This bill aims to reduce fraud and misuse of federal child care funding by requiring states to report and reduce their improper payment rates. States would have to submit annual reports by June 30 showing what percentage of their child care subsidies were improperly paid out, along with plans to improve. If a state's improper payment rate exceeds 6 percent, the federal government would penalize it by reducing future funding by 5 to 15 percent depending on how high the rate is—with larger cuts for rates above 10 percent. States with improper payment rates exceeding 6 percent must submit a corrective action plan within 60 days that includes verified attendance records for children receiving subsidized care. The bill takes effect one year after passage and also requires the Secretary of Health and Human Services to publicly report improper payment rates broken down by state.
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