Federal officials tighten childcare funding rules, raising concerns in Michigan

Описание: The federal government has announced newly-tightened oversight of billions of dollars in childcare funding given to states in a sweeping effort to stifle fraud, however, childcare advocates are raising concerns that the move could disrupt services for families and providers in Michigan as well as around the country.

The U.S. Department of Health and Human Services (HHS), through its Administration for Children and Families, announced it is rescinding a series of Biden-era rules that required states to pay childcare providers before care was delivered and before attendance was verified.

Those provisions were part of a 2024 update to the Child Care and Development Fund (CCDF), which is meant to subsidize care for lower-income working families.

Federal officials say the changes are necessary after alleged fraud schemes involving federally-funded childcare programs, particularly in Minnesota, which is currently under investigation.

“Congress appropriated this funding to support working families and ensure children have safe places to grow and learn,” Health and Human Services Secretary Robert F. Kennedy, Jr. said in a statement. “Loopholes and fraud diverted that money to bad actors instead. Today, we are correcting that failure and returning these funds to the working families they were meant to serve.”

Under the previous framework, states were required to determine payments based on enrollment rather than verified attendance, issue payments to providers in advance of services, and prioritize guaranteed contracts with providers over parent-directed vouchers.

HHS claims those requirements weakened oversight and increased the risk of waste, fraud, and abuse.

Under the revised approach:

States may once again base payments on verified attendance rather than enrollment alone.
Upfront payments to providers will no longer be required; states may pay after care is delivered.
States will have more flexibility to use parent-directed vouchers instead of steering funding toward provider contracts.
“Paying providers upfront based on paper enrollment instead of actual attendance invites abuse,” said HHS Deputy Secretary Jim O’Neill, pointing to what he called “credible and widespread allegations” of fraud in Minnesota.

Assistant Secretary for Family Support Alex Adams added that the changes are intended to ensure taxpayer dollars are tied to services actually delivered to children.

HHS said it has stepped up enforcement efforts by activating a national “Defend the Spend” system, imposing additional verification requirements, and launching a fraud-reporting hotline.

Read: https://wwmt.com/news/local/federal-g...
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