CMS strengthens fight against waste and fraud
Final rule requires surety bonds
The Centers for Medicare & Medicaid Services (CMS) now requires certain durable medical equipment (DME) suppliers to post a surety bond.
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 (DME) post a $50,000 surety bond. Existing suppliers must comply with this requirement by Oct. 2, 2009, while newly enrolling suppliers must meet this requirement by May 4, 2009. This requirement was due in part to the large number of improper and potentially fraudulent payments to medical equipment suppliers for furnishing medical equipment and devices to people with Medicare, according to CMS. The 2007 Medicare error rate report found approximately $1 billion in improper payments for medical equipment and supplies.
Suppliers who have had certain adverse legal actions imposed against them in the past also may 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. More information about the new regulation can be found at www.cms.hhs.gov/MedicareProviderSupEnroll.
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.
In addition to suspending payment, CMS is:
implementing extensive pre- and post-payment review of claims submitted by ordering/ referring physicians;
validating claims submitted by physicians who order a high number of certain items or services by sending follow-up letters to these physicians;
verifying the relationship between physicians who order a large number of home health services and the beneficiaries for whom they ordered those services; and
identifying and visiting high-risk beneficiaries to ensure they are appropriately receiving the services for which Medicare is being billed.
The Centers for Medicare & Medicaid Services (CMS) now requires certain durable medical equipment (DME) suppliers to post a surety bond.You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
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