Medicare
Medicare Bonds or DMEPOS Bonds, are mandatory for manufacturers and suppliers of Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS). Starting in January 2009 after a rule imposed by the Centers for Medicare & Medicaid Services (CMS). The requirement is aimed at curbing medical fraud and malpractice.
In most cases, suppliers are required to obtain a $50,000 surety bond, however there are some unique exceptions. The bond amount will actually increase beyond $50,000 for suppliers that are deemed "high risk".
Some suppliers may qualify for an exemption from the Medicare/DMEPOS Bond requirement:
– Physicians and non-physician practitioners, as defined in section1842(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:
• Certified nurse-midwives
• Certified registered nurse anesthetists
• Clinical psychologists and registered dietitians or nutrition professionals.
• Clinical nurse specialists
• Clinical social workers
• Nurse practitioners
• Physician assistants
- Physical and occupational therapists in private practice may be exempted if:
• the business is a sole propietorship 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
• the business is only billing for orthotics, prosthetics and supplies.
Suppliers with multiple locations need to be aware that bonds are required for each National Provider Identifier (NPI), i.e. – a larger DMEPOS supplier with four locations would have to obtain a $200,000 Medicare/DMEPOS Bond, one for each location. Please be aware that DMEPOS suppliers will have to obtain additional $50,000 in surety bonds for any adverse legal actions taken against the company within the past 10 years before enrolling. Those adverse legal 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
There are no exceptions for nursing homes or pharmacies that bill for Medicare/DMEPOS to their own residents.
The new regulation also requires suppliers to submit a Medicare/DMEPOS Bond upon a change of ownership or a move to enroll a new business site.
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