CMS Moratorium and Selling a Home Health Agency: What Owners Should Know

Introduction

CMS has placed a temporary nationwide Medicare enrollment moratorium on home health agencies and hospices. For owners thinking about selling, that headline matters, but it should not be translated into a simple rule that all sales are blocked or that every certified agency is suddenly worth more.

The important question is narrower and more practical: how does the moratorium affect buyer diligence, transaction structure, timing, enrollment risk, and the perceived value of an already-certified provider?

This article is written for home health and hospice owners preparing for a sale. It is not legal advice, regulatory advice, tax advice, or a substitute for counsel, CMS guidance, the applicable Medicare Administrative Contractor, state licensing review, or transaction-specific diligence.

Source note: CMS and Federal Register sources for this article were reviewed on June 9, 2026.

What the CMS Moratorium Covers

The current CMS moratorium is focused on Medicare provider enrollment for home health agencies and hospices.

Based on the CMS source materials reviewed, the moratorium covers:

• Initial Medicare enrollment applications for home health agencies.
• Initial Medicare enrollment applications for hospices.
• Non-exempt changes in majority ownership, which CMS refers to as CIMOs.
• New HHA branch and practice-location enrollment activity described in the CMS QSO memo.

CMS has described the moratorium as temporary and nationwide. The Federal Register notice and CMS materials frame it as a fraud, waste, and abuse prevention measure.

The seller-facing takeaway is that buyers are likely to ask whether the contemplated transaction creates new Medicare enrollment risk or non-exempt CIMO risk under the moratorium. That question should be answered before a seller assumes the deal can close on the same timeline as a cleaner historical transaction.

What It Does Not Automatically Mean

The moratorium is important, but owners should avoid overstating it in either direction.

It does not automatically mean:

• Every Medicare-certified home health agency cannot be sold.
• Every ownership change will be denied.
• Every certified provider is now worth more.
• CMS will create individual exceptions for a provider that wants to transact.
• A buyer can ignore CHOW, CIMO, state licensure, Medicaid, managed care, or HHA 36-month-rule issues.
• Existing certified providers no longer have ordinary compliance, reporting, revalidation, survey, quality, licensure, or billing obligations.

It also does not replace transaction-specific regulatory review. A stock sale, membership-interest transfer, asset sale, merger, provider agreement assignment, or new applicant scenario can have different consequences. Buyers will not usually underwrite the moratorium in isolation. They will connect it to the agency’s enrollment history, ownership history, compliance profile, payer mix, and operational continuity.

CMS Facts and Seller Implications

The table below is a practical orientation tool for sellers. It is not a legal conclusion and should not be used to decide transaction structure without qualified regulatory and deal counsel.

Why This Matters in a Sale Process

Before the moratorium, many buyers already cared deeply about Medicare enrollment history, CHOW mechanics, state licensure, payer contracts, survey results, billing compliance, and ownership records. The moratorium increases the importance of those same questions because the alternative to acquiring an existing certified provider may be less straightforward during the moratorium period.

That can affect a sale process in several ways:

• Buyers may spend more time validating whether the agency’s Medicare certification is transferable or usable after closing.
• Regulatory diligence may move earlier in the process, sometimes before a buyer is ready to sign a final letter of intent.
• Buyers may ask more detailed questions about prior ownership changes, CIMO history, and HHA 36-month-rule risk.
• Purchase agreements may include more detailed conditions around enrollment filings, notices, approvals, absence of adverse findings, and post-closing cooperation.
• Buyers may underwrite revenue more conservatively if billing continuity or payer transfer is uncertain.
• A seller with organized records may look more credible than a seller who has to reconstruct basic enrollment history during diligence.

For owners, the goal is not to turn the moratorium into a sales pitch. The goal is to prepare enough documentation that buyers can separate real risk from uncertainty.

CHOW, CIMO, and the HHA 36-Month Rule

Three concepts need to be reviewed together in many Medicare-certified home health transactions: CHOW, CIMO, and the HHA 36-month ownership provisions.

CHOW generally refers to change of ownership in the Medicare provider context. Depending on the facts, a CHOW can involve transfer or assignment of the Medicare provider agreement if the buyer accepts assignment. If the buyer does not accept assignment, the seller’s provider agreement can be terminated and the buyer or new owner may be treated as a new applicant.

CIMO means change in majority ownership. CMS’s moratorium materials specifically identify non-exempt CIMOs as part of the current moratorium scope. That makes majority ownership history and proposed transaction structure more important in buyer diligence.

For home health agencies, CMS’s 36-month ownership provisions add another layer. At a high level, if a change in majority ownership occurs within 36 months of initial Medicare enrollment or within 36 months of the most recent change in majority ownership, CMS guidance indicates the agency may need to enroll as a new provider and obtain a new survey or accreditation unless an allowable exception applies.

Sellers should not say they can avoid CHOW, avoid CIMO review, or avoid the 36-month rule by choosing a particular structure without regulatory counsel. Buyers will ask for the ownership timeline, prior transaction documents, CMS-855A filings, PECOS records, MAC correspondence, and any facts relevant to exceptions or new-enrollment risk.

The safest seller posture is practical: identify the issue early, organize the record, and let counsel and qualified advisors analyze the proposed transaction before the sale process depends on a fragile assumption.

What Sellers Should Prepare Before Going to Market

Owners who may sell during the moratorium should prepare for deeper Medicare enrollment diligence than a generic business sale would require.

Before going to market, gather:

• Current Medicare enrollment records.
• PECOS access and confirmation information.
• Prior CMS-855A filings.
• MAC correspondence related to enrollment, ownership, revalidation, or prior changes.
• Current ownership chart and historical ownership timeline.
• Documents for any prior change in majority ownership.
• Initial Medicare certification date and most recent majority ownership change date.
• State license, renewal history, and any pending licensing issues.
• Survey, accreditation, plan of correction, complaint, sanction, or quality-reporting records.
• Medicaid enrollment and managed care contract information, if applicable.
• Billing, claims, refund, overpayment, and audit history.
• Compliance program materials, clinical policies, and key operational controls.
• Census, referral, staffing, and payer mix support.

This preparation does not guarantee a smooth transaction. It does, however, help a buyer and its advisors evaluate the actual facts instead of pricing uncertainty.

If the agency has open issues, organize them rather than hiding them. A manageable issue disclosed early is usually easier to underwrite than a surprise discovered late in diligence.

Buyer Underwriting Implications

Buyers may respond to the moratorium in different ways depending on their strategy.

A strategic buyer with existing operations may focus on whether the target’s provider agreement, license, staff, referral relationships, and census can be integrated without unexpected enrollment disruption. A financial buyer may focus more heavily on closing conditions, regulatory opinions, escrow, indemnity, and whether debt financing can tolerate timing uncertainty. A smaller operator may be more sensitive to any pause in billing or approvals because cash flow cushion is thinner.

Common underwriting questions include:

• Is the target already Medicare-certified and actively operating?
• Are enrollment, licensure, and ownership records accurate and current?
• Could the transaction be a non-exempt CIMO under the current moratorium?
• Does the HHA 36-month rule apply, and if so, is an exception plausibly available?
• Will the buyer accept assignment of the provider agreement?
• Could any part of the transaction cause new applicant treatment?
• Are state licensure, Medicaid, and managed care approvals separate from Medicare review?
• Are there open surveys, complaints, overpayments, revocation risks, or revalidation issues?
• Does the purchase agreement allocate regulatory risk clearly?

The moratorium can make clean facts more valuable to buyers, but it does not make weak earnings, poor documentation, compliance problems, unstable census, or payer concentration disappear.

Advisor Questions Before Signing an LOI

Before signing a letter of intent, sellers should ask their transaction team and regulatory advisors direct questions.

1. What specific transaction structure is being considered?
2. Would the proposed transaction be treated as a CHOW, CIMO, acquisition/merger, new enrollment, or some combination of those concepts?
3. Does the CMS moratorium apply to any required filing?
4. Is the contemplated change a non-exempt CIMO?
5. Were any relevant applications submitted before May 13, 2026, and can receipt be documented?
6. Does the HHA 36-month ownership rule apply to this agency?
7. If an exception is being discussed, what source supports it and who is giving that analysis?
8. Will the buyer accept assignment of the Medicare provider agreement?
9. What would happen if the buyer is treated as a new applicant?
10. What MAC, PECOS, CMS-855A, and state licensing steps are expected?
11. Are Medicaid and managed care contracts transferable, assignable, or subject to recredentialing?
12. What closing conditions, covenants, indemnities, escrows, or post-closing obligations will the buyer request?
13. What should be disclosed in the confidential information memorandum or buyer diligence room?

These questions are not meant to slow down a sale. They are meant to prevent a seller from agreeing to timing, valuation, or closing certainty before the regulatory path is understood.

How Sellers Should Talk About Value

The moratorium may increase buyer attention on already-certified home health and hospice agencies. It may also make some buyers more cautious about deal structure and closing risk.

Both can be true.

Sellers should avoid saying that the moratorium automatically increases valuation. A buyer will still underwrite revenue durability, adjusted EBITDA or SDE, referral concentration, census trends, payer mix, staffing, compliance history, documentation quality, and management depth. A clean Medicare certification story can support buyer confidence, but it is one part of the value equation.

Better seller messaging sounds like this:

"The agency is an existing Medicare-certified provider with organized enrollment, ownership, licensure, and compliance records. Given the current CMS moratorium, buyers should review CHOW, CIMO, and 36-month-rule implications with regulatory counsel early in the process."

That is more credible than claiming the moratorium makes every certified agency scarce or premium-priced.

When to Start Preparing

If you are considering a sale in the next 6 to 24 months, preparation should start before a buyer asks for documents.

The moratorium has an initial six-month term, but CMS may extend it in six-month increments. Sellers should not assume that waiting a few months will eliminate the issue, and they should not assume the same rules will apply indefinitely. The better approach is to prepare the record now and update the analysis as CMS guidance changes.

That preparation should include both business readiness and regulatory readiness:

• Normalize financials and identify add-backs carefully.
• Clean up census, billing, and payer reporting.
• Review compliance and survey history.
• Confirm ownership history and Medicare enrollment facts.
• Organize state license, Medicaid, and managed care records.
• Identify buyer diligence questions before they become objections.
• Build a sale timeline that accounts for regulatory review.

A prepared seller can still face uncertainty. But a prepared seller is less likely to lose momentum because basic records are missing.