If you are buying or selling a home health agency or a hospice, CMS’s latest announcement is a reason to revisit the growth assumptions in your deal model.
On November 12, 2026, CMS extended its nationwide moratoria on new Medicare home health and hospice enrollments for another six months, effective November 13, 2026. The freeze still reaches certain ownership changes that require an initial enrollment. But CMS also reopened a door it had closed in May—an agency that is already enrolled can once again add practice locations under its existing enrollment, so long as each new location is in the same state.1
That change gives an established operator an option it did not have last month. It may add a practice location under its existing enrollment, so long as the new location is in the same state, or it may grow by buying. Adding a location is not unlimited expansion, because a branch office serves only a portion of the geographic area the parent agency already serves. A buyer entering the market has no comparable option. For that buyer, whether the target’s Medicare enrollment survives the transaction is the transaction. The two paths will shape which targets buyers pursue and what they are willing to pay for the growth each one promises.
The threshold question is whether the deal triggers a new Medicare enrollment. If a home health agency or hospice undergoes a change in majority ownership by sale—including asset sales, stock transfers, mergers, and consolidations—within 36 months after the effective date of its initial enrollment or within 36 months after its most recent change in majority ownership, its provider agreement and Medicare billing privileges do not convey to the new owner unless an exception applies. The new owner must instead enroll in Medicare as a new agency and obtain a state survey or an accreditation from an approved accreditation organization. While the moratoria are in place, CMS will deny that initial enrollment.2
Whether a transaction falls outside that rule comes down to four exceptions, and in practice those exceptions are what decide whether Medicare revenue survives the closing. The provider agreement and billing privileges still convey if the agency or hospice has submitted two consecutive years of full cost reports since initial enrollment or the last change in majority ownership, whichever is later; if a parent company is undergoing an internal corporate restructuring, such as a merger or consolidation; if the owners are changing the existing business structure and the owners remain the same; or if an individual owner dies. On the cost report exception, confirm what was actually filed for each of the two years, because low-utilization and no-utilization cost reports do not qualify as full cost reports.3
What Diligence Has to Prove
An agency that has operated for a decade can still sit inside the 36-month window, because the clock restarts at each change in majority ownership, so buyers should build the complete ownership timeline, document any exception they intend to rely on, and confirm the answer before the operating model counts on uninterrupted Medicare revenue. The branch path carries its own diligence requirements. A branch serves only part of the parent agency’s service area, the parent must provide supervision, direct support, and administrative control, each proposed branch must be reported to the state survey agency, and state licensing rules still apply. All of these operational requirements drive what a branch strategy costs and how quickly it produces revenue.4
The 2027 Rule Raises the Stakes
CMS says its Calendar Year 2027 Home Health Prospective Payment System final rule makes all revocations retroactive to the date of noncompliance, which lets CMS recover payments already made to a noncompliant provider, and adds or expands grounds for denial and revocation, including requirements for home health agencies and hospices to reenroll after certain majority-ownership changes. CMS also aimed the rule at clusters of agencies operating in small geographic areas and at administrators who oversee multiple sites from a distance. An amendment to the enrollment moratorium regulation is already pending. Diligence that clears a target under today’s regulatory text may not clear it under next year’s.5
Why Timing Matters Now
The extension runs six months from November 13, 2026, and CMS may extend it in further six-month increments, so a deal signed today will be negotiated and closed against a moving enrollment deadline. For buyers, that means settling the enrollment pathway before settling on price, stress-testing the expansion assumptions, and tying closing conditions and timelines to what the regulations actually require. Sellers can get ahead of diligence by assembling enrollment records, a complete ownership history, and support for the growth plan they are asking buyers to pay for.6
- Press Release, CMS, CMS Extends and Modifies Nationwide Freeze on New Medicare Hospice and Home Health Enrollment for Six Months to Combat Fraud (Nov. 12, 2026); CMS, Provider Enrollment Moratoria, https://www.cms.gov/medicare/enrollment-renewal/providers-suppliers/chain-ownership-system-pecos/provider-enrollment-moratoria. The home health moratorium notice is available at https://public-inspection.federalregister.gov/2026-23241.pdf.
- 42 C.F.R. § 424.550(b)(1); id. § 424.570(a)(1)(iii)(C), (c).
- 42 C.F.R. § 424.550(b)(2)(i)–(iv).
- 42 C.F.R. § 484.2 (definitions of “Branch office” and “Parent home health agency”); id. §§ 484.100(b), 484.105(d).
- Press Release, CMS, CMS Extends and Modifies Nationwide Freeze on New Medicare Hospice and Home Health Enrollment for Six Months to Combat Fraud (Nov. 12, 2026) (describing the Calendar Year 2027 Home Health Prospective Payment System final rule); see also amendment to 42 C.F.R. § 424.570 published at 91 Fed. Reg. 72172 (Nov. 9, 2026).
- 42 C.F.R. § 424.570(b); CMS, Provider Enrollment Moratoria.
