MLG’s plans for “free” childcare plus a Biden-era rule allowed child care centers to be paid on enrollment, not attendance!
The Santa Fe New Mexican has an interesting article about MLG’s plans for “free” childcare and the Trump Administration’s attempt to root out fraud in the system:
One fascinating nugget from the story is that among the federal changes in response to the Minnesota scandal is a change in the way childcare centers are paid:
The (Trump’s) changes would roll back Biden-era policies requiring states to base provider payments on children enrolled in child care — not on those who actually attended. The new rule changes would allow states to pay providers after care has been delivered, the U.S. Health and Human Services Department announced in a news release Monday.
Chavez said the federal government’s shift away from enrollment-based billing, which New Mexico currently uses, and toward attendance-based payment was a “step in the wrong direction.”
Of course, New Mexico opposes the Trump Administration’s efforts to ensure that services are actually delivered rather than simply promised prior to payment. One wonders why these federal programs are susceptible to fraud. This is a great example. Yes, it is easy to understand why child care providers (like anyone) would wish to be paid in advance of services rendered, but that is not the way things work for most businesses.
The article goes on to note:
The state is in a fairly unique position compared to others, as it provides significantly more subsidies to its families than much of the country, said Barbara Tedrow, policy chair for the New Mexico Early Childhood Association.
Many states do not fund child care assistance for any families who earn more than 150% of the federal poverty level (New Mexico currently offers “free” child care for those earning up to 400% of FPL with MLG’s plan to make that “universal and ‘free'”, the threshold at which families receiving subsidies from the federal Child Care and Development Fund can have their copays waived — meaning a freeze on those dollars could halt all government-subsidized child care assistance in a state.
Since New Mexico now offers assistance with no copays to all families, regardless of income, Tedrow predicted there would be no disruption to providers’ payments or delivery of services.
The LFC funded “only” $14 million of MLG’s planned expansion. Of course, in addition to federal and general fund $$ MLG COULD dip into the Early Childhood permanent fund to fund her program at least initially.