From McKnights: CMS issues six-month moratorium on new hospices, home health agencies nationwide
After home health and hospice providers have been under the spotlight due to ongoing investigations of fraud, CMS has decided to place a six-month moratorium on new agencies enrolling with CMS. Read more in this McKnights article and additional analysis and details will be available soon.
Two Percent Sequestration Deduction Applied Twice on Home Health, SNF, Hospice Claims
Multiple Medicare Administrative Contractors overseeing home health payments have reported the two percent sequestration deduction has been applied twice on recently processed claims, beginning in mid-April. This is specific to Part A institutional providers including skilled nursing, home health and hospice claims (the dollar deducted for sequestration is shown in value code 73). Home Health and Hospice MAC’s CSG, Wellpoint Federal (formally NGS), and Palmetto, have each included an issue of log item on their websites for more information. The MACs state no further provider action is needed. The Fiscal Intermediary Standard System (FISS) maintainer is identifying claims underpaid incorrectly due to this issue. Identified/impacted claims will be adjusted starting on May 14, 2026. Members are advised to review their claims from the last month and ensure proper payments are reprocessed.
Building Momentum for Observation Stays Bill
LeadingAge continues advocacy on the Improving Access to Medicare Coverage Act (H.R. 3954). This bill would require all days spent in a hospital, regardless of inpatient or outpatient observation status, to count toward the three-day qualifying stay required for Medicare Part A coverage of a skilled nursing facility (SNF) stay. The House bill was originally introduced this congress by Reps. Joe Courtney (D-CT), Glen Thomspon (R-PA), Suzan DelBene (D-WA), and Ron Estes (R-KS) and currently has 33 co-sponsors. We hope to see a companion bill in the Senate soon. LeadingAge will continue working with congressional offices to build support for this and the forthcoming Senate bill.
HHS Takes Aim at De-prescribing
The Department of Health and Human Services (HHS) has announced a new initiative to curb “psychiatric overprescribing.” HHS Secretary Robert F. Kennedy, Jr. announced an action plan on May 4 aimed at preventing unnecessary initiation of psychiatric medications and supporting the tapering and discontinuation of medications for patients not experiencing clinical benefit. The plan includes three main pillars: education and outreach, program and policy, and research-to-practice initiatives. In a Dear Colleague letter also released on May 4, HHS encouraged providers to “prioritize informed consent and shared decision-making, and to regularly review the risks and benefits of psychiatric medications with patients.” HHS noted that the letter also highlighted non-pharmacological interventions and provided information on billing codes that could be used to support the delivery of evidence-based nonmedication treatments. While the HHS announcement referred several times to this initiative in relation to children and adolescents, it is worth taking note for nursing homes given the increased attention to psychotropic medications in recent years. Recall that the Centers for Medicare and Medicaid Services (CMS) released updated guidance in November 2024 that re-classified unnecessary psychotropic medications as chemical restraints, while continuing efforts to reduce the use of antipsychotic medications in nursing homes. As HHS pursues this agenda, it will be important for nursing homes to ensure they are continuing to follow requirements and best practices. Specifically, providers should pay attention to key areas of compliance such as informed consent, adequate clinical indications for use, and gradual dose reductions. Check out LeadingAge resources on psychotropic medications and preventing chemical restraints for assistance.
Long-Term Care Workforce Support Act Reintroduced in House
The Long-Term Care Workforce Support Act, reintroduced in the House of Representatives by Congresswoman Debbie Dingell (D‑MI) on April 28, 2026, aims to address severe workforce shortages across aging services settings through increased federal investment, particularly in Medicaid-funded care. LeadingAge supports the bill’s overarching goal of strengthening and stabilizing the direct care workforce and has long emphasized that meaningful progress will require substantial and sustained public funding. At the same time, many of the concerns that LeadingAge raised when the bill was considered last Congress remain relevant. Though the reintroduced version does include some changes that respond to stakeholder feedback, its core structure is largely unchanged. Read more about the bill here.
Tip Sheet: Proposed FY27 Hospice Wage Index Rule Comments
To help members in crafting comments to the Centers for Medicare and Medicaid Services (CMS) on the FY27 Hospice Wage Index proposed rule, LeadingAge has developed this resource with tips and links to additional resources. Access the tip sheet here.
OMB Receives CY2027 Home Health Proposed Rule
On May 11, the Office of Management and Budget (OMB) received the CY2027 Home Health Proposed Rule. This is the first step in federal review of rulemaking. LeadingAge anticipates this rule will be posted late June to early July. Based on the title the rule will contain additional updates for the Home Infusion Therapy program. Link to the regulatory review page here.
Weekly recaps: Wednesday, May 13
