Medicare DMEPOS Surety Bond Details

All DMEPOS suppliers who have billing privileges with Medicare must provide the National Supplier Clearinghouse (NSC) with a Medicare surety bond valued at no less than $50,000.

Important Note: New suppliers or suppliers changing ownership must provide the bond when they file their application with Medicare.

Existing providers will need to provide this bond by October 2, 2009.Suppliers deemed to be of “significantly higher risk” may be required to provide a bond valued at an amount greater than $50,000. National Supplier Clearinghouse will notify suppliers no later than May 2, 2009 if they have been deemed to be of high risk and will be required to purchase a bond of greater value than the $50,000 minimum.

CMS noted that its intention behind the surety bond requirement is to limit fraud and enhance the enrollment process by ensuring that only legitimate suppliers are enrolled in the Medicare program.

Medicare Bond Exemptions from the regulation include:

• Government-operated DMEPOS suppliers are provided an exception to the surety bond requirement if the DMS supplier has provided CME with a comparable surety bond under State law.
• State-licensed orthotic and prosthetic personnel in private practice making custom-made orthotics and prosthetics are exempted from the surety bond requirement if:
  1. the business is solely-owned and operated by the orthotic and prosthetic personnel, and
  2. the business is only billing for orthotics, prosthetics and supplies. Tell me more about this.
• Physicians and non-physician practitioners, as defined in section 1842(b)(18) of the Social Security Act, are exempted from the surety bond requirement when items are furnished only to the physician or non-physician practitioner's own patients as part of his or her own service.
• Physical and occupational therapists in private practice are exempted from the surety bond requirement if:
  1. the business is solely-owned and operated by the physical or occupational therapist,
  2. the items are furnished only to the physical or occupational therapist's own patients as part of his or her professional service, and
  3. the business is only billing for orthotics, prosthetics and suppliers.
• All other DMEPOS suppliers are subject to the surety bond requirement.

• A physician assistant, nurse practitioner, or clinical nurse specialist.
• A certified registered nurse anesthetist.
• A certified nurse-midwife.
• A clinical social worker.
• A clinical psychologist.