HHS Finds Minnesota Child Care Agency Failed to Verify Attendance Records and ‘Pursue Fraud Tips’

The US Department of Health and Human Services found Minnesota’s child care agency failed to adequately verify attendance records or “pursue fraud tips” following an oversight visit in late January, according to a letter obtained by The Post.

HHS’ Administration for Children and Families informed Minnesota officials that its handling of the distribution of federal taxpayer dollars for child care in the state had “not established adequate controls to verify the accuracy of county-issued provider payments based on attendance of children.”

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Just four investigators are working for Minnesota’s Child Care Assistance Program to address all potential fraud.

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Minnesota youth services got $184,928,081 in taxpayer funding in fiscal year 2025 that HHS officials also warned in a Jan. 15 letter could be withheld if the state’s Department of Children, Youth and Families didn’t hand over attendance and inspection records in 60 days.

The Biden administration had previously relaxed a federal rule for “attendance-based billing” in April 2024, meaning that states no longer had to provide the records in order to be reimbursed for child care expenses.

In total, HHS ACF provided more than $91.8 billion between 2021 and 2024 from its Child Care Development Fund (CCDF), one of the largest federal block grant programs, which provides taxpayer money for child care in states, US territories and tribes, departmental data show.

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