Industry Groups Call for Federal Oversight of Hospice Licensing as Concerns Emerge in Several States

Federal oversight is needed to stem harmful and potentially illegal practices associated with a proliferation of new providers in several states, four of the nation’s largest hospice industry groups wrote to U.S. Centers for Medicare & Medicaid Services (CMS) Administrator Chiquita Brooks-LaSure.

Signatories on the joint letter included LeadingAge, the National Association for Home Care & Hospice (NAHC), the National Hospice and Palliative Care Organization (NHPCO) and the National Partnership for Healthcare and Hospice Innovation (NPHI).

Lax oversight has created an environment that enables large-scale fraud and abuse, the organizations contend. This includes instances in which multiple hospices were operating out of the same address without a corresponding increase in the population of eligible patients, as well as some individuals holding management positions at several hospices simultaneously.


“We believe that, in addition to action at the state level, increased federal oversight is needed to protect hospice patients and their families, as well as the vast majority of hospice providers that properly observe Medicare and Medicaid laws and regulations,” the groups wrote in the letter. “When similar activities were occurring in the home health program, CMS took decisive action to maintain the integrity of the benefit through imposition of temporary moratoria on the admission of new agencies in select areas of the country.”

A prime example is the state of California.

Late last year, the California legislature passed two new laws, including a moratorium on new hospice provider licenses as well as an extensive audit of California’s licensing and oversight processes. 


The subsequent audit found that poor, uncoordinated hospice oversight has contributed to widespread fraud and other violations, according to a report from the state’s Department of Justice (CDOJ).

“The state’s weak controls have created the opportunity for large-scale fraud and abuse,” CDOJ indicated in its report. “We identified numerous indicators of such fraud and abuse by hospice agencies, which typically offer palliative end-of-life care to individuals with medical diagnoses of fewer than six months to live.”

These issues have been spreading to other states, signaling a need for federal involvement, the four organizations indicated in the letter. This includes Arizona, Nevada and Texas.

Arizona had 239 new Medicare-certified hospices appear between 2018 and 2022, representing 52% of all providers in the state. In that time frame, Nevada saw 56 newly certified hospices, and 369 emerged in Texas.

“Based on these developments, we believe that targeted moratoria and similar actions directed toward high-risk providers could serve as a valuable means for blocking or eliminating from the hospice program those who engage in improper, unethical, and potentially illegal activities that harm patients and families and taint the reputation of the broader hospice provider community,” the organizations said in the letter.