U.S. Sen. Susan Collins (R-Maine) introduced legislation Friday aimed at strengthening oversight of the Medicare home health program, combating fraud, and protecting legitimate home health agencies from reimbursement losses caused by fraudulent billing schemes.
The Medicare Home Health Payment Integrity and Protection Act would provide the Centers for Medicare and Medicaid Services (CMS) with expanded authority to identify and prevent fraud before taxpayer dollars are paid out, while also making changes intended to stabilize reimbursement rates for legitimate providers, particularly those serving rural communities.
The legislation comes as federal officials have intensified their focus on home health fraud nationwide. Earlier this week, CMS Administrator Dr. Mehmet Oz highlighted concerns about widespread abuse in Medicaid-funded home health programs, including scrutiny of billing practices in Maine’s home health and autism services. Federal officials have said fraudulent providers can drain billions of dollars from government healthcare programs while reducing resources available to legitimate providers and the patients they serve.
“When billions of dollars are improperly siphoned from the Medicare home health program, this can undermine the integrity of the payment system used to reimburse legitimate providers and threaten care for the seniors who depend on it,” Collins said in announcing the legislation.
Collins said home health care allows millions of seniors to remain safely in their own homes while avoiding unnecessary hospitalizations and nursing home admissions. She argued that fraudulent providers not only exploit taxpayers but also reduce reimbursements for honest agencies already struggling with workforce shortages, rising costs, and the challenges of serving rural areas.
According to Collins’ office, traditional Medicare home health utilization has declined significantly despite the nation’s aging population. The number of Medicare beneficiaries receiving home health services fell from approximately 3.3 million in 2019 to 2.7 million in 2024.
During that same period, more than 500 Medicare-certified home health agencies outside California closed their doors. Meanwhile, California experienced a dramatic increase in providers, with the number of Medicare-certified home health agencies nearly doubling—growth that occurred almost entirely in Los Angeles County.
Although Los Angeles County contains only about two percent of the nation’s Medicare fee-for-service beneficiaries, it accounts for roughly nine percent of Medicare fee-for-service home health spending. Federal watchdogs, including the Medicare Payment Advisory Commission and the California State Auditor, have raised concerns that the unusually high concentration of providers and spending may be driven in part by fraud and abuse.
Collins argues that fraudulent billing in high-risk areas can distort the data CMS uses to calculate reimbursement rates nationwide, ultimately reducing payments to legitimate agencies serving patients in rural states like Maine.
Under the proposed legislation, CMS would receive expanded authority to verify the identities of home health administrators before agencies are approved to participate in Medicare, require liability insurance for providers considered at high risk for fraud, and impose enhanced screening requirements on agencies determined to present an elevated fraud risk.
The bill would also require more frequent inspections of newly enrolled agencies, organizations that change ownership, and providers that reactivate Medicare billing privileges. Agencies exhibiting suspicious billing patterns or failing to report required quality data would face increased oversight and higher financial penalties.
In addition, the legislation would strengthen federal oversight of accrediting organizations responsible for evaluating home health agencies, authorize additional funding for CMS and federal law enforcement to investigate organized home health fraud schemes, and provide resources for accelerated inspections, unannounced site visits, and enrollment verification efforts.
The proposal also directs CMS to recalculate home health payment rates to account for fraud-related distortions and changes in home health utilization since the COVID-19 pandemic.
The legislation received immediate backing from several national healthcare organizations, including the National Alliance for Care at Home, LeadingAge, and VNS Health, all of which praised Collins’ efforts to both strengthen program integrity and stabilize reimbursement for legitimate providers serving Medicare beneficiaries.
If enacted, the measure would represent one of the most significant congressional efforts in recent years to address Medicare home health fraud while seeking to protect access to care for seniors, particularly those living in rural communities such as Maine.
