Unnoticed Surety Bond Rejections Raise Serious Concerns

WATERLOO, Iowa — A handful of HME providers who managed to
get through the clogged National Supplier Clearinghouse phone lines
got a nasty surprise when they learned that their surety bonds or accreditation
notifications had been rejected by the NSC and their Medicare
billing privileges are in jeopardy, VGM officials said Friday.

“It’s a relatively small number, but whether
it’s one or a thousand, it’s important to us,”
said Warren Freeman, director of sales and marketing for VGM
Insurance, Waterloo, Iowa. He added that the reports are disturbing
because while some providers received vague rejection letters, many
did not get any type of notification.

“They submitted a bond in July or August and they called
last week and found that their bond was rejected, but they never
received any notification,” Freeman said. CMS mandated that
HME providers carry a $50,000 surety bond per location as of Oct. 2
in order to bill Medicare; they must also, as of Oct. 1, be
accredited. Consultants and other industry entities had urged
providers to contact the NSC to determine whether their bond status
had been updated, but many reported that they were
unable to get through.

That means many providers do not know what their status is.

“These people could bill for weeks and find out that as of
Oct. 2, they couldn’t bill,” Freeman said.
“Supposedly, if you did not have a bond in place by Oct. 2,
your billing privileges are revoked as of Oct. 3.”

Revocations are for at least a year.

Freeman added that there were “a whole lot of other
issues” that VGM was working on in connection with the bonds,
including failure of overnight mail companies to deliver some of
them, name discrepancies between a firm’s actual name and the
name the NSC has on file, and rejection letters that are so vague
providers are not sure why their bonds were rejected.

“It’s just a lot of confusion,” Freeman said,
noting that providers could get tripped up by small
discrepancies—a date that was not filled in, for example, or
an address that was not exactly as the NSC has it in its files.

The question is, what can be done to fix the various situations.
“What kind of parameters are there for mistakes on a
provider’s part by forgetting a date or the NSC’s part
for not notifying a provider [of a rejection]?” Freeman
asked.

So far, VGM officials said, providers who have actually spoken
to someone at the NSC have gotten mixed messages.

When responding to what the provider needs to do to remedy the
problem, the NSC has given several different answers that include:
provider will need to re-enroll; provider will lose billing number;
provider just needs to resend the surety bond or accreditation
notification,” VGM reported on its Web site.

Freeman said VGM is compiling information from providers
“and we are submitting [it] as a whole to the NSC and asking
them to either review or provide clarification as to what to
do.”

Providers wanting to share their concerns can email their
stories to [email protected] and include: company name,
contact person, contact information (phone/fax), PTAN number and
NPI, attempts that have been made to correct the issue with the
results and any names of NSC personnel who have been contacted.

“We will have opportunities to talk to the NSC at Medtrade
[this week in Atlanta] and we want to make sure we know of any
issues,” Freeman said. “Right now, we have about eight
that we are fairly concerned about, and we want to make sure there
are some answers.”

Providing the information to the NSC en masse could gain some
traction, Freeman believes. “It’s hard for a provider
to get any attention as a single unit,” he said.