What is CMS (Centers for Medicare & Medicaid Services) in Healthcare?

The Centers for Medicare and Medicaid Services (CMS) is an integral part of the US Department of Health and Human Services. The CMS runs Medicare, Medicaid, Children’s Health Insurance Programs (CHIP), and state and federal insurance marketplaces. 

This federal agency provides health coverage for more than 100 million people throughout the US. One of the goals is to provide quality healthcare at affordable costs for everyone. Read on to learn all about what the CMS does and why it is a vital part of the US health system.

The History of CMS

Medicare and Medicaid programs were established in 1965, with a bill signed by President Johnson. Twelve years later, the government founded the Health Care Finance Administration (HCFA). HCFA was renamed to CMS in 2001, and this federal agency has been vital for the health and well-being of millions of Americans.

What Does CMS Do?

The primary responsibility of the CMS is to oversee and administer major healthcare programs in the US. They look for ways to improve the healthcare system, develop protocols that allow better patient care, expand access to healthcare coverage, and improve the population’s overall health.

The CMS is able to do that through developing administrative and quality standards in all healthcare institutions, including nursing homes. They manage the Administrative Simplification Standards of the Health Insurance Portability and Accountability Act (HIPAA), which is vital for every healthcare organization. The agency enforces HIPAA regulations, patient privacy and security guarantees, and nationwide use of electronic health records.

The CMS also ensures quality in assistive care facilities and clinical labs, and oversees health insurance transactions.

Different Types of CMS Programs

Here is a quick overview of the CMS programs and why they are important:


Medicare is a program that provides health coverage for people over 65, people with disabilities, and those with specific diseases in ending stages, as confirmed by the Social Security Administration (SSA).

This program is funded by taxpayers, and eligibility depends on whether a person has contributed through the payroll tax. Medicare consists of several parts that cover hospital stay, medications, skilled nursing, home services, physician exams, outpatient services, lab tests, and more.


Medicaid is a program offering health coverage to people with low income. The patients who have access to Medicaid can get financial assistance for hospital stays, doctor visits, and other medical costs. The federal government is responsible for funding this program.


The Children’s Health insurance Program (CHIP) is designed to help parents of children and teens who cannot get regular insurance but don’t qualify for Medicaid. The program provides full or partial financial assistance for doctor visits, emergency services, follow-ups, hospital care, lab tests, imaging screenings, medications, and more.

How Can a Medical Practice Receive Payment from CMS?

If you run a medical practice and want to participate in CMS programs, you must comply with their Conditions of Participation (CoPs). An accrediting organization is responsible for enforcing standards and ensuring organizations who pass them receive the certification.

 For help with the codes and regulations, you can contact Peregrine Healthcare. We have plenty of experience with compliance in the healthcare industry, and can offer consultations and services that will make your life easier. Click here to contact us.

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