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For the first time, a federal Medicare pilot program will allow certain eligible patients to access hemp-derived CBD products through participating care organizations.
Beginning April 1, 2026, the Centers for Medicare & Medicaid Services (CMS) will launch a new initiative designed to explore how hemp-derived cannabinoids may fit into coordinated care models. This is not a permanent policy change,
but an active pilot program with defined parameters and oversight.¹
For qualifying patients, this includes access to up to $500 per year in eligible CBD products, provided through their healthcare provider and guided by a physician. Products must meet strict federal requirements, including third-party testing, THC limits, and oral administration.
It’s important to note that this program:
- Does not include marijuana
- Does not include inhalable products
- Requires participation from both a care organization and a physician
If you or a loved one are on Medicare and exploring CBD, this is worth discussing with your provider.
Separately, individuals who qualify for this program may also be eligible for the Extract Labs 60% Discount Program, which helps make CBD more accessible outside of clinical settings.
What Is the Substance Access BEI?
The Substance Access Benefi ciary Engagement Incentive (BEI) is part of CMS’s Innovation Center, which tests new approaches to improving care delivery and patient outcomes. ²
This pilot is being introduced through select Medicare care models:
- ACO REACH Model — Coverage begins April 1, 2026.
- Enhancing Oncology Model (EOM) — Coverage begins April 1, 2026.
- Long-Term Enhance ACO Design (LEAD) Model — Coverage begins January 1, 2027.
Participation is optional. Care organizations must elect to offer the benefit, submit an implementation plan, and receive CMS approval before providing access to eligible products.
Rather than reimbursing patients directly, the program allows participating providers to furnish qualifying hemp-derived products as part of a patient’s care plan. Patients do not purchase products retail or submit claims for reimbursement. ²
To find out if a care organization near you is participating in the ACO REACH model, CMS maintains a public participant database here.
Who May Qualify?
Patient eligibility is defined at the care organization level, but CMS has published general criteria that apply across all three models. ²
Basic Eligibility
Patients Must:
- Age 18 or older
- Not pregnant or breastfeeding
- No specified disqualifying conditions (defined per model)
- Aligned to a participating organization that has elected the BEI
Physician Involvement
Access is not automatic. A physician affiliated with the participating organization must determine whether CBD is appropriate for the patient.
This includes a documented shared decision-making process, such as:
- A discussion of potential benefits and risks
- A review of current medications and potential interactions
- A record of the patient’s goals and preferences
What Products Are Eligible?
CMS has defined “eligible hemp products” with specific requirements aligned with existing federal regulations.²
Included Products Must Be:
- Hemp-derived and federally legal under the 2018 Farm Bill
- Orally administered (tinctures, oils, gummies, capsules, softgels)
- No more than 0.3% delta-9 THC by dry weight
- No more than 3mg of total THC per serving
- Third-party tested for cannabinoid content, contaminants, and microbial hazards
- Sourced from legally compliant farms meeting federal hemp standards
- Furnished directly by a qualified physician — not purchased retail
Not Included:
- Inhalable products of any kind
- Products exceeding THC limits
- Products containing cannabinoids not naturally produced by the cannabis plant
How Did This Program Come About?
This pilot follows a broader executive directive signed on December 18, 2025, which encouraged federal agencies to explore expanded access to hemp-derived CBD within Medicare populations. ³
At the time of the announcement, CMS leadership indicated that the program is intended to evaluate how physician-directed CBD access may support patient care, particularly in areas where patients are already exploring these products independently.
Industry stakeholders, including established hemp companies, have also participated in discussions as CMS developed program guidelines. ¹
For a product category that has historically operated outside of traditional healthcare systems, this level of federal evaluation represents a notable shift.
Why This Matters
For Seniors
For many Medicare patients, especially those managing ongoing wellness concerns, this program creates a new opportunity to discuss CBD within a clinical setting.
Rather than navigating CBD independently, patients in participating programs can have structured conversations with their providers, including:
- Whether CBD is appropriate for their situation
- How it may fit into an existing care plan
- What risks or interactions should be considered
This reflects a broader trend. Survey data suggests that cannabis and CBD use among adults 65+ has increased in recent years, with many individuals already exploring these products outside of the healthcare system. ³
This program brings those conversations into a more formal, supervised setting.
For the CBD Industry
While limited in scope, this pilot represents a meaningful step toward broader institutional recognition of hemp-derived products.
The program establishes clear expectations around:
- Product quality
- Third-party testing
- Transparent labeling
- Controlled distribution through healthcare providers
These standards align with practices many established hemp companies already follow, but now exist within a federal framework.
Colorado, with a long history in hemp and cannabis production, is well positioned to support this evolving landscape. Industry observers note that it may take time (potentially several years) for providers, patients, and supply chains to fully adapt. ³
What this Program Does and Does Not Do
What It Does
- Introduces a federal pilot program for hemp-derived CBD access
- Provides up to $500 per year in eligible products for qualifying patients
- Requires physician oversight and documentation
- Establishes product quality and safety standards
- Applies to select Medicare care models beginning April 2026
What It Does Not Do
- Legalize marijuana
- Automatically enroll all Medicare patients
- Allow retail purchases for reimbursement
- Override state-specifi c hemp laws
- Include inhalable or high-THC products
- Apply to all Medicare Advantage plans
One Thing Worth Watching
Federal hemp policy continues to evolve.
A provision within the FY2026 Agriculture Appropriations Act (Section 781), expected to take effect in November 2026, proposes a revised defi nition of hemp that would significantly limit allowable THC levels — including a cap of 0.4 mg total THC per container.¹
If implemented as written, this could impact the availability of many currently compliant hemp products.
CMS has acknowledged this possibility and indicated that program requirements will be updated as federal law evolves.
For now, the April 2026 launch reflects current regulations but this is a space that may continue to change.
The Extract Labs Connection
This Medicare pilot and the Extract Labs Discount Program are separate, but complementary.
How the Medicare BEI Works
Under the BEI, CBD products are:
- Selected and provided by participating care organizations
- Directed by a physician
- Not purchased directly by the patient
This means hemp companies, including Extract Labs, are not direct vendors within the Medicare transaction.
Where the Extract Labs Discount Comes In
Many individuals may still choose to purchase CBD independently whether:
- Their provider is not participating
- They want additional product options
- They prefer direct access
For those individuals, the Extract Labs 60% Discount Program helps make CBD more accessible outside the clinical setting.
Which Extract Labs Products Qualify
Many Extract Labs products align with the general product standards outlined in the BEI, including:
- Tinctures
- Gummies
- Capsules
- Softgels
These products are:
- Hemp-derived
- Orally administered
- Third-party tested
The primary exception is inhalable products, which are not included in the Medicare pilot.
All Extract Labs products are supported by publicly available third-party testing and sourced from U.S.-grown hemp.
Frequently Asked Questions
No. The program applies only to hemp-derived products that meet federal THC limits.
April 1, 2026, for ACO REACH and EOM participants.
You can ask your care provider directly or search CMS’s public database of ACO REACH participants.
No. Products are provided through participating care organizations.
Eligibility and use are determined by the physician and care organization.
Not at this time.
No. This is a pilot program.
Potentially. CMS has indicated it will adapt to changes in federal law.
Sources
Feds Detail Plan To Cover Up To $500 In Hemp CBD And THC Products For Medicare Patients Under Program Launching Next Week.
Centers for Medicare & Medicaid Services. “Substance Access Beneficiary Engagement Incentive
Medicare may soon cover certain cannabis medications for seniors
Enhancing Oncology Model
ACO REACH Model Participants
