On February 25, 2026, the Centers for Medicare & Medicaid Services (“CMS”) announced several program integrity actions impacting Medicaid funding and Medicare supplier enrollment, along with a request for stakeholder input regarding potential future regulatory approaches to fraud prevention. [1] These actions include the deferral of certain federal Medicaid funds, the imposition of a temporary nationwide enrollment moratorium for certain Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (“DMEPOS”) suppliers, and the issuance of a Request for Information (“RFI”) under CMS’s Comprehensive Regulations to Uncover Suspicious Healthcare (“CRUSH”) initiative. [2]
Medicaid Funding Deferral
CMS announced that it has deferred approximately $259.5 million in federal Medicaid matching funds to Minnesota while conducting further review of claims identified as unsupported or potentially improper. [3] CMS indicated that it has authority to withhold, defer, or disallow federal financial participation when program integrity requirements are not satisfied. [4]
According to CMS, the deferral is intended to provide an opportunity for the affected state to submit additional documentation and respond to agency findings during an ongoing review process. [5] CMS stated that its review identified “unusually high” spending growth in certain service categories, including personal care services and home- and community-based services. [6]
CMS further indicated that additional federal funds could be subject to deferral if the Minnesota Medicaid program does not address program integrity concerns or if CMS determines expenditures are noncompliant. [7]
Temporary Moratorium on Certain DMEPOS Enrollment
CMS also announced a 6-month nationwide moratorium on new Medicare enrollment for certain DMEPOS suppliers. [8] Under federal regulations implementing section 1866(j)(7) of the Social Security Act, CMS may impose temporary enrollment moratoria to address risks of fraud, waste, or abuse within specific provider or supplier categories. [9] CMS indicated that the moratorium is intended to allow evaluation of additional safeguards related to supplier enrollment and billing practices within this sector. [10]
During the moratorium, CMS will not approve new enrollments for 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. [11]
The moratorium will also potentially impact certain DMEPOS supplier transactions where there has been a change in the majority direct ownership of the Medical Supply Company within the prior 36 months. [12] In such instances, under the CMS “36 Month Rule,” the Medical Supply Company could be required to submit an initial enrollment application for a new Medicare number. However, during the moratorium, this initial enrollment application will be denied. [13]
Existing enrolled DMEPOS suppliers may continue to participate in Medicare, submit claims for covered services, and make other changes to their enrollment information. CMS may extend the moratorium on the new enrollments if it determines an extension is necessary. [14]
Transparency and Enforcement Measures
CMS also announced that it plans to publish information regarding providers and suppliers whose participation in the Medicare program has been revoked, including identifying information and the basis for revocation. [15] CMS described this measure as intended to provide additional transparency regarding administrative enforcement actions. [16]
Request for Information: CRUSH Initiative
In addition to these actions, CMS issued an RFI seeking stakeholder input on potential approaches to strengthen fraud prevention across Medicare, Medicaid, the Children’s Health Insurance Program, and the Health Insurance Marketplace. [17] The RFI invites feedback on both the use of existing authorities and potential future regulatory approaches related to enrollment oversight, ownership transparency, data-driven monitoring, and other fraud prevention mechanisms. [18] CMS indicated that stakeholder input may inform future rulemaking under the CRUSH initiative. [19]
Conclusion
The February 25, 2026 announcement underscores CMS’s emphasis on program integrity. The use of federal funding deferrals as a regulatory enforcement mechanism may have significant financial impact on providers and suppliers relying heavily on Medicaid funding. DMEPOS fraud and abuse remains a top enforcement priority. More broadly, the CRUSH RFI signals a shift towards preventative structural controls designed to address improper enrollment and payment risks before claims are submitted, rather than relying on traditional post-payment fraud enforcement. Stakeholder feedback submitted in response to the RFI may inform how such approaches are developed or implemented in future rulemaking.
FOOTNOTES
[1] See Centers for Medicare & Medicaid Services, Trump Administration Prioritizes Affordability by Announcing Major Crackdown on Health Care Fraud (Feb. 25, 2026).
[2] Id.
[3] Id.
[4] Id.
[5] Id.
[6] Id.
[7] Id.
[8] Id.
[9] See Medicare, Medicaid, and Children’s Health Insurance Programs; Nationwide Temporary Moratoria on Enrollment of Certain Durable Medical Equipment, Prosthetics, Orthotics, and Supplies Suppliers, CMS-6099-N (Feb. 2026).
[10] See Centers for Medicare & Medicaid Services, Trump Administration Prioritizes Affordability by Announcing Major Crackdown on Health Care Fraud (Feb. 25, 2026).
[11] See Centers for Medicare & Medicaid Services, DME Nationwide Moratorium Q&As (Feb. 25, 2026).
[12] Id.; see also Sheppard, Medicare’s New Enrollment Reporting and Oversight Landscape: What Providers and Suppliers Need to Know for 2026, Sheppard Healthcare Law Blog (2026).
[13] Id.
[14] See Centers for Medicare & Medicaid Services, DME Nationwide Moratorium Q&As (Feb. 25, 2026).
[15] See Centers for Medicare & Medicaid Services, Trump Administration Prioritizes Affordability by Announcing Major Crackdown on Health Care Fraud (Feb. 25, 2026).
[16] Id.
[17] Id.
[18] See Request for Information, Comprehensive Regulations to Uncover Suspicious Healthcare (CRUSH), CMS-6098-NC (Feb. 2026).
[19] See Centers for Medicare & Medicaid Services, Trump Administration Prioritizes Affordability by Announcing Major Crackdown on Health Care Fraud (Feb. 25, 2026).