HHS ENDS Biden’s Massive Child Care FRAUD Scheme That Let States Pay Providers Without Verifying Attendance

The U.S. Department of Health and Human Services (HHS) has officially moved to dismantle a sweeping Biden-era child care scheme that allowed states to shovel billions in federal dollars to child care providers without verifying whether children were actually present, a reckless policy now linked to massive fraud investigations, particularly in Democrat-run hellholes like Minnesota.

Under the leadership of President Trump, HHS, through its Administration for Children and Families, is rescinding provisions of the 2024 Child Care and Development Fund (CCDF) rule imposed under Joe Biden.

“Congress appropriated this funding to support working families and ensure children have safe places to grow and learn,” said HHS Secretary Robert F. Kennedy Jr.

“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 Biden regime’s insanity included:

• Forcing payments on enrollment alone, not verified attendance
• Mandating upfront cash to providers before any care was even provided
• Push states toward provider contracts instead of parent-directed vouchers

But under President Trump’s triumphant return and HHS’s new rule changes:

• Attendance-based billing is BACK! States can now demand proof that kids are actually there before handing over a dime.
• No more free money upfront! Payments after services
• Parental choice restored! Vouchers over crony contracts

The New York Post reported:

The President Biden rule took effect on April 30, 2024, meaning more than $19.3 billion in taxpayer dollars over 20 months may have been spent before President Trump could correct provisions that could have prolonged massive day care fraud in Minnesota.

[…]

Between 2021 and 2024, the Administration for Children and Families shelled out more than $91.8 billion from its Child Care Development Fund (CCDF), a federal block grant program that helps fund child care in states, US territories and tribes, per HHS data.

A whopping $56 billion went out the door just in 2021, during the height of the COVID-19 pandemic.

The officials froze all future funding from CCDF — the third-largest block grant program after Temporary Assistance for Needy Families (TANF) and the Department of Housing and Urban Development’s Community Development Block Grants — last week until states can verify there is no fraud.

[…]

More than a decade before, HHS’ Office of Inspector General audited states and found tens of millions of dollars were being erroneously paid out to child care centers.

The consequences of Biden’s lax rules are playing out most dramatically in Minnesota, where allegations have surfaced that daycare providers collected hundreds of millions of dollars for children who never showed up or didn’t exist at all.

Since December 30, 2025, more than 245 fraud reports have already been submitted, according to The Post.

“Paying providers upfront based on paper enrollment instead of actual attendance invites abuse,” said Health and Human Services Deputy Secretary Jim O’Neill. “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,” said Assistant Secretary for Family Support Alex Adams. “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.”

A viral video by YouTuber Nick Shirley alleged that nearly a dozen Minnesota daycare centers took in $111 million in federal funding while appearing to have no children present.

Last month, the HHS announced it is freezing all childcare payments to Minnesota amid allegations of widespread fraud.

Somali healthcare and daycare scammers may have stolen more than $9 billion in taxpayer money in Minnesota.

“We have turned off the money spigot,” HHS Deputy Secretary Jim O’Neill said.

The HHS took three actions against the rampant fraud in Minnesota: All payments across the country will require justification and photo evidence before money is sent to a state.

Once again, the Trump administration is left cleaning up a costly Biden-era disaster, restoring accountability, protecting children, and safeguarding taxpayer dollars after years of willful negligence by the Left.

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