CMS has issued the final rule requiring surety bonds for DMEPOS providers. In a letter to some House and Senate Committees (see below), Acting Director of the Office of Legislation, Don Johnson stated that the new regulations would “make certain” that DME providers would post a $50,0000 surety bond. Johnson’s letter also indicated that providers who “have had certain adverse legal actions imposed against them in the past may also be required to post a higher bond amount.”
The Final Rule is now on The Federal Register. To view the rule, click here.
The following is the letter from Don Johnson to Congress:
U.S. House and Senate Notification
Monday, December 29, 2008
To: Senate Finance Committee
House Ways and Means Committee
House Energy and Commerce Committee
House and Senate Appropriations Committees
House and Senate Budget Committees
Other Interested Hill Staff
From: Don Johnson, Acting Director of the Office of Legislation
Centers for Medicare & Medicaid Services
Subject: Medicare Issues Final Rule Requiring Surety Bonds for DMEPOS Suppliers
Today, CMS issued a final surety bond regulation, required by the Balanced Budget Act of 1997, that makes certain suppliers of durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) post a $50,000 surety bond. While this regulation requires most suppliers to obtain a surety bond, some companies or organizations that supply these items are exempt from the surety bond requirement, including certain physicians and non-physician practitioners, physical and occupational therapists, state-licensed orthotic and prosthetic personnel, and government-owned suppliers.
Suppliers who have had certain adverse legal actions imposed against them in the past may also be required to post a higher bond amount. All newly enrolling suppliers that meet the requirements of the rule will be required to have a surety bond before they can enroll in the Medicare program.
The general effective date for the rule will be March 3, 2009 (60 days after publication). § 424.57(d)(1)(i) (DMEPOS suppliers seeking enrollment or with a change in ownership) will be effective May 4, 2009 (90 days after publication) and § 424.57 (d)(1)(ii) (existing DMEPOS suppliers) will be effective on October 2, 2009 (9 months after publication).