[Federal Register Volume 91, Number 94 (Friday, May 15, 2026)]
[Notices]
[Pages 27954-27961]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2026-09717]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
[CMS-6101-N]
Medicare, Medicaid, and Children's Health Insurance Programs:
Announcement of Nationwide Temporary Moratoria on Enrollment of Home
Health Agencies (HHAs)
AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of
Health and Human Services (HHS).
ACTION: Notice.
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SUMMARY: This notice announces the imposition of a 6-month nationwide
moratorium on the Medicare enrollment of home health agencies (HHAs).
DATES: This moratorium is effective May 13, 2026.
FOR FURTHER INFORMATION CONTACT: Frank Whelan, (410) 786-1302.
SUPPLEMENTARY INFORMATION:
I. Background
A. CMS' Authority To Impose Temporary Enrollment Moratoria
1. Statutory and Regulatory Background
Under the Patient Protection and Affordable Care Act (Pub. L. 111-
148), as amended by the Health Care and Education Reconciliation Act of
2010 (Pub. L. 111-152) (collectively known as the Affordable Care Act),
Congress provided the Secretary with new tools and resources to combat
fraud, waste, and abuse in Medicare, Medicaid, and the Children's
Health Insurance Program (CHIP). One of these was section 6401(a) of
the Affordable Care Act, which added a new section 1866(j)(7) to the
Social Security Act (the Act). It provided the Secretary with authority
to impose a temporary moratorium on the enrollment of new fee for
service (FFS) Medicare, Medicaid or CHIP providers and suppliers--
including categories of providers and suppliers--if the Secretary
determines that a moratorium is necessary to prevent or combat fraud,
waste, or abuse under these programs.
Section 6401(b) of the Affordable Care Act added specific
moratorium language applicable to Medicaid at section 1902(kk)(4) of
the Act, requiring States to comply with any moratorium imposed by the
Secretary unless the State determines that the imposition of such
moratorium would adversely impact Medicaid beneficiaries' access to
care. Section 6401(c) of the Affordable Care Act amended section
2107(e)(1) of the Act to provide that all the Medicaid provisions in
sections 1902(a)(77) and 1902(kk) are also applicable to CHIP.
In February 2011, in accordance with the aforementioned authority,
CMS published a final rule with comment period titled, ``Medicare,
Medicaid, and Children's Health Insurance Programs; Additional
Screening Requirements, Application Fees, Temporary Enrollment
Moratoria, Payment Suspensions and Compliance Plans for Providers and
Suppliers'' (76 FR 5862). This final rule implemented section
1866(j)(7) of the Act by establishing new regulations at 42 CFR
424.570. Under Sec. 424.570(a)(2)(i) and (iv), CMS--or CMS in
consultation with the Department of Health and Human Services Office of
Inspector General (HHS-OIG) or the Department of Justice (DOJ) or
both--may impose a temporary moratorium on newly enrolling Medicare
providers and suppliers if CMS determines that there is a significant
potential for fraud, waste, or abuse with respect to a particular
provider or supplier type or particular geographic areas or both.
2. Particulars of a Moratorium as Outlined in Sec. 424.570
a. Length
In accordance with Sec. 424.570(b), a temporary enrollment
moratorium imposed by CMS remains in effect for 6 months. If CMS deems
it necessary, the moratorium may be extended in 6-month increments. CMS
evaluates whether to extend or lift the moratorium before the end of
the initial 6-month period and, if applicable, before the expiration of
any subsequent moratorium periods. If the moratorium announced in this
notice is extended, CMS will publish a document regarding such
extension(s) in the Federal Register.
b. Cessation
As provided in Sec. 424.570(d), CMS may lift a moratorium at any
time if: (1) the President declares an area a disaster under the Robert
T. Stafford Disaster Relief and Emergency Assistance Act; (2)
circumstances warranting the imposition of a moratorium have abated or
CMS has implemented program safeguards to address the program
vulnerability; (3) the Secretary has declared a public health
emergency; or (4) in the judgment of the Secretary, the moratorium is
no longer needed. Once a moratorium is lifted, the provider or supplier
types that were unable to enroll because of the moratorium will be
assigned to the ``high'' screening level in accordance with Sec. Sec.
424.518(c)(3)(iii) and 455.450(e)(2) if such provider or supplier
applies for enrollment at any time within 6 months from the date the
moratorium was lifted.
c. Circumstances Where Moratorium Is Inapplicable
Under Sec. 424.570(a)(1)(iii), a temporary moratorium does not
apply to any of the following:
Changes in practice location (except if the location is
changing from a location outside the moratorium area to a location
inside the moratorium area).
Changes in provider or supplier information, such as phone
number or address.
Changes in ownership (except changes in ownership of HHAs,
hospices, and suppliers of durable medical equipment, prosthetics,
orthotics, and supplies (DMEPOS) that would require an initial
enrollment).
Also, in accordance with Sec. 424.570(a)(1)(iv), a temporary
moratorium does not apply to any enrollment application that has been
received by the Medicare contractor prior to the date the moratorium is
imposed.
3. Announcement of Moratorium
CMS states at Sec. 424.570(a)(1)(ii) that it will announce a
temporary moratorium in a Federal Register notice that includes the
rationale for its imposition.
[[Page 27955]]
The subject notice fulfills that requirement.
B. CMS' Previous Temporary Enrollment Moratoria
We first used our moratorium authority to prevent enrollment of new
HHAs, subunits, and branch locations (hereafter collectively referred
to as HHAs) in Miami-Dade County, Florida and Cook County, Illinois, as
well as surrounding counties, and Part B ambulance suppliers in Harris
County, Texas and surrounding counties, in a notice issued on July 31,
2013 (78 FR 46339). We exercised the moratorium authority again in a
notice published on February 4, 2014 (79 FR 6475), when we extended the
existing moratoria for an additional 6 months and expanded it to
include enrollment of HHAs in Broward County, Florida; Dallas County,
Texas; Harris County, Texas; and Wayne County, Michigan and surrounding
counties, and enrollment of ground ambulance suppliers in Philadelphia,
Pennsylvania and surrounding counties. We extended these moratoria for
another 6 months on August 1, 2014 (79 FR 44702); February 2, 2015 (80
FR 5551); July 28, 2015 (80 FR 44967); and February 2, 2016 (81 FR
5444).
We again extended these moratoria for another 6 months on August 3,
2016 (81 FR 51120) and also expanded them Statewide with respect to the
enrollment of new HHAs in Florida, Illinois, Michigan, and Texas, and
Part B non-emergency ambulance suppliers in New Jersey, Pennsylvania,
and Texas. In this same notice, though, we announced the lifting of
temporary moratoria for all Part B emergency ambulance suppliers.
The original 2013 moratorium, after being extended and revised
several times,\1\ expired on January 30, 2019. However, in the February
27, 2026, Federal Register (91 FR 9855), we published a notice
announcing a 6-month nationwide enrollment moratorium on DMEPOS medical
supply companies.\2\ Said moratorium remains in effect.
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\1\ On January 9, 2017, CMS issued another notice to extend the
temporary moratoria for a period of 6 months (82 FR 2363). On
January 9, 2017 (82 FR 2363) and July 28, 2017 (82 FR 35122), CMS
again issued a notice to extend the temporary moratoria for a period
of 6 months. On September 1, 2017, CMS lifted the Statewide
temporary moratorium on the enrollment of new Medicare Part B non-
emergency ground ambulance suppliers in Texas under the authority of
Sec. 424.570(d). This lifting of the moratorium also applied to
Medicaid and CHIP in Texas. This decision was a result of the
Presidential Disaster Declaration signed on August 25, 2017, for
several counties in the State of Texas due to Hurricane Harvey. Upon
declaration of the disaster, CMS carefully reviewed the potential
impact of continued moratoria in Texas and decided to lift the
temporary enrollment moratorium on non-emergency ground ambulance
suppliers in Texas in order to aid in the disaster response. CMS
published a formal announcement of this decision on November 3, 2017
(82 FR 51274). On January 30, 2018 (83 FR 4147), CMS announced the
extension of the temporary moratoria for an additional 6 months. In
August 2018, CMS announced the extension of the temporary moratoria
for an additional 6 months. CMS allowed the temporary moratoria to
expire on January 30, 2019.
\2\ ``Medicare, Medicaid, and Children's Health Insurance
Programs: Announcement of Nationwide Temporary Moratoria on
Enrollment of Durable Medical Equipment, Prosthetics, Orthotics, and
Supplies (DMEPOS) Supplier Medical Supply Companies'', 91 FR 9855.
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C. Determination of the Need for Moratoria
In weighing the need to establish an enrollment moratorium, CMS
considers whether a significant risk of fraud, waste, or abuse exists.
CMS also relies on its own and law enforcement's longstanding
experience with ongoing and emerging fraud trends and activities gained
through civil, criminal, and administrative investigations and
prosecutions.
1. Law Enforcement
The HHS-OIG has long highlighted and documented the problem of HHA
fraud, waste, and abuse. The OIG and DOJ have over the years encouraged
and supported strong anti-fraud measures targeting HHAs, and we believe
the action announced by this notice is consistent therewith.
2. Data Analysis
In contemplating the present moratorium, we also used data analysis
that included reviewing: (1) both current and historic Medicare
enrollment data; and (2) indicators of fraud, waste, and abuse.
Sections II.A. and B. of this notice discuss our review in more detail.
3. Access to Care
Beneficiary access to care in Medicare, Medicaid and CHIP is of
critical importance to CMS and our State partners. In our moratorium
determination, we carefully evaluated access to care for Medicare
beneficiaries nationwide. We discuss our findings for Medicare
beneficiaries in the Beneficiary Access to Care section later in this
notice.
II. National HHA Moratorium
Under its authority at Sec. 424.570(a)(2)(i) and (a)(2)(iv), CMS
is implementing a nationwide temporary moratorium on the Medicare
enrollment of HHAs nationwide. In this section, we explain the
rationale for and scope of this moratorium.
A. Longstanding HHA Program Integrity Risks and CMS Efforts To
Alleviate Them
As previously alluded to, HHA fraud, waste, and abuse has been a
severe problem for over two decades. Based on our experience, low
start-up costs and the home-based nature of the services--with little
direct supervision of the persons performing them--help make the HHA
arena ripe for fraud. Indeed, HHAs have long been among the highest-
risk Medicare provider/supplier types in terms of program integrity,
with the OIG stating in 2018: ``Home health has long been recognized by
OIG and CMS as a program area vulnerable to fraud, waste, and abuse.''
\3\ To help address this, CMS over the years has established a number
of provider enrollment payment safeguards concerning HHAs.
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\3\ https://oig.hhs.gov/documents/evaluation/2926/OEI-05-16-00510-Complete%20Report.pdf.
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One involves capitalization. Under Sec. 489.28(a), newly enrolling
HHAs must have available sufficient funds (known as ``initial reserve
operating funds'') at the time of application submission and at all
times during the enrollment process up to the expiration of the 3-month
period following enrollment. The purpose is to ensure that the HHA is a
viable and financially stable business, for an underfunded entity could
skimp on patient care to save money or engage in fraud to improve its
finances. HHAs are the only Medicare provider/supplier type that have
minimum capitalization requirements as a condition of enrollment; this
underscores the uniquely serious fraud, waste, and abuse threat HHAs
pose.
Another involves risk designations. All providers/suppliers are
assigned to an application screening level under Sec. 424.518 of
``limited,'' ``moderate,'' or ``high.'' Those in the ``high'' category
receive the strictest scrutiny; when initially enrolling in Medicare or
undergoing an ownership change, they receive a site visit and must have
their 5 percent or greater owners be subject to fingerprinting for a
criminal background check. HHAs are one of only six provider/supplier
types in the ``high'' classification.\4\ Especially telling, though, is
that HHAs were one of only two types that were assigned to this level
in our initial category assignments in 2011.
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\4\ The others are DMEPOS suppliers, hospices, Medicare diabetes
prevention programs, skilled nursing facilities, and opioid
treatment programs.
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A third involves changes in majority ownership (CIMOs). We found in
the mid-2000s that some HHAs were attempting to enter Medicare without
[[Page 27956]]
undergoing the required State survey or accreditation. Brokers would
enroll an HHA (after the survey or accreditation) with the specific
intention of quickly selling it to another party. This allowed the
buyer to participate in Medicare with no survey or accreditation of the
HHA under its new ownership--hence increasing the possibility of an
illegitimate HHA furnishing (and billing for) poor or otherwise non-
compliant services to beneficiaries. To help halt such circumvention,
we promulgated Sec. 424.550 in 2009. It required an HHA undergoing a
CIMO within 36 months of its initial enrollment (or within 36 months of
its most recent CIMO) to--unless certain exceptions apply--initially
enroll as a new HHA and undergo a State survey or accreditation.
An additional initiative concerned provisional periods of enhanced
oversight (PPEO). Section 1866(j)(3) of the Act permits the Secretary
to establish a PPEO of between 30 days and 1 year during which new
providers or suppliers (including categories thereof) would be subject
to enhanced oversight, such as prepayment review and payment caps.
Consistent therewith--and in light of the HHA payment safeguard threats
we have observed--we implemented a PPEO in 2019 on new HHAs nationwide
regarding their requests for anticipated payments (RAPs). Specifically,
HHAs would not receive upfront payments prior to the provision of
services stemming from their RAPs.\5\ The PPEO expired in 2020, and
there presently are no HHA-related PPEOs in effect.
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\5\ CMS eliminated the use of RAPs for HHAs; beginning January
1, 2022, CMS replaced RAP submissions with a Notice of Admission.
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Most pertinent to the current notice and as already mentioned, we
also imposed and extended several HHA enrollment moratoria from 2013
through 2019. Although the particular circumstances involving each
affected county and State varied somewhat, they all shared a common
characteristic: a significant potential for HHA fraud, waste, and
abuse. This was reflected in, for instance: (1) an abnormally high
number of HHAs vis-[agrave]-vis the location's beneficiary population
(that is, market oversaturation); and (2) heavy law enforcement
activity as reflected in part by criminal convictions of HHA owners and
operators.
We believe these and other provider enrollment measures have to
some degree helped reduce the amount of HHA fraud, waste, and abuse.
These measures also show our ongoing commitment to addressing this
dilemma and our recognition of our obligation to do everything possible
to protect Medicare beneficiaries, the Medicare Trust Funds, and the
American taxpayers.
B. Continued Problems in the HHA Sphere
Despite all these initiatives, HHA program integrity risks are
still among the highest of any provider/supplier type. Our actions
might have lessened the degree of HHA fraud, waste, and abuse, but
certainly not to the extent that CMS need no longer undertake
additional initiatives. It should not be assumed that the expiration of
the prior HHA moratoria and PPEO signified a massive reduction in the
scope of the HHA risk. As the examples below demonstrate, hundreds of
millions of taxpayer dollars remain under threat from fraudulent
parties, and we must always consider further means of addressing this
continuing problem, particularly as new threats arise.
One such threat involves the Los Angeles region, which has seen
unusual and highly disturbing trends in HHA enrollment. CMS data
indicates that the number of HHAs in Los Angeles County between 2019
and 2023 rose more than 40 percent. Well over 1,000new HHAs have
enrolled in the county since 2019, and the county currently has roughly
12-15 percent of all HHAs nationwide--notwithstanding the fact that the
county's Medicare beneficiary population has not drastically changed
over the past 7 years and represents roughly 3 percent of the total
nationwide beneficiary community. There is no evidence of medical need
or other justification for this sudden, overwhelming increase, and we
believe this requires much closer scrutiny of potentially fraudulent
HHA activity. Others share our concerns about this, including MedPAC,
members of Congress, and even several national HHA organizations--with
some having urged CMS to take additional measures to stem HHA fraud
throughout Los Angeles County.\6\ Concerning trends in HHA enrollment
are not restricted to Los Angeles County. For instance, CMS has
recently detected several situations in Ohio where numerous HHAs are
operating out of a single, common practice location. In fact, we have
uncovered at least nine cases in Ohio where at least five HHAs have the
same practice location address; four of these nine situations involve
at least nine HHAs in one location, with one location having 18 HHAs.
Similar situations have been seen in Texas, Michigan, North Carolina,
and Nevada.
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\6\ https://www.medpac.gov/wp-content/uploads/2025/12/Tab-H-HHA-update-Dec-2025.pdf; Letter from United States House Representatives
Brett Guthrie, John Joyce, M.D., Morgan Griffith, Jason Smith, David
Schweikert, and Vern Buchanan to T. March Bell, Inspector General,
HHS-OIG, January 9, 2026; https://energycommerce.house.gov/posts/chairmen-guthrie-joyce-griffith-smith-schweikert-and-buchanan-ask-hhs-oig-about-ongoing-hha-and-hospice-fraud-in-los-angeles-county-1.
Letter from LeadingAge and the National Alliance for Care at Home
Letter to Dr. Mehmet Oz, CMS Administrator, December 22, 2025;
https://allianceforcareathome.org/wp-content/uploads/Final-Alliance-and-LeadingAge-Home-Health-and-Hospice-Program-Integrity-Recommendations.pdf.
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There have also been a considerable number of criminal convictions
and other findings over the last several years involving home health
fraud. These included, but were not limited to, the following:
The owner of a Pennsylvania home care agency was sentenced
to prison in June 2025 and ordered to pay over $235,000 in restitution.
The provider had been reimbursed by Medicaid for services that were not
provided and for claims containing false representations. The
investigation revealed that some of the submitted claims pertained to:
(1) patients who never signed up for or received care from the
provider; or (2) employees who were not aware that the owner had
submitted false claims for hours they allegedly worked.\7\
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\7\ https://www.attorneygeneral.gov/taking-action/owner-of-berks-county-home-care-agency-sentenced-to-prison-ordered-to-pay-more-than-235k-in-restitution-after-pleading-guilty-to-medicaid-fraud-scheme/.
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Two Illinois home health care company owners were
sentenced to prison in September 2022 and ordered to pay more than $8
million as part of a home health care fraud scheme. According to court
documents, the two owned and operated three home health companies in
Illinois and Indiana. From approximately January 2009 to June 2018, the
pair secretly paid bribes and kickbacks to patient marketers in
exchange for referring Medicare beneficiaries to the companies. One of
the two maintained relationships with marketers and signed sham
contracts with patient marketers on behalf of the companies, while the
other facilitated kickback payments to marketers by writing checks to
himself and agency employees; the latter would then convert the checks
to cash that was used to pay kickbacks to marketers. Also, the former
individual caused fraudulent claims to be submitted to Medicare for
home health services that falsely represented that she, as a registered
nurse, performed assessments of patients on dates when she was out of
the country.\8\ According to the
[[Page 27957]]
Department of Justice: ``[I]t was the practice of the [pair's]
companies to admit, discharge, and re-certify certain patients
repeatedly, regardless of their medical conditions.'' \9\
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\8\ https://www.justice.gov/archives/opa/pr/home-health-care-company-owners-sentenced-67-million-health-care-fraud.
\9\ Ibid.
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A part-owner of a Massachusetts home health provider in
January 2025 was sentenced in Federal court to 12 years in prison and
ordered to pay almost $100 million in restitution for her role in a
home health care fraud scheme. (A co-defendant, who was a nurse at the
home health agency, had previously been sentenced to prison for her
involvement in the scheme.) \10\ According to the indictment for the
co-defendant, the provider--through the part-owner, the nurse, and
others--billed for home health services that were (1) never provided;
(2) not medically necessary; or (3) not authorized. The part-owner and
others also developed employment relationships to pay kickbacks for
patient referrals and disregarded medical necessity requirements. In
addition, they allegedly entered sham employment relationships with
patients' family members to provide home health aide services that were
not medically necessary and routinely billed for fictitious visits that
did not occur. As alleged in the civil complaint, the part-owner--
either directly or through the home health company--``targeted
particularly vulnerable patients who were low-income, on disability
and/or suffering from depression and/or addiction.'' \11\ The United
States attorney for the case added that the part-owner, ``used the
stolen money to fund her lavish lifestyle, showing a callous disregard
for those who were in dire need of care and assistance. Her actions not
only defrauded taxpayers but also compromised the integrity of
essential home health care services. The significant prison term
imposed today reflects the seriousness of her crimes and the harm she
caused to patients, providers, and the public.'' \12\
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\10\ https://www.justice.gov/usao-ma/pr/operator-home-health-care-company-sentenced-12-years-prison-multimillion-dollar-health;
https://www.justice.gov/usao-ma/pr/lowell-nurse-pleads-guilty-100-million-home-health-care-fraud-and-kickback-scheme
\11\ Ibid.
\12\ Ibid.
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A home health care owner was sentenced in April 2025 to 42
months in prison for committing Medicaid fraud and was ordered to pay
$5.7 million in restitution to Medicaid. According to court documents
and trial testimony, the defendant owned and operated three home health
care businesses in Ohio. She lived in California for the majority of
the time she owned the businesses, and despite not being involved in
the businesses' daily operations, she did all the Medicaid billing for
nursing services. In doing so, she: (1) inflated the hours of services
provided; (2) billed for registered nurses when licensed practical
nurses completed the care; and (3) billed for care for patients who
were either deceased or ineligible to receive Medicaid.\13\
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\13\ https://www.justice.gov/usao-sdoh/pr/home-health-care-companies-owner-sentenced-more-3-years-prison-57-million-medicaid.
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The State of Massachusetts in December 2020 reached a $10
million settlement with a Massachusetts-based home health care company
and its owner to resolve allegations that they falsely billed the
State's Medicaid program for unauthorized services. According to the
State's Attorney General, the State since 2016 had returned ``more than
$40 million to [the State's Medicaid program] by going after fraud in
the home health industry.'' \14\
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\14\ https://www.mass.gov/news/ag-healey-secures-10-million-from-home-health-care-company-that-falsely-billed-masshealth.
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A San Francisco Bay Area doctor was convicted in Federal
court in November 2023 of charges that included: (1) accepting
kickbacks for patient referrals to HHAs; (2) health care fraud; and (3)
false statements relating to a health care matter. One of the schemes
the physician engaged in involved referring patients to an HHA in
exchange for illegal kickback payments. Regarding the HHA itself,
employees thereof and the chief executive officer (CEO) conspired to
pay the physician regular and recurring amounts to ensure that he
referred Medicare patients to the HHA. The CEO pled guilty to charges
of conspiracy to pay kickbacks for the referrals of Medicare
beneficiaries on August 5, 2022.\15\
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\15\ https://www.justice.gov/usao-ndca/pr/bay-area-doctor-convicted-health-care-fraud-and-kickback-scheme-referrals-medicare.
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In November 2024, a Michigan HHA owner and operator was
sentenced to prison for his role in a health care fraud conspiracy that
resulted in almost $7.9 million in false and fraudulent claims for home
health care services paid by Medicare. According to court documents,
the individual--together with three doctors and two other home health
care company owners--offered kickbacks, bribes, and other inducements
to beneficiary recruiters in exchange for Medicare beneficiary
information. They then used this information to bill Medicare for
services that were medically unnecessary and not provided.\16\
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\16\ https://www.justice.gov/archives/opa/pr/international-fugitive-home-health-care-owner-sentenced-fraudulently-billing-medicare.
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A New Hampshire man pleaded guilty in July 2021 to two
counts of Medicaid fraud. The individual owned a company licensed to
provide in-home personal care services to Medicaid beneficiaries. He
submitted claims for reimbursement for such services that: (1) were
never actually provided; and (2) included periods when the company's
patients were not at home but instead were in hospitals or nursing
homes.\17\
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\17\ https://oig.hhs.gov/fraud/enforcement/home-care-company-owner-pleads-guilty-to-medicaid-fraud-agrees-to-pay-1000000-restitution/.
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A Texas man in August 2025 was sentenced to 75 months in
Federal prison for leading a Medicare fraud scheme. The individual
owned and operated an HHA. He or others at his direction forged
signatures of doctors and nurses; specifically, they cut out old
signatures and taped them onto newly created doctors' orders, nursing
notes, and nursing assessments. The defendant submitted these falsified
documents in response to a request for records from Medicare. He also:
(1) continued using the signature of a nurse who had departed the HHA
on nursing notes and assessments; (2) per witness testimony, bribed a
doctor in exchange for approving home health services; and (3) billed
Medicare for over $400,000 in HHA claims but did not maintain the
documentation for many of them and later falsified records to support
the claims.\18\
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\18\ https://www.justice.gov/usao-sdtx/pr/home-health-agency-owner-sentenced-more-six-years-medicare-fraud-and-identity-theft.
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A Michigan man was convicted in September 2023 for
orchestrating a $2.8 million health care fraud and wire fraud
conspiracy, and engaging in money laundering, aggravated identity
theft, and witness tampering. Despite being excluded from billing
Medicare, the individual purchased an HHA using the names, signatures,
and personal identifying information of others to conceal his ownership
of the company. In a 2-month period, he and his co-conspirators billed
and were paid nearly $2.8 million by Medicare for services that were
never provided. He then transferred these funds through bank accounts
belonging to shell corporations and eventually into his accounts in
another country. Too, on the eve of trial--and using a pseudonym--he
wrote false and malicious emails to various federal government agencies
alleging a government witness had
[[Page 27958]]
committed various crimes and should not be allowed to remain in the
United States in an attempt to keep the witness from testifying.\19\
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\19\ https://www.justice.gov/archives/opa/pr/owner-home-health-company-convicted-28m-medicare-fraud-scheme.
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An Oklahoma-based home health provider in January 2026
agreed to pay $34 million to resolve its civil liability under the
False Claims Act for billing medically unnecessary home health claims
to Medicare and providing financial benefits to physicians in exchange
for referrals.\20\
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\20\ https://www.justice.gov/opa/pr/traditions-health-agrees-pay-34m-resolve-false-claims-act-liability-relating-home-health.
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In another Oklahoma case in October 2022, an Oklahoma-
based home health provider, its affiliates, and their president and
chief operations officer agreed to pay nearly $7.2 million to resolve
allegations that they violated the False Claims Act by billing the
Medicare program for medically unnecessary therapy provided to patients
in Florida. Specifically, the home health provider allegedly billed the
Medicare program knowingly and improperly for home healthcare to
patients in Florida based on therapy provided without regard to medical
necessity and overbilled for therapy by upcoding patients'
diagnoses.\21\
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\21\ https://www.justice.gov/archives/opa/pr/carter-healthcare-affiliates-and-two-senior-managers-pay-7175-million-resolve-false-claims.
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C. Assessment of the Data
The foregoing information plainly shows a significant potential for
fraud, waste or abuse with respect to HHAs nationwide. Several other
observations can be made about this data.
First, while Los Angeles County has been the focus of much recent
attention regarding HHA fraud, this does not mean an HHA enrollment
moratorium should be limited to that area. HHA fraud can and does
happen in numerous geographic regions--even those that might not be
traditionally considered very high risk, such as Massachusetts, Ohio,
and Oklahoma. Indeed, quick and dramatic spikes in fraud can occur
anywhere and at any time. Los Angeles County, for instance, had not
been included in any of our previous HHA moratoria because the risk
that existed there between 2013 and 2019 was deemed less than that
posed by HHAs in other areas like Houston and the South Florida region.
Yet a rapid, unexpected, and very substantial increase in the number of
HHAs occurred in said county. Too, the aforementioned Ohio situation
involving dozens of HHAs took place suddenly in the Columbus region,
which had never before been a major hotspot for HHA fraud. The point is
that the Los Angeles County situation--rather than militating against a
nationwide moratorium--in our view bolsters the case for it, for fraud
schemes can be highly migratory. As we stated in a previous HHA
moratorium notice: ``The HHS-OIG and CMS have learned that some fraud
schemes are viral, meaning they replicate rapidly within communities,
and that health care fraud also migrates--as law enforcement cracks
down on a particular scheme, the criminals may redesign the scheme or
relocate to a new geographic area.'' \22\ With a nationwide HHA
moratorium, though, prospective HHA enrollees seeking to defraud
Medicare would have no new geographic area to which to migrate.
Likewise, a national moratorium would prevent situations we saw during
our prior HHA moratoria where HHAs--attempting to circumvent the
moratorium--opened immediately outside the moratorium area and
furnished services to beneficiaries within it.
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\22\ ``Medicare, Medicaid, and Children's Health Insurance
Programs: Announcement of Temporary Moratoria on Enrollment of
Ambulances Suppliers and Providers and Home Health Agencies in
Designated Geographic Areas,'' July 31, 2013 (78 FR 46339).
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Second, and in a similar vein, the fact that some of the home
health fraud is occurring strictly in Medicaid (as shown in several of
the previously noted cases) does not diminish the need for a Medicare
moratorium. To the contrary, it shows that such fraud takes place
across different Federal and State programs. It is the fraud activity
itself and its widespread nature--not the specific health care program
in which it happens--that is the critical consideration when
establishing anti-fraud measures. This is particularly true given that
many HHAs are enrolled in both Medicaid and Medicare, meaning behavior
in one program could be repeated in another.
Third, we recognize that the overall nationwide number of non-
California enrolled HHAs has decreased somewhat in recent years. On the
surface at least, this might weigh against a moratorium, since the
problem of large numbers of new enrollments is not present outside of
Los Angeles County. However, we reiterate that the principal test under
Sec. 424.570 for a moratorium is whether a ``significant potential for
fraud, waste, or abuse'' exists. Although a dramatic spike in
enrollments is often indicative of potential fraud, it is not a
prerequisite for it. Other data can also show this potential. For
example, the aforementioned criminal and other cases and the clusters
of co-located HHAs reveal that home health fraud is taking place even
in areas that have seen reductions in the number of enrolled HHAs, such
as Michigan and Texas.\23\ Accordingly, we do not believe that the HHA
decrease outside of California obviates the need for a moratorium.
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\23\ Between 2019 and 2025, the number of enrolled HHAs in
Michigan dropped from 485 to 361 (over 25 percent) and from 2,269 to
1,893 in Texas (roughly 17 percent).
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CMS must be aggressive in halting fraud before it begins;
proactivity is a far better anti-fraud approach than a reactive, ``pay-
and-chase'' one. We found our previous HHA moratoria beneficial in this
regard, which is largely why we extended and expanded them over a 5-
year period. The HHA moratoria's lapse in 2019 did not signify a lack
of their success but instead our view that it had achieved the desired
goal of keeping potentially fraudulent parties in certain areas from
enrolling in Medicare. However, given the serious problems in Los
Angeles County and elsewhere, we believe that our current HHA anti-
fraud measures have not by themselves dramatically reduced HHA fraud.
HHA program integrity requires a holistic effort on our part. We cannot
impose only one measure at a time and then wait indefinitely to see if
it works before attempting another. Such has been the magnitude of HHA
fraud for so long that more measures are needed to supplement our
existing ones--and we believe that by applying an HHA moratorium
nationwide, we could experience the success of our prior localized
moratoria on a much broader geographic scale.
D. Moratorium Determination and Scope
In light of the foregoing concerns, and pursuant to our
consultation with OIG, CMS has concluded that HHAs present significant
potential for fraud, waste or abuse. To prevent potentially fraudulent
HHAs from enrolling in Medicare, we have determined to impose a
nationwide moratorium on the enrollment of all HHAs. Beginning on the
effective date of this notice, no new HHAs or HHA branches or practice
locations will be enrolled into Medicare unless the HHA's enrollment
application was received by the applicable Medicare contractor prior to
this notice's effective date. Geographically, the moratorium applies to
HHAs seeking to enroll anywhere in the United States, including all
States, territories, and the District of Columbia.
[[Page 27959]]
As previously mentioned, our prior HHA moratoria included the
establishment of HHA subunits and branches. In 2013, a ``subunit' of an
HHA, like the HHA itself, was required under 42 CFR part 484 to
independently meet the HHA conditions of participation (CoPs) in 42 CFR
part 484, sign a separate provider agreement, and separately enroll in
Medicare; the only material distinction between an independent HHA and
a subunit was that they could share the same governing body,
administrator, and group of professional personnel.\24\ Considering
CMS' conclusion that the requirement for a subunit to independently
meet the CoPs rendered said distinction moot, CMS ended the ``subunit''
designation in 2018.\25\ Subunits are accordingly not part of the
present moratorium. An HHA ``branch office,'' meanwhile, is defined in
42 CFR 484.2 as an approved location or site from which an HHA provides
services within a portion of the total geographic area served by the
parent HHA--the parent providing supervision and administrative control
of the branch. The branch need not independently meet the HHA CoPs. For
purposes of provider enrollment, CMS has always considered an HHA
branch to be a practice location of the HHA. It is therefore an
integral part of the HHA and its operations, which is partly why we
included branches within the previous moratoria and do so in the
present one. More basically, Sec. 424.570(a)(1)(i) is clear that a
moratorium can apply to ``the establishment of new practice
locations,'' which, again, new HHA branches are.
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\24\ See the proposed rule titled ``Medicare and Medicaid
Program: Conditions of Participation for Home Health Agencies'',
published in the Federal Register on October 9, 2014 (79 FR 61164
and 61167).
\25\ Ibid.
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We also note Sec. 424.550(b), which, as already mentioned,
requires an HHA undergoing a non-exempt CIMO within 36 months of its
initial enrollment (or within 36 months of its most recent CIMO) to
enroll in Medicare as a brand new HHA and undergo a State survey or
accreditation. The HHA's current enrollment and provider agreement are
terminated in these situations. This means that the HHA's new
enrollment is an initial enrollment no less than if the HHA had never
enrolled in Medicare before. Hence, our moratorium would prohibit an
HHA undergoing a non-exempt CIMO from reenrolling in Medicare because,
again, it would constitute an initial enrollment; the HHA is ``new''.
E. Applicability to Medicaid and CHIP
As already mentioned, section 1866(j)(7) of the Act authorizes
imposition of a temporary enrollment moratorium for Medicare, Medicaid
or CHIP if the Secretary determines such moratorium is necessary to
prevent or combat fraud, waste, or abuse. The Secretary is not required
to impose a particular moratorium on all three programs but may do so
on any combination of the three programs or one program alone.\26\
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\26\ The February 2, 2011, final rule also established new
Medicaid regulations at 42 CFR part 455, subpart E, including Sec.
455.470, which implements the moratoria authority under section
1902(kk)(4) of the Act. Likewise, that final rule implemented Sec.
457.990, providing that part 455, subpart E applies to CHIP in the
same manner as it applies to Medicaid. Under Sec. 455.470(a)(1)
through (3), the Secretary may impose a temporary moratorium, in
accordance with Sec. 424.570, on the enrollment of new providers or
provider types after consulting with any affected State Medicaid
agencies. The State Medicaid agency will impose a temporary
moratorium on the enrollment of new providers or provider types
identified by the Secretary as posing an increased risk to the
Medicaid program unless the State determines that the imposition of
a moratorium would adversely affect Medicaid beneficiaries' access
to medical assistance and so notifies the Secretary in writing.
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At this time, we believe it is in Medicaid and CHIP beneficiaries'
best interests to allow each State to decide whether some form of a
home health provider moratorium is appropriate for their respective
Medicaid and CHIP programs, and the scope of any such moratorium. Each
State has greater expertise and experience with their pool of home
health provider types--including the requirements for each type of home
health provider--than CMS. Nevertheless, CMS encourages each State to,
as appropriate, implement a home health provider moratorium tailored to
the specifics of their beneficiary population as well as any geographic
considerations (in accordance with 42 CFR 455.470(b)). Additionally,
CMS is offering every State and territory the opportunity to consult
with CMS on the prospect of implementing a Medicaid- or CHIP-based (or
both) home health moratorium in their jurisdictions.
F. Beneficiary Access to Care
Although there has been a slight decline in the number of Medicare-
enrolled non-California HHAs since 2019, there remain over 11,500 HHAs
nationwide. We have not seen evidence of a present nationwide shortage
of HHAs or of access-to-care issues for beneficiaries in Medicare
either nationally, in particular geographic areas, or rural regions. We
are also not aware of similar concerns in Medicaid or CHIP. We
therefore do not believe that a national moratorium will threaten
beneficiaries' ability to receive home health services in any of these
programs. However, we will monitor this matter for any access issues--
including in rural areas--that arise.
III. No Judicial Review of CMS's Decision To Impose an Enrollment
Moratorium
In accordance with section 1866(j)(7)(B) of the Act, there is no
judicial review under sections 1869 and 1878 of the Act, or otherwise,
of the decision to impose a temporary enrollment moratorium. Under
Sec. Sec. 424.530(a)(10) and 424.570(c), CMS denies the enrollment
application of a provider or supplier if the provider or supplier is
subject to a moratorium. In addition, Sec. 424.514(d)(2)(v)(C) states
that if the provider or supplier was required to pay an application
fee, the application fee will be refunded if the application was denied
because of the imposition of a temporary moratorium.
A provider or supplier that is impacted by a moratorium may use the
existing appeal procedures at 42 CFR part 498 to administratively
appeal a denial of billing privileges based on the imposition of a
temporary moratorium. The scope of any such appeal, though, would be
limited solely to assessing whether the temporary moratorium applies to
the provider or supplier appealing the denial (see 42 CFR 498.5(l)(4)).
IV. Collection of Information Requirements
This document does not impose information collection and
recordkeeping requirements. Consequently, it need not be reviewed by
the Office of Management and Budget under the authority of the
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).
V. Regulatory Impact Statement
A. Statement of Need
This notice is necessary to help reduce the prevalence of Medicare
fraud, waste, and abuse among HHAs.
B. Overall Impact
We have examined the impacts of this notice as required by E.O.
12866, ``Regulatory Planning and Review''; E.O. 13132, ``Federalism; E.
O. 13563, ``Improving Regulation and Regulatory Review''; E.O. 14192,
``Unleashing Prosperity Through Deregulation''; and the Regulatory
Flexibility Act (RFA), 5 U.S.C. 601 through 612; section 1102(b) of the
Social Security Act; and section
[[Page 27960]]
202 of the Unfunded Mandates Reform Act of 1995.
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select those regulatory approaches that
maximize net benefits (including potential economic, environmental,
public health and safety, and other advantages; and distributive
impacts). Section 3(f) of Executive Order 12866 defines a ``significant
regulatory action'' as any regulatory action that is likely to result
in a rule that may: (1) have an annual effect on the economy of $100
million or more or adversely affect in a material way the economy, a
sector of the economy, productivity, competition, jobs, the
environment, public health or safety, or State, local, or tribal
governments or communities; (2) create a serious inconsistency or
otherwise interfere with an action taken or planned by another agency;
(3) materially alter the budgetary impact of entitlements, grants, user
fees, or loan programs or the rights and obligations of recipients
thereof; or (4) raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the Executive Order itself.
An RIA must be prepared for a regulatory action that is significant
under section 3(f)(1) of Executive Order 12866. Based on our analysis,
the Office of Information and Regulatory Affairs (OIRA) has determined
that this notice is not significant pursuant to section 3(f)(1) of
Executive Order 12866. In accordance with Subtitle E of the Small
Business Regulatory Enforcement Fairness Act of 1996 (also known as the
Congressional Review Act), OIRA has also determined that this notice
does not meet the criteria for a major rule as defined in 5 U.S.C.
804(2). Accordingly, we have not prepared a regulatory impact analysis.
In addition, section 1102(b) of the Act requires us to prepare an
RIA if a rule may have a significant impact on the operations of a
substantial number of small rural hospitals. This analysis must conform
to the RFA provisions at 5 U.S.C. 604. For purposes of section 1102(b)
of the Act, we define a small rural hospital as a hospital that is
located outside of a metropolitan statistical area and has fewer than
100 beds. This notice is primarily applicable to HHAs suppliers, not
rural hospitals. Therefore, the Secretary has certified that this
notice will not have a significant economic impact on the operations of
small rural hospitals.
We note that we expect savings to the Medicare program from the
reduction in the number of newly enrolling HHAs. However, we do not
have data upon which to base an estimate of the amount of savings.
C. Regulatory Flexibility Analysis (RFA)
1. Small Business Impact
The RFA requires agencies to analyze options for regulatory relief
of small businesses. For purposes of the RFA, small entities include
small businesses, nonprofit organization, and small governmental
jurisdictions. Most entities and most other providers and suppliers are
small entities, either by nonprofit status or by having revenues less
than $19 million to $41 million in any 1 year. Individuals and States
are not included in the definition of a small entity.
We do not believe that this HHA moratorium notice will have a
significant economic impact on a substantial number of small
businesses. Between 2023 and today in States other than California, the
combined annual number of newly enrolling HHA has generally been less
than 400 (or an average of roughly 150 to 200 over a 6-month period).
If we assumed that a roughly similar number would seek to enroll during
the moratorium but would be prohibited from doing so, this is a
miniscule percentage when compared to the well over 2 million providers
and suppliers currently enrolled in Medicare. The same would hold true
if several hundred HHA branches could not be added as practice
locations during the moratorium. Moreover--and excluding their ability
to add branches to their enrollments--the moratorium would not impact
the roughly 11,500 currently enrolled HHAs, which could continue
furnishing services (assuming they remain compliant with all Medicare
requirements). Accordingly, we expect few small businesses to be
affected by the moratorium. Even conceding the impact on newly
enrolling HHAs and prospective HHA branches, we believe that the risk
that HHA fraud, waste, and abuse poses to the Trust Funds, Medicare
beneficiaries, and the taxpayers far exceeds this and thus justifies
our measure.
2. Alternatives Considered
There are two principal alternatives we considered in preparing
this notice. First, we considered forgoing a moratorium entirely. Yet
as already mentioned, the longstanding fraud, waste, and abuse problems
require fraud, waste, and abuse prevention measures beyond those
described earlier in this notice, such as capitalization requirements.
Helpful though the latter have been, more is needed. Second, we
contemplated limiting the moratorium to southern California. We
believe, though, that the problems the moratorium seeks to address are
nationwide rather than restricted to particular geographic areas. As we
also stated earlier, the transient nature of fraud schemes--as shown
in, for instance, the sudden upswing in new HHAs in Los Angeles County
and the tens of HHAs in Ohio operating out of single site--require
nationwide (rather than localized) proactivity to prevent these schemes
from developing in the first place. Third, we contemplated requiring
States to implement an HHA moratorium, but, as noted, we believe States
are in the best position to determine whether a moratorium is
appropriate for their jurisdictions and beneficiary populations.
D. Unfunded Mandates Reform Act (UMRA)
Section 202 of UMRA of 1995 UMRA also requires that agencies assess
anticipated costs and benefits before issuing any rule whose mandates
require spending in any 1 year of $100 million in 1995 dollars, updated
annually for inflation. In 2026, that threshold is approximately $193
million. This notice will not impose a mandate that will result in the
expenditure by State, local, and Tribal governments, in the aggregate,
or by the private sector, of more than $193 million in any 1 year. UMRA
only applies in situations where an agency engages in notice-and-
comment rulemaking. It does not apply to this notice.
E. State and Local Costs
Executive Order 13132 establishes certain requirements that an
agency must meet when it promulgates a proposed regulatory action (and
subsequent final action) that imposes substantial direct requirement
costs on State and local governments, preempts State law, or otherwise
has Federalism implications. Since this notice does not impose any
costs on State or local governments, the requirements of Executive
Order 13132 are not applicable.
In accordance with the provisions of Executive Order 12866, this
notice was reviewed by the Office of Management and Budget.
The Administrator of the Centers for Medicare & Medicaid Services
(CMS), Dr. Mehmet Oz, having reviewed and approved this document,
authorizes Chyana Woodyard, who is the Federal Register Liaison, to
electronically sign
[[Page 27961]]
this document for purposes of publication in the Federal Register.
Chyana Woodyard,
Federal Register Liaison, Centers for Medicare & Medicaid Services.
[FR Doc. 2026-09717 Filed 5-13-26; 8:45 am]
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