Ohio Daycare Probe Reveals Widespread Fraud

Wednesday, 31 Oct 2012 12:26 PM

By Sandy Fitzgerald

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Ohio’s Department of Job and Family Services is investigating dozens of taxpayer-funded daycare centers for fraud, after an overhaul meant to detect abuse in the program found problems.
According to the Dayton Daily News, the department has opened 64 investigations in 21 counties of centers operated out of homes and small businesses that are reimbursed by the state for watching children in low-income families while their parents work.
The state spent $6 million in January to switch to a new billing method aimed at weeding out centers that invoice for children they’re not watching. In March, the family services department launched its anti-fraud unit to investigate.
“They’re [the state] finally starting to see what we’ve been saying all along: There are certainly opportunities for abuse in the system, and the few are making it bad for the many,” said Joel Potts, executive director of the Ohio Job and Family Services county directors association.
In January, the state brought an electronic billing system online to replace its old paper-billing method. Each child is assigned an ID card, which a parent or guardian swipes at the daycare center. The information then shows the state when the child was at daycare, and the providers are paid for the hours provided.
Before the cards were adopted, parents filled out time sheets. Critics said they were too easy for dishonest providers and parents to fake.
The state has brought two cases in court already related to the investigation. In February, a home-based daycare in Columbus was charged with stealing more than $18,000 for delivering non-existent child care.
And in Lima, the owner of two centers was convicted of racketeering and theft for billing $27,000 in non-existent care for 17 children. Another 14 people, including parents and daycare  workers, have also pleaded guilty in connection with the case.
The state has cut off some daycare providers that refused to switch to the new electronic billing system. 

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