Acute Care Delivery Hits a Wall with CMS Ending the Hospital-at-Home Reimbursement

As on October 1, 2025, the Centers for Medicare & Medicaid Services (CMS) has ended its waiver for Acute Hospital Care at Home due to the lack of Congressional extension. This means hospitals can no longer admit or continue to treat Medicare Fee-for-Service and non-managed care Medicaid patients under this waiver authority. CMS had instructed all hospitals with active AHCAH waivers to discharge or transfer all inpatients back to the traditional hospital setting by September 30, 2025. This is more than a policy shift; it is a clinical, operational, and financial earthquake for the hundreds of health systems that have invested billions into this innovative care model. This comprehensive guide breaks down what the CMS AHCAH expiration means for patients, providers, and the future of healthcare innovation.

What is Acute Hospital Care at Home

The Acute Hospital Care at Home was an initiative launched by CMS during the COVID-19 Public Health Emergency (PHE) in November 2020. It granted Medicare waiver flexibilities to hospitals and allowed them to provide a comprehensive range of inpatient services for over 60 different acute conditions like CHF, pneumonia, and cellulitis at the patient’s residence.

Crucially, the program was authorized under a waiver of Medicare rules that normally require specific hospital structural and staffing requirements (such as the 24/7 on-site nursing requirement). The waiver provided the same Inpatient Prospective Payment System (IPPS) reimbursement as a traditional hospital stay, offering the necessary financial incentive for hospitals to invest in the model.

The Immediate Mandate from CMS

With the absence of a legislative extension, the CMS was legally bound to revert all the pre-pandemic regulations immediately that resulted in severe consequences.

The Operational and Financial Aftershock for Providers

The expiration of the CMS waiver presented an immediate, triple-threat crisis to the hundreds of approved health systems.

Operational Chaos and Patient Safety Concerns

The most immediate concern was the safe disposition of active patients. Moving medically fragile patients from a structured home environment back to the hospital or prematurely discharging might introduce new risks and clinical deterioration, care coordination errors, and adverse events. Health systems were forced to execute complex contingency plans with little notice. Furthermore, a significant portion of the specialized staff hired for these programs (nurses, paramedics, remote monitoring specialists) now face uncertainty, leading to potential attrition of a highly trained workforce.

Massive Financial Stranded Costs

Health systems have invested heavily in infrastructure to stand up their H@H programs, like

These are now stranded costs. Without the consistent Medicare FFS reimbursement stream, programs relying heavily on this revenue source cannot justify their operational budgets. Many systems will be forced to pause, scale down, or permanently shut down their AHCAH programs, halting patient access and writing off significant capital investment.

Uncertainty in Managed Care and Medicaid

While the CMS AHCAH waiver only directly governed Medicare FFS, it served as the de facto regulatory template for others:

• Medicare Advantage (MA):Many MA plans follow CMS FFS policy. While MA plans can continue H@H via contract, the loss of the AHCAH model's official CMS endorsement creates regulatory ambiguity and a chilling effect on future program expansion by MA organizations.
• Medicaid: State Medicaid programs relied on the AHCAH waiver as a signal for safety and reimbursement protocols. The expiration is expected to cause many states to delay or abandon plans to integrate H@H into their own Medicaid offerings.

Strategic Planning for Healthcare Providers

For providers who have championed the Hospital-at-Home model, this is a moment of critical strategic reassessment. Continuing the model now requires non-Medicare FFS revenue and a high-risk operational commitment.

Engage Managed Care Organizations (MCOs)

Even though Medicare have paused reimbursement, some commercial payers and Medicaid managed care would still cover home-based acute or hybrid models. Shoreline Healthcare Technologies can help providers to review existing contracts for clauses supporting home-based, outpatient, or remote acute care billing and negotiate stopgap payment arrangements with commercial payers to sustain cash flow.

Coding Strategy Realignment

The codes, modifiers, and place-of-service designations used under the CMS H@H waiver may no longer apply. We update provider EMRs and billing rules with the latest CMS and payer coding guidance for telehealth and transitional care. And educate coding teams on alternative billing pathways like chronic care management (CCM), remote physiologic monitoring (RPM), or observation status billing. We have implemented real-time code scrubbing in the RCM workflow to prevent denials. For our ongoing innovations in revenue cycle management and healthcare technology, read our latest PR blog post highlighting how we’re driving smarter and more efficient care delivery.

Compliance and Audit Shielding

The waiver’s expiration has introduced new audit risks, services billed under lapsed authority can trigger recoupments. We at Shoreline Healthcare Technologies conduct compliance audits for all post-Sept 30 claims to ensure no exposure under expired CMS codes. We have always sticked on with audit-ready documentation workflows (proper modifier use, time logs, consent forms) and maintain up-to-date regulatory tracking to instantly adjust billing workflows when new CMS guidance or congressional action occurs.

We provide real-time dashboards tracking denials, reimbursements, and payer trends. Our AI-based analytics tools help to identify under-coded or under-paid encounters.

The current lapse meant a massive step backward, risking the disruption of care for patients and increased healthcare costs. By partnering with a right RCM partner like Shoreline Healthcare Technologies, hospitals and physician can adapt themselves to the new regulatory changes and stabilize their operations more quickly and smartly.