Summary

Requires child-care payments to be made as reimbursements based on recorded attendance (not just enrollment), and mandates seven-year attendance and service record retention for providers subject to federal audit. Adds new detection and reporting duties for large, single-year spikes in provider counts or payments in ZIP codes/counties across Medicare, Marketplace plans, Medicaid, and CHIP, with the HHS Inspector General authorized to audit large multi-year increases. Directs OMB to issue guidance to agencies to recover improper payments and requires Inspector General reports to include amounts of improper payments recovered.

Key Points

• Child-care payments under the federal block grant must be reimbursements based on recorded attendance, not enrollment.
• Child-care providers receiving federal funds must retain attendance and service records for seven years and allow federal audits.
• HHS and state Medicaid agencies must notify the HHS Inspector General of >100% single-year spikes in payments or provider counts by ZIP code/county.
• Health Insurance Exchanges must collect plan-level data annually so HHS can detect large payment or provider spikes.
• HHS IG must identify and audit programs with at least a 400% increase in payments or provider counts in a ZIP code/county over five years.
• OMB must issue guidance to agencies to recover improper payments, and Inspector General reports must include dollar amounts recovered.
• Medicare and Exchange reporting rules take effect 180 days after enactment; Medicaid/CHIP allow delayed state compliance where enabling legislation is needed.
• The law increases oversight and audit authority to detect and recover potential fraud or improper payments across child care and health programs.
• New requirements may shift payments to reimbursement timing and add administrative and recordkeeping burdens for providers and states.

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