A Medicare reform bill introduced in the past week calls for new surety bond requirements for many healthcare providers. Sponsored by Sen. Chuck Grassley, the “Strengthening Program Integrity and Accountability Health Care Act” (S.2964) proposes extending the new requirement that durable medical equipment (DME) suppliers carry a $50,000 surety bond to a great many more types of medical providers – all Medicare Part A and Part B providers except for physicians. It’s a move intended to help better screen providers of Medicare covered services including those delivered at hospitals, outpatient clinics, and physical and occupational therapy facilities.

The bill proposes requiring these healthcare providers to have a surety bond of $50,000 or one that covers the value of the provider’s volume of billing, whichever is larger. Other provisions of the bill expand the recovery audit contractor program, which audits various healthcare providers to discover instances of fraud or overpayment. The bill would also allow the Department of Health and Human Services to suspend payments, demand speedy return of any overpayments made, and extend the time available to Medicare to pay claims to allow more evaluation time.

“Because of this prompt payment rule, the government puts itself in a position of having to pay and chase Medicare fraud, instead of working to prevent it in the first place,” Grassley said.

The bill was introduced January 28, following a National Summit on Health Care Fraud. It’s since been read twice and referred to the Senate Finance Committee. There’s no information on the committee’s Web site about the bill as yet. The committee’s calendar for this week appears to be filled with issues surrounding the President’s fiscal year 2011 budget proposal.

Image: Mark Coggins