President Donald Trump declared Illinois “worse” than Minnesota amid a federal crackdown on child care fraud, as Health and Human Services froze federal funding for states until rigorous verification of provider legitimacy is completed.
The U.S. Department of Health and Human Services announced Tuesday it has frozen the disbursement of taxpayer dollars to Minnesota’s day care centers amid an investigation into alleged fraud involving tens of millions of dollars. The agency also mandated that all states verify legitimate use of funds before receiving matching child care dollars — a policy shift that directly targets Illinois, which President Trump called “worse” than Minnesota during remarks at a New Year’s Eve gathering in Palm Beach, Florida.
“Can you imagine they stole $18 billion? That’s just what we’re learning about,” Trump said. “California is worse. Illinois is worse, and, sadly, New York is worse, a lot of other places. We’re going to get to the bottom of all of it. It’s a giant scam.”
Trump framed the administration’s efforts to recover lost funds as a major economic win, linking it to his broader tariff-driven revenue strategy. “I view that as a reason for a good year because we’re going to get to the bottom of it. We’re going to get that money back. It’s all coming back,” he stated.
The move by HHS follows internal investigations by the Department of Homeland Security and the Federal Bureau of Investigation into misuse of federal child care assistance funds. Press Secretary Emily G. Hilliard confirmed that verification protocols are now mandatory for all states to access matching funds under the Child Care and Development Fund (CCDF) program.
“The documentation process exists to rule out fraud and confirm that funds are supporting legitimate child care providers,” Hilliard said in a statement issued to The Center Square. “The onus is on the state to provide additional verification, and until they do so, HHS will not allow the state to draw down their matching funds for the CCDF program.”
Federal appropriations for Illinois’ child care programs totaled $412,167,876 in 2025, according to HHS data. The Illinois Network of Child Care Resource and Referral Agencies reported that 172,794 children benefited from Child Care Assistance Program funding during that period.
The state’s current budget allocates $2 billion for the Child Care Assistance Program (CCAP), up from $1,789,399,000 in fiscal year 2025, and another $777,099,000 for general Child Care Services. These figures underscore Illinois’ reliance on federal support — now under heightened scrutiny.
Illinois Republican U.S. Senate candidate Pamela Denise Long criticized both state and federal oversight, calling for comprehensive audits beyond day care centers. “I suspect Minnesota is but a tip of the iceberg, as they say. I not only want daycare centers looked into, I want not-for-profit centers looked into,” Long told The Center Square. “I also want so-called ‘legit’ big business looked into that is dependent upon government funding.”
HHS has launched a dedicated hotline for individuals to report suspected fraud in any state’s child care system. Complaints can be filed online or by calling 1-800-447-8477 — a direct response to public concerns over mismanagement.
This development echoes historical precedents where federal funding for social services has been suspended or restricted due to fraud allegations. In 2016, similar actions were taken against Medicaid providers across multiple states. The current policy aligns with past enforcement models designed to protect taxpayer dollars while ensuring equitable access to critical services.
The political fallout could intensify as lawmakers grapple with balancing accountability and access. Illinois legislators face mounting pressure to demonstrate transparency in how federal funds are managed — especially as the state prepares for potential cuts if verification requirements are not met.
Public reaction has been mixed, with some praising the administration’s focus on fiscal responsibility and others warning of unintended consequences for low-income families who rely on these services. Advocacy groups have called for immediate clarification on the verification criteria to prevent disruptions to essential care.
The situation underscores a broader national debate over the role of federal oversight in state-run social programs. As HHS enforces stricter standards, the question remains whether these measures will deter fraud or inadvertently harm vulnerable populations seeking affordable child care.
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