Sales Tax

Medicare does not reimburse separately for sales tax. The CMS Internet Only Manual (IOM), Publication 100-04, Medicare Claims Processing Manual, Chapter 23, Section 80.3.1, states the following:

Sales taxes where appropriate were included in the calculation of reasonable charges computed. They were also accounted for in the calculation of the base fee schedules for DME and orthotic/prosthetic devices. The Consumer Price Index used to update fee schedules also accounts for sales tax. Therefore, contractors do not make any additional payment for sales taxes and do not make adjustments in fees to reflect local changes in tax rates.


Last Updated Sep 23 , 2022