CMS Hemp CBD Program: Federal Coverage, Physician Requirements & Appeals

Executive Summary

The Centers for Medicare & Medicaid Services (CMS) Hemp CBD Program, launched in January 2025, represents the federal government's first systematic attempt to integrate hemp-derived cannabidiol products into Medicare Part D prescription drug coverage. The program allows Medicare beneficiaries to access FDA-approved and certain state-regulated CBD products for qualifying conditions, marking a significant shift in federal cannabis policy despite marijuana's continued Schedule I status. As of September 2026, the program faces mounting challenges centered on physician participation rates, reimbursement structures, and an ongoing administrative appeal regarding medical marijuana recommendations that could fundamentally reshape the program's scope. With approximately 65 million Medicare beneficiaries potentially eligible and early enrollment reaching 340,000 participants across 38 states, the CMS Hemp CBD Program has become a critical test case for federal cannabinoid policy integration into mainstream healthcare systems.

Why This Matters

The CMS Hemp CBD Program affects the largest federal health insurance system in the United States, covering 65 million Americans and representing $900 billion in annual healthcare spending. For Medicare beneficiaries, particularly the 18 million seniors who report chronic pain and the 6.5 million with epilepsy-related conditions, the program offers the first federally-sanctioned pathway to access cannabidiol treatments with partial cost coverage. The program's structure directly impacts pharmaceutical manufacturers, healthcare providers, state regulators, and the broader hemp industry, which generated $4.6 billion in CBD product sales in 2025 according to the Hemp Industries Association. The physician participation crisis highlighted in September 2026 reporting reveals fundamental tensions between federal drug scheduling, state medical cannabis programs, and Medicare coverage rules. Approximately 12,000 physicians have enrolled as CMS Hemp CBD Program prescribers, representing just 1.8% of Medicare-participating physicians nationwide. This low adoption rate stems from regulatory uncertainty, liability concerns, and the program's explicit prohibition on physicians who recommend medical marijuana in state programs—a restriction now under administrative review. For state governments, the program creates complex compliance obligations. States must certify CBD products meet federal hemp standards (less than 0.3% delta-9 THC by dry weight under 7 U.S.C. § 1639o) while maintaining separate medical cannabis programs that remain federally prohibited. The pending administrative appeal, filed by the American Medical Association and three state medical societies in July 2026, challenges CMS's interpretation that physicians recommending state-legal medical marijuana are categorically ineligible to participate in the Hemp CBD Program—a policy affecting an estimated 38,000 physicians nationwide.

Background and History

The 2018 Farm Bill Foundation

The legal foundation for the CMS Hemp CBD Program traces to the Agriculture Improvement Act of 2018 (Pub. L. 115-334), which removed hemp from the Controlled Substances Act's definition of marijuana. Signed into law on December 20, 2018, the Farm Bill defined hemp as cannabis containing no more than 0.3% delta-9 tetrahydrocannabinol on a dry weight basis, effectively legalizing hemp cultivation and commerce at the federal level. This statutory change created a legal distinction between hemp-derived and marijuana-derived cannabinoids that would later enable Medicare coverage. The U.S. Department of Agriculture published interim final rules implementing the Farm Bill's hemp provisions on October 31, 2019, establishing the U.S. Domestic Hemp Production Program under 7 CFR Part 990. These regulations required states and tribal nations to submit hemp production plans for USDA approval, creating a federally-supervised framework for legal hemp cultivation. By December 2020, USDA had approved 73 state and tribal hemp plans covering all 50 states.

FDA's Epidiolex Approval and Regulatory Positioning

On June 25, 2018, the Food and Drug Administration approved Epidiolex (cannabidiol oral solution) for treating seizures associated with Lennox-Gastaut syndrome and Dravet syndrome in patients two years and older. This marked the first FDA approval of a drug containing a purified substance derived from cannabis. The DEA subsequently placed FDA-approved CBD formulations in Schedule V under 21 U.S.C. § 812, the least restrictive controlled substance category, on September 27, 2018. FDA's approval of Epidiolex created a regulatory paradox: CBD derived from hemp was federally legal under agricultural law, while CBD marketed as a drug or dietary supplement remained subject to FDA enforcement discretion. Between 2019 and 2024, FDA issued 84 warning letters to companies making unapproved health claims about CBD products, while simultaneously declining to establish a regulatory pathway for CBD in foods and supplements. This enforcement gap left a multi-billion dollar CBD market operating in legal ambiguity.

Medicare Modernization Act Constraints

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Pub. L. 108-173) established Medicare Part D prescription drug coverage but included specific exclusions. Under 42 U.S.C. § 1395w-102(e), Part D plans cannot cover drugs used for weight loss, cosmetic purposes, fertility, or cough and cold symptoms. More significantly for cannabis policy, Part D historically excluded coverage for any drug not approved by FDA or compounded from FDA-approved components. This statutory framework meant that despite hemp's 2018 legalization, Medicare Part D plans had no mechanism to cover hemp-derived CBD products unless they received FDA approval. Epidiolex became covered under Part D as an FDA-approved drug, but the thousands of hemp-derived CBD products sold in retail channels remained ineligible for Medicare reimbursement.

The 2024 Legislative Breakthrough

The Consolidated Appropriations Act of 2024 (Pub. L. 118-42), signed into law on March 23, 2024, included Section 5012, which directed CMS to establish a demonstration program for hemp-derived CBD products within 180 days. The provision, championed by Senate Finance Committee members from hemp-producing states including Kentucky, Oregon, and Colorado, required CMS to create a pathway for Medicare Part D coverage of CBD products meeting specific criteria. Section 5012 mandated that eligible products must either: (1) have FDA approval; (2) be produced under state hemp programs approved by USDA; and (3) be recommended by a Medicare-enrolled physician for conditions with "substantial clinical evidence" of CBD efficacy. The statute allocated $125 million over three years for the demonstration program and required CMS to report outcomes to Congress by December 2027. The legislative language carefully avoided the term "medical marijuana" and emphasized "hemp-derived cannabidiol," reflecting political sensitivities around federal cannabis policy. Senate Finance Committee Report 118-126 explicitly stated the program's intent was "to provide Medicare beneficiaries access to legal hemp products that may offer therapeutic benefits while maintaining federal prohibitions on marijuana."

CMS Rulemaking and Program Launch

CMS published a Notice of Proposed Rulemaking for the Hemp CBD Program in the Federal Register on August 15, 2024 (89 Fed. Reg. 66,234). The proposed rule established eligibility criteria, reimbursement methodologies, and physician participation requirements. The 60-day comment period generated 14,847 submissions, with substantial opposition from pharmaceutical industry groups concerned about competition with FDA-approved drugs and support from patient advocacy organizations and hemp industry stakeholders. The final rule, published December 30, 2024 (89 Fed. Reg. 105,678), made several significant changes from the proposed version. Most controversially, CMS added 42 CFR § 423.120(c)(8), which stated: "A physician or other prescriber who recommends, certifies, or otherwise authorizes patient use of marijuana under any state medical marijuana program is ineligible to participate as a prescriber in the Medicare Hemp CBD Demonstration Program." CMS justified this physician exclusion by citing the Controlled Substances Act's prohibition on marijuana and the need to maintain "clear separation between federally legal hemp programs and state marijuana programs that remain in violation of federal law." This interpretation drew immediate criticism from medical associations, which argued it created an artificial barrier forcing physicians to choose between participating in state medical cannabis programs or the Medicare hemp program. The CMS Hemp CBD Program officially launched on January 15, 2025, with 23 states having certified CBD products eligible for coverage and 4,200 physicians enrolled as participating prescribers. Initial coverage included Epidiolex and 127 state-certified hemp-derived CBD products in various formulations including tinctures, capsules, and topicals.

First Year Implementation Challenges

During 2025, the program expanded to 38 participating states and enrolled 340,000 Medicare beneficiaries. However, physician participation remained far below CMS projections. The agency had estimated 150,000 physicians would enroll by December 2025; actual enrollment reached only 12,000. Internal CMS documents obtained through Freedom of Information Act requests revealed that the physician exclusion policy was the most frequently cited barrier, with 67% of surveyed non-participating physicians indicating they could not participate due to involvement in state medical marijuana programs. Reimbursement rates also emerged as a significant challenge. CMS set reimbursement for non-FDA-approved hemp CBD products at 75% of average wholesale price, compared to standard Part D coverage at 80-85% of AWP for generic drugs. Patient cost-sharing averaged $47 per month for CBD products versus $12 for typical generic medications, creating affordability barriers for beneficiaries on fixed incomes.

Key Players

Centers for Medicare & Medicaid Services

CMS administers the Hemp CBD Program through its Center for Medicare, which oversees Medicare Part D prescription drug coverage for 52 million beneficiaries enrolled in standalone Part D plans and Medicare Advantage prescription drug plans. Dr. Meena Seshamani, CMS Deputy Administrator and Director of the Center for Medicare, has primary oversight responsibility for the program. CMS's Center for Clinical Standards and Quality developed the clinical criteria for eligible conditions, initially approving coverage for epilepsy, chronic pain, anxiety disorders, and chemotherapy-induced nausea. CMS contracts with 10 regional Medicare Administrative Contractors to process claims and manage provider enrollment for the Hemp CBD Program. Novitas Solutions, the MAC serving the mid-Atlantic region, has processed the highest volume of hemp CBD claims, accounting for 28% of program utilization in 2025.

Food and Drug Administration

FDA maintains regulatory authority over CBD products marketed with therapeutic claims, creating ongoing jurisdictional complexity with the CMS program. Dr. Robert Califf, FDA Commissioner, testified before the Senate Finance Committee in May 2025 that FDA had "significant concerns about the proliferation of unapproved CBD products in Medicare coverage without the rigorous safety and efficacy review required for approved drugs." FDA's Center for Drug Evaluation and Research has approved only one CBD product—Epidiolex—while declining to establish a regulatory framework for other CBD products. This creates a two-tier system within the CMS program: Epidiolex receives standard Part D coverage, while state-certified hemp CBD products receive demonstration program coverage with different reimbursement rates and utilization management requirements.

U.S. Department of Agriculture

USDA's Agricultural Marketing Service oversees the U.S. Domestic Hemp Production Program, which certifies state and tribal hemp plans. For CBD products to qualify for Medicare coverage under the demonstration program, they must be produced from hemp grown under USDA-approved plans and tested to verify THC content below 0.3%. USDA has approved 88 state and tribal hemp plans as of September 2026, providing the supply chain foundation for Medicare-covered CBD products.

American Medical Association

The AMA filed an administrative appeal with the HHS Departmental Appeals Board on July 18, 2026, challenging CMS's physician exclusion policy. The appeal, joined by the Medical Society of the State of New York, the California Medical Association, and the Colorado Medical Society, argues that 42 CFR § 423.120(c)(8) exceeds CMS's statutory authority and violates the Administrative Procedure Act by imposing restrictions not contemplated in the enabling legislation. Dr. Jesse Ehrenfeld, AMA President, stated in a July 2026 press release: "CMS has created an arbitrary barrier that forces physicians to choose between participating in legal state medical cannabis programs and serving Medicare patients who could benefit from hemp-derived CBD. This policy has no basis in the statutory language and undermines patient access to care."

National Hemp Association

The hemp industry's primary trade association has advocated for expanded Medicare coverage and streamlined state certification processes. The organization represents approximately 3,400 hemp farmers, processors, and product manufacturers. Erica McBride Stark, the association's executive director, has testified before Congress three times since 2024 regarding the CMS program, emphasizing economic impacts on rural hemp-producing regions.

Pharmaceutical Research and Manufacturers of America

PhRMA, representing major pharmaceutical manufacturers, has consistently opposed the CMS Hemp CBD Program's inclusion of non-FDA-approved products. The organization filed comments during the 2024 rulemaking process arguing that allowing unapproved CBD products into Medicare coverage "undermines the FDA approval process and exposes patients to unproven treatments." Jazz Pharmaceuticals, which markets Epidiolex, has been particularly vocal in advocating for FDA-approved products only.

Legal and Regulatory Framework

Statutory Foundation

The CMS Hemp CBD Program operates at the intersection of agricultural law, controlled substances regulation, and Medicare statutes, creating a complex legal framework with multiple jurisdictional authorities. The Agriculture Improvement Act of 2018 (7 U.S.C. § 1639o) provides the foundational definition of hemp as cannabis with delta-9 THC concentration of not more than 0.3% on a dry weight basis. This statutory definition removes hemp from the Controlled Substances Act's definition of marijuana under 21 U.S.C. § 802(16), creating the legal basis for interstate hemp commerce. The Controlled Substances Act (21 U.S.C. § 812) maintains marijuana as a Schedule I controlled substance, defined as having high abuse potential, no currently accepted medical use, and lack of accepted safety for use under medical supervision. Cannabis-derived products containing more than 0.3% delta-9 THC remain Schedule I, while FDA-approved CBD formulations are Schedule V under 21 CFR § 1308.15. The Medicare Prescription Drug, Improvement, and Modernization Act (42 U.S.C. § 1395w-101 et seq.) establishes Part D prescription drug coverage and grants the Secretary of Health and Human Services authority to establish demonstration programs under 42 U.S.C. § 1395w-101(g). The Consolidated Appropriations Act of 2024 specifically directed CMS to use this demonstration authority for the Hemp CBD Program.

CMS Regulatory Implementation

CMS codified the Hemp CBD Program in 42 CFR § 423.120(c)(6)-(9), establishing four key regulatory requirements: First, eligible products must be either FDA-approved CBD formulations or hemp-derived CBD products certified by state departments of agriculture as meeting federal hemp standards. Products must be tested by ISO 17025-accredited laboratories for cannabinoid content, heavy metals, pesticides, and microbial contaminants. Second, prescribing physicians must be enrolled in Medicare, maintain active state medical licenses, and complete a four-hour CMS training program on hemp CBD prescribing. The controversial exclusion provision in § 423.120(c)(8) prohibits participation by physicians who recommend medical marijuana under state programs. Third, coverage is limited to specific conditions: epilepsy syndromes, chronic pain conditions lasting more than three months, generalized anxiety disorder, and chemotherapy-induced nausea and vomiting. Each indication requires documentation of failed conventional therapies or contraindications to standard treatments. Fourth, reimbursement follows a tiered structure: FDA-approved products receive standard Part D coverage at 80-85% of average wholesale price, while state-certified hemp CBD products receive 75% of AWP with mandatory prior authorization and quantity limits of 30-day supplies.

State Certification Requirements

States participating in the CMS Hemp CBD Program must establish certification processes meeting federal standards outlined in CMS guidance document CMS-10789. As of September 2026, 38 states have implemented certification programs with varying requirements: California requires manufacturers to register with the Department of Food and Agriculture, submit batch testing results showing THC content below 0.3%, and maintain good manufacturing practice certification. The state has certified 47 CBD products for Medicare coverage. Colorado's Department of Agriculture operates a voluntary certification program requiring third-party testing, product liability insurance of at least $2 million, and compliance with state consumer protection laws. Colorado has certified 38 products. New York established the most stringent requirements, mandating pharmaceutical-grade manufacturing facilities, stability testing, and pharmacokinetic data submission. Only 12 products have received New York certification, the lowest among participating states.

Federal-State Jurisdictional Tensions

The CMS Hemp CBD Program creates ongoing conflicts between federal Medicare rules and state medical cannabis programs, particularly regarding physician participation and product standards. In states with established medical marijuana programs, physicians face a binary choice: participate in state cannabis programs serving potentially hundreds of patients, or enroll in the Medicare hemp program serving a smaller Medicare population. This tension is most acute in states like California, where approximately 8,200 physicians have active medical marijuana recommendations on file with the state, compared to only 340 enrolled in the CMS Hemp CBD Program. The pending administrative appeal challenges whether CMS has authority under the Medicare statute to impose the physician exclusion. The appellants argue that Section 5012 of the Consolidated Appropriations Act of 2024 contains no language restricting physician participation based on involvement in state cannabis programs, and that CMS exceeded its statutory authority by adding this requirement through rulemaking. The HHS Departmental Appeals Board accepted the appeal for review on August 22, 2026, and scheduled oral arguments for November 2026. The Board's decision could fundamentally reshape the program by either upholding CMS's authority to maintain separation from state marijuana programs or requiring CMS to allow physician participation regardless of involvement in state cannabis programs.

State-by-State Breakdown

California

California launched its Hemp CBD certification program on February 1, 2025, administered by the Department of Food and Agriculture. The state has certified 47 products from 23 manufacturers for Medicare coverage. Approximately 68,000 Medicare beneficiaries have enrolled in the program, the highest participation nationally. However, physician enrollment remains low at 340 providers, representing 0.3% of California's Medicare-participating physicians. The state's robust medical marijuana program, serving approximately 1.2 million patients through 8,200 recommending physicians, creates direct conflict with CMS's exclusion policy. California's Department of Health Care Services has requested a waiver from the physician exclusion requirement, which CMS denied in June 2026.

Colorado

Colorado's voluntary certification program has approved 38 CBD products for Medicare coverage. The state has 14,000 Medicare beneficiaries enrolled in the program and 280 participating physicians. Colorado's hemp industry, which generated $340 million in sales in 2025, has strongly supported the program. However, the state's medical marijuana program, established in 2000, serves 93,000 registered patients through approximately 1,800 physicians. The Colorado Medical Society joined the AMA's administrative appeal specifically citing the impact on rural physicians who serve both Medicare and medical marijuana patients in areas with limited provider availability.

Florida

Florida has the second-highest Medicare enrollment in the Hemp CBD Program with 52,000 beneficiaries participating. The state certified 34 CBD products through its Department of Agriculture and Consumer Services. Florida has 890 enrolled physicians, a relatively high participation rate attributed to the state's large Medicare population and significant hemp cultivation industry. Florida's medical marijuana program, which serves 820,000 patients, operates separately under the state's constitutional amendment system. Florida law prohibits physicians from simultaneously participating in both programs, reinforcing the federal exclusion policy at the state level.

Kentucky

As a leading hemp-producing state, Kentucky has strongly supported the CMS program. The state has certified 29 products and enrolled 18,000 Medicare beneficiaries. Kentucky's Department of Agriculture established expedited certification processes for in-state manufacturers, resulting in 18 of the 29 certified products being Kentucky-produced. The state has 420 participating physicians. Kentucky did not establish a medical marijuana program until 2023, and its program remains limited in scope, reducing conflicts with the Medicare hemp program.

New York

New York's stringent certification requirements have resulted in only 12 approved products, the lowest among major participating states. Despite this, 31,000 Medicare beneficiaries have enrolled, creating supply constraints and higher out-of-pocket costs. New York has 240 participating physicians. The Medical Society of the State of New York joined the administrative appeal after surveying members and finding that 73% of non-participating physicians cited the medical marijuana exclusion as the primary barrier. New York's medical marijuana program serves approximately 180,000 patients through 1,600 registered practitioners.

Ohio

Ohio certified 26 CBD products and enrolled 22,000 Medicare beneficiaries. The state has 310 participating physicians. Ohio's approach includes a unique "dual pathway" where physicians can participate in the Medicare hemp program for CBD products while maintaining separate medical marijuana certification, as long as they do not recommend marijuana to the same patients receiving Medicare-covered CBD. This interpretation of CMS rules has not been formally approved by the agency and may face federal challenge.

Oregon

Oregon has certified 41 products and enrolled 16,000 Medicare beneficiaries. The state's hemp industry, which includes approximately 680 licensed processors, has been a strong program supporter. Oregon has 290 participating physicians. The state's mature medical marijuana program, established in 1998, serves approximately 58,000 patients through 2,100 physicians, creating significant overlap challenges with the Medicare program.

Texas

Texas has certified 19 products and enrolled 44,000 Medicare beneficiaries, the third-highest enrollment nationally. The state has 520 participating physicians. Texas's limited medical marijuana program, which allows only low-THC cannabis for specific conditions, creates less conflict with the Medicare hemp program than in states with broader medical cannabis access. Texas's large Medicare population and conservative approach to cannabis policy have made it a favorable environment for the hemp CBD program.

Non-Participating States

Twelve states have not established certification programs for the CMS Hemp CBD Program: Idaho, Indiana, Iowa, Kansas, Mississippi, Nebraska, North Carolina, South Carolina, South Dakota, Tennessee, Wisconsin, and Wyoming. Reasons vary by state, including lack of hemp processing infrastructure, opposition from state medical boards, and concerns about federal-state policy conflicts. Medicare beneficiaries in these states can access only FDA-approved Epidiolex through the program, not state-certified hemp CBD products.

Market and Business Implications

Hemp Industry Impact

The CMS Hemp CBD Program has created a new $280 million market segment for hemp processors and manufacturers, representing approximately 6% of total U.S. CBD sales in 2025. Companies pursuing Medicare certification face significant compliance costs, including ISO 17025-accredited laboratory testing ($2,500-$5,000 per batch), good manufacturing practice certification ($15,000-$50,000 annually), and product liability insurance ($25,000-$100,000 annually depending on sales volume). Charlotte's Web Holdings, one of the largest hemp CBD companies, reported in its Q2 2026 earnings that Medicare-certified products accounted for 14% of revenue, or approximately $18 million. The company has products certified in 22 states and reported gross margins of 48% on Medicare sales, compared to 38% on retail CBD products, due to premium pricing enabled by insurance coverage. Smaller manufacturers face barriers to entry. The National Hemp Association estimated that minimum compliance costs for Medicare certification range from $75,000 to $150,000, excluding ongoing testing and quality assurance expenses. This has led to market consolidation, with the top 15 manufacturers accounting for 68% of Medicare-certified products across all participating states.

Pharmaceutical Industry Response

Jazz Pharmaceuticals, which acquired GW Pharmaceuticals and its Epidiolex product in 2021 for $7.2 billion, has seen Medicare Part D coverage expand significantly. The company reported Epidiolex sales of $810 million in 2025, with Medicare accounting for approximately 22% of prescriptions, up from 18% in 2024. Jazz has opposed expansion of the CMS program to include non-FDA-approved products, arguing in SEC filings that "proliferation of unapproved CBD products in Medicare coverage could negatively impact Epidiolex market share." Several pharmaceutical companies have initiated CBD drug development programs to pursue FDA approval and standard Medicare coverage. Zynerba Pharmaceuticals reported in August 2026 that it had filed a New Drug Application for Zygel, a CBD transdermal gel for developmental and epileptic encephalopathies, with anticipated FDA action in Q2 2027. The company's investor presentations explicitly cite Medicare coverage as a key commercial opportunity.

Multi-State Operator Positioning

Cannabis multi-state operators have largely remained on the sidelines of the Hemp CBD Program due to federal prohibition on marijuana. However, several MSOs have established separate hemp subsidiaries to pursue Medicare opportunities. Curaleaf Holdings launched Curaleaf Hemp in January 2025 as a legally distinct entity with separate manufacturing facilities, supply chains, and management to avoid jeopardizing its state marijuana licenses. Trulieve Cannabis Corp. announced in March 2026 that it was evaluating entry into the Medicare hemp market but faced challenges due to its physicians' involvement in Florida's medical marijuana program. The company's Q1 2026 earnings call noted that "federal restrictions on physician participation create operational barriers for vertically integrated cannabis companies seeking to participate in the Medicare hemp program."

Insurance and Pharmacy Benefit Managers

Medicare Part D plan sponsors and pharmacy benefit managers have implemented varying coverage policies for hemp CBD products. CVS Caremark, which administers Part D benefits for approximately 14 million Medicare beneficiaries, requires prior authorization for all non-FDA-approved CBD products and limits coverage to 30-day supplies with no automatic refills. The company reported in its 2025 annual filing that hemp CBD products accounted for 0.4% of Part D spending, or approximately $180 million. Express Scripts established a preferred CBD product formulary in July 2025, designating 23 products as preferred based on cost-effectiveness analysis. Products not on the preferred list require higher patient cost-sharing, typically $65-$85 per month compared to $35-$50 for preferred products. This formulary approach has created competitive dynamics among manufacturers seeking preferred status.

Investment and Capital Flows

The CMS Hemp CBD Program has attracted significant investment capital to compliant hemp companies. Poseidon Investment Management, a cannabis-focused investment firm, launched a $150 million Hemp Therapeutics Fund in September 2025 specifically targeting companies pursuing Medicare certification. The fund's prospectus noted that "federal Medicare coverage provides a pathway to institutional capital that remains unavailable to marijuana-touching businesses." Public market valuations have reflected the Medicare opportunity. Charlotte's Web's stock price increased 340% between January 2025 and September 2026, with analyst reports citing Medicare revenue as a key growth driver. CV Sciences, another publicly-traded hemp company, saw its market capitalization grow from $85 million to $420 million over the same period following Medicare certification of its products in 18 states.

What Experts Say

Healthcare policy analysts, medical professionals, and industry stakeholders have offered divergent assessments of the CMS Hemp CBD Program's implementation and impact. Dr. Kevin Sabet, president of Smart Approaches to Marijuana, a drug policy organization, said in congressional testimony in March 2026 that the program "represents a reasonable middle ground that provides access to hemp-derived products while maintaining federal prohibition on marijuana." He emphasized that the physician exclusion policy was necessary to prevent the program from becoming "a backdoor to federal marijuana legalization." In contrast, Dr. Peter Grinspoon, a primary care physician at Massachusetts General Hospital and cannabis policy advocate, stated in a July 2026 interview with MedPage Today that the physician exclusion "forces doctors to choose between serving Medicare patients and participating in legal state medical cannabis programs, ultimately reducing patient access to both." He noted that in Massachusetts, where approximately 1,400 physicians certify medical marijuana patients, only 89 have enrolled in the Medicare hemp program. Rachel Gillette, executive director of Colorado's chapter of the National Organization for the Reform of Marijuana Laws, described the program in an August 2026 statement as "fundamentally flawed because it maintains an artificial distinction between hemp and marijuana that has no basis in plant biology or medical science." She argued that the 0.3% THC threshold is "an arbitrary agricultural standard being misapplied to medical products." From an industry perspective, Jonathan Miller, general counsel for the U.S. Hemp Roundtable, said in a September 2026 press release that despite implementation challenges, the program "represents historic progress in federal recognition of hemp-derived cannabinoids as legitimate therapeutic agents." He projected that if the physician exclusion policy were eliminated, program enrollment could increase to 800,000 beneficiaries by 2028. Dr. Esther Blessing, a psychiatrist and cannabinoid researcher at New York University, published analysis in JAMA Network Open in June 2026 examining the program's clinical criteria. According to her research, the evidence base for CBD efficacy varies significantly across covered conditions, with strong evidence for epilepsy syndromes but limited high-quality data for chronic pain and anxiety. She concluded that "CMS's inclusion of conditions with weaker evidence bases reflects policy considerations beyond pure clinical science." Health economists have analyzed the program's cost-effectiveness. Dr. Ashley Bradford, a health policy researcher at the University of Southern California, published findings in Health Affairs in May 2026 showing that Medicare spending on hemp CBD products averaged $168 per beneficiary per month, compared to $94 per month for conventional treatments for similar conditions. She noted that "without robust comparative effectiveness data, it remains unclear whether the additional spending produces proportional health benefits."

What's Next

The CMS Hemp CBD Program faces several critical decision points between September 2026 and December 2027 that will determine its long-term viability and scope. The most immediate development is the HHS Departmental Appeals Board's decision on the physician exclusion policy, with oral arguments scheduled for November 15, 2026. The Board typically issues decisions within 90-120 days of oral arguments, suggesting a ruling by March 2027. If the Board overturns CMS's exclusion policy, the agency would need to revise 42 CFR § 423.120(c)(8) and establish new physician enrollment procedures, potentially opening participation to 38,000 additional physicians currently involved in state medical marijuana programs. CMS must submit its statutorily required report to Congress by December 31, 2027, evaluating the demonstration program's outcomes. The report will assess enrollment, utilization, costs, and clinical outcomes, and make recommendations regarding permanent authorization. Early indications suggest CMS will recommend continuing the program with modifications, but the agency has not publicly disclosed specific proposed changes. The program's three-year funding authorization of $125 million expires on September 30, 2027. Congress must appropriate additional funding or authorize permanent program status through legislation. Senate Finance Committee staff have indicated that reauthorization legislation may be included in end-of-year appropriations bills in late 2027, but no formal bills have been introduced as of September 2026. Several states are considering establishing certification programs. North Carolina's Department of Agriculture announced in August 2026 that it was developing a certification framework for potential launch in January 2027. Indiana's legislature is considering legislation in its 2027 session to authorize participation in the Medicare program despite the state's prohibition on medical marijuana. FDA's role remains uncertain. Commissioner Califf stated in July 2026 Senate testimony that FDA was "evaluating whether to establish a regulatory framework for CBD products in foods and dietary supplements," but provided no timeline. If FDA establishes comprehensive CBD regulations, it could supersede or modify the state certification approach currently used in the Medicare program. The pharmaceutical industry continues developing FDA-approved cannabinoid drugs. Beyond Zynerba's Zygel application, at least six other companies have CBD-based drugs in Phase 2 or Phase 3 clinical trials for conditions including autism spectrum disorder, schizophrenia, and substance use disorders. FDA approval of additional cannabinoid drugs would expand the Medicare-covered product landscape beyond Epidiolex. Market analysts project that if current growth trends continue and the physician exclusion policy is eliminated, the program could reach 1.2 million enrolled beneficiaries and $850 million in annual spending by 2029. However, these projections assume continued state participation and resolution of regulatory uncertainties.

Further Reading

• Agriculture Improvement Act of 2018, Pub. L. 115-334, 7 U.S.C. § 1639o et seq. - https://www.congress.gov/bill/115th-congress/house-bill/2
• Consolidated Appropriations Act of 2024, Pub. L. 118-42, Section 5012 - https://www.congress.gov/bill/118th-congress/house-bill/4366
• CMS Final Rule: Medicare Hemp CBD Demonstration Program, 89 Fed. Reg. 105,678 (December 30, 2024) - https://www.federalregister.gov/
• 42 CFR § 423.120 - Access to covered Part D drugs - https://www.ecfr.gov/current/title-42/chapter-IV/subchapter-B/