct personal or financial stake in the outcome of the administrative review.

This means that a sponsoring organization employee could conduct the administrative review, provided he or she was not involved in the decision to terminate the provider’s agreement. This is the same approach currently used by State agencies in choosing review officers to hear administrative reviews requested by institutions. Sponsoring organizations must make every reasonable attempt to ensure that no review official has a real or apparent conflict of interest that would affect their ability to render an impartial decision.

This institution is an equal opportunity provider.
Esta institución es un proveedor que ofrece igualdad de oportunidades.