What we're reading. What it means for your agency.
CMS rule changes, OASIS-E2 transition issues, OIG enforcement, EVV state updates,
and Carelytic product news — translated into operational implications for home health
agency leadership.
Under 42 CFR 405.371, a 'credible allegation of fraud' is enough for CMS to halt Medicare payments immediately. The April 2026 LA enforcement wave shows how fast that cash-flow stop can arrive.
In April 2026, a White House–led interagency task force triggered Medicare payment suspensions for 23 home health agencies and 447 hospices in the Los Angeles area — an estimated $600 million in alleged fraud — with no criminal charges required. The mechanism: 42 CFR 405.371, the credible-allegation-of-fraud suspension authority. Funds stop flowing the day the letter arrives.
After May 11, every Medicare 270 eligibility request without an active HETS attestation gets rejected. Here's what your intake team needs to do in the next week.
CMS confirmed in its January urgent notification that the HETS Trading Partner attestation requirement is a hard cutover on May 11, 2026. No transition period. No retries. Agencies that haven't filed an attestation for every NPI lose real-time Medicare eligibility on day one.
The November 2025 final rule landed softer than the proposed 6.4% cut — but PDGM weights are recalibrated and 43 case-mix groups have new LUPA thresholds. Your visit-utilization plan from CY2025 doesn't carry forward.
CMS finalized a net 1.3% payment cut for CY2026 (~$220M down from the proposed 6.4%). The bigger operational story is buried in the recalibration: case-mix weights move using CY2024 data, and LUPA thresholds shift on 43 of the 432 case-mix groups.
April 1 wasn't just an OASIS form change. It was the end of the iQIES manual-entry safety net. Field reports show clinicians defaulting to E1 logic on the new items — and the rejections that creates.
OASIS-E2 took effect April 1. CMS shut down the iQIES manual-entry interface the same day. Agencies that hand-keyed OASIS into the legacy UI as a fallback no longer have one — every assessment must come from a certified EMR or data submission pathway.
Three of five HHCAHPS measures dropped. OASIS measure weight bumped to 40% with three new measures. And Medicare Spending Per Beneficiary–Post Acute Care joins the TPS as a claims-based measure. Your performance-year work just changed shape.
The expanded HHVBP model rewrote the Total Performance Score for CY2026. OASIS measures now carry 40% of TPS (with three new items). Three HHCAHPS measures dropped. And MSPB-PAC introduces accountability for downstream Medicare spending through 90 days post-treatment.
After a federal audit found ~13% of MA denials should have been approved per Medicare rules, CMS tightened response timelines and reclassified mid-care decisions as appealable organization determinations. Your authorization team has new ammo.
Medicare Advantage prior-auth must now respond within 72 hours for urgent and 7 days for standard requests. Mid-care MA decisions are now formally classified as 'organization determinations' — meaning they're directly appealable through the Medicare appeals process.
Michigan went hard-edit January 1. Missouri begins April. Illinois cuts over to HHAeXchange in March. If your EVV records aren't in spec, the claims that used to bounce as warnings now don't pay.
Three states are moving EVV from soft-warning to claim-denying enforcement in Q1 2026. Multi-state agencies need state-by-state payer-rule checks in the EVV pipeline before April — otherwise A/R ages on visits that already happened.
The January 2026 Kaiser Permanente settlement, $556M for Medicare Advantage risk-adjustment upcoding, makes one thing explicit: the OIG considers AI tools that 'nudge clinicians toward higher-margin codes' a fraud risk vector. Here's what that means for any HHA using AI coding assistance.
Kaiser Permanente's $556M settlement on January 14 didn't just resolve a False Claims Act case — it cemented Amedisys ($150M, 2024) as part of a pattern. The DOJ-HHS 2026 Working Group has now formally listed AI-assisted coding as a fraud enforcement priority.
BAYADA paid $17 million to resolve DOJ allegations that purchasing two agencies from an Arizona retirement-home operator constituted illegal remuneration for referrals. Mid-market agencies considering tuck-in acquisitions need fair-market-value opinions on every deal.
The DOJ's $17M BAYADA settlement uses a kickback theory that should change how any HHA structures acquisition deals: overpaying for an agency owned by a referral source can itself constitute a kickback, regardless of how the deal is documented.
The DOJ-mandated divestitures from UnitedHealth's $3.3B Amedisys deal hit the market in late 2025. For independent agencies, that's the largest concentration of mid-market acquisition targets in a decade — and the largest competitive threat in your service area, depending on the market.
The UnitedHealth–Amedisys merger closed August 14 with a court-ordered 164-location divestiture. As those locations come to market, mid-market HHAs face two questions simultaneously: are any of them in your acquisition lane, and how aggressive will Optum be in your existing markets?
RN turnover at 17.6%. LPN shortage at 20%. Home-care worker turnover projected at 64% by 2030. The 2026 NSI report and HRSA workforce projections converge on one conclusion: clinical workforce is now the binding constraint on every mid-market HHA's growth.
The 2026 NSI National Health Care Retention Report and updated HRSA workforce projections both landed in the same quarter. The headline numbers: RN turnover 17.6%, LPN shortage 20%, ~40% of RNs say they'll leave the field by 2027–29, home-care worker turnover projected at 64% by 2030.
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