Republican Senators Propose Child Care Reform Bill

Two Republican senators have put forward a draft bill aimed at reforming child care for low-income families. This follows reports of fraud in Minnesota and other states. Senators Bill Cassidy from Louisiana and Tommy Tuberville from Alabama are seeking input on their proposed amendments to the Child Care and Development Block Grant Act of 1990. Notably, this program hasn’t been reauthorized since 2014.

“Every dollar taken is a dollar that should support children and working families,” Cassidy remarked, highlighting that while Minnesota has drawn attention to these issues, it’s a broader problem. He emphasized that those who commit fraud against children and taxpayers will face accountability.

The senators’ objectives include reducing fraud, improving eligibility checks, increasing transparency, and ensuring corrective actions within federally funded child care initiatives.

Currently, the Senate committee is examining cases in several states, including Minnesota, New York, Oregon, and Michigan, for potential fraud in federal child care funding.

In December, the Department of Health and Human Services halted child care payments to Minnesota amid widespread fraud allegations.

Recently, President Trump signed an executive order to establish the Task Force to Eliminate Fraud, appointing Vice President JD Vance as the head of this effort.

“American families have suffered long enough,” Tuberville stated. “It’s crucial to identify the root of this abuse and address it so that our families and children can truly thrive. I will always push for accountability in the system and advocate for hardworking families in Alabama.”

The deadline for feedback on the proposed legislation is April 8.

Strengthening Federal Oversight Authority

The draft grants the Department of Health and Human Services the authority to enforce program requirements, ensuring that states and primary agencies adhere to the rules.

The agency could even suspend a state from receiving additional Child Care and Development funds if it fails to comply.

According to the draft, if a state is deemed noncompliant, penalties would include disallowance or withholding of funds, as well as a percentage reduction in funds.

The proposal also suggests more frequent oversight, requiring states to submit error reports every two years instead of every three.

The Government Accountability Office would assess these state reports and make recommendations to the HHS Office of Inspector General for enhanced oversight and policy improvements.

Enhancing Monitoring for High-Risk States

States with high error rates would face intensified monitoring by HHS. If a state’s error report exceeds 9%, additional scrutiny would be mandated. States consistently above a 6% error rate over two audit cycles would also be classified as “high risk.”

The draft includes stipulations for states to publicly display their plans and corrective actions regarding compliance issues. Additionally, fraudulent payments would be counted as improper payments when assessing state error rates.

HHS would need to publish state error reports online for taxpayers to evaluate how their state manages these funds.

This proposal would shift compensation for child care providers to be based on verified attendance rather than mere enrollment, while still allowing states to choose payment methods—either prospectively or after services are rendered.

Removing the Marriage Penalty

The draft aims to modify eligibility criteria to prevent discouragement of marriage. Specific provisions will ensure that families aren’t penalized when single parents marry, and it provides assistance to married parents working a combined total of 60 hours weekly or those engaged in job training.

Tightening Eligibility and Payment Verification

The draft sets forth stricter verification processes for determining eligibility. Cassidy and Tuberville propose that participants report any income changes within three months and require states to verify this income every six months. Significant changes in income would also need to be reported during that timeframe.

Additional changes could eliminate retroactive eligibility and mandate the use of electronic authentication tools to confirm participants’ identities.