CMS Halts New Enrollments for Medical Supply Companies Under Medicare
The Centers for Medicare & Medicaid Services (CMS) has announced a temporary halt on new enrollments for medical supply companies under the Medicare program. This moratorium is introduced to address rising concerns about fraud, waste, and abuse in the Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) sector. The decision follows findings from the Department of Health and Human Services Office of Inspector General (OIG) and consultations with the Department of Justice (DOJ), as well as CMS's internal analysis of enrollment and claims data.
From 2023 to October 2025, medical supply companies faced a notably higher revocation rate of 17% compared to other DMEPOS suppliers. They also ranked high in categories such as payment suspensions, law enforcement referrals, and complaints. Based on these insights, CMS has implemented a nationwide restriction targeting medical supply companies to mitigate risks without limiting patient access to essential services.
The moratorium specifically affects entities primarily engaged in providing DMEPOS supplies, excluding groceries, retail pharmacies, and medical providers like physician practices or hospitals where DMEPOS provision is not the primary function. To enforce the moratorium, CMS plans to rigorously screen supplier applications to the National Provider Enrollment contractors, incorporating site assessments and online evaluations to determine eligibility.
CMS has issued warnings that submitting inaccurate information in enrollment applications to sidestep the moratorium could result in denial or revocation. Consequences may include a reapplication ban, exclusion from the Medicare program, and referrals to OIG for potential legal actions. Although the moratorium applies solely to Medicare, CMS encourages states to consider similar measures for their Medicaid or CHIP programs.
This moratorium is initially set for six months but may be extended as necessary. It impacts medical supply companies by affecting plans for reorganization, expansion, and new market entries. Suppliers exempt from the moratorium may still face thorough evaluations and possible delays as CMS endeavors to maintain compliance with its requirements. Exceptions for reactivation of billing privileges will be communicated based on specific circumstances surrounding previous deactivations.
CMS has hinted at the possibility of extending the moratorium, focusing on prevalent concerns and the current abundance of medical supply companies. This initiative underscores CMS's commitment to protecting the integrity of the Medicare program and ensuring regulatory compliance within the industry.