If you own a Medicare hospice, a home health agency, or a blended agency, and you are weighing an exit in the next 6 to 24 months, two public clocks matter this week.
The first is fixed. The Fiscal Year (FY) 2027 hospice wage index and payment rate update final rule (CMS-1851-F) takes effect October 1, 2026. That is about two weeks from September 18, 2026. Sources: https://www.cms.gov/newsroom/fact-sheets/fiscal-year-2027-hospice-wage-index-payment-rate-update-hospice-quality-reporting-program (July 30, 2026) and https://www.federalregister.gov/documents/2026/08/03/2026-15686/medicare-program-fy-2027-hospice-wage-index-and-payment-rate-update-and-hospice-quality-reporting (published August 3, 2026; effective October 1, 2026; FR Doc 2026-15686).
The second is still open-ended on the public page. As of September 18, 2026, CMS still lists a temporary nationwide Medicare enrollment moratorium on Home Health Agencies (HHAs) and Hospices as active. It was implemented May 13, 2026, for six months. On that calendar, the initial window ends about November 13, 2026, unless CMS extends or lifts it through a Federal Register notice. This pack does not claim CMS extended or lifted the freeze. Source: https://www.cms.gov/medicare/enrollment-renewal/providers-suppliers/chain-ownership-system-pecos/provider-enrollment-moratoria (reconfirmed September 18, 2026).
This post is educational for owners considering an exit. It is not legal, tax, or investment advice. Vallexa Advisors does not guarantee outcomes.
Clock 1: What changes on October 1 for hospice value
CMS updated FY 2027 hospice payment rates by 2.3 percent, an estimated increase of $755 million in payments from FY 2026. That figure comes from a finalized 3.2 percent inpatient hospital market basket percentage increase reduced by a finalized 0.9 percentage point productivity adjustment. The finalized FY 2027 hospice aggregate cap is $36,174.75 (the FY 2026 cap of $35,361.44 increased by the 2.3 percent update). Source: CMS FY 2027 hospice fact sheet, July 30, 2026.
Hospices that do not submit required quality data receive the 2.3 percent update minus four percentage points, which CMS describes as a 1.7 percent reduction over the previous year’s payment rate. HQRP noncompliance remained material: 22.06 percent of hospices in FY 2024, 23.53 percent in FY 2025, and 20.37 percent in FY 2026. Roughly one-fifth of hospices still miss the quality reporting bar. Source: same CMS fact sheet.
The rule also finalizes a mandatory hospice election statement addendum for all Medicare beneficiaries at the time of hospice election, not only upon request. CMS links the change to growth in Medicare non-hospice spending during hospice elections. In the Federal Register final rule, CMS notes that Medicare paid over $2.8 billion in non-hospice spending during a hospice election in FY 2024 for items and services under Parts A, B, and D. Source: https://www.federalregister.gov/d/2026-15686 (August 3, 2026).
CMS also discusses the Service and Spending Variation Index (SSVI). The SSVI uses nine claims-based measures. The lowest score is zero. The maximum score is 16. A higher score signals potential concern for utilization, quality, or program integrity when a hospice sits well above peers. The final rule updates SSVI displays with FY 2024 and FY 2025 claims data. Source: same Federal Register document and CMS fact sheet.
For a buyer reading a hospice or blended book after October 1, these items are no longer “coming soon.” They are live underwriting inputs: rate math, cap, HQRP exposure, election-addendum process, and SSVI posture.
Clock 2: The freeze decision window is still running
CMS implemented the nationwide HHA and hospice enrollment moratorium on May 13, 2026. It applies to initial applications, including non-exempt changes in majority ownership (CIMOs) under 42 CFR 424.550(b). Applications submitted after implementation are denied. CMS states the moratorium remains in effect for six months and may be extended in six-month increments if CMS deems it necessary. Extensions and lifts are announced through the Federal Register. Source: CMS Provider Enrollment Moratoria page, reconfirmed September 18, 2026.
The CMS Home Health and Hospice Nationwide Moratorium FAQs add operational detail owners and counsel already use in diligence:
- Existing enrolled providers may generally continue to participate, bill covered services, and make certain enrollment-information changes.
- Adding a new practice location to an existing enrollment (new branches, satellites, expansion locations on an existing CCN) is prohibited during the moratorium.
- A CIMO within 36 months of initial enrollment (or of the most recent CIMO), unless an exception applies, treats the provider as new and subject to the freeze.
- Applications received by the Medicare contractor before May 13, 2026, are not subject to the moratorium under 42 CFR 424.570(a)(1)(iv).
- Initial applications submitted during the moratorium are denied and must be resubmitted if and when the moratorium is lifted.
Source: https://www.cms.gov/files/document/hh-hospice-moratorium-faqs.pdf
As of September 18, 2026, the CMS moratoria page still describes the freeze as active. No Federal Register notice extending or lifting the HHA/hospice freeze is cited in this pack. Owners should treat about November 13, 2026, as the end of the initial six-month window on the public calendar, and should watch the Federal Register for any extension or lift. Do not assume either outcome.
Federal Register notices for the freeze were published May 15, 2026 (FR Doc 2026-09717 for HHAs; FR Doc 2026-09718 for hospices), both effective May 13, 2026. Sources: https://www.federalregister.gov/d/2026-09717 and https://www.federalregister.gov/d/2026-09718
What the two clocks mean together for exit diligence
October 1 lands first. For hospice and blended owners, buyers will ask whether your rate, cap, HQRP, election-addendum, and SSVI files are ready for a post-October 1 underwriting model. That is a documentation and process clock.
The freeze clock runs past October 1 into mid-November on the initial six-month calendar. It shapes sale structure, majority-ownership change timing, and growth-via-new-location plans. Existing enrolled agencies can generally continue operations. New enrollment paths and certain majority-ownership change paths remain constrained while the freeze is listed as active.
Those are different diligence problems. Mix them and you get a confused data room. Keep them on separate checklists.
Companion context (not this week’s lead)
CY 2027 Home Health PPS is still proposed
CMS issued the Calendar Year (CY) 2027 Home Health Prospective Payment System proposed rule (CMS-1844-P) on July 1, 2026. Comments were due August 31, 2026. The proposal remains proposed until a final rule publishes. CMS estimated Medicare payments to HHAs in CY 2027 would increase in the aggregate by 2.4 percent, or $420 million, compared with CY 2026, based on proposed policies (proposed 2.1 percent payment update / $370 million, plus an estimated 0.3 percent FDL effect / $50 million). CMS is proposing to continue a temporary adjustment of -3.0 percent and is not proposing an additional permanent PDGM behavior adjustment for CY 2027. Label every CY 2027 home health figure proposed. Source: https://www.cms.gov/newsroom/fact-sheets/calendar-year-cy-2027-home-health-prospective-payment-system-proposed-rule-fact-sheet-cms-1844-p (July 1, 2026).
DOJ Fraud Division priorities (verified primary)
On August 13, 2026, Assistant Attorney General Colin M. McDonald issued a National Fraud Enforcement Division priorities memorandum. The memo states that home health aide and hospice scams directly impact vulnerable elderly Americans, and that the Division will target health-care fraud schemes including home health and hospice schemes. Sources: https://www.justice.gov/opa/pr/assistant-attorney-general-colin-m-mcdonald-issues-memorandum-national-fraud-enforcement (August 13, 2026) and https://www.justice.gov/opa/media/1457756/dl?inline= (memo PDF, August 13, 2026).
Use this as enforcement context next to rates and enrollment. Do not treat a priorities memo as a case against any specific operator. This pack names no operators.
What to do before a buyer does
- Build an October 1 hospice checklist: 2.3 percent rate update, $36,174.75 cap, HQRP compliance status against the -1.7 percent miss outcome, mandatory election-addendum workflow, and SSVI score posture (0 to 16 scale). Cite the CMS fact sheet and FR Doc 2026-15686 in your internal notes.
- Confirm freeze facts in writing while the CMS page still lists the freeze as active: initial enrollment date, any prior majority-ownership change, the 36-month window, pending PECOS changes, and whether any planned expansion would add a practice location.
- Keep CY 2027 home health payment math labeled proposed until a final rule publishes. Do not mix proposed home health figures with finalized FY 2027 hospice figures.
- Ask counsel to map sale structure against CIMO rules and the freeze FAQs before you lock a letter of intent timeline that assumes new enrollment or a constrained ownership change.
- Write four short paragraphs for a confidential valuation conversation: October 1 hospice items, freeze/CIMO status, proposed CY 2027 home health math (if applicable), and current quality/enrollment integrity files.
None of this requires you to be on the market. The Seller Learning Center is built for owners who want a plan before they talk to buyers. See also Vallexa’s hospice, home health, and home care pages, and healthcare agencies for sale nationwide.
