A September 2025 report from the Department of Health and Human Services’ (HHS) Office of Inspector General (OIG) found that Texas failed to calculate or collect overpayments to hospices that served Medicaid beneficiaries.

Hospices are subject to two annual limits or caps which are meant to prevent over utilization of services. OIG found that Texas failed to calculate and collect $10.5 million from 174 hospices serving Medicaid patients from 2020 through 2022 due to not having the correct policies in place.

Providers in Texas have been under increased scrutiny over the last several years for the outsized growth in the number of new hospices. As of September 2024, all new hospice providers in Texas are currently subject to a Provisional Period of Enhanced Oversight.

In addition to recommending adopting policies and procedures to calculate and collect the hospice cap in future years, OIG recommended Texas collect the outstanding $10.5 million and return the federal share of $6.9 million to the federal government.