WASHINGTON – The U.S. Department of Health and Human Services (HHS) aiming to change the guidelines from the Biden era that allowed states to pay childcare providers without verifying attendance. This move aims to prevent waste, fraud and abuse in federally funded state childcare programs.
Health and Human Services Secretary Robert F. Kennedy, Jr. emphasized the importance of these funds supporting working families and ensuring safe environments for children. “Loopholes and fraud diverted that money to bad actors instead,” said Kennedy. “Today, we are correcting that failure and returning these funds to the working families they were meant to serve.”
The rule changes will restore attendance-based billing, eliminate upfront payments and bring back voucher flexibility. Health and Human Services Deputy Secretary Jim O’Neill highlighted issues in Minnesota, where fraudulent daycare providers allegedly billed for non-existent services. “The reforms we are enacting will make fraud harder to perpetrate,” said O’Neill.
Assistant Secretary for Family Support Alex Adams stressed the need for proof that services are delivered. “Families and taxpayers deserve proof that services are being delivered to children,” said Adams. The changes will undergo a 30-day public comment period.
HHS is also enhancing oversight with a national Defend the Spend system and a fraud-reporting hotline. Since Dec. 30, 2025, over 245 fraud reports have been received. HHS remains committed to ensuring childcare programs protect children and serve families responsibly.
childcare.gov
