The New York State Department of Health has announced a six-month Medicaid enrollment moratorium affecting several healthcare provider categories, including Licensed Home Care Services Agencies (LHCSAs). The temporary moratorium is expected to significantly impact providers, agency owners, buyers, investors, and organizations planning ownership transitions or expansion within New York.
Although existing providers may continue operating, businesses pursuing acquisitions or transactions involving Medicaid enrollment should carefully evaluate how this temporary pause may affect their plans.
The Department of Health has temporarily suspended the processing of new Medicaid enrollment applications for several provider categories they identified as higher risk under federal Medicaid program integrity initiatives.The moratorium also impacts the processing of certain Change of Ownership (CHOW) applications, potentially delaying transactions that require Medicaid enrollment approval before they can proceed.
The provider categories currently affected include:
• Licensed Home Care Services Agencies (LHCSAs)
• Laboratories
• Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS)
• Applied Behavior Analysis (ABA) providers
• Pharmacies
• Managed Long-Term Care (MLTC) organizations
Organizations considering acquisitions, mergers, ownership changes, or expansion should evaluate the regulatory impact early in the transaction process to avoid unnecessary delays.
Not every transaction will be affected in the same way, making experienced legal guidance especially important.
Existing Providers Are Not Losing Their Enrollment
The moratorium does not terminate existing Medicaid enrollments.
Current providers may continue operating but should remain compliant with all Medicaid requirements, including timely completion of Medicaid revalidation when notified by the Department of Health.
Preparing for the Months Ahead
During periods of increased regulatory oversight, planning becomes even more critical.
Healthcare providers should consider reviewing:
• Corporate ownership structure
• Medicaid enrollment status
• Pending Change of Ownership (CHOW) applications
• Regulatory compliance history
• Transaction documents and anticipated closing timelines
Taking these steps now can help avoid surprises and prepare for a smoother transaction once the moratorium is lifted.
Kahn Yuniver Law
Healthcare transactions require more than business planning; they require strategic legal guidance. Kahn Yuniver Law advises healthcare providers, agency owners, investors, and healthcare organizations on regulatory compliance, licensing, Medicaid enrollment, Change of Ownership transactions, corporate structuring, and Department of Health matters.
If your organization is planning an acquisition, ownership transition, or expansion, our attorneys can help you evaluate how New York’s current regulatory landscape may affect your business and develop strategies to move forward with confidence.
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