Why It Matters

A new Congressional Research Service (CRS) report, published Aug. 4, details how fraud schemes in Medicare hospice have metastasized into a national problem, forcing the Centers for Medicare and Medicaid Services (CMS) to take some of its most aggressive enforcement actions yet.

The hospice program's vulnerabilities run deep. Hospice eligibility rests on clinical judgment rather than objective diagnostic criteria, making it harder to police. Care is delivered at home, limiting oversight compared to institutional settings. Additionally, Medicare pays a per-diem rate capped annually, creating an incentive structure that some operators have weaponized.

As a result, fraudsters have "opened" nonexistent agencies at the same address, billed for services never provided using stolen identities, and enrolled patients who were not actually terminally ill.

The Big Picture

Over the past decade, medicare-certified hospice agencies grew from 4,840 in 2019 to 6,706 in 2024, a nearly 40 percent increase. CMS reported that certain states saw suspicious levels of growth accompanied by numerous fraud reports. The agency visited over 7,000 hospices nationwide in August 2023 and identified nearly 400 for "potential administrative action."

In February 2026, CMS put into effect a "nationwide moratorium" on Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) medical supply companies. Furthermore, in May 2026, the agency also announced a six-month nationwide temporary moratorium on new Medicare hospice and home health agency enrollment.

According to The Washington Post, some legitimate small businesses may have had payments unduly suspended.

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