The Centers for Medicare & Medicaid Services is temporarily halting approvals of new hospice and home health agencies nationwide for six months, an unusually aggressive anti-fraud action that carries particular relevance in Arizona, one of the nation’s fastest-growing hospice markets in recent years.The six-month moratorium marks the agency’s second enrollment freeze this year, following a February pause on new durable medical equipment supplier enrollments. CMS said the action is intended to stop fraudulent operators from entering Medicare while the agency reviews billing patterns, utilization trends and provider enrollment activity.
In its March 2026 report to Congress, MedPAC reported Arizona added 96 hospice providers between 2019 and 2023, a 14% average annual increase, one of the highest growth rates in the country. Only California, Texas and Nevada posted similarly elevated expansion. Growth slowed in Arizona in 2024, a shift MedPAC said may reflect increased program-integrity scrutiny.
Federal officials have spent years trying to curb fraudulent hospice and home health billing. According to Reuters, schemes can involve billing Medicare for services patients neither requested nor needed. While CMS has previously imposed targeted enrollment freezes in fraud hot spots such as Miami-Dade County in Florida and several Illinois counties, Reuters noted nationwide moratoriums are rare.
California’s experience illustrates the concern. A state audit of hospice growth in Los Angeles County cited several warning signs regulators associate with hospice fraud, including:
- Rapid growth in hospice agencies without a corresponding increase in patient need
- Dozens of separately licensed hospices operating from the same building
- Unusually long hospice stays and high rates of live discharge
- Use of potentially stolen identities tied to medical personnel
The Trump administration is also increasing pressure on states. Federal officials recently moved to withhold $1.3 billion in Medicaid funding from California, escalating a dispute over hospice oversight and program integrity. “The state of California has not taken fraud very seriously,” Vice President JD Vance said during a White House press conference on Wednesday.
The financial stakes are significant. Medicare spent $28.3 billion on hospice care for about 1.8 million beneficiaries in 2024, according to MedPAC, while home healthcare services accounted for another $16 billion serving 2.7 million Medicare patients.
Although industry groups broadly support stronger fraud enforcement, some also warn against sweeping restrictions. The National Alliance for Care at Home said fraud should be addressed through targeted enforcement rather than nationwide enrollment freezes that could reduce access in underserved communities and discourage legitimate providers.
Arizona’s hospice market includes about 250 providers in 2026, including nonprofit operator Hospice of the Valley, the state’s market leader, as well as hospice services provided from larger health systems including Banner and Dignity Health. According to CMS Data, about 50,000 Medicare beneficiaries received hospice care in Arizona in 2023.
Read more about the temporary ban from CMS
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