Provider Alert: DMEPOS Moratorium Underway

On February 27, 2026, the Centers for Medicare & Medicaid Services (“CMS”) issued a six-month nationwide moratorium on several types of Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (“DMEPOS”) suppliers, banning new businesses from enrolling in Medicare for at least the next six months. CMS took this drastic step as a program integrity measure to prevent Medicare fraud, waste and abuse, which, according to CMS, is prevalent in the DEMPOS industry.

Section 6401(a) of the Affordable Care Act added Section 1866(j)(7) to the Social Security Act, which provides the Health and Human Services Secretary (the “Secretary”) with the authority to impose temporary moratoria on the enrollment of new fee-for-service  Medicare, Medicaid or CHIP providers and suppliers if the Secretary determines a moratorium is necessary to prevent fraud, waste or abuse within these programs. 42 C.F.R 424.570 contains the parameters under which CMS may impose such a moratorium. Since that time, CMS has implemented a handful of moratoria, including bans affecting home health agencies and ambulance suppliers in designated areas of the country.

This latest moratorium on DMEPOS suppliers went into effect on February 27, 2026 and will last at least six months. Notably, it is the first moratorium in over five years, as the last one expired in 2019. CMS maintains the authority and discretion to extend the nationwide moratorium in 6-month increments beyond the initial 6-month period.

As rationale for the moratorium, CMS pointed to several OIG pending studies which look more closely into the concerning trends and high risk of fraud, waste and abuse in the DMEPOS industry. As a result, the OIG recommended CMS analyze DMEPOS billing patterns to identify potential specific areas of fraud. In addition to the OIG studies, CMS highlighted criminal convictions from the last several years involving DMEPOS suppliers. Following consultation with the OIG and DOJ, CMS determined that a moratorium was appropriate.

Affected DMEPOS Provider Types

The 6-month enrollment ban applies to the following types of DMEPOS suppliers:

1. Medical Supply Company;
2. Medical Supply Company with Orthotics Personnel;
3. Medical Supply Company with Pedorthic Personnel;
4. Medical Supply Company with Prosthetics Personnel;
5. Medical Supply Company with Prosthetic and Orthotic Personnel;
6. Medical Supply Company with Registered Pharmacist; and
7. Medical Supply Company with Respiratory Therapist.

For purposes of the moratorium CMS defines “medical supply company” as “a business whose principal function is to furnish DEMPOS supplies (regardless of supply type) directly to another party, such as, but not limited to: (1) beneficiaries with a medical order (for example, via mail order); (2) medical providers and suppliers; or (3) both” 91 Fed. Reg. 9859 (February 27, 2026).

It is important to note that the moratorium only applies to these specific types of medical supply companies designated by CMS. Accordingly, the moratorium does not apply to other supplier types that might file an initial enrollment application to enroll as a DMEPOS supplier. Examples include retail pharmacies, or inpatient or outpatient medical providers (such as physicians, chiropractors, therapists, home health agencies and/or nursing facilities), whose principal function is typically not the provision of DMEPOS.

Type of Enrollment Activities Prohibited or Permitted

Any initial enrollment application filed by a DMEPOS supplier subject to the moratorium during the moratorium period will be denied. This includes new companies filing an initial enrollment application or existing DMEPOS suppliers filing an initial enrollment application. The moratorium is nationwide and includes all states, territories and the District of Columbia. This moratorium may also prevent affected DMEPOS providers from enrolling in state Medicaid programs as well so it’s important to check with your state’s Medicaid agency for further guidance. CMS declined to extend the moratorium to Medicaid but rather left it to each state’s discretion. Existing DMEPOS suppliers may continue to operate, participate in Medicare and submit claims for covered services. Suppliers may also make changes to their enrollment record, including changes in existing practice location and changes to enrollment information (such as contact information). DMEPOS suppliers may undergo changes in ownership, unless the change of ownership transaction falls within the purview of the 36-month rule, explained below.

The moratorium prohibits new DMEPOS suppliers from enrolling in Medicare. It also prevents DMEPOS suppliers who are currently enrolled in Medicare from re-enrolling after undergoing a change in majority ownership, unless exempt under 42 C.F.R. 424.551. CMS recently extended the “36-month” rule to include DMEPOS suppliers. This means that a DMEPOS supplier which undergoes a change in majority ownership within 36 months of its initial enrollment or last change in majority ownership must initially enroll in Medicare as a new supplier rather than assuming the Medicare Provider Agreement of the previous owner. Practically speaking, since DMEPOS suppliers are prohibited from initially enrolling in Medicare during the moratorium period, this would prevent DMEPOS suppliers whose transactions are subject to the 36-month rule from continuing to participate in Medicare until the moratorium ends.

During the moratorium, CMS will closely screen any Medicare enrollment applications received from DMEPOS suppliers to ensure suppliers are not trying to circumvent the moratorium. CMS emphasized that it has the authority to not only deny enrollment but also impose a reapplication bar up to ten years for a supplier’s submission of false or misleading information on the enrollment application in order to circumvent the moratorium.

 Expiration of Moratorium

CMS will review whether to extend or lift the moratorium before the initial 6-month period ends. If CMS decides to extend the moratorium, it will publish a notice in the Federal Register. Once lifted, providers or suppliers that were unable to enroll in Medicare as a result of the moratorium will be reviewed at the “high” screening level, as defined in 42 C.F.R. 424.518(c)(3)(iii), if they apply for enrollment at any time within six months from the date the moratorium was lifted.

“Provider Alert: DMEPOS Moratorium Underway”

Written by  Lauren Ambler