CMS Imposes Unprecedented Nationwide Moratorium on DMEPOS Enrollments

The Centers for Medicare & Medicaid Services (CMS) has taken a decisive and historically significant step by implementing a nationwide moratorium on the enrollment of new Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) suppliers into the Medicare program. Effective February 27, 2026, this six-month freeze represents a major escalation in the federal government’s efforts to combat systemic fraud, waste, and abuse within the medical supply chain. While CMS has previously utilized regional moratoria to target specific geographic hot spots known for fraudulent activity, the transition to a blanket nationwide restriction signals a shift toward a more aggressive, comprehensive enforcement strategy that leaves no territory unmonitored.

The impetus for this moratorium is rooted in years of escalating data indicating that the DMEPOS sector has become a primary vehicle for improper Medicare payments. According to reports from the HHS Office of Inspector General (OIG), the government has identified billions of dollars in potentially fraudulent billings over the last decade, particularly concerning items such as orthotic braces and urinary catheters. By consulting with the Department of Justice (DOJ) and analyzing its own internal claims data from 2023 through late 2025, CMS determined that the risk to the Medicare Trust Funds had reached a threshold necessitating an immediate halt to new market entrants in specific high-risk categories. This data-driven approach suggests that the moratorium is not merely a temporary pause but a tactical reset for the entire enrollment infrastructure.

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The impetus for this moratorium is rooted in years of escalating data indicating that the DMEPOS sector has become a primary vehicle for improper Medicare payments.

The moratorium specifically targets seven distinct types of medical supply companies. These include general medical supply companies as well as specialized entities employing orthotics, pedorthic, prosthetics, or respiratory therapy personnel. The defining characteristic for these entities is that their principal function is the furnishing of DMEPOS supplies directly to beneficiaries or other medical providers. This targeted approach ensures that the freeze impacts the specific business models most frequently associated with the pop-up storefronts and mail-order schemes that have historically plagued the program. By narrowing the scope to these seven subtypes, CMS is attempting to surgically remove fraud risk without completely paralyzing the broader healthcare delivery system.

Crucially, the moratorium includes safeguards against regulatory circumvention. It applies not only to entirely new enrollments but also to new practice locations and certain changes in ownership. Specifically, the moratorium triggers for ownership changes that fall under the 36-month rule, which prevents new owners from bypassing enrollment hurdles if the previous owner had been enrolled for less than three years. This is a clear attempt to prevent bad actors from purchasing existing, under-performing provider numbers to continue fraudulent billing cycles. However, the rule is not a total shutdown of the industry’s administrative functions; existing suppliers may still change their physical locations or update their business names without being barred, provided no new enrollment is generated.