The Trump administration has frozen all federal child care payments to states and announced sweeping changes to the rules governing the Child Care and Development Fund (CCDF), one of the largest federal programs supporting affordable child care for low-income families.
The move, announced by the U.S. Department of Health and Human Services (HHS) on Monday, January 5, 2026, is being described by the administration as a fraud-prevention measure but has raised significant legal, administrative, and policy concerns among child care advocates and state officials.
CCDF provides federal funds to states, tribes, and territories to help subsidize child care costs for working families. Less than a week before Monday’s announcement, HHS confirmed it had frozen all CCDF funding nationwide, effective immediately.
According to HHS spokesperson Andrew Nixon, the funds will remain frozen until states submit unspecified “administrative data,” though the agency has not clarified what information is required or how long the review process will take.
In parallel with the funding freeze, HHS said it is rescinding several Biden-era regulations designed to stabilize child care providers and improve access for families. Those rules had encouraged states to pay providers based on enrollment rather than daily attendance, issue payments in advance of services, and prioritize guaranteed child care slots over voucher-based systems. The Trump administration now plans to restore attendance-based billing, end advance payments, and shift funding priorities back toward vouchers.
Alex Adams, assistant secretary for family support at HHS’s Administration for Children and Families, said the changes are necessary to prevent fraud. “When controls are not in place, bad actors can bill for children who aren’t there,” Adams said, adding that taxpayers and families deserve proof that services are actually being delivered.
Child care advocates, however, dispute the premise that existing safeguards are insufficient. Susan Gale Perry, CEO of Child Care Aware of America, told NPR that states already operate under longstanding program integrity requirements that are reviewed and updated annually. She warned that even a short disruption in funding could have serious consequences, noting that most child care providers operate on extremely thin margins.
“Going even a month without funding could result in child care centers closing,” she said.
The legal and practical implications of the funding freeze are significant. According to the most recent HHS data, approximately 1.4 million children and more than 857,000 families per month received child care assistance through CCDF in 2019. Melissa Boteach, chief policy officer at the nonprofit Zero to Three, said the rollback of regulations and the lack of clarity surrounding the funding freeze are creating “chaos and confusion” for states, providers, and families. She added that HHS has not explained how states are expected to operate their programs while funds remain frozen.
The administration’s actions follow renewed allegations of fraud involving child care providers in Minnesota. As previously reported by NPR, a viral video posted by a right-wing social media influencer after Christmas alleged that Somali-American–run day care centers had defrauded the federal government of millions of dollars, though the video offered no clear evidence. Days later, HHS Deputy Secretary Jim O’Neill cited “serious allegations” of widespread fraud in Minnesota and nationwide, announcing stricter documentation requirements, including receipts or photographic evidence, before federal funds are released.
In Monday’s announcement, O’Neill said the new rules would make fraud “harder to perpetrate.” HHS stated that the regulatory changes will be subject to a 30-day public comment period, opening the door to potential legal challenges from states, advocacy groups, or providers who argue that the funding freeze and rule reversals violate federal administrative law or exceed the agency’s authority.
As states await further guidance, legal experts note that the combination of an immediate funding freeze and rapid regulatory reversal could prompt litigation over due process, statutory interpretation, and the federal government’s obligations under existing child care law. For now, families and providers across the country face growing uncertainty over whether—and when—critical child care funding will resume.
