Even If the Moratorium Ends, CMS's Focus Will Remain — What Owners Should Build Before Enforcement Comes Knocking

CMS’s enrollment moratorium may end, but its focus on home health or hospice is expected to continue through audits, data driven review, enrollment scrutiny, and stronger revocation tools. For owners, compliance readiness is also exit readiness because buyers underwrite documentation, referral relationships, ownership records, and cash flow durability. This article provides a practical 90 day checklist to help agencies reduce enforcement risk and protect sale value. It also explains how Senate Healthcare approaches potential acquisitions as the buyer and strategic partner.

9/13/20267 min read

The six month CMS enrollment moratorium may end on November 13, 2026, but the enforcement environment facing home health or hospice owners is unlikely to return to normal. This article explains what CMS is watching, why compliance risk can reduce sale value, and what owners should build now to protect operations, valuation, and exit readiness.

Quick Scan Summary

Who this is for

This article is for owners of home health or hospice agencies with approximately $2 million to $10 million in annual revenue who are:

Preparing for a possible sale or succession
Expanding into a new market or service area
Managing audit, enrollment, or documentation risk
Reviewing referral, marketing, or ownership arrangements
Trying to protect enterprise value in a more selective buyer market

Key takeaways

The moratorium may expire, but CMS will continue focusing on home health or hospice as high risk areas.
Existing providers remain exposed to audits, payment review, enrollment scrutiny, and possible revocation action.
Compliance risk is not only a regulatory problem. It is an underwriting problem that can reduce a buyer’s valuation.
Agencies should build a defensible record trail across clinical documentation, billing, ownership, referrals, and corrective actions.
A clean compliance profile can increase buyer confidence at a time when weak operators may leave the market.

Why enforcement will outlive the freeze

CMS imposed a national six month moratorium on new Medicare enrollment for home health agencies and hospice providers effective May 13, 2026. The moratorium also applies to certain changes in majority ownership that require re enrollment.

The freeze was designed to stop new operators from entering markets where federal officials identified serious fraud concerns. It does not prevent existing providers from continuing to operate and submit claims, provided they remain compliant.

The more important message for established owners is that the freeze gives CMS an opportunity to concentrate resources on providers already in the Medicare program. The Frier Levitt analysis describes expanded oversight that includes hospice site visits, enhanced screening, revocations, and broader prepayment and post payment review.

Mollie Gurian, vice president of policy and government affairs at LeadingAge, summarized the long term concern clearly:

> “It is important for providers to understand that even if the moratoria ends, CMS' focus on hospice and home health as an area of concern will remain.”

That distinction matters. The end of an enrollment freeze is not the end of enforcement. It may simply mark a shift from restricting new entrants to examining the financial, clinical, and ownership records of current providers.

What is driving the crackdown?

The federal anti fraud task force was established in March 2026 under the leadership of Vice President J.D. Vance. The task force includes approximately 10 federal agencies, including the Departments of Justice, Health and Human Services, Homeland Security, and Labor.

On April 15, the task force suspended 447 hospices and 23 home health agencies in the Los Angeles area over suspected malfeasance estimated at approximately $600 million. The Hospice News report identified several patterns that have drawn federal attention:

Enrolling patients who did not qualify for hospice or who did not consent
Transferring patients between organizations in exchange for payments
License flipping
Illegal kickbacks for referrals
Multiple hospices operating from the same address
Individuals holding management positions at several hospices simultaneously

The states receiving enhanced attention include Arizona, California, Georgia, Nevada, Ohio, and Texas. Owners in these states should expect more scrutiny, but owners elsewhere should not assume they are outside the enforcement environment.

LeadingAge has urged CMS Administrator Dr. Mehmet Oz to end the moratorium rather than extend it. Katie Sloan, LeadingAge’s president and CEO, said legitimate providers are being caught in the crossfire of the fight against fraud. She also noted that providers had made substantial investments to develop services for their communities, only to have those efforts delayed.

The National Alliance for Care at Home has raised similar concerns. Its CEO, Jennifer Sheets, pointed to potential harm to rural and underserved communities, as well as pressure on provider financial positions.

Those concerns do not eliminate the need for compliance. They reinforce the need for objective standards, consistent documentation, and a defensible operating model.

What CMS is watching now

CMS and its contractors are likely to focus on whether the agency’s records tell a consistent story from referral through discharge.

For home health, that means reviewing:

OASIS accuracy and consistency
Homebound status
Skilled need
Physician orders and plans of care
Visit notes and billed services
Authorization and medical necessity support
Referral patterns and unusual census growth

For hospice, the review typically centers on:

Terminal prognosis support
Patient election and consent
Physician certification and recertification
Evidence of decline across benefit periods
Level of care documentation
Interdisciplinary group records
Referral and marketing arrangements
Live discharge and length of stay patterns

WellSky’s moratorium and compliance audit strategy article makes the central point: documentation must demonstrate eligibility and clinical necessity consistently over time, not only in isolated records.

Owners should also prepare for more involvement from Targeted Probe and Educate contractors, Medicare Administrative Contractors, Unified Program Integrity Contractors, and other review entities.

In addition, owners should monitor the proposed CY2027 rule. The proposed changes would expand CMS authority in areas such as retroactive revocations, new denial grounds, and restrictions on reapplication. These provisions may change before finalization, but they signal the direction of travel.

As Gurian warned, without objective standards and procedural safeguards, providers could face significant consequences while diverting operational and clinical resources away from care delivery and innovation.

How enforcement risk affects audits and valuation

A buyer does not underwrite only revenue and EBITDA. A buyer underwrites the durability of the revenue and the risk attached to the cash flow.

An agency with inconsistent records, unexplained referral concentration, or unresolved enrollment issues may receive a compliance haircut even when its financial statements look strong.

Consider a hospice or home health agency with $500,000 of normalized EBITDA:

These are illustrative scenarios, not market guarantees. The point is that a one turn reduction in the multiple can cost $500,000 on the same earnings base.

A clean agency may also benefit from reduced supply if weaker operators leave the market. Buyers can place a premium on a business that has:

Reliable clinical documentation
Clear ownership and management records
No unexplained related party arrangements
Consistent billing and coding
A documented audit response process
Strong employee retention and clinical leadership
Referral relationships that withstand review

A confidential owner vignette illustrates the issue. One hospice owner with approximately $4.5 million in revenue had strong community relationships and stable EBITDA. During preliminary underwriting, however, the agency could not quickly reconcile referral data, certification narratives, and several contractor agreements. The problem was not necessarily improper conduct. The problem was that the buyer could not efficiently prove the absence of improper conduct. That uncertainty would likely affect price, structure, escrow, or all three.

What owners should build now: A 90 day checklist

Days 1 through 30: Identify exposure

Run a focused clinical and billing audit.
Compare OASIS, visit notes, plans of care, and claims for home health.
Review terminal prognosis, election, consent, and recertification records for hospice.
Screen owners, executives, contractors, and referral partners against applicable exclusion databases.
Review all marketing, lead generation, and referral compensation arrangements for anti kickback concerns.
Confirm that ownership, locations, licenses, and enrollment records are accurate.

Days 31 through 60: Correct the gaps

Create written corrective action plans with responsible owners and deadlines.
Retrain clinicians, billers, marketers, and referral staff.
Establish a process for handling overpayments, repayment questions, and potential disclosures with healthcare counsel.
Build a centralized audit response file containing policies, licenses, organizational charts, payer correspondence, and prior findings.
Test whether the agency can respond quickly to an Additional Documentation Request or site visit.

Days 61 through 90: Make readiness repeatable

Report compliance findings to ownership or the board monthly.
Track denials, appeals, repayment activity, audit requests, and corrective action completion.
Create a standing referral and marketing review process.
Separate owner responsibilities from clinical and administrative functions where possible.
Document succession plans for the administrator, director of nursing, medical director, and other key leaders.

For home health owners, monthly reporting should include net reimbursement per completed visit by payer, authorized visits compared with clinically ordered visits, denials and appeal overturn rates, authorization labor hours per 100 Medicare Advantage episodes, days in accounts receivable by payer, EBITDA margin by payer, revenue concentration by individual Medicare Advantage plan, and referral volume by payer and referral source.

These metrics do more than support operations. They help a buyer understand whether revenue is repeatable, whether payer risk is concentrated, and whether margin depends on fragile processes.

Plain Language Glossary

Enrollment moratorium: A temporary pause on accepting certain new Medicare enrollment applications.

Payment suspension: The withholding of Medicare payments while suspected fraud is investigated. It is not the same as a final denial or revocation.

Targeted Probe and Educate review: A focused review process in which a contractor examines claims, identifies patterns, and may provide education before further review.

Underwriting: A buyer’s process for evaluating financial performance, compliance risk, leadership strength, and future cash flow.

Compliance haircut: A reduction in valuation or purchase price because a buyer believes unresolved compliance risk could create future losses.

License flipping: Selling or transferring a provider license soon after obtaining it, particularly where regulators suspect the transaction is being used to avoid scrutiny.

Normalized EBITDA: Earnings before interest, taxes, depreciation, and amortization adjusted to remove unusual or nonrecurring items.

So what should you do now?

Treat the November moratorium expiration as a planning deadline, not a return to business as usual.
Complete a focused audit of clinical documentation, billing, ownership, and referral arrangements.
Correct issues before a buyer or regulator discovers them.
Build a clean data room that shows why your revenue, margin, and compliance profile are durable.

Partner with the buyer before you are under pressure

Senate Healthcare is evaluating acquisitions of home health or hospice agencies and works directly with owners considering a sale, succession plan, or strategic transition.

We are the buyer and strategic partner, not a broker, agent, or advisor representing an owner. Our focus is on understanding the operation, preserving quality care, reducing transaction risk, and building a practical path toward a sale or partnership.

An agency does not need to be perfect today to begin a confidential conversation. Owners who identify weaknesses early generally have more time to correct them, protect their valuation, and make decisions from a position of control.

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