CMS issued a Program Integrity Manual transmittal on August 7, 2009 on "Compliance Standards for Consignment Closets and Stock and Bill Arrangements." Through the transmittal, CMS is defining and prohibiting certain arrangements where an enrolled DMEPOS supplier maintains inventory at a practice location which is not owned by the enrolled DMEPOS supplier, but rather, owned by a physician, non-physician practitioner or other health care professional for the purpose of distribution (commonly referred to as a “consignment closet” or “stock and bill” arrangement). In addition, the transmittal instructs providers that use of consignment closets and/or stock and bill arrangements must be in compliance with current standards. The transmittal is effective September 8, 2009.