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Surety Bond FAQs

VGM Bond Hotline 866-497-0472

Home Bonds Bond FAQs

Bond FAQs


What is a surety bond?

A surety bond is a contract between three parties: the principal (the applicant that will perform the contractual obligation), the obligee (the party who is the recipient of the obligation), and the surety (who assures the obligee that the principal can perform the task).

The contract expresses the surety’s promise to answer for the principal’s failure to perform the task or meet the obligation as promised.

How do I get a quote for my bond?

  • The easiest way to get a quote for your surety bond is through our online application. It takes approximately 5-10 minutes to complete.

     Apply Now

  • After completing the application, we recommend adding to your email address book so that return emails will reach your inbox and not end up in a junk folder.

How much does a surety bond cost?

Each bond is underwritten individually, and we use several factors for underwriting, including prior history with VGM Group Inc., credit scores, longevity of business, and information contained in the application.  There are several discounts that are available through VGM Insurance, based on an organization’s relationship with VGM Group Inc. or our partner/affiliate companies, and/or multiple NPI numbers.

How long does it take to get my surety bond?

The length of time from application to issuance varies depending on accuracy of information on application, promptness of premium payment and other factors. Most bonds are generally issued one to two days after receipt of payment and a signed copy of the indemnity agreement. 

What is an indemnity agreement?

In an indemnity agreement, the principal agrees to reimburse, or indemnify, the surety if the surety must pay the obligee for the principal’s default.

  • VGM does not require spousal signature on the indemnity agreement if they are not part owner.

I have multiple DMEPOS supplier locations. Do I need to obtain a bond for each location?

  • Yes

Suppliers subject to the bonding requirement must obtain a surety bond for each practice location that has a separate National Provider Identifier (NPI). Thus, if a supplier has two separately-enrolled DMEPOS locations, each with its own NPI, it must obtain $50,000 worth of bond coverage for each location.

How does the bond renewal process work?

Each state requires the surety to give them written notice between 30-60 days in advance of the bond renewal date. In order to give you time to renew, and the surety time to notify the state or CMS, VGM Insurance sends out renewal notices to the organization’s primary contact, via email, 90-100 days in advance of the cancellation date.

There is a misconception you can wait to renew your bond until your previous bond runs out. This is not true. If a principal is operating without a bond, it can endanger their business.

How do I report a change on my Surety Bond?

The following changes must be reported to VGM Insurance immediately:

  • Ownership change
  • Address change
  • Legal Business Name change

All changes can be completed by logging into our online system:

  1. Log into Bondlink Log In Now
  2. Your username is your email address. You can click on “Forgot My Password” if you need to reset your password.
  3. Once Logged in click “Make Payments, Request Changes, Print Indemnity Agreement, View Receipts,” etc. button
  4. Then click “View My Information.”
  5. Find the location you need to make updates to and select “edit” to the right, to make the necessary updates.
  6. We will issue a rider (change request) to update your surety bond.

How do I change my user name or point of contact on my bonds?

Please have the company owner or main point of contact call the Bond Hotline at 866-497-0472.  Multiple bonds for your company can now have the same point of contact and user name/email address.

What happens if an overpayment claim is filed against my bond?

The Surety Claims Department will conduct an investigation quickly to avoid further interest charges. If the claims department does determine through their examination that the claim is valid, the principal (applicant) will be reminded of their obligations under the indemnity agreement and will be given the opportunity to satisfy the claim first. If the principal fails to respond, the surety will arrange settlement with the obligee to implement collection proceedings against the principal.

How much ownership detail do I need to provide?

Each owner with 5% ownership or more must be listed on the application, as this is the information the underwriter uses to access risk and assign a rate.  The name on the bond must match the way the company is registered with the government.  This is usually the company’s legal business name, which should match your Medicare application, the NPI, and the Secretary of State your company is registered in.

What do I do if I get audited? Expert advice from our affiliate company The van Halem Group

There are a few things you should do if you receive an audit request.

  • Determine the amount of time you have to respond. It is imperative that you respond in a timely manner to an audit. Audit responses received after the due date may not be acknowledged and will count as non-responsive, which will negatively impact your error rate. Suppliers with high error rates are at risk for continued audits.
  • Review the patient files and be sure you have all the documentation you need to prove medical necessity is met for the products you provided. If not, make attempts to reach out to the physician and get additional office visit notes and/or addendums when applicable.
  • If you determine that a service was billed in error, notify the auditor of the error.
  • Send complete and accurate files in your response.
  • Track your submission to ensure it is received and responded to timely by the auditor.
  • Upon completion of the audit, review any overpayments assessed (if post payment audit) and refund the money as soon as possible to avoid accruing interest or potential referral to the US Treasury.
  • Appeal any overpayments that you disagree with.

In some instances it may be beneficial to employ a third party to assist in the audit response. The van Halem Group can help. Their team of clinicians will review your files, identify any issues and provide recommendations. The clinical review can also be used with your referral sources to educate them on documentation requirements. Their medical records staff can request documentation on your behalf and their Audits and Appeals team will respond to your audit within the established timeframe. In the event of a post payment audit, their team can work to appeal any overpayments and get your claims overturned.

How do I prevent being audited? Expert advice from our affiliate company The van Halem Group

While no one can completely prevent being audited, there are some things you can do to lessen your chances.

  1. Work with your referral sources to ensure the documentation they provide to you shows the medical necessity for the items provided.
  2. Educate your staff, both intake and billing, to ensure the patient meets coverage criteria for the items provided. If not, be sure that an ABN is used and is executed correctly.
  3. Review your documentation before billing. If the medical records are lacking, you can contact your referral source and obtain an addendum.
  4. Train your staff on the coverage criteria and billing guidelines for the services you provide.
  5. Submit complete and correct claims. This includes proper modifiers and HCPCS codes.

For more information, please reach out to the VGM Insurance bonds team any time by emailing us here or calling our bond hotline toll-free at 866-497-0472.


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