CMS Proposes Medicare Oversight and Home-Health Payment Changes
The Centers for Medicare & Medicaid Services is proposing broader Medicare oversight for providers and suppliers while projecting that aggregate payments to home-health agencies would rise in 2027. CMS issued the proposed rule on July 1, 2026, and the Federal Register published it on July 6.
The proposal is not final. CMS will accept comments until 5 p.m. EDT on August 31, 2026. After reviewing comments, the agency could keep, revise or drop provisions before issuing a final rule.
What CMS wants to change in provider oversight
The proposed rule would expand CMS authority to deny or revoke Medicare enrollment for certain providers and suppliers. Although the provisions are included in the home-health payment rule, CMS says the enrollment changes would apply across Medicare provider and supplier types.
One major proposal would make all Medicare provider-enrollment revocations retroactive to the date noncompliance began. Under current rules, some revocations take effect prospectively while others can be applied retroactively for specified reasons.
CMS also proposes additional denial or revocation grounds. They include situations in which a provider or supplier is located in a limited geographic area with an excessive concentration of providers and suppliers, creating what CMS would classify as a high risk for fraud, waste and abuse. The proposal also would address certain misdemeanor convictions related to sexual assault or financial misconduct within the previous 10 years.
These would be proposed authorities, not findings that all home-health agencies are engaging in misconduct. CMS estimates the program-integrity provisions would produce about $82 million in annual savings. That is an agency projection, not savings already realized or proof of widespread fraud across the sector.
What the payment proposal means
CMS projects that aggregate Medicare home-health payments would rise about 2.4%, or $420 million, in 2027 compared with 2026. The estimate is based primarily on a proposed 2.1% payment update, worth about $370 million, and an estimated 0.3% increase tied to the proposed update to the fixed-dollar-loss amount, worth about $50 million.
The rule also proposes a temporary 3% reduction to the CY 2027 national standardized home-health payment rate. CMS says the adjustment would continue recovering retrospective overpayments associated with the transition to the Patient-Driven Groupings Model and the 30-day payment unit. Because a 3% temporary adjustment is already included in the CY 2026 rates, CMS projects the temporary adjustment itself would have a net-zero effect when comparing aggregate CY 2027 payments with the CY 2026 baseline.
That structure means the proposed 2.4% aggregate increase should not be read as a uniform payment increase for every agency. CMS says effects could differ by case mix, utilization, provider type, wage index, outlier payments, low-utilization payment adjustments and geography.
What could change for patients and families
CMS proposes shortening the home-health quality-reporting assessment-data submission deadline from 4.5 months to 45 days. If finalized, the change could allow publicly reported quality information to become available up to three months sooner. It concerns agency reporting and public information; it would not immediately change a beneficiary’s clinical care.
CMS is also seeking comments on how to promote access to community-based palliative care through existing Medicare benefits, including the home-health benefit. The proposal does not create a new finalized palliative-care benefit, and palliative care under the home-health benefit is separate from Medicare hospice coverage.
Medicare beneficiaries do not need to change home-health providers because of this proposal. Any future effects on provider participation, public quality information or payment patterns would depend on the final rule.
What CMS is still asking about
The proposed rule includes a request for information on whether CMS should develop a home-health-specific wage index using an alternative data source, such as Bureau of Labor Statistics data. A wage index can affect payment adjustments across labor markets, but CMS has not adopted a new home-health-specific wage index in this proposal.
What happens next
People and organizations that want to influence the rule must submit comments through the Federal Register or Regulations.gov instructions by 5 p.m. EDT on August 31, 2026, citing file code CMS-1844-P. CMS will review the submissions before issuing a final rule.
The main uncertainties are which enrollment authorities will survive review, how CMS will apply the temporary payment adjustment, whether the reporting deadlines will change and what guidance the agency may issue on community-based palliative care. The projected 2.4% payment increase is an aggregate CMS estimate, not a guarantee for any individual agency or beneficiary.
Sources
- CMS proposed-rule fact sheet
- Federal Register proposed rule CMS-1844-P
- SBA Office of Advocacy regulatory alert
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