CMS Expands Fraud Enforcement with Nationwide Moratoria on Hospice and HHA Enrollments

On May 13, 2026, the Centers for Medicare & Medicaid Services (CMS) announced a nationwide six-month moratorium on new Medicare enrollments for hospice providers and home health agencies (HHAs). The action follows a recent executive order establishing a federal task force focused on fraud prevention and efforts to “disrupt and dismantle fraud networks and facilitators.” 

Scope of the Moratoria 

The two moratoria, Hospice and Home Health Agency, apply to all new HHA and hospice Medicare enrollment applications, including certain ownership changes that require a “new” enrollment. The moratoria apply nationwide, reaching all states, territories, and the District of Columbia, and are modeled on prior moratoria for these provider types that were issued in more limited geographies. The moratoria apply to new hospices, new hospice practice locations, new HHAs, and new HHA branches or practice locations, as well as to those hospices and HHAs subject to the “36-month rule” — i.e., those with non-exempt changes in majority ownership occurring within 36 months of initial enrollment or the most recent change in majority ownership. 

The moratoria do not apply to existing enrolled providers, applications submitted before May 13, 2026, and changes to information — including routine updates to provider information such as phone numbers, indirect ownership changes, or ownership changes that do not require a new enrollment. CMS also clarified that routine practice location changes generally remain permissible unless the provider relocates into a moratorium-covered area, suggesting that expansion beyond existing approved service areas would be prohibited but a relocation within those areas may be viewed as a “routine” and permitted change. 

Although the moratorium is set initially for six months, CMS may extend it in six-month increments if the agency determines that the underlying fraud concerns that led to its issuance persist. Based on prior CMS practice, extension for a period of at least one year is likely. CMS further indicated that providers seeking enrollment after the moratorium is lifted may be subject to heightened scrutiny and placed into a high-risk screening category if they apply within six months following the end of the moratorium. That higher risk designation, which would apply to any new enrollment or location of a hospice of HHA nationwide, requires additional screening for all owners and additional survey scrutiny, among other things.  

CMS has also issued an FAQ addressing the moratoria. 

Heightened Enforcement Activity

The moratoria are only one aspect of the administration’s broader enforcement initiative. Simultaneous with its moratoria, CMS has stated that it intends to intensify targeted investigations and expand the use of data analytics to identify hospice and home health providers suspected of fraud. Providers should also expect increased audit activity, including potential pre-payment audits. In addition to recoupments, adverse audit findings may be used by CMS to revoke billing privileges or terminate a provider’s Medicare enrollment in more serious cases. 

CMS’s Rationale

The moratoria are driven by CMS’s concerns regarding fraud and abuse in the hospice and home health sectors, including kickback arrangements to induce referrals or improper certifications, enrolling ineligible patients, and billing for services that were not provided, not medically necessary, or improperly documented. CMS also highlighted hospice “churn and burn” schemes in which providers shut down and reopen under new billing numbers to evade oversight, along with broader HHA structural vulnerabilities like low startup costs and limited supervision that make these sectors particularly susceptible to fraud, waste, and abuse.

Medicaid Enforcement Action: $1.3 Billion Withheld From California

The enforcement push is not limited to Medicare. On the same day CMS announced the moratoria, the White House announced it would withhold $1.3 billion in Medicaid reimbursements to California, based on concerns about inadequate efforts to address hospice fraud. The action, also tied to the task force, signals a broader willingness to use federal funding to compel stronger anti-fraud enforcement by states. Vice President JD Vance warned that additional states could face funding suspensions, similar to the withholding of approximately $243 million in Medicaid reimbursements to Minnesota over allegedly suspect claims in the last few months.

Potential State-Level Expansion of the Moratorium

Lastly, in connection with the moratoria, CMS is also encouraging states to evaluate whether to implement their own HHA or hospice enrollment moratoria tailored to their Medicaid programs and CHIP beneficiaries. CMS further stated that it is offering consultation and technical assistance to any state or territory considering implementation of such measures, signaling the potential for broader state-level enforcement and enrollment restrictions.

Practical Takeaways

Organizations potentially impacted by the moratoria should promptly evaluate how transactions and operations may be affected, particularly with respect to changes of ownership, pending enrollment applications, and de novo expansion strategies. From a compliance perspective, providers should anticipate increased Medicare audit and enforcement activity and take steps to strengthen billing practices, clinical documentation, and internal controls. Providers should also ensure they have effective processes in place for timely and organized responses to record requests and audit inquiries.

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The Goodwin Healthcare team will continue to monitor activity from CMS. For more information on the issues discussed in this alert, please contact the authors, reach out to Goodwin’s Healthcare Regulatory and Compliance group, or the Goodwin lawyer whom you typically consult. 

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