By: Aaron R. Claxton
On February 27, 2026, the Centers for Medicare and Medicaid Services (“CMS”) issued a moratorium on the enrollment of new durable medical equipment (“DME”) suppliers with Medicare. The moratorium applies to the following seven supplier types:
- Medical supply company
- Medical supply company with orthotics personnel
- Medical supply company with pedorthic personnel
- Medical supply company with prosthetics personnel
- Medical supply company with prosthetics and orthotics personnel
- Medical supply company with registered pharmacist
- Medical supply company with respiratory therapist
In issuing the moratorium, CMS noted that their determination for the need to implement the moratorium was based on a high risk that fraud, waste, and abuse exists. CMS relied on historical Medicare enrollment and claims data and analyzed key metrics pertaining to enrollment volume and trends for more than eighty types of DME suppliers. Despite a relatively small number of bad actors, DME suppliers continue to be a prime target for allegations of fraud, waste, and abuse.
The moratorium will remain in effect for six months and may be extended thereafter. The CMS notice identifies the following changes that the moratorium does not apply to:
- Changes in practice location (except if the location is changing from a location outside the moratorium area to a location inside the moratorium area).
- Changes in provider or supplier information, such as phone number or address.
- Changes in ownership (except changes in ownership of home health agencies that would require an initial enrollment).
However, the moratorium would apply to suppliers that go through a change of ownership because a supplier that undergoes a nonexempt change in majority ownership within thirty-six months of its initial enrollment must enroll in Medicare as a brand new supplier, despite already operating prior to the moratorium. Additionally, changes of ownership that are the result of asset sales would also be impacted by the moratorium as the new owners would also have to enroll in Medicare as a new DME supplier. Applications submitted to CMS for new enrollment during the moratorium period will be denied and the applications will have to be resubmitted in the future once the moratorium is no longer in place.
The notice indicates that CMS believes the moratorium will not substantially limit Medicare beneficiaries’ access to care because “there is already an adequate nationwide quantity of such suppliers.” However, the number of overall suppliers does not take into account the fact that there may be limited numbers of specific types of suppliers and also fails to consider that there may already be very limited access to Medicare beneficiaries located in certain rural communities.
For existing DME suppliers, this moratorium serves as a barrier to entry to new suppliers that would compete with them for business. DME suppliers currently enrolled in Medicare should note the increased scrutiny that they face for allegations of fraud, waste, and abuse with the current administration. It is as important as ever for DME suppliers to prioritize regulatory and compliance efforts in order to maintain their Medicare enrollment and continue to serve the Medicare beneficiary population.
Aaron Claxton is a California healthcare attorney and partner with Wilke Fleury LLP focused on regulatory compliance for a range of clients providing healthcare services within the state.
