Hospice industry leaders and healthcare policy attorneys are demanding answers from the Centers for Medicare & Medicaid Services after Washington sources indicated the agency may be considering a nationwide moratorium on new hospice provider Medicare enrollment — a step that would mark one of the most sweeping federal responses yet to a fraud crisis that has cost the Medicare program billions of dollars.
CMS had not publicly confirmed the consideration as of April 13, 2026, leaving trade associations and legal advisers with more questions than answers about what such a policy would mean for thousands of legitimate providers and the vulnerable patients who depend on them, according to reporting by Hospice News.
Fraud Crisis Drives the Conversation
The moratorium discussion comes amid an accelerating federal and state crackdown on fraudulent hospice operations, concentrated heavily in California but spreading to other states.
On April 3, 2026, federal authorities arrested eight people in Southern California connected to a health care and hospice fraud scheme totaling more than $50 million, with five of the cases involving hospice providers in the Los Angeles-area cities of Glendale, Artesia, Tarzana, and Simi Valley. Days later, on April 9, the California Governor’s office announced criminal charges against 21 suspects in a separate state investigation involving 14 fraudulent hospice providers and more than $267 million in improper claims paid with state and federal funds. Investigators found that shell companies had purchased personal identifying information on the dark web, enrolled out-of-state residents in California’s hospice care system, billed for services never rendered, and laundered proceeds through complex corporate structures.
The scale of the problem extends well beyond California. CMS referred 343 cases to federal law enforcement in 2025 representing $3.4 billion in alleged fraudulent billing. As of June 2025, 668 hospices were under medical review through the agency’s Provisional Period of Enhanced Oversight, and 122 had billing privileges revoked. CMS has identified California, Arizona, Nevada, Texas, Ohio, and Georgia as fraud hotspots, with Greater Los Angeles County flagged as the primary epicenter after hospice billing activity in that region rose sevenfold in recent years.
Industry Divided on the Remedy
The National Partnership for Healthcare and Hospice Innovation (NPHI) became the most prominent voice calling for federal action when CEO Tom Koutsoumpas sent a letter to CMS Administrator Dr. Mehmet Oz and Deputy Administrator Kimberly Brandt on March 27, 2026, urging a temporary, time-limited nationwide moratorium on new hospice enrollments.
“These bad actors exploit vulnerable patients, undermine trust, and threaten the integrity of the Medicare hospice benefit,” Koutsoumpas wrote. “This is not a failure of the hospice model of care. It is the result of a subset of providers exploiting the healthcare system, and that must stop.”
But significant opposition has emerged from other corners of the industry. Hilary Loeffler of the National Alliance for Care at Home argued that broad enrollment moratoria fail to address fraud at its root, calling on CMS to target bad actors specifically rather than freeze enrollment across the board, according to Hospice News.
Healthcare attorney Edo Banach of Foley Hoag LLP warned of an unintended consequence: “When you have a moratorium, you lock in fraud,” he said, explaining that a freeze would allow existing fraudulent operators to continue billing while blocking legitimate new entrants from the program.
Andrew Brenton of Husch Blackwell described the potential policy as “unfair” and “not a good idea,” arguing it would penalize law-abiding organizations and restrict access to care in underserved communities. State hospice associations from Florida, North Carolina, South Carolina, California, and Texas, along with the Save Home Health Coalition, have also weighed in on the debate.
Existing Enforcement and Legislative Backdrop
California has operated a moratorium on new hospice licenses since 2024, which Gov. Gavin Newsom extended through January 2027. Since that moratorium took effect, the state has revoked more than 280 hospice licenses and placed 300 additional providers under investigation.
At the federal level, CMS implemented a Provisional Period of Enhanced Oversight for newly enrolling hospices in California, Arizona, Nevada, Texas, Georgia, and Ohio in 2023, subjecting them to increased medical review before billing can proceed.
Congress has also entered the debate. The Hospice CARE Act of 2026 includes a provision that would mandate a five-year nationwide moratorium on the enrollment of new hospice programs beginning on the date of enactment. That legislation had not been signed into law as of the date of publication.
Why This Matters for Home Care
A national moratorium on new hospice Medicare enrollment would limit entry of new providers into the program — potentially concentrating end-of-life care among a smaller pool of established operators and placing greater responsibility on families to arrange and maintain quality care in the home environment.
For families navigating hospice or comfort care at home, the clinical and physical setup surrounding a patient shapes both safety and dignity during one of the most sensitive periods a family faces. SonderCare’s home hospital beds are built for exactly these settings — with full positioning capabilities including Zero Gravity, Cardiac Chair, and Trendelenburg support, a FallSafe ultra-low platform height of 10 inches for fall prevention, and furniture-grade upholstered panels that preserve the feel of a home rather than a clinical facility.
If your family is arranging hospice or comfort care at home, explore SonderCare’s home hospital beds at sondercare.com/beds or call our care specialists to discuss which configuration best supports your loved one’s needs and your caregiving situation.
