The Child and Adult Care Food Program (CACFP) helps centers like yours provide healthy meals to participants by giving financial support. However, this funding comes with rules that must be followed. Breaking these can cause penalties known as CACFP adverse actions. They cost your center money, and you can even risk losing Program eligibility.
If “adverse actions” sound confusing, don’t worry. We’ll explain what happens when CACFP rules aren’t followed and how it can affect your center financially.
What Are CACFP Adverse Actions?
Simply put, they’re financial consequences for breaking CACFP rules. CACFP has guidelines for managing finances, serving meals, record-keeping, and training staff. If not followed, you could face financial penalties from your sponsor or state agency.
When CACFP adverse actions are ignored, they can lead to worse consequences. Check those out here.
How CACFP Adverse Actions Cost You Money
1. Lost Reimbursement
CACFP provides reimbursement for meals served, but only if they meet specific criteria. This doesn’t just mean serving the right foods—your paperwork must be in order too. For example, if you’re missing some enrollment and income eligibility forms for participants – or if expired forms aren’t updated – you can’t be reimbursed for those meals until forms are completed.
Imagine your center serves 200 participants each week, but 25 of them don’t have enrollment and income eligibility forms on file. Until they’re completed, you can’t claim reimbursement for their meals. This can cost you hundreds – or even thousands – of dollars in reimbursement for that month.
💡 The Bottom Line? Keeping up with CACFP documentation is just as important as what’s on the plate!
2. Paid Back Funds
In some cases, you may be required to pay back funds already received. This can happen if serious or recurring errors are found in required paperwork.
Examples include:
- Spending CACFP funds on unallowable items: If you purchased unapproved items, you may have to pay back the funds you used to buy them.
- Missing receipts for purchased items: If you purchased approved items – but don’t have the receipts to prove it – you could be required to pay back funds you used to purchase them.
- Missing or Expired Enrollment/Income Eligibility Forms: If these forms are missing or haven’t been updated, any meals served to those participants are ineligible for reimbursement. If you’ve already claimed meals for them, you will be required to pay back those funds.
- Miscategorizing Income Eligibility Forms: If you made a mistake in calculating total income on the forms you do have – you’ll have to pay back the difference in funds for the correct income category that should have been used.
3. Program Disqualification
If non-compliances are serious enough, you could even lose your ability to participate in CACFP altogether. This costs you vital reimbursement that you need to provide healthy meals.
If you want to rejoin CACFP, it can take a long time and require extra steps, costing you more time and money down the road.
To access the CACFP National Disqualified List, click here.
4. More Paperwork and Stress
Fixing mistakes takes extra time and resources. When a problem happens, your center may be required to create a corrective action plan to resolve it. This means reviewing documents, improving processes, and retraining staff.
Whether it’s responding to issues, creating corrective plans, or preparing for audits, you and your staff might need to work overtime—or you may have to hire outside help to get back on track. This all takes valuable time away from running your center.
5. Overworked Staff
When compliance issues arise, both you and your staff may feel overwhelmed by the additional workload to correct them. If problems aren’t addressed quickly, it can lead to stress, burnout, and even staff turnover.
How to Avoid CACFP Adverse Actions
The good news? You can avoid most CACFP financial penalties by taking simple, proactive steps.
Here’s how to help ensure your center stays compliant:
1. Check Records Regularly
Review financial records, receipts, attendance logs, and meal records on a regular basis. This helps you catch small mistakes before they turn into bigger problems.
2. Stay Organized
Using CACFP software can make it easier to complete daily records, reconcile monthly expenses, and prepare claim totals. Leverage technology to help you stay on top of your Program.
3. Train Your Staff
Make sure they understand how to plan meals, keep accurate records, and keep track of Program expenses. Regular training can help prevent mistakes before they happen.
4. Ask for Help
Unsure about a CACFP requirement? Contact your sponsor or state agency for guidance to help you avoid mistakes.
Protect Your Reimbursement
CACFP adverse actions put your reimbursement, business reputation, and even your ability to operate the Program at risk. Want to know more about the problems that trigger these consequences?
Stay tuned for our next post: “Top Mistakes That Trigger CACFP Adverse Actions” Don’t miss it! 🚀