CMS SURETY BOND REQUIREMENTS FOR DMEPOS
Thanks to Claire Miley of Bass, Berry & Sims in Nashville, Tennessee for posting an alert regarding the final DMEPOS Surety Bond requirements. Below is the text of the American Health Lawyers Association e-mail alert.
CMS Issues Final Rule Requiring Surety Bonds for DMEPOS
On December 29, 2008, the Centers for Medicare & Medicaid Services (CMS) announced regulations requiring suppliers of certain durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) to post a surety bond as a condition of new or continued Medicare enrollment. Specifically, the final regulations require:
- For DMEPOS Suppliers Seeking Enrollment or with a Change in Ownership. Beginning May 4, 2009, DMEPOS suppliers seeking to enroll or to change the ownership of a supplier of DMEPOS must submit to the National Supplier Clearinghouse (NSC) a $50,000 surety bond for each assigned NPI for which the DMEPOS supplier is seeking to obtain Medicare billing privileges.
- For Existing DMEPOS Suppliers. Beginning October 2, 2009, each Medicare-enrolled DMPOS supplier must submit to the NSC a $50,000 surety bond for each assigned NPI to which Medicare has granted billing privileges.
- Enrolling New Practice Locations. A DMEPOS supplier enrolling a new practice location must submit to the NSC a new surety bond or an amendment or rider to the existing bond, showing the new practice location is covered by an additional base surety bond of $50,000.
- Elevated Surety Bond Amounts. Suppliers who have certain adverse legal actions imposed against them in the past may be required to post a higher bond amount. The final regulations permit the NSC to require DMEPOS suppliers to obtain a base surety bond of $50,000 and an elevated surety bond of $50,000 for each occurrence of an adverse legal action within ten years preceding enrollment, revalidation, or reenrollment in the Medicare program.
The final regulations are effective March 3, 2009. Some companies or organizations that supply DMEPOS are exempt from the surety bond requirements, including certain physician and non-physician practitioners, physical and occupational therapists, state-licensed orthotics and prosthetic personnel, and government-owned suppliers.
What is the best way/place to purchase a surety bond?
We do the billing for our Medicare patients for post cataract glasses (durable medical equipment). However we do not participate, patient pays us and gets reimbursed. Do we still need to get a Medicare Surety Bond?
Are Respiratory Practitioners exempt from the surety bond?
I wanted to address some of the commenter's questions regarding DMEPOS surety bonds. . .
The clock is ticking for medical equipment suppliers and other industry professionals to obtain new Medicare surety bonds, part of a recent federal requirement aimed at curbing fraud and malpractice.
The Centers for Medicare & Medicaid Services published in January a final rule mandating that certain Medicare suppliers of durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) obtain a surety bond to remain in compliance. In most cases, suppliers will have to post a $50,000 surety bond through an authorized agent.
Suppliers enrolled in the program before the new rule became effective in March have until Oct. 2 to obtain the correct surety bond. Those who enrolled after the effective date were had to secure the proper bonding by May 4.
Currently, there are some exceptions and exemptions to the bonding requirement. But some industry groups continue to press for more, including pharmacy associations, nursing home groups and others. Suppliers deemed high-risk will likely face more expensive bonding requirements.
As it stands today, those entities exempt from the new DME surety bond are:
• Government-operated suppliers that have provided CMS with a comparable surety bond under state law.
• Private-practice and state-licensed orthotic and prosthetic workers making custom orthotics and prosthetics are exempted if:
The business is solely owned and operated by the orthotic and prosthetic
personnel and is only billing for orthotic, prosthetics and supplies.
• Physicians and non-physician practitioners, as defined in section 1842(b)(18) of the Social Security Act, if the items are furnished only to the physician or non-physician practitioner’s patients as part of the service. Also covered are: physician assistants, nurse practitioners, clinical nurse specialists, certified registered nurse anesthetists, certified nurse-midwives, clinical social workers, clinical psychologists and registered dietitians or nutrition professionals.
• Physical and occupational therapists in private practice are exempted if:
The business is solely-owned and operated by the physical or occupational
therapist; the items are furnished only to the physical or occupational
therapist’s own patients as part of his or her professional service; and the
business is only billing for orthotics, prosthetics and supplies.
There are also significant considerations for some larger DME suppliers. Those with multiple locations will be required to obtain a bond for each National Provider Identifier (NPI). That means a DMEPOS supplier with three locations would have to obtain a $150,000 Medicare Bond, one per location.
Beyond that, DMEPOS suppliers must obtain additional $50,000 surety bonds for any adverse legal actions taken against the company within the past decade. Those actions can include:
* Losing Medicare billing privileges
* Suspension or revocation of a license
* Loss or suspension of accreditation
* A felony conviction
* Exclusion from a federal or state health care program
To learn more about surety bonding requirements or how to obtain a DMEPOS Medicare bond, visit www.suretybonds.com or contact the author at josh@suretybonds.com.
We are an optical shop that does not participate in Medicare. Our customers pay us up front for their glasses and then we bill Medicare for them. Medicare reimburses the customer directly. Do we need the $50,000 surety bond