On July 26, 2013, CMS announced temporary moratoria on enrollment of new home health providers and ambulance suppliers under Medicare, Medicaid and the Children’s Health Insurance Program (CHIP) in three parts of the country identified as “fraud hot-spots.” This is the first time the agency is exercising its authority under the Affordable Care Act (ACA) to impose temporary moratoria on new provider enrollment to protect against a high risk of fraud. The temporary moratorium applies to: (1) the enrollment of home health agencies (HHAs) in Miami-Dade County (Florida) and Cook County (Illinois), as well as selected surrounding areas, and (2) the enrollment of new ambulance suppliers and providers in Harris County, Texas and surrounding counties. CMS selected these areas and services, in consultation with the Health and Human Services’ Office of Inspector General (OIG) and the Department of Justice, because of the high potential fraud risk indicated by such factors as a disproportionate number of providers and suppliers relative to beneficiaries, a rapid increase in enrollment applications from providers and suppliers, and extremely high utilization of services.

The temporary enrollment moratoria begin on July 30, 2013 and will remain in effect for 6 months. If CMS deems it necessary, the moratoria may be extended in 6-month increments (with notification in the Federal Register). During the moratoria, existing providers and suppliers can continue to provide and bill for services, but no new provider and supplier applications for these provider types will be approved in these geographic areas. Note that the temporary moratorium does not apply to changes in practice locations, changes to provider or supplier information such as phone number, address, or changes in ownership (except changes in ownership of HHAs that require initial enrollments), nor does it apply to an enrollment application that a CMS contractor has already approved, but has not yet entered into the Provider Enrollment Chain and Ownership System (PECOS) at the time the moratorium is imposed.

CMS observes the tendency of health care fraud to “migrate” — as enforcement efforts target a particular activity, “criminals may redesign the scheme or relocate to a new geographic area.” CMS will therefore monitor the broad geographic areas for “indicia of activity designed to evade these moratoria” and to address the spread of fraud activities beyond the identified areas.