Ohio: Medicaid may require surety bonds

Friday, August 23, 2013

COLUMBUS, Ohio – HME providers are “high risk,” and therefore should be required to get surety bonds if they want to participate in Ohio’s Medicaid program, according to a recent audit report. 

That may or may not be a big deal, stakeholders say.

“As Medicare providers, a lot of our members already have that,” said Kam Yuricich, executive director of the Ohio Association of Medical Equipment Services (OAMES). “The big question is if this will be a separate bond, or the same one a lot of providers already have.”

As part of a performance audit of the Ohio Department of Job and Family Services (ODJFS), which oversees the state Medicaid program, the Ohio Auditor of State recommended surety bonds for “high risk” providers, including home health care providers, ambulance/ambulette services and durable medical equipment providers. The requirement would increase fraud debt collections by at least $10 million each year, the auditor stated.

It’s up to ODJFS to decide if and how to act on the auditor’s findings. The agency has a year to implement suggestions before reporting its decisions and actions back to the legislature. 

Only three states currently require surety bonds for Medicaid providers: Florida, Arkansas and Texas. Those bonds are in addition to the surety bonds Medicare requires, says insurance expert Bill McMahon.

“They have completely different stipulations,” said McMahon, an account executive for Cailor Fleming Insurance in Youngstown, Ohio. “They can’t intertwine—both agencies want their money.”

Ohio providers say if the state requires additional bonds, it will mean increased complexity in doing business.

“Most providers are in favor of doing what we can to keep the market clear of bad players,” said Joe Petrolla, president of Boardman, Ohio-based Seeley Medical. “(However), I’m not sure why this is necessary. It would just be another layer of bureaucracy.”