Instant Issue (hidden) Bond - DMEPOS $50,000 in All States
Table of Contents
Brief Summary
This is the $50,000 base Medicare DMEPOS supplier bond, issued fast so it can go in with your CMS-855S enrollment application. The bond has to be in effect on the date you submit the application, so having it in hand early keeps your enrollment from stalling.
Medicare requires a $50,000 surety bond from DMEPOS suppliers for each NPI, under 42 CFR 424.57(d). It is filed with the CMS enrollment contractor when you enroll, change ownership, revalidate, reenroll or add a practice location. CMS is the obligee. Suppliers with an adverse legal action in the past 10 years must also post an elevated bond of $50,000 per occurrence on top of the base bond, so check your history before you order.
We can help with all All States bonds!
Want the rule behind this bond? Read the Medicare DMEPOS bond guide: the $50,000 per NPI rule, elevated bonds and exemptions.
How to Apply for an Instant Issue (hidden) Bond:
- Confirm whether you fall under one of the four exceptions in 42 CFR 424.57(d)(15).
- Check for any adverse legal action in the last 10 years, which triggers an elevated bond of $50,000 per occurrence on top of the base bond.
- Have the supplier's legal name and NPI exactly as they appear on the CMS-855S.
- Provide owner names, home addresses and Social Security numbers for the credit review.
- Pay the premium and receive the executed $50,000 bond.
- Submit the bond to the CMS enrollment contractor with the CMS-855S, effective no later than the date the application is submitted.
Detailed Information About the All States Instant Issue (hidden) Bond:
Who has to post the bond
Under 42 CFR 424.57(d), every DMEPOS supplier enrolling in Medicare, changing ownership, or responding to a revalidation or reenrollment request must submit a $50,000 surety bond with its CMS-855S application. The CMS DMEPOS enrollment page puts it simply: the bond is $50,000 for each NPI the supplier maintains. Enrolling a new practice location requires an additional $50,000 bond, or a rider adding the location to your existing bond.
The elevated bond catches people off guard
The $50,000 figure is the base amount. If the supplier has had an adverse legal action within the 10 years before enrollment, revalidation or reenrollment, the CMS contractor prescribes an elevated bond of $50,000 for each occurrence, and that is in addition to the base bond. Settle that question before you buy, because a bond that does not match what the contractor requires will hold up the application.
Who is exempt
The regulation carves out four groups:
- Government-operated suppliers that have given CMS a comparable bond under state law.
- State-licensed orthotic and prosthetic personnel in private practice making custom orthotics and prosthetics, if the business is solely owned and operated by them and bills only for orthotics, prosthetics and supplies.
- Physicians and nonphysician practitioners furnishing items only to their own patients as part of their physician service.
- Physical and occupational therapists in private practice, if solely owned and operated by the therapist, furnishing items only to their own patients as part of their professional service, and billing only for orthotics, prosthetics and supplies.
A supplier that stops qualifying for an exception has 60 days after it knows, or has reason to know, to file a bond.
What the bond covers
The surety must pay CMS, within 30 days of written notice with sufficient evidence, up to the full bond amount for unpaid claims (Medicare overpayments plus interest), civil money penalties and assessments imposed by CMS or the OIG. If you later repay CMS directly, CMS reimburses the surety.
Keeping it in force
The bond must be continuous and must name the supplier as principal and CMS as obligee. Canceling it takes 30 days written notice to the CMS contractor and the surety, and cancellation is grounds for revocation unless a replacement bond is in place first. A lapse in coverage means revocation back to the date of the lapse, and Medicare will not pay for items furnished during the gap. If you switch sureties, the new bond has to reach the contractor at least 30 days before the old one expires, with no gap in coverage.
Cost
You pay a premium, not the $50,000. The rate is set by the surety after reviewing the owners' credit and the supplier's financial condition.
Eligibility and Requirements for an All States Instant Issue (hidden) Bond:
- $50,000 base bond for each NPI, plus $50,000 for each additional practice location.
- Bond issued by an authorized surety on the U.S. Treasury list of certified sureties.
- CMS named as obligee and the DMEPOS supplier as principal.
- Continuous bond, no fixed expiration.
- No gap in coverage at any time, including when changing sureties.
All States Instant Issue (hidden) Bond FAQs:
Per NPI. Each new practice location needs an additional $50,000 bond or a rider adding it to your existing bond.
When the supplier had an adverse legal action in the 10 years before enrollment, revalidation or reenrollment. The CMS contractor then requires an elevated bond of $50,000 per occurrence on top of the base bond.
Physicians and nonphysician practitioners are exempt when items go only to their own patients as part of their physician service. Physical and occupational therapists in solely owned private practices are exempt if they furnish items only to their own patients and bill only for orthotics, prosthetics and supplies.
CMS revokes billing privileges effective the date of the lapse, and Medicare will not pay for items furnished during the gap.
The regulation requires a continuous bond. It stays in force until canceled, with 30 days written notice required before cancellation. The premium is billed by the surety on its own schedule.
