Surety bonds still creating confusion

Sunday, October 11, 2009

YARMOUTH, Maine - Believe it or not, some insurers are still receiving calls from providers who don't yet have surety bonds.

The deadline to obtain the $50,000 bonds and notify the National Suppliers Clearinghouse (NSC) was Oct. 2.

It may be that providers are confused by the requirement rather than procrastinating, said Bill McMahon, an account executive with Cailor Fleming Insurance in Youngstown, Ohio.

"There wasn't much literature from Medicare on this as there was with national competitive bidding and accreditation," he said. "There are so many DMEs that have local insurance agencies who don't specialize in the HME industry who knew nothing about it."

McMahon estimates there are "anywhere between 20,000 and 30,000" providers who haven't obtained bonds.

Several industry stakeholders heard rumors that CMS may extend the deadline by up to 30 days, but they hadn't seen anything definitive at press time.

Sources say the rumors could stem from a possible bureaucratic snafu. Some providers have notified The VGM Group that they may have had their surety bonds or accreditation notification erroneously rejected by the NSC, which could result in the loss of their Medicare billing privileges for at least one year.

"CMS hasn't notified people that they didn't get the bond," said John Gallagher, vice president of government relations for The VGM Group. "It's an error on the NSC's part. CMS knows they screwed up."

For providers who still haven't obtained a bond but want to continue billing Medicare, most insurers say they can turnaround the bonds quickly.

"Assuming we can write the bond, we can do it within a day," said Cole Cushman, vice president of Cushman Insurance in Herndon, Va. "CMS doesn't need the original, so we can e-mail it or fax it to the provider."