Key takeaways:
While Medicare historically has not covered cannabis, a pilot program that began in April 2026 allows some enrollees to receive up to $500 per year in hemp-derived products for medical purposes. Hemp is a type of cannabis plant.
Tetrahydrocannabinol (THC) — the mind-altering compound in cannabis that is responsible for giving people a high — is considered a riskier substance than cannabidiol (CBD), a cannabis component that has relaxing qualities. Products that are covered under the program primarily contain CBD. Products are not eligible if they contain more than 0.3% delta-9 THC, the natural form of THC in cannabis.
To qualify for the Substance Access Beneficiary Engagement Incentive (BEI) pilot program, Medicare enrollees must be 18 or older, healthy enough to participate, and have a prescription from a physician or other qualified healthcare professional. Participants cannot be pregnant or breastfeeding.
Cannabis is used by people for many reasons, including medical purposes such as pain relief. For example, studies show that older adults are increasingly using cannabis, often for health-related reasons. In recent years, many have turned to cannabis for help with sleep, pain, and anxiety. A 2023 survey of adults 65 and older, found that as many as 7% had consumed cannabis in the previous month.
Under a pilot program that began in April 2026, some Medicare enrollees will be allowed to receive up to $500 per year in hemp-derived products that primarily contain cannabidiol (CBD), and little to no tetrahydrocannabinol (THC).
Both THC and CBD are cannabinoids that are found in cannabis plants. However, they do different things to the body. CBD is a compound that has relaxing and anti-inflammatory effects. It's used in products designed to help ease stress, pain, and anxiety. THC is a mind-altering compound that is known for making people feel high. It’s also used in medical cannabis products for symptoms such as nausea and pain.
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Keep reading to learn more about the new Medicare program that is giving some older adults access to CBD-based hemp products.
What is the Medicare hemp product pilot program?
The Substance Access Beneficiary Engagement Incentive (BEI) gives some Medicare enrollees a limited opportunity to try taking CBD to help with certain medical conditions. The pilot program, which began in April 2026, is only available in Washington, D.C., and states where the eligible hemp products are considered legal.
Substance Access Beneficiary Engagement Incentive (BEI)
Organizations that participate in the BEI are able to provide eligible Medicare enrollees with prescribed CBD-based hemp products to help manage certain health conditions. Medicare does not reimburse healthcare professionals or practices for the services. Enrollees are also not reimbursed or paid in advance for hemp products and should not be asked to submit a Medicare claim or receipts.
This pilot program and the hemp products can be offered through three models:
ACO REACH Model: Through this initiative, different types of facilities and healthcare professionals — such as primary care providers and specialty physicians — collaborate in accountable care organizations (ACOs) to treat Medicare enrollees with chronic conditions and help them better navigate the healthcare system.
Enhancing Oncology Model: This is a voluntary payment initiative that offers incentives for cancer treatment facilities that provide coordinated care for Medicare enrollees receiving systemic chemotherapy (treatment that targets the whole body) for certain cancers.
Long-term Enhanced ACO Design (LEAD) Model: This project begins in 2027 to help extend the ACO Reach Model through 2036 with financial and administrative support for participating healthcare professionals.
The BEI only covers hemp products that contain no more than 0.3% delta-9 THC. Program enrollees may qualify to receive up to $500 in hemp products to help manage their symptoms with no out-of-pocket costs.
In order to qualify, enrollees must:
Be 18 or older
Pass a frailty test
Not have any disqualifying conditions
Not be pregnant or breastfeeding
Get a prescription from a physician or other qualifying healthcare professional
Suspended enforcement of certain federal drug laws
The Controlled Substances Act, which became federal law in 1970, establishes the legality and illegality of certain items in the U.S. At one time, all cannabis-related substances were considered illegal. The Agriculture Improvement Act of 2018, also known as the 2018 Farm Bill, removed the "controlled substance" label from hemp products and effectively made them federally legal if they contain no more than 0.3% THC.
What products are included in the Medicare hemp product pilot program?
Products available through this program primarily contain CBD, but can have as much as 0.3% THC. Eligible items may include edibles and topicals such as balms, creams, and lotions. CBD oil, a product that some people use to ease pain, stress, or anxiety, could be covered if it fits all other criteria.
What products are not included in the Medicare hemp product pilot program?
Items that are not covered include:
Inhalable products
Orally administered products that contain more than 3 mg per serving or more than 0.3% THC
Products that contain cannabinoids — compounds that interact with the body's endocannabinoid system — that are not naturally produced by cannabis plants
Does Medicare cover medical cannabis?
Medicare doesn't cover medical cannabis because it is considered a controlled substance that is not legal under federal law. That is one reason why the BEI is such a groundbreaking program.
Medicare does not pay directly for the hemp products, but allows healthcare professionals to provide the items to enrollees. The BEI requires participating organizations to:
Identify potential participants
Have physicians and other eligible healthcare professional prescribe the hemp products
Pay for the hemp products
There are a few FDA-approved cannabinoid-based medications that may be covered by Medicare prescription plans for certain conditions. (Cannabinoids are found primarily in cannabis plants or as synthetic compounds.) We will discuss these medications later.
What is the difference between cannabis and marijuana?
The terms cannabis and marijuana are often used interchangeably, but there are differences. Cannabis is the scientific term used to refer to a group of plants, called Cannabis sativa, that produce cannabinoids. Marijuana is a less formal term that is typically used to describe cannabis plants that contain THC.
It should also be noted that the term “marijuana” has a history of being used in racially insensitive ways to negatively associate cannabis with immigrants and people of color.
What is the difference between cannabis and hemp?
Cannabis refers to a group of plants that contain cannabinoids such as THC and CBD. Hemp refers to cannabis plants that contain primarily CBD, a compound known for its relaxing and anti-inflammatory properties that is often found in stress-relief, pain, and anxiety treatments. Officially, a cannabis plant that has no more than 0.3% THC is considered hemp.
What is the difference between THC and CBD?
THC and CBD are both natural compounds known as cannabinoids that are found in cannabis plants. However, they work differently in the body, have different risks, and have different legal statuses:
CBD: Known for its relaxing qualities, CBD is often found in foods, lotions, cosmetics, and other products that are designed to help with conditions such as stress, anxiety, and pain. The Agriculture Improvement Act of 2018 legalized certain CBD products derived from hemp. However, some states have not legalized CBD, so its legal status varies depending on the location.
THC: THC is the compound found in cannabis plants that is considered to be mind-altering and is responsible for the feeling of being high. It’s also used for medical purposes, such as pain and cancer-related nausea. Under federal law, cannabis with more than 0.3% THC is considered an illegal controlled substance. Some states have different THC regulations. In some states, cannabis possession without medical authorization remains a criminal offense — thus, is not decriminalized.
THC potency in cannabis products has increased globally in the last few decades. High-potency cannabis, which contains more than 20% THC or at least 10 mg of THC per serving, can lead to dependency and negative effects such as difficulty thinking, rapid heart beat, and poor coordination.
Cannabis Terminology: Knowing the Difference
| Cannabis is the scientific term used to refer to a group of plants called Cannabis sativa. | vs. | Marijuana is an informal term typically used to describe cannabis plants that contain THC and are mind-altering. |
| Hemp refers to cannabis plants that have primarily CBD and no more than 0.3% THC. | ||
| CBD is a compound found in cannabis plants that is often used for sleep, anxiety, and pain. | THC is a compound found in cannabis plants that can lead to feelings of being high, and is used for pain and nausea, among other conditions. |
Does Medicare cover FDA-approved cannabinoid-based medications?
Medicare may cover some FDA-approved cannabinoid-based medications. You can check your Part D prescription plan formulary to see if you have coverage.
At the time of publication, medical cannabis is legal in most states, most territories, and Washington, D.C. Medical cannabis remains illegal at the federal level. But these FDA-approved cannabinoid-based medications are classified differently:
Epidiolex (cannabidiol): Epidiolex is an oral liquid medication that is derived from cannabis. It is prescribed for rare forms of epilepsy such as Lennox-Gastaut syndrome, Dravet syndrome, and tuberous sclerosis complex.
Marinol and Syndros (dronabinol): These brand-name medications contain dronabinol, a lab-made form of THC used to prevent nausea and vomiting from chemotherapy. Marinol and Syndros are also sometimes prescribed for people living with HIV/AIDS who have experienced significant weight loss. Marinol is an oral capsule and Syndros is an oral solution.
Cesamet (nabilone): Cesamet contains the synthetic cannabinoid nabilone and is prescribed to treat nausea and vomiting in people receiving chemotherapy when other medications haven’t worked.
Frequently asked questions
In states where medical cannabis is legal, you typically need a certification from a healthcare professional showing that the substance is being used to help manage a medical condition.
To qualify for the BEI pilot program, Medicare enrollees must be 18 or older, considered healthy enough to participate, have a prescription, and not be pregnant or breastfeeding. But the BEI is limited to CBD-based hemp products.
It depends on the laws where you live. Some states only allow people with specific health conditions to have access to medical cannabis. Others allow prescribers to recommend it for any symptoms, such as sleep issues, pain, or anxiety, they believe it may help manage.
The best first step is to discuss medical cannabis with a certified healthcare professional. They can help determine if it’s an appropriate option for you and if you qualify for it under the laws of your state.
In states where medical cannabis is legal, you typically need a certification from a healthcare professional showing that the substance is being used to help manage a medical condition.
To qualify for the BEI pilot program, Medicare enrollees must be 18 or older, considered healthy enough to participate, have a prescription, and not be pregnant or breastfeeding. But the BEI is limited to CBD-based hemp products.
It depends on the laws where you live. Some states only allow people with specific health conditions to have access to medical cannabis. Others allow prescribers to recommend it for any symptoms, such as sleep issues, pain, or anxiety, they believe it may help manage.
The best first step is to discuss medical cannabis with a certified healthcare professional. They can help determine if it’s an appropriate option for you and if you qualify for it under the laws of your state.
The bottom line
Medicare does not cover medical cannabis, often known as medical marijuana. But a pilot program that began in April 2026 allows some enrollees to receive up to $500 per year in hemp-derived products prescribed for medical purposes and provided by an eligible practice or accountable care organization. This program is known as the Substance Access Beneficiary Engagement Incentive (BEI). Products available through the BEI primarily contain CBD, but can have as much as 0.3% THC. Items may include CBD oils, edibles, and topicals such as balms, creams, and lotions.
DISCLAIMER: Keep in mind that cannabis is legal in some states for recreational and/or medicinal use, but not in others. Cannabis is still illegal under federal law. Before you use cannabis products, find out the laws in your state.
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References
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Centers for Disease Control and Prevention. (2025). About CBD.
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Centers for Medicare & Medicaid Services. (2026). CMS marks milestone in expanding patient-centered innovation with Substance Access Beneficiary Engagement Incentive.
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Centers for Medicare & Medicaid Services. (2026). LEAD (Long-term Enhanced ACO Design) Model.
Centers for Medicare & Medicaid Services. (2026). Substance Access Beneficiary Engagement Incentive.
Han, B. H., et al. (2025). Trends in past-month cannabis use among older adults. JAMA Internal Medicine.
Lampe, J. R. (2025). The Controlled Substances Act (CSA): A legal overview for the 119th Congress. Congress.gov.
Lampe, J. R., et al. (2026). The federal status of marijuana and the policy gap with states. Congress.gov.
Makary, M. A. (2026). Hemp-derived cannabidiol products in Medicare research models. U.S. Food and Drug Administration.
Moffitt Cancer Center. (n.d.). Systemic therapy.
Naya, N. M., et al. (2024). An overview of cannabidiol as a multifunctional drug: Pharmacokinetics and cellular effects. Molecules.
National Center for Complementary and Integrative Health. (2019). Cannabis (marijuana) and cannabinoids: What you need to know. National Institutes of Health.
National Conference of State Legislatures. (2026). Report: State medical cannabis laws.
National Institute of Neurological Disorders and Stroke. (2026). Dravet syndrome. National Institutes of Health.
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Office of the Law Revision Counsel. (2025). 7 USC chapter 38, subchapter VII: Hemp production. U.S. House of Representatives.
