How to Bond My Home Health Care Business
Obtaining a surety bond for your home health care business is important for establishing legitimacy and building your reputation. Home health care businesses that desire to accept Medicare and Medicaid payments and order supplies must secure a bond to prove they are not engaging in fraudulent activity. The process for getting a surety bond can be difficult but worth the effort for protecting your business and customers.
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Things You'll Need
- Financial statement
- Credit history
- Surety bond producer
- Surety bond application
Instructions
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Decide on the type of surety bonds that you need. There are a variety, from commercial bonds to patient trust bonds. However, many are not ideal for a home health care business. The type of bond you choose will narrow your focus on the specific requirements to meet. Most home health care businesses will need a Medicare Bond and/or Health Care Professional Bond. Contact your state Department of Health or state Small Business Administration to discuss the surety bonds required and recommended.
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Choose a reliable surety bond producer. Do research on bond producers that are accredited and certified by the federal government. The National Association of Surety Bond Producers, A.M. Best and the Treasury Department's Circular 570 are good resources to begin your search. Contact home health care businesses in your area to get recommendations on the best producers for surety bonds. The Better Business Bureau and Ripoff Report are useful for reading records of complaints from current and former customers. In some instances, you can obtain a bond through your insurer.
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Review the requirements of the surety bonds producers you are interested in. Afterward, make a checklist and a plan for your home health care business to meet the requirements. Meet with your employees and discuss the goals for the business. General qualifications includes a high credit rating, consistent growth, clear financial statements and expected duration of the business. Surety bond producers also prefer to issue bonds to businesses that have a solid reputation. Home health businesses with poor credit history, lawsuits and stagnant growth can result in high premiums or a denied application.
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Meet with the bond producer you have chosen and apply for the bond. Read all the fine print to be sure the specific bond complies with the requirements of your state. Talk with the representative to get a thorough understanding about the bond, the costs and how to maintain the requirements once you have obtained approval for their bond. While waiting for approval on your application, research other surety bond producers in case you are denied or to find a better opportunity.
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If you are approved, sign the agreement and send to your State Department of Health. You can begin paying your premium. If you are not approved, contact the surety bond producer to find out why. Contact your local Chamber of Commerce for referrals for other surety bond producers more likely to approve you.
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Tips & Warnings
Obtain the correct amount of bonds; some states require a $50,000 premium, while others require $500,000.
If your bond producer is not accredited or certified, your bond is useless.
