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DMEPOS Surety Bond Update

DMEPOS Surety Bond FAQs

Q:  Are optometrists exempt from the DMEPOS surety bond?
A:  Yes.  CMS recognizes that Congress exempted physicians from the surety bond requirement in the Balanced Budget Act of 1997.

Q:  Are optometrists exempt from DMEPOS accreditation?
A:  Yes.  In the Medicare Improvements for Patients and Providers Act of 2008, Congress prohibited CMS from requiring physicians to meet the accreditation requirement unless CMS creates standards specifically for physicians.  Although CMS has stated its intent to create such standards, it has not taken that step.

Q:  If ODs are exempt, why are we told we still need to get a surety bond?
A:  In some circumstances, Medicare considers a physician practice to be a medical supply company subject to the bond.  Those circumstances include when an OD operates an actual general medical supply company, when an OD employs an optician who is enrolled as a DMEPOS suppler, and when an OD supplies covered eyeglasses without any sort of test or examination that would establish that the beneficiary is a patient when he or she enters the office for the first time with a prescription following cataract surgery.

Q:  What if I referred one of my patients to a cataract surgeon, and the patient comes back after the procedure with a prescription for eyeglasses?
A:  This patient should be considered your patient and you would not need a surety bond.

Q:  What if a patient comes into my office with a prescription and I just fill the prescription?
A:  If you don’t do any sort of test or examination prior to filling the prescription for a beneficiary who has not been in the office previously, then CMS believes you are a medical supply company who must have a surety bond to provide that service.

Q:  Do I have to notify CMS or the NSC that I am exempt from the surety bond?
A:  You do not have to notify CMS or the NSC that you are an exempt physician but you should respond to correspondence from Medicare that demands a response “within 30 days” about whether you have a surety bond.

Q:  When is the deadline for the surety bond?
A:  October 2, 2009

Q:  What do I do if I don’t have a surety bond at that date?
A:  You should obtain a surety bond if you plan to supply post-cataract eyeglasses to a so-called “walk in” Medicare patient without performing any sort of test or examination.

Q:  Do I have to bill Medicare and/or the patient for the exam or test?
A:  CMS does not specifically require that an exam or test be billed prior to dispensing eyeglasses.  If you provide a covered service to a Medicare beneficiary, then you should collect a copayment and bill Medicare.  If you provide an uncovered service and want to bill the patient, then you might need an Advance Beneficiary Notice of Noncoverage (ABN) signed before billing the patient.  If you provide an uncovered service and do not plan to bill Medicare and/or the patient, then you should at least record the service in the medical record.  Regardless of the CMS requirement to establish who is a patient for purposes of the physician exemption to the surety bond, ODs should abide by whatever other legal obligations exist.

Q:  Does this apply to all patients who need glasses?
A:  The Medicare surety bond only applies when supplying eyeglasses to Medicare beneficiaries who were not previous patients.

Q:  Are ophthalmologists exempt?
A:  Ophthalmologists, like optometrists, are exempt but face the same restrictions as ODs.

Q:  Are opticians exempt?
A:  Opticians are not exempt.  Opticians who are enrolled as DMEPOS suppliers need to have a surety bond.  Opticians who work in optometry offices do not need a surety bond as long as the optometrist owns the business and is enrolled as a DMEPOS supplier to bill in Medicare.

Q:  What if I don’t get a bond?
A:  Medical supply companies that do not have a surety bond by October 2, 2009, are subject to a one-year revocation of Medicare billing privileges.  If an optometrist plans to act as a medical supply company by providing eyeglasses to Medicare beneficiaries who are not patients, then the OD should have a surety bond prior to dispensing glasses to the general public.

Q:  Can I turn away Medicare beneficiaries who are not my patients but need eyeglasses?
A:  Yes.  ODs are not required to provide eyeglasses to Medicare beneficiaries who are not patients.