Accountability for Funds Used for Child Care

On July 11, the U.S. Department of Health and Human Services, Office of Inspector General, issued an early alert memorandum identifying gaps in state health and safety policies for children in unlicensed settings whose care is paid for through federal funding.

The Office of Inspector General is conducting an evaluation entitled, “Child Care and Development Fund: Monitoring of Licensed Child Care Providers” (OEI-07-10-00230), which is expected to be released this fall.  Under the federal Child Care and Development Block Grant (CCDBG statute), states are required to have health and safety standards in place for all providers (including unlicensed providers) receiving CCDBG funds.  The three requirements by statute are: prevention and control of infectious disease; building and physical premises safety; and health and safety training.

In the course of investigations pertaining to the report, the IG’s office found that:

  • Nearly 300,000 children whose care is paid for through CCDBG are in unlicensed care.
  • 30 states allow license-exempt center-based providers to care for children receiving CCDBG subsidies.
  • 33 states allow license-exempt family child care home providers to care for children receiving CCDBG subsidies.
  • Despite CCDBG statutory requirements, some states, such as Mississippi, reported that they did not have any requirements for unlicensed centers or unlicensed family child care homes.
  • Of the states that reported health and safety requirements in the three areas required by law, 9 states allowed center-based providers to “self-report” compliance with the requirements and 23 states allowed family child care home providers to self-report compliance.
  • In most states, license-exempt providers are not subject to routine monitoring visits.

In May, HHS proposed new rules to strengthen the safety and quality of child care for children whose care is paid for through CCDBG.  When the new rules go into effect, all providers (licensed or unlicensed – except relatives) will have to meet basic health and safety requirements. In addition, HHS will no longer allow states to accept self-certifications (unless such certifications document each of the requirements met by the provider).  But, self-certification, alone, will no longer be allowed.

How many children in your state receive a subsidy? Click here. How many children receiving a subsidy in your state are in unlicensed care? Click here The comment period on the proposed HHS regulation runs through August 5, 2013.  If you agree that there should be accountability for the expenditure of federal funds, money used to help low-income families afford the cost of child care, comment today.

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