The Centers for Medicare & Medicaid Services (CMS) has put forward a new proposed rule aimed at cracking down on fraud, recovering taxpayer money lost to noncompliant providers, and improving access to home health care. The Calendar Year (CY) 2027 Home Health Prospective Payment System (PPS) proposed rule is estimated to save around $82 million annually while also making home health services more accessible and improving how quickly quality information is shared with the public.

CMS Administrator Dr. Mehmet Oz said the proposals would give CMS stronger tools to protect Medicare beneficiaries and taxpayer dollars from fraud, waste, and abuse, and that the Trump Administration remains committed to making sure only qualified providers participate in Medicare.

One of the bigger changes in this proposal has to do with how CMS recovers money from providers who are found to be out of compliance. Right now, CMS can only claw back payments going back to the date of noncompliance for certain specific revocation reasons. Under the new rule, that clawback ability would apply to all Medicare provider enrollment revocations, no matter the reason. This means CMS would be able to recover more money and make sure noncompliant providers are not continuing to collect Medicare payments.

The rule also proposes expanding the list of reasons CMS can use to revoke or deny a provider's Medicare enrollment. Two notable additions include the ability to revoke enrollment if a provider is in a geographic area with an unusually high concentration of providers that presents a high fraud risk, and the ability to deny or revoke enrollment if a provider has been convicted of a misdemeanor involving sexual assault or financial misconduct in the past 10 years.

On the payment side, CMS is proposing to increase total Medicare payments to home health agencies by about 2.4%, which works out to roughly $420 million more compared to CY 2026. The agency is also continuing its work to transition the Home Health PPS (Prospective Payment System) to the Patient-Driven Groupings Model in a way that stays budget neutral.

The proposed rule also takes steps to expand access to palliative care through the Medicare home health benefit. CMS is clarifying that skilled palliative care services can be billed under existing Medicare home health benefits for patients dealing with serious illnesses. The agency is careful to point out that this type of palliative care is separate from hospice care and can be used earlier in a patient's illness. More detailed guidance on what qualifies as skilled palliative care will be released after the final rule is published.

To make quality information more available to patients and families, CMS is also proposing to shorten the deadline for submitting Outcome and Assessment Information Set (OASIS) data from four and a half months down to 45 days. This change could make publicly reported quality data available up to three months sooner than it currently is.

Other areas covered in the proposed rule include updates to durable medical equipment, prosthetics, orthotics and supplies, the home health quality reporting program, hospices, and the Medicare provider enrollment process.

The fact sheet for this proposed rule is available at cms.gov, and the full rule can be found on the Federal Register at federalregister.gov.