HHS freezes all childcare funding to Minnesota, citing 'blatant fraud'...

The Department of Health and Human Services has frozen childcare payments to Minnesota in the wake of what the agency says is fraud at daycares in the state, and has tightened restrictions for other payments across the country. The department took action against what it alleged was "blatant fraud that appears to be rampant in Minnesota and across the country," Deputy Secretary of Health and Human Services Director Jim O'Neil said in a post on X on Tuesday, Dec. 30. "We have turned off the money spigot and we are finding the fraud," said O'Neil, who also is the acting director of the Centers for Disease Control and Prevention. The department has frozen all Administration for Children and Families payments to the state and activated what O'Neil called the "defend the spend system." "Starting today, all ACF payments across America will require a justification and a receipt or photo evidence before we send money to a state," he said. O'Neil also pointed to conservative influencer Nick Shirley's video of what he alleged are abandoned day cares and demanded an investigation into them. Democratic Minnesota Gov. Tim Walz's office said in a statement to USA TODAY that "the governor has been combatting fraud for years while the President has been letting fraudsters out of jail" and that the move was "a transparent attempt to politicize the issue to hurt Minnesotans and defund government programs." This is a developing story and will be updated.