AMARILLO, TX – On November 25, 2025, the Office of Inspector General (OIG) issued a report entitled Medicare Payments for Continuous Glucose Monitors and Supplies Exceeded Supplier Costs and Retail Market Prices, Indicating Medicare Can Save At Least Tens of Millions of Dollars in One Year (“Report”).

Continuous Glucose Monitors (“CGMs”) are a wearable technology that can help patients manage diabetes by tracking glucose levels every few minutes. Low blood glucose levels can impact an individual’s ability to think and function. High levels can damage organs over time.

According to the OIG, it prepared the Report for the following reasons:

• Medicare Part B payments for CGMs and supplies rose from $109 million in 2018 to $1.3 billion in 2023.
• The OIG compared Medicare payments for CGMs and associated supplies to the costs incurred by suppliers and retail prices to assess the potential for Medicare cost savings. According to the OIG, it previously determined that Medicare was paying more than other payors for other types of DME, other than CGMs, inflating Medicare’s overall expenses and the enrollee copayments.

According to the Report, (i) a comparison of Medicare payments to CGM suppliers’ acquisition costs, (ii) a review of suppliers’ total estimated costs and (iii) a review of retail prices indicate that there are potential cost savings for Medicare and enrollees. Specifically, the OIG found:

• From July 2022 to June 2023, Medicare payments for CGMs and supplies exceeded DME suppliers’ acquisition costs and the suppliers’ estimated total costs. Medicare payments for CGMs and supplies exceeded suppliers’ acquisition costs by $377 million (or 69%) in a year, and the suppliers’ total estimated costs by $70 million (or 8%) in one year.
• CGM supplies (the most common CGM-related Medicare billing) represent the largest potential number of dollars that can be saved. Medicare payments exceeded suppliers’ acquisition costs by $359 million and suppliers’ total estimated costs by $61 million. Medicare payments for CGM supplies exceeded retail market prices by $290 million in one year.
• DME suppliers received $7 million in potential overpayments based on improper coding of CGMs and supplies. Suppliers billed Medicare for CGMs and supplies that have higher payment rates but provided CGMs and supplies that should have had lower payment rates.

In its Report, the OIG recommends the following:

• CMS should pursue reductions to Medicare’s payment rates for CGMs and supplies. In July 2025 (during the course of the OIG’s review), CMS issued a proposed rule to use the Competitive Bidding Program (“CBP”) and CMS’s inherent reasonableness authority for CGMs and supplies. CMS stated in the proposed rule that such actions would reduce Medicare payment rates.
• To achieve potentially millions of dollars of cost savings for Medicare and enrollees, CMS should take action to prevent overpayments caused by suppliers’ improper use of billing codes for CGMs and supplies.

The Report concludes by saying that CMS agrees with the above recommendations.

The following are lessons that DME suppliers can learn from the Report:

• When there is new technology resulting in a “next generation” product (e.g., CGMs)…and when the demand for the next generation product skyrockets…and when the dollar amount of claims to Medicare correspondingly skyrockets…the OIG and CMS will eventually clamp down. The government’s reasoning is that the spike in claims submissions is at least partially driven by fraud and/or reimbursement that is too high.
• Even when a spike in claims submissions is not driven by new technology – but rather – is driven by other factors, the government will take steps to reign in what it pays to DME suppliers. As we have seen with Operation Brace Yourself, such “other factors” include (i) aggressive marketing by DME suppliers, (ii) aggressive marketing by marketing companies and lead generation companies, and (iii) improper use of telemedicine.
• If a DME supplier’s business model is dependent on a particular product line (e.g., CGMs, intermittent catheters, wound care), the supplier needs to be aware of “which way the wind is blowing” regarding the product line. For example, will CGMs be included in the next iteration of competitive bidding? Perhaps. Alternatively, CGMs may be subjected to a 15% inherent reasonableness reduction.
• It is important for DME suppliers to diversify their product offerings to have a cushion in the event that CMS (i) reduces reimbursement for a product line and/or (ii) makes it difficult for DME suppliers by engaging in aggressive audits.

Jeffrey S. Baird, Esq., is chairman of the Health Care Group at Brown & Fortunato, PC, a law firm based in Texas with a national healthcare practice. He represents pharmacies, infusion companies, HME companies, manufacturers, and other healthcare providers throughout the United States. Baird is Board Certified in Health Law by the Texas Board of Legal Specialization and can be reached at (806) 345-6320 or [email protected].