Policy & oversight
Federal Register Notice Gives CMS Direct Power to Bar Providers From Medicare and Medicaid
A delegation published today in the Federal Register gives the CMS Administrator permissive exclusion authority under Section 1128(b) of the Social Security Act, placing that enforcement tool at CMS alongside the OIG rather than exclusively within the OIG.
By the Goodsurance editorial teamOctober 14, 2026
The Department of Health and Human Services published a statement of delegation in the Federal Register on October 14, 2026, giving the administrator of the Centers for Medicare and Medicaid Services direct authority to exclude providers, suppliers, and organizations from participating in Medicare and Medicaid. The authority is rooted in Section 1128(b) of the Social Security Act.
Historically, the HHS Secretary had delegated this power only to the HHS Office of Inspector General, which maintains the government's List of Excluded Individuals and Entities. That 1988 delegation to the OIG remains in effect and is not altered by the new notice.
Starting today, CMS can directly bar providers from Medicare and Medicaid, joining the OIG as a second enforcement authority under a Federal Register delegation notice.
The permissive exclusion authority allows the relevant official to bar an individual or organization from federal health programs. Unlike mandatory exclusions, permissive exclusions involve a discretionary judgment. The Federal Register notice states that CMS is uniquely positioned to investigate, identify, and develop the evidentiary basis underpinning such determinations, and that formalizing the delegation reduces redundancy and improves program integrity outcomes. CMS cannot use this authority to conduct administrative hearings or to issue regulations.
For Medicare beneficiaries, the change creates a second enforcement path. The agency that administers Medicare claims and approves plan contracts can now act directly against providers it identifies as problematic, separately from the OIG. The OIG retains its own exclusion authority unchanged.
In plain words
The government runs Medicare through an agency called CMS. A separate office, called the OIG, has long been the only one allowed to officially ban a doctor or company from Medicare when they break the rules. As of today, CMS also has that power. A notice in the official government rulebook, called the Federal Register, made it official on October 14, 2026. CMS still cannot hold hearings or write new rules using this power. The OIG keeps all of its existing authority. Now both offices can work to remove dishonest providers from Medicare.
Understand the basics first
Source: Federal Register
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