HHS Expands Power to Bar Fraudulent Providers from Medicare and Medicaid
Research direction: Isaac Kashaka | Prepared with AI assistance
The Department of Health and Human Services has formally granted CMS direct authority to exclude fraudulent providers and bad actors from participating in federal health programs. The move aims to expedite the removal of dishonest suppliers and clinical scammers targeting older adults.
What happened
In mid-October 2026, the Department of Health and Human Services formally delegated permissive exclusionary authority under Section 1128(b) of the Social Security Act directly to the Centers for Medicare & Medicaid Services (CMS) Administrator. Historically, excluding abusive clinicians, fraudulent telehealth clinics, and dishonest medical equipment companies fell under the purview of the HHS Office of Inspector General (OIG). CMS now possesses concurrent authority to directly bar individuals and corporate entities that commit fraud from participating in Medicare and Medicaid.
Who is affected
Medicare and Medicaid beneficiaries, especially older Americans who rely on federal healthcare programs and are vulnerable to deceptive medical billing, bogus genetic testing schemes, and unnecessary durable medical equipment claims.
Why it matters
Medicare fraud costs taxpayers billions annually and can directly harm seniors' care when scammers bill for unnecessary treatments, alter medical records, or compromise Medicare beneficiary numbers. Granting CMS direct authority to remove predatory actors helps clean up Medicare provider networks faster, shutting down rogue suppliers before they can cause widespread financial and medical damage.
Practical steps to take
- 1Review your Medicare Summary Notices (MSNs) and Explanation of Benefits (EOBs) carefully each month for services, equipment, or tests you never ordered or received.
- 2Treat your red, white, and blue Medicare card like a credit card; never give your number over the phone or online to unsolicited callers offering 'free' medical supplies or braces.
- 3Report any suspicious medical charges or unrequested medical deliveries directly to 1-800-MEDICARE (1-800-633-4227) or your local Senior Medicare Patrol (SMP).
Important dates
Immediate administrative implementation following the formal delegation on October 13, 2026.
Effective: October 13, 2026
Sources
- Sidley Austin LLPPublished 2026-10-19
- Reed SmithPublished 2026-10-15