Robert F. Kennedy Jr. Closes Biden-Era Childcare Provider Loopholes that Enabled Fraud

Health and Human Services (HHS) Secretary Robert F. Kennedy Jr. announced Monday that the department has rescinded Biden-era rules that required states to pay childcare providers before verifying attendance and before care was delivered.

“Congress appropriated this funding to support working families and ensure children have safe places to grow and learn,” Secretary Kennedy said in a written 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.”

The Trump HHS will roll back provisions in the Biden-era Child Care and Development Fund rule that softened oversight and “increased the risk of waste, fraud, and abuse in federally-funded state child care,” which includes programs now under investigation in Minnesota.

The HHS will now:

• Restore attendance-based billing, noting that states may require payment based on verified attendance rather than enrollment alone
• Allow states to pay after care is delivered
• Bring back parental choice, allowing states to offer parent-directed vouchers

“Paying providers upfront based on paper enrollment instead of actual attendance invites abuse,” Health and Human Services Deputy Secretary Jim O’Neill said. “In Minnesota, we’ve seen credible and widespread allegations of fraudulent daycare providers who were not caring for children at all. The reforms we are enacting will make fraud harder to perpetrate.”

“When controls are not in place, bad actors can bill for children who aren’t there,” Assistant Secretary for Family Support Alex Adams remarked. “Families and taxpayers deserve proof that services are being delivered to children. These rule changes emphasize the critical role federal investments in child care play for the American workforce.”

Reports have suggested that Somalians in Minnesota have bilked billions of dollars through various scams, including daycare centers. The scandal has become so controversial that Gov. Tim Walz (D-MN) has decided not to run for reelection.