The DMEPOS Medicare Surety Bond System Is Curious

It is amazing to me that the government has set-up their 2009 Medicare surety bond system in the manner that it is. Surety bonds are a forced insurance policy for Medicare to collect from if unscrupulous medical equipment suppliers try to cheat the system. Each medical equipment provider must buy a 50,000 surety bond for each business address. If one of the addresses in their chain does not perform, Medicare can collect their damages from the bond totals.

On the surface, this seems to be a fair way to keep the lowlife providers out of the way of the American public, but some lesser equipment providers are not being allowed to have the required bonds that they are applying for based upon a credit rating, or a 10-year old system question about their business practices. What I see happening is that only the larger providers are being allowed to prosper through this new system. The government is not allowing the smaller businesses to have the required bonds that they need.