Home Health · False Claims Act · Program Integrity
Nobody Is Watching the Visit
A compliance officer's guide to home health fraud: why it leads federal enforcement, how the schemes work, what the 2026 enrollment freeze means, and five questions to ask before a relator asks them for you
Care in the home happens out of sight, eligibility turns on a signature, and the referral stream runs through your hospital. The people who see the pattern first are your discharge planners, therapists, and agency liaisons. When the hotline does not act, they become relators.
You are three weeks into the job. A registered nurse calls the compliance hotline. She is a clinical liaison, an agency employee placed in your hospital to receive referrals, and she has spent the last year on your medical floors. She says case management leadership routinely assigns her hospital discharge tasks for patients who are not candidates for her agency, and that a lead case manager told her preferred agencies "help clear beds if they want to keep getting referrals."
You pull her badge records and EHR audit logs. Her documentation permissions are broader than most of your own staff's, and she has authored transfer summaries across three units. That unit's referrals to her agency went from 14 percent to 71 percent in nine months.
That scene is a composite and every figure in it is hypothetical. The pattern is not. Free labor to the hospital is remuneration under the Anti-Kickback Statute, and every claim the agency bills on a tainted referral is a false claim. She called you. The next nurse may call a lawyer.
This brief is for the person who took that call. It sets out why home health leads federal enforcement, how the schemes work, why a nationwide enrollment freeze changed the year, and five questions that tell you in a week whether your system is already inside one of these fact patterns.
01
Why Home Health Leads Enforcement
The numbers, datedIn calendar 2015 Medicare paid about $18.4 billion for home health, and CMS's error-rate program measured improper payments at 59 percent that fiscal year, the peak. For fiscal 2024 the rate was 6.7 percent, about $1.1 billion, and CMS says in every release that it is not a fraud rate: more than half is insufficient documentation, about a third medical necessity. The decline explains the enforcement posture, not the end of it. DOJ reported more than $5.7 billion in health care False Claims Act recoveries for fiscal 2025, and the June 2026 takedown charged 455 defendants over $6.5 billion. Home health was in it, not as a headline category, which is not the comfort it sounds like.
2026 changed the yearOn February 25, the Vice President, the HHS Secretary, and the CMS Administrator announced the CRUSH initiative, a program integrity rulemaking agenda, and froze new enrollment of certain DMEPOS suppliers nationwide the same day. On May 13, CMS froze new Medicare enrollment of home health agencies and hospices nationwide for six months, extendable in six-month increments, citing payment suspensions of 773 hospices and 23 agencies in Los Angeles involving about $70 million. The freeze covers initial enrollments, new branches and practice locations, and certain changes in majority ownership. If your system was planning to open, acquire, branch, or restructure an agency this year, that plan is on hold until CMS lifts it, and the 36-month change-of-ownership rule is the operative constraint on any deal.
Nobody Is Watching the Visit
September 30, 2026
02
How the Schemes Work, and Which One Is Yours
Why it is commonCare occurs out of sight, without the counts, time-outs, and rosters of an inpatient unit. Agency formation historically required little capital. Patients are frail and cannot audit their own billing. And hospital clinicians treat certifications as paperwork, which is the phrase that shows up in the enforcement record more than any other. The claim itself carries codes, not notes, and pays automatically unless an edit or a review intervenes. Detection is retrospective, and the tool that catches it is cross-claims analysis: Medicare's contractors aggregate a beneficiary's full history across every entity, so a home visit billed on a day an inpatient claim shows the patient in a bed, or an aide visit billed while the beneficiary was deceased or abroad, cannot be hidden by any edit to a chart.
The one that is yoursA hospital's own exposure runs through three of the six schemes in the table below: certifications its clinicians sign, referrals its planners route, and financial relationships it holds with agencies. The other three are the agency's, unless the agency carries your name.
| Scheme | How it works | Whose conduct |
|---|
| Certification fraud | Mobile patients certified as confined to the home; generic or fictitious face-to-face documentation; pre-signed blank forms. | Your clinicians |
| Liaison kickbacks | Agency intake staff embedded in case management doing hospital discharge work as free labor. | Your case management |
| Physician remuneration | Sham directorships, above-market stipends, per-referral bounties, bonuses tied to a spouse's referrals. | Your contracts |
| Steering | Discharges funneled to a system-owned agency without the required list or the patient's documented choice. | Your discharge planning |
| Phantom care | Visits billed while the patient or the aide was inpatient, abroad, or deceased; more than 24 hours in a day. | The agency's |
| Case-mix inflation | OASIS scores inflated at intake; visits added to clear the LUPA threshold; nursing modifiers billed for aide work. | The agency's |
03
Five Questions to Ask This Week
If you cannot answer one of these, that is the answerFive questions, each answerable from records you already hold, each mapped to a resolution on the next page.
| The question | What the answer tells you |
|---|
| 1 | Pull sixty home health certifications your hospitalists signed in the last year. How many state, patient by patient, why the patient cannot leave home, rather than a macro? | A default smart phrase on every chart is the rubber-stamp pattern. If same-day therapy notes document independent ambulation, the certification is false on its face. |
| 2 | Which outside agency liaisons have write access to your EHR, and what have they authored? | A liaison who writes transfer summaries for patients who are not her agency's is providing free labor. That is remuneration. |
| 3 | For each unit, what share of post-acute discharges went to one agency, and how has that moved against your own baseline? | No regulation sets a threshold. A sharp rise toward one agency, with a liaison on the unit, is the cold open. |
| 4 | Do any employees' bonuses correlate with referrals by a spouse or relative who is a physician? | That is the Medical Services of America fact pattern, resolved under Stark in January 2026. |
| 5 | If you own an agency, match its billing against your own admission, discharge, and death records. Any visits on inpatient days? | Cross-claims analysis will find them. The only question is whether you find them first. |
Nobody Is Watching the Visit
September 30, 2026
| Matter | Resolution | What it involved |
|---|
| Arbor Homecare, Faith Newton D. Mass., Jan. 2025 | 12 years; $99.7 million restitution | Medicaid. Services not provided, falsified notes, kickbacks for referrals, sham employment of patients' relatives as aides, 2013 to 2017. |
| Choice HomeCare OIG CMP, April 2026 | $35 million, self-disclosed | Medicaid. In-home care hours not provided; falsified dates of service. |
| Traditions Health DOJ, Jan. 2026 | $34 million, self-disclosed | Medicare. Unnecessary care at one location, 2021 to 2024; remuneration to physician medical directors, 2019 to 2024. About 1.5 times restitution. |
| Medical Services of America USAO S.D. Fla., Jan. 2026 | $702,541 | Medicare. Stark: bonus payments to an employee based on referrals by the employee's physician spouse. |
| Doctor's Choice Home Care DOJ | $675,000, additional | Medicare. Employees pressured clinicians to add visits so periods would clear the LUPA threshold. |
| Dr. Lilit Baltaian C.D. Cal., June 2025 | 54 months; $1.5 million restitution | Medicare. Falsely certified patients for at least four Los Angeles agencies, 2012 to 2018, some on pre-signed blank undated forms. Sentenced in absentia; a fugitive. |
Three things to take from that table. The two largest civil resolutions, Choice and Traditions, were both self-disclosed, and Justice Manual §4-4.112 sets out the credit factors: timeliness, completeness, assistance, and usefulness. Three of the largest matters are Medicaid, so a Medicare-focused system's exposure runs through rules it may not be watching. And certifying clinicians are prosecuted individually: a hospitalist who signs whatever the discharge coordinator queues is signing Baltaian's blank form.
What the standard actually is, and is not
You will read that a health system faces False Claims Act liability for referring to an agency it "knew or should have known" was billing improperly. That is not the standard. The statute reaches actual knowledge, deliberate ignorance, or reckless disregard, and after Schutte v. SuperValu it turns on what the defendant actually knew and believed. A hospital is not a guarantor of an unrelated agency's billing. Its exposure is its own conduct: the certifications it signs, the discharge planning it runs, the relationships it enters. A narrower target, and entirely yours.
May 13
The freeze, 2026
Nationwide moratorium on new home health and hospice enrollment, six months, extendable
12 years
Arbor Homecare, January 2025
Sentence for the owner, with $99.7 million in restitution, on a Medicaid scheme of at least $100 million
54 months
A certifying physician, June 2025
Sentenced in absentia for falsely certifying patients for at least four agencies, some on pre-signed blank forms
What you do is specific. Put every outside liaison on a vendor-access agreement before they enter a unit: no hospital discharge tasks, no record access without patient-directed selection, no solicitation in patient rooms. Build certification templates to §424.22(a)(1), disable any macro that auto-populates "homebound," and require a patient-specific basis before the signature applies. Remove any compensation or metric for case managers or hospitalists tied to routing. Appraise every directorship, retainer, and lease with an agency at fair market value. If you own an agency, hard-stop any claim that overlaps an inpatient stay. And when an audit finds systemic defects, use the OIG Self-Disclosure Protocol with counsel, because what separates the first two rows of that table from the rest is who reported it.
The nurse in the cold open called the hotline. What separates a self-disclosure from a relator's complaint is the week after.
Nobody Is Watching the Visit
September 30, 2026
The Terms You Will Meet in This Brief
| Term | What it means, plainly |
|---|
| Certification | A practitioner's attestation that a patient is confined to the home, needs intermittent skilled care, is under a plan of care, and had a face-to-face encounter within 90 days before or 30 days after the start of care. No form is required. |
| Confined to the home | The eligibility test, often called homebound. Leaving home must require a considerable and taxing effort. A patient who drives to the store is not. |
| 30-day period, LUPA | Medicare pays home health in 30-day periods, sized by OASIS, the functional assessment the admitting clinician scores. Below a threshold of two to six visits, the period pays per visit. |
| Discharge planning rule | 42 C.F.R. §482.43. The hospital must present the list of participating Medicare-certified agencies, disclose any financial interest, and document the patient's choice. |
| Relator | A private person who sues on the government's behalf under the False Claims Act and keeps a share. In home health, most are frontline clinicians. |
Where MHMDAA Comes In
MHMDAA (Michael Hill, MD and Associates) is a revenue cycle consulting and payor-provider dispute resolution firm, retained by hospital and payor clients alike, which is why this reads as method rather than argument. The work is the same from either chair: physician-led clinical validation and forensic review of disputed coding, level-of-care, and medical necessity determinations, benchmarked against the clinical criteria, statutory standards, and coverage policies that govern the claim, to arrive at the diagnoses the record substantiates and the reimbursement tier that follows from them.
The five questions in this brief are the ones that review runs against a health system's records first. We also work with clinical, documentation, and audit teams to bring their workflows into line with the CMS regulations those questions are built on, so that certifications, discharge planning, and agency relationships hold up before anyone outside the organization reads them.
Michael Hill, MD & Associates
Revenue cycle consulting and payor-provider dispute resolution
(877) 464-4556 · info@mhmdaa.com
Neutrality. This brief is educational commentary; it is not legal, coding, or clinical advice, and it is not a determination about any specific claim, payor, provider, or matter. Scenarios described as composites are illustrative of method only, and every figure inside them is hypothetical. Settlements resolve allegations and establish no finding; where a party self-disclosed, that is stated. MHMDAA is an independent revenue cycle consulting and payor-provider dispute resolution firm; its principals provide dual-perspective analysis and independent expert services to payors and providers alike, and nothing in this publication constitutes advocacy for either side of any dispute or prejudges any question on which they may serve as independent experts.
Authorship. This document was drafted with human authorship and may include AI-assisted formatting or summarization. All analysis, conclusions, and opinions are solely those of Dr. Michael Hill.
Sources
- CMS, 2024 Medicare FFS Supplemental Improper Payment Data, Tables D3, G3, I3; MedPAC, March 2021, ch. 8 (FY2015 rate); HHS-OIG, OEI-05-16-00031 (June 2016). 91 Fed. Reg. 27961 (May 15, 2026), home health and hospice moratoria; 91 Fed. Reg. 9803 and 9855 (February 27, 2026), CRUSH RFI and DMEPOS moratorium. 42 C.F.R. §§424.22, 482.43, 484.60, 424.535; 42 U.S.C. §§1395f(a)(2)(C), 1395n(a)(2)(A), 1320a-7b(b), 1395nn; 31 U.S.C. §3729; Schutte v. SuperValu, 598 U.S. 739 (2023).
- DOJ, FCA statistics for fiscal 2025 (January 2026); 2026 National Health Care Fraud Takedown (June 23, 2026). DOJ and USAO releases: United States v. Newton (D. Mass., sentenced January 22, 2025); Traditions Health (January 22, 2026); Medical Services of America (S.D. Fla., January 26, 2026); Doctor's Choice Home Care; United States v. Baltaian (C.D. Cal., sentenced June 12, 2025). HHS-OIG civil monetary penalty, Choice HomeCare (April 2026). Justice Manual §4-4.112.
- MHMDAA, Post-Acute Compliance Monitor: The Regulatory Crucible, v2.13, September 29, 2026, with its verification register; supersedes the September 29 v2.12 draft.
