Potential Changes Coming to Medicare Provider Enrollment and DMEPOS Accreditation

Often there is a lot of attention paid to the Centers for Medicare & Medicaid Services (“CMS”) Inpatient Prospective Payment System (“IPPS”), Outpatient Prospective Payment System (“OPPS”), and Medicare Physician Fee Schedule (“MPFS”) proposed rules by the many organizations that work with hospitals and physicians.  However, these organizations can also be affected by other payment systems based on the services they provide.  On June 30, 2025, the CMS issued the CY 2026 Home Health Prospective Payment System (“HH PPS”) proposed rule (the “Proposed Rule”) that would, in part, update and change Medicare provider enrollment, Durable Medical Equipment, Prosthetics, Orthotics, & Supplies (“DMEPOS”) accreditation, and the DMEPOS Competitive Bidding Program. While couched in a home health-based rule, DMEPOS updates are promulgated under HH PPS, and can affect any entity furnishing services/supplies under CMS’s DMEPOS regime. 

According to the Proposed Rule, the Medicare provider enrollment updates are in furtherance of CMS’s ongoing efforts to prevent both (1) Medicare fraud, waste, and abuse by unqualified providers or suppliers, and (2) harm to Medicare beneficiaries or the Medicare Trust Funds. The principal proposed updates concern Medicare enrollment revocations and deactivation. Current regulations mandate that certain Medicare enrollment revocations become effective 30 days after either CMS, or the CMS contractor, mails notice of the revocation to the affected provider, making the revocation date prospective. However, through the Proposed Rule, CMS seeks to increase the number of grounds to revoke a provider’s enrollment retroactively, so the revocation would become effective back to the date which the provider’s non-compliance with Medicare requirements began. CMS states this change would help prevent improper payments to non-compliant providers. Critically, the Proposed Rule would also add language that would allow for revocation based on the attestation of a beneficiary that items or services identified on the provider’s or supplier’s claim were not rendered/furnished. 

The Proposed Rule would allow CMS to deactivate an enrolled physician’s or non-physician practitioner’s Medicare billing privileges if they had not (1) ordered, referred, or certified Medicare Part A or B claims received for the previous 12 consecutive months, and (2) were enrolled via the Form CMS-8550 application solely to order, certify, or refer Medicare services or items. This could help to reduce the potential for fraud via deactivation of inactive NPIs; however, this could potentially cause additional administrative difficulties for providers who rarely have a need to order, refer, or certify Medicare Part A or B claims, and thus could potentially face having claims denied due to an inactivity deactivation by CMS without the provider having been given an opportunity to clarify or respond prior to the deactivation. 

In terms of DMEPOS accreditation, CMS requires DMEPOS suppliers to be accredited by a CMS-approved accrediting organization (“AO”) to enroll in and bill Medicare. This helps confirm that suppliers meet the DMEPOS quality standards. CMS is concerned that the DMEPOS accreditation programs have integrity vulnerabilities, in part because CMS noted increased reports of accredited suppliers not meeting quality standards, the possibility for inconsistencies in the AO’s and suppliers’ DMEPOS accreditation process, and a long lapse in time since the original accreditation regulations were updated. The Proposed Rule would update these regulations to allow CMS greater scrutiny over DMEPOS suppliers and AOs. Some of the key proposals include (1) mandating that DMEPOS suppliers be surveyed and reaccredited annually (rather than the current 3-year cycle), (2) expanding CMS’s oversight ability of DMEPOS AO’s operations, (3) reducing inconsistencies among AOs in how they oversee DMEPOS suppliers, and (4) requiring AOs to furnish more detailed information when applying or reapplying for approval to become or remain a DMEPOS AO.  Particularly with reaccreditation occurring annually rather than every three years, there are likely additional administrative burdens on DMEPOS suppliers, and something such suppliers should be prepared for in the future, if this proposal is adopted. 

The Proposed Rule would also create additional specificity for the DMEPOS prior authorization exemption process. CMS states these changes would “…reduce supplier burden and effectively utilize contractor resources...” The Proposed Rule states that CMS would exempt suppliers that achieve a prior authorization provisional affirmation threshold of 90% during an initial or periodic assessment. Suppliers who do not meet the compliance rate threshold must continue submitting prior authorization requests as required. CMS also proposes a 60-day prior notice to suppliers of a granted exemption, or the withdrawal of an exemption (this is proposed to give suppliers time to submit required prior authorization requests).   Often this type of exemption is called “gold carding”, which is in line with the potential gold carding discussed in CMS’s WISer Model for electrical nerve stimulators, skin and tissue substitutes, and knee arthroscopy, previously discussed in the following post: CMS Unveils New Prior Authorization “WISeR Model” for Electrical Nerve Stimulators, Skin and Tissue Substitutes and Knee Arthroscopy. 

The Proposed Rule flags that a future announcement will reveal CMS’s proposed improvements to the DMEPOS Competitive Bidding Program; however, neither the product categories for bidding, nor the specific timeframe for the next competition have been announced. It is important to note that the Proposed Rule had many other changes, some of which are outlined in CMS’s HH PPS Proposed Rule Fact Sheet. 

The notice and comment period is open, and comments must be received no later than September 2, 2025, according to the text of the Proposed Rule, but note that in the “SUBMIT A PUBLIC COMMENT” box of the Proposed Rule, it states comments are due no later than “8/29/2025 at 11:59 pm EST”.

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Molly Tutt is a third-year law student at Washington University in St. Louis School of Law. Ms. Tutt will rejoin the firm as an Associate in 2026.