Press Releases


For Immediate Release: Thursday, August 26, 2010
Contact: CMS Media Relations


New Rule Strengthens Supplier Enrollment Standards to Help Prevent Fraud


The Centers for Medicare & Medicaid Services (CMS) today issued a final rule representing another step to increase protections for Medicare and beneficiaries from potentially fraudulent suppliers of durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS).


The new regulation enhances Medicare enrollment standards for DMEPOS suppliers by adding several new standards and strengthening existing standards that suppliers must meet before being able to furnish equipment and supplies to Medicare beneficiaries. These new and stronger standards will help to reduce fraud in Medicare and provide beneficiaries with additional assurance that they are being served by legitimate suppliers who meet Medicare’s standards.


 “We know the majority of medical equipment suppliers and health care providers want to improve the health of Medicare beneficiaries, but we also know there are those who look for any opportunity to take advantage of beneficiaries and Medicare, including sham operations who are not legitimate businesses,” said CMS Deputy Administrator for Program Integrity, Peter Budetti.  “The steps we are taking today provide us with additional tools to support our continuing efforts to reduce Medicare fraud by helping to ensure that only appropriately qualified suppliers are enrolled in the program.”


            The additions and revisions to the DMEPOS supplier enrollment standards help ensure that only qualified and legitimate DMEPOS suppliers participate in Medicare. All suppliers for these items, including those DMEPOS items prescribed by the beneficiary’s physician, from simple canes and walkers to complex power wheelchairs, oxygen supplies and equipment, and hospital beds now must meet these new standards.  This final rule will:


  • Require DMEPOS suppliers to obtain oxygen from a state-licensed oxygen supplier (applies only in states that require oxygen licensure).


  • Require DMEPOS suppliers to remain open to the public for at least 30 hours a week, with exceptions for physicians or licensed non-physician practitioners furnishing services to their own patient(s) as part of their professional service, and DMEPOS suppliers working with custom made orthotics and prosthetics.


  • Ensure that DMEPOS suppliers continue to maintain ordering and referring documentation from physicians or non-physician practitioners.


  • Prohibit DMEPOS suppliers from sharing a practice location with certain other Medicare providers and suppliers subject to certain exceptions.


The final rule also clarifies and expands the existing enrollment requirements that DMEPOS suppliers must meet to establish and maintain billing privileges in the Medicare program. Specifically, this final rule will revise current supplier standards to:


  • Ensure that the DMEPOS supplier maintains a physical facility on an appropriate site that must 


* measure at least 200 square feet, except for State-licensed

orthotic and prosthetic personnel providing      custom fabricated orthotics or prosthetics in private practice;


  * be in a location that is accessible to the public, Medicare     beneficiaries, CMS, the National Supplier Clearinghouse (NSC), and its agents (not in a gated community or other area where access is restricted);


* be accessible and staffed during posted hours of operation;

  maintain a permanent visible sign in plain view and post hours

 of operation; and


* be in a location that contains space for storing business records, including the supplier’s delivery, maintenance, and beneficiary communication records.


* Prohibit the use of cell phones, beeper numbers and pagers as a primary business telephone number.  In addition, answering machines and answering services may not be used exclusively as a supplier’s primary telephone number during posted business hours.


* Expand the prohibition on a DMEPOS supplier’s telephone solicitation of a Medicare beneficiary to also include in-person contacts, e-mails, instant messaging and internet coercive advertising.


A copy of the final rule is posted on the Federal Register site at:


and will be posted at


The current supplier enrollment standards can be found on the NSC’s website at


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