New York Halts New Medicaid Provider Enrollments For Six Months

The moratorium is similar to federal moratoriums implemented by CMS earlier this year.

In direct response to a Centers for Medicare and Medicaid Services (CMS) directive issued to all state governors on April 23, 2026, requiring all states to revalidate every enrolled Medicaid provider within 24 months, New York state Medicaid Director Amir Bassiri announced on July 30, 2026, an immediate moratorium of at least six months on new Medicaid provider enrollments, including processing affected changes of ownership (CHOW) applications, for certain provider categories, including pharmacies, durable medical equipment suppliers, applied behavioral analysts, licensed home care service agencies, managed long-term care plans and laboratories. 

As of August 2026, there are millions of Medicaid providers in New York, including over 460,000 pharmacies. By pausing new enrollment and CHOW applications, the moratorium allows New York Medicaid to focus on complying with CMS’s 24-month revalidation requirement and allowing it time to implement a new revalidation process. Prior to the April directive, New York Medicaid providers were only required to revalidate every five years—thus, the new CMS directive greatly increases the revalidation frequency for Medicaid providers.

The moratorium is similar to federal moratoriums implemented by CMS earlier this year. For example, on May 13, 2026, CMS implemented a nationwide moratorium for new enrollment applications and specific transactions requiring new enrollments for certain suppliers of durable medical equipment, prosthetic devices, prosthetics, orthotics and supplies, home health agencies and hospices.

While the New York moratorium makes it clear that new Medicaid applications will not be processed for a minimum of six months, how the moratorium will affect CHOW applications is still not entirely clear.

Enrolled Medicaid providers are required to inform the New York Department of Health (DOH) within 15 calendar days of any change in direct or indirect ownership of, control interest in or managing employees of the enrolled provider. However, it is important to note that per the NYRx Medicaid Pharmacy Program Manual, changes in the supervising pharmacist must be reported by the pharmacy owner within seven calendar days. In addition, the pharmacy owner must complete and submit a new supervising pharmacist agreement form (eMedNY-409901). The supervising pharmacist must also submit a New York state affiliation/disaffiliation request form (eMedNY-610201).

New York Medicaid regulations define ownership as follows:

• Indirect ownership interest means an ownership interest in an entity that has an ownership interest in the disclosing entity. This term includes an ownership interest in any entity that has an indirect ownership interest in the disclosing entity.
• Ownership interest means the possession of equity in the capital, the stock or the profits of the disclosing entity.
• Managing employees means a general manager, business manager, administrator, director or other individual who exercises operational or managerial control over or who directly or indirectly conducts the day-to-day operation of an institution, organization or agency and includes, but is not limited to, laboratory directors and supervising pharmacists.
• Person with an ownership or control interest means a person or corporation that:
  • Has an ownership interest totaling 5 percent or more in a disclosing entity;
  • Has an indirect ownership interest equal to 5 percent or more in a disclosing entity;
  • Has a combination of direct and indirect ownership interests equal to 5 percent or more in a disclosing entity;
  • Owns an interest of 5 percent or more in any mortgage, deed of trust, note or other obligation secured by the disclosing entity if that interest equals at least 5 percent of the value of the property or assets of the disclosing entity;
  • Is an officer or director of a disclosing entity that is organized as a corporation; or
  • Is a partner in a disclosing entity that is organized as a partnership.

Changes of ownership must be reported to New York Medicaid by submitting an enrollment form. However, changes to managing employees or those with a control interest, but not to ownership, must only be reported by submitting the applicable disclosure form and do not require a new application. Thus, such modifications in controlling interests of pharmacies do not appear to be impacted by the New York moratorium.

If New York’s policy governing CHOW applications remains the same, existing providers that undergo equity CHOW transactions during the moratorium period would appear to be unable to reenroll in New York Medicaid upon the closing of the transaction, potentially leading to the termination of the provider’s enrollment.

Since many critical questions remain unanswered, it is important that DOH consider the prompt issuance of guidance to Medicaid providers as to how the moratorium applies to CHOW transactions. The DOH has announced that it will release more details about the moratorium, including hosting a webinar that will explain the moratorium’s requirements, guidelines and instructions. Duane Morris will be closely monitoring these developments and provide an update once the DOH releases additional information and guidance.

However, in the meantime, pharmacy owners must consider how this moratorium may affect opening new locations, ownership changes and/or asset and equity pharmacy transactions, including conditions precedent to closing, timing, valuation, additional transactions costs, reporting obligations and structuring of such transactions.

For More Information

If you have any questions about this Alert, please contact Jonathan L. Swichar, Nikki Baniewicz, any of the attorneys in our Pharmacy Litigation Group or the attorney in the firm with whom you are regularly in contact.