DMEPOS Surety Bond

DMEPOS Surety Bond

Don Foley

8/7/2009

Dear O&P Practitioner,
Below is a very important correspondence with Frank Whelan, who oversees the
Medicare Surety Bond program with CMS. It appears diabetic shoes are being
defined as DME and will very possibly take away the O&P exemption. Please
see below and feel free to call if you have any questions.
Thank you,
Don Foley
Cailor Fleming Insurance
800.796.8495


----- Forwarded Message -----
From: Frank B. Whelan (CMS/OFM) < <Email Address Redacted> >
To: O&P Practitioner
Sent: Wednesday, August 5, 2009 12:15:06 PM GMT -07:00 US/Canada Mountain
Subject: RE: Surety Bond Problem
Hi -
 FAQ #38 on the National Supplier Clearinghouse's FAQ page for surety bonds
states as follows:
 
Q: With respect to the surety bond exemption for prosthetists and
orthotists in 42 CFR 424.57(d)(15)(i)(B), what are considered supplies, as
that term is used in 42 CFR 424.57(d)(15)(i)(B)(2)?
 For purposes of the surety bond exception for prosthetists and orthotists,
supplies are those items that are related to custom-made orthotics and
prosthetics. Prosthetic devices - such as compression garments, mastectomy
items and diabetic shoes - are considered supplies for purposes of this
exception only if they are related to the provision of custom-made
prosthetics and orthotics.
 Thus, if the diabetic shoes you furnish are related to the provision of
custom-made prosthetics and orthotics, they are considered supplies for
purposes of the surety bond exemption. It does not appear, based on the
facts you present below, that this is the case here. Since you furnish and
bill for items that are not considered supplies, you do not meet the
regulatory requirement that the practice be billing only for orthotics,
prosthetics, and supplies.
 A bond must therefore be obtained.
 Thanks.
 From: O&P Practitioner
Sent: Tuesday, August 04, 2009 6:06 PM
To: Whelan, Frank B. (CMS/OFM)
Subject: Surety Bond Problem
 Hello Mr. Whelan:
 I was given your name from my insurance agent as I had called him to find
out if my company needs to purchase a Surety Bond. According to what I have
been reading I am thinking that we would be exempt from having to have a
Surety Bond. My agent said we fit the criteria except for the diabetic
shoes. We are a practitioner owned company. Our state does not require
state licensure. We mostly provide custom fabricated orthotics and
prosthetics. We do provide some off-the-shelf items but the majority is
custom. We do not provide any other DME services.
 My agent told me there is a clause that may cause me some problems and that
is that we provide diabetic shoes and inserts. All of our patients are sent
to us from their physician treating their diabetic foot related problems.
Everything we do requires a prescription and a Therapeutic Shoe
documentation form. Occasionally a patient just needs shoes and not the
foot orthotics. We are not a shoe store. We order the shoes after we have
seen the patient. All of our customers are orthotic or prosthetic patients.
 Are we exempt from requiring a Surety Bond or do we need one?
General Operations Director
O&P Practice

Please click on the following link for the entire list of FAQs:
<URL Redacted>
.pdf/$FIle/suretybondfaqs072209.pdf
 
Thanks Again,
 
Don Foley
Cailor Fleming Insurance
800.796.8495
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