Executive Summary
On May 13, 2026, CMS announced a six-month nationwide moratorium on new Medicare enrollment for home health agencies (HHAs) and hospices. While there have been mentions of moratoria by Dr. Mehmet Oz, Administrator for CMS, and others over the last few months, this action taken by CMS has made it a reality, with CMS citing the moratoria as part of an aggressive nationwide crackdown on fraud.
The action represents one of the most significant program integrity interventions in recent years and is intended to combat fraud, waste, and abuse in high-risk provider categories. Previously, HHAs experienced a moratorium from 2013 until 2019 for targeted geographic locations. However, this recent moratoria announcement is the first of its kind for hospices.
While existing providers can continue operating as normal, the moratoria has immediate and far-reaching implications for growth strategies, compliance expectations, referral patterns, and market dynamics that need to be considered through this new lens of scrutiny.
Why CMS Took This Action
HHAs have long been recognized by the Office of Inspector General (OIG) and CMS as high-risk Medicare providers vulnerable to fraud, waste, and abuse. OIG and U.S. Department of Justice (DOJ) have encouraged CMS to undertake anti-fraud measures regarding hospices due to “dramatically” increased risks over the past seven years.
The background rationale for the moratoria includes several recent fraud cases and impacted dollar amounts, along with data surrounding provider growth across the country, particularly in specific states. Noted in the moratoria publications are longstanding concerns from the OIG regarding fraud, waste, and abuse that have led to the (previously recommended and now implemented) stronger anti-fraud measures.
The moratoria aim to prevent new bad actors from entering the system, stabilize the provider landscape, and allow CMS to intensify enforcement using advanced analytics. There is significant concern from industry stakeholders as to whether this nationwide response was warranted, as opposed to a more targeted, data-driven approach to identify potential fraudulent providers.
CMS addressed its decision for the nationwide approach as a needed response to stop the entry of fraud by halting new enrollments while making efforts to identify and remove existing fraudulent providers. CMS has the authority to modify the moratoria beyond the initial six-month time frames.
This action is part of a broader strategy that includes payment suspensions, enhanced screening, and increased audit activity, which could impact numerous HHAs and hospices across the country in the coming months as the focus on fraud, waste, and abuse intensifies.
What the Moratoria Covers
The moratoria apply nationwide and include all new Medicare enrollment applications for HHAs and hospices. According to the moratoria, no new agencies, branches, or practice locations will be enrolled while the moratoria are in effect, unless the enrollment application was received by the Medicare contractor prior to the moratoria effective date. A change of ownership (CHOW) is allowed, except in instances where initial Medicare enrollment would be required as a result of the CHOW. Practice location changes and updates to provider information, like phone numbers, are allowed to continue.
The moratoria also apply to certain changes in majority ownership if such changes result in an initial Medicare enrollment. Specific details are outlined in the moratoria publications and should be closely reviewed as part of any CHOW procedures during the moratoria period.
Existing Medicare-certified providers may continue operations and billing without interruption, though they should anticipate the potential for additional scrutiny, including onsite surveys and audit requests from Medicare contractors, during the moratoria period.
Operational & Strategic Implications
The moratoria halt growth through new Medicare enrollment, requiring organizations to shift strategies toward partnerships or the acquisition of existing entities, which may require organizations to re-evaluate their growth strategy plans.
In addition, providers should expect significantly increased oversight, including audits, medical review, and claims scrutiny. Hospices should note the newly published Service and Spending Variation Index (SSVI), as it was referenced in the moratoria announcement as part of the effort to crush fraud. Expansion of the Review Choice Demonstration (RCD) project, currently underway for HHAs in Illinois, Ohio, Texas, North Carolina, Florida, and Oklahoma, was also referenced in the moratoria announcement, though no specific details have yet been released.
Ownership changes and transactions may face delays or heightened scrutiny, impacting mergers and acquisitions (M&A). Ownership changes have been identified as a high-risk area and prevalent in past fraud cases. Thus, stakeholders considering ownership changes or transactions should carefully assess risks.
Of note, there are industry stakeholder concerns over access-to-care constraints in certain markets due to the inability to add new providers. CMS acknowledged these concerns as having little evidence of nationwide access-to-care issues for these programs.
For referral networks, strengthening relationships with existing high-performing providers may be helpful (given the halting of new providers entering the market). Value-based care will continue to be of growing importance for HHAs and hospices, as high-quality care performance with low Medicare spending and positive patient experiences will continue to be assessed by CMS.
Data analysis resulting in suspicious claims, spending outside of the benefit, and other outlier measures regarding quality and service will potentially trigger increased scrutiny. As such, providers must understand how they are performing and take intentional steps to improve outcomes.
Financial & Market Effects
In the short term, providers may experience reduced competition and increased compliance costs. Slowing new market entry can allow providers to solidify and improve their current market position. Providers also should anticipate and plan for increased survey and claim audit activity.
Mid-term impacts may include higher valuations for existing agencies and increased consolidation activity. The limitation of new Medicare enrollments will move the focus to M&A, and this must be approached with careful due diligence when considering value in relation to compliance risks, quality, and operational practices of potential targets.
Finally, long-term effects may include higher barriers to entry and a more regulated, performance-driven provider landscape. The hospice Provisional Period of Enhanced Oversight for new providers may extend and expand once the moratoria are modified or lifted. Quality performance will be here to stay for all providers, both existing and new. Data will be utilized to identify potentially fraudulent activities during the moratoria and will continue to be used moving forward.
With HHAs and hospices now both designated as high risk for fraud, waste, and abuse, along with CMS’ plan to stop the reactive “pay-and-chase” approach, the potential for ongoing scrutiny is likely.
Key Risks for Providers
Regulatory risks include increased likelihood of audits, revocation, and payment suspension. Providers should prepare now for increased surveys and audits to mitigate risks and prevent additional actions that could lead to revocation and/or payment suspensions.
Operational risks include capacity constraints and administrative burden from compliance activities. Skilled leaders and well-educated staff can help ensure that their organization has a solid compliance process to safeguard that Conditions of Participation and Conditions of Payment are met while providing high-quality patient care.
Lastly, strategic risks for providers include delayed growth plans and disruption to expansion or investment strategies. It is probable that stakeholders will re-evaluate strategy plans to adjust to the current moratoria.
What Providers Should Do Now
HHAs and hospices are encouraged to:
- Conduct internal compliance audits focusing on eligibility documentation, coding accuracy, and billing integrity.
- Reevaluate growth strategies and consider acquisitions or partnerships rather than new enrollments.
- Strengthen relationships with referral sources by emphasizing quality and compliance performance.
- Prepare for increased audit activity and develop response protocols.
- Monitor CMS updates for potential extensions, policy clarifications, or additional actions.
Bottom Line
The moratoria signal a fundamental shift in regulatory oversight of HHAs and hospices.
Organizations may weather this by demonstrating strong compliance, adapting to constrained growth conditions, and positioning themselves as high-quality providers in a more tightly regulated environment.
Forvis Mazars has the industry experience to help providers through this shifting environment by navigating increased scrutiny and helping to improve value-based performance. Through internal and external clinical and financial audit support, data analysis, and operational strategy development, our Home Care & Hospice team is here to provide your organization with the knowledge needed now in the face of industry headwinds.
Contact our team today to start proactively planning your strategic approaches to mitigating risks and positioning your organization for future success in the HHA and hospice sector.