Hospice Enrollment Moratorium and the 36-Month Rule: When a Sale Requires a New Medicare Enrollment

The hospice 36-month rule and moratorium can turn the sale of an operating hospice into a blocked Medicare enrollment. The ownership rule requires a new enrollment after certain majority-ownership changes, and the nationwide moratorium stops that new enrollment. The Centers for Medicare & Medicaid Services designed these controls to interrupt hospice fraud that moves through provider numbers, ownership changes and businesses opened for resale.

If you handle a hospice’s billing, ownership paperwork or operations, you may know what changed behind the forms. We work with insiders to connect that knowledge to a health care fraud case. A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

Why Did Medicare Freeze New Hospice and Home Health Providers?

Medicare froze new hospice and home health enrollment to prevent fraud, waste and abuse before new providers began billing. In its hospice moratorium notice, the agency described businesses that opened, billed Medicare, shut down once they were audited or reached their annual payment limit, and bought another Medicare billing number. Patients moved to the new number and billing began again. It calls this “churn and burn.”

The agency also described apparently non-operational hospice addresses, recruiters targeting people who did not qualify, and payments to physicians for false terminal-illness certifications. Some operators established hospices to sell them, including after committing fraud but before Medicare could revoke their enrollment. That puts the enrollment itself at the center of the business model. The ability to bill becomes something to acquire, use and replace.

The growth was concentrated. The Medicare Payment Advisory Commission’s March 2025 report found that the combined hospice provider count in California, Texas, Arizona, Georgia and Nevada grew about 19% in 2023, compared with about 2% elsewhere. The later moratorium notice described numerous hospices operating from a single building in Los Angeles County. Its concern was the combination of enrollment growth, shared locations and the billing practices it was seeing.

The harm reaches the patient as well as the payment. The Centers for Medicare & Medicaid Services described hospices certifying people as terminally ill when they were not and furnishing little or no service. It warned that people placed on the hospice benefit inappropriately could lose coverage for other care.

The payment problem predates this freeze. A 2011 Congressional Research Service report explained how providers could enroll, collect and disappear before Medicare recovered the money. The report described a shift toward preventing improper payments, including closer examination of enrollment applications and visits to provider locations. The hospice controls apply that approach to who gets a billing number and whether it can pass to another owner.

What Is the 36 Month Rule for Hospice?

The hospice 36-month rule requires a hospice that changes majority ownership within 36 months of initial enrollment, or its most recent majority-ownership change, to enroll as a new Medicare provider unless an exception applies. The hospice must also undergo a state survey or accreditation.

The rule extended to hospices effective January 1, 2024, through the home health payment and enrollment rule. The Centers for Medicare & Medicaid Services described the ownership trigger as crossing the 50% threshold. A complete sale of the business is therefore not necessary for the majority-ownership question to arise.

The agency’s moratorium FAQ includes asset sales, stock transfers, mergers and consolidations in its explanation. The name given to the transaction does not answer whether fresh enrollment is required. Whether the hospice must enroll again depends on what changed, when it changed and whether an exception applies.

The agency borrowed the control from home health after seeing businesses enroll specifically to be flipped. A broker could obtain certification and sell the provider so the buyer entered Medicare without a survey of the business under its new ownership. The agency reported similar rapid sales among hospices. Requiring a new survey or accreditation lets the agency examine the new owner and the hospice together.

That is where the moratorium changes the practical result. For a covered ownership change, the agency terminates the existing enrollment and provider agreement. The replacement application counts as initial enrollment, just as it would for a hospice that had never participated in Medicare. The new owner cannot get the required Medicare enrollment while the freeze lasts. The business may have patients, staff and an operating history, yet its new enrollment is still blocked.

Hospice 36 Month Change in Majority Ownership Exceptions

Exceptions to the hospice 36-month change in majority ownership rule can prevent a transaction from requiring new enrollment. The FAQ gives the prior owner’s death as an example. The same guidance says majority-ownership changes beyond the applicable window generally do not cause the hospice to be treated as a new provider.

The Centers for Medicare & Medicaid Services does not grant individual hospices exceptions to the moratorium.

An existing provider agreement matters only if the transaction allows it to continue. The agency says already enrolled providers can acquire or merge with other enrolled providers during the moratorium when the transaction does not trigger required new enrollment and does not add new locations. If you know what changed behind the ownership paperwork, that is worth a conversation with us.

When Did the Nationwide Hospice Enrollment Moratorium Begin?

The nationwide hospice enrollment moratorium took effect on May 13, 2026. The agency published the notice on May 15. The initial six-month period runs to November 13, 2026, and the agency can extend it in six-month increments through another Federal Register notice.

An enrollment application received by the Medicare contractor before the moratorium’s effective date falls outside the freeze.

Initial applications submitted during the freeze are denied. The moratorium therefore stops enrollment at the application stage, including the new application required after a covered ownership change. It also reaches new hospice practice locations anywhere in the United States, including the territories and the District of Columbia.

How Does the Hospice Nationwide Enrollment Moratorium Affect Existing Providers?

The hospice nationwide enrollment moratorium allows existing providers to continue participating in Medicare and submitting claims for covered services. The Centers for Medicare & Medicaid Services estimated that approximately 7,000 already enrolled hospices could continue furnishing care when it announced the measure. The restriction reaches new entry, new locations and ownership events that require new enrollment.

An operating hospice still has to report changes in its enrollment information and meet revalidation requirements. The agency’s FAQ preserves those obligations during the moratorium.

A New Location and an Address Change Get Different Treatment

Adding a practice location to an existing Medicare enrollment is prohibited during the moratorium. The agency includes new branches, satellite offices and expansion locations under an existing CMS Certification Number. Keeping the same number does not make an additional location exempt.

The agency looks at what actually moved when a hospice reports a new address. Its FAQ says the Centers for Medicare & Medicaid Services or the state survey agency evaluates whether the provider has entered a new geographic community, begun serving a new patient population, or changed its clinical or administrative staff. A substantive operational change can count as a new provider rather than an address update.

That is a distinction an employee can see in the business itself. The enrollment form may describe a move while the staffing, service area and patient population show a substantially different operation. Those operating facts are the ones the agency identifies in deciding whether the change creates a new provider.

Medicare and Medicaid Enrollment Are Separate

The national action governs Medicare enrollment. The agency left each state to decide whether a hospice moratorium was appropriate for its Medicaid program or Children’s Health Insurance Program, and how broad it should be.

Hospice PPEO Review for New Providers and Ownership Changes

Hospice PPEO review reaches new providers and specified ownership changes through medical review of claims, including review before payment. The provisional period of enhanced oversight began before the nationwide enrollment moratorium.

On July 13, 2023, the Centers for Medicare & Medicaid Services began enhanced oversight in Arizona, California, Nevada and Texas. The program reaches newly enrolled hospices, qualifying changes of ownership, complete ownership changes outside that category, and reactivation after deactivation. The agency’s enhanced-oversight fact sheet describes medical review that can last from 30 days to one year.

In September 2024, the agency expanded prepayment review to existing hospices in the same four states. Georgia and Ohio joined the targeted oversight on December 30, 2025.

The agency also changed when the enhanced-oversight clock starts. It had seen home health agencies refrain from billing until their oversight period expired, then begin improper billing after scrutiny ended. The oversight period starts with the first claim. Waiting to send the bill no longer uses up the review period before the reviewer sees a claim.

By the end of 2025, the Centers for Medicare & Medicaid Services reported that 817 hospices had undergone medical review under the enhanced-oversight program and that it had revoked 181 enrollments. Those results appear in its January 2026 hospice fact sheet.

Why the Freeze Reached Every State

The nationwide freeze addresses schemes that move. Earlier local and state moratoria had seen providers relocate outside the restricted areas. In the hospice notice, the agency said a nationwide freeze would remove that geographic escape route for new enrollment.

The agency also said it had found little evidence of widespread hospice access problems outside the enrollment outliers and would monitor access during the freeze. The Medicare Payment Advisory Commission adds a useful industry distinction: an office’s location does not capture a hospice’s size, capacity or service area. The number of providers alone cannot tell a patient how much care is available nearby.

Owners and Managing Employees Are Part of Enrollment Screening

The Centers for Medicare & Medicaid Services moved hospices into the high screening category in 2024, adding fingerprint-based background checks for owners with a direct or indirect interest of 5% or more. Site visits already applied when hospices were in the moderate category.

Background checks reach owners with a smaller stake than the one needed to control a majority. The majority-ownership rule determines whether a transaction requires the hospice to enroll again. The same ownership documents can matter to both inquiries.

Medical directors and administrators also count as managing employees and must appear on the hospice’s Form CMS-855A Medicare enrollment application. The agency explained why: identifying people who hold those positions at multiple hospices can help expose a broader scheme when the businesses also show other program-integrity concerns.

Payment also depends on the Medicare status of physicians supplying terminal-illness certifications. For initial certification, the hospice physician and the patient’s attending physician, if there is one, must be enrolled in Medicare or have opted out for the hospice service to be paid. The agency said this lets it screen the physicians’ qualifications and program-integrity history.

An enrollment analyst or administrator may know that the person directing operations is different from the person the application presents. A medical director may know which other hospices use the same management. Those connections can give meaning to otherwise separate provider files.

What Insiders Can Connect to the Medicare Claims

An insider can connect an ownership change or provider-number switch to the patients, instructions and claims behind it. The agency’s churn-and-burn description makes that connection concrete: the billing number changes, the patients transfer, and payment starts again. The billing records show which provider sought payment before and after the change.

The enrollment application, ownership documents and management assignments describe who the government understood to be operating the hospice. Patient transfers and billing records show what the business did. We work with insiders to connect those accounts, including who directed the change and what explanation employees received.

For hospice whistleblowers, the useful knowledge may sit in enrollment or healthcare finance as much as in a clinical chart. We examine how the ownership and operating decisions connect to the payments and the suspected scheme.

Speak to Our Hospice Fraud Whistleblower Experts

If you handled a hospice sale, enrollment application or billing-number change and know what the paperwork leaves out, speak with our whistleblower experts about the operation behind it. We work beside you to build your strongest hospice fraud whistleblower case around the ownership, the instructions and the Medicare payments. We bring in hospice fraud whistleblower lawyers who understand enrollment and ownership schemes, and remain your partners through the case.