| (a) The OIG may require each provider of medical assistance
in the Medicaid program, in a provider type that has demonstrated
significant potential for fraud, waste, or abuse, to file with the
OIG a surety bond in a reasonable amount. The amount of the surety
bond may not exceed the maximum amount allowed by state or federal
law, plus the maximum amount of penalties allowed by state and federal
law.
(b) The OIG requires a provider of medical assistance
or person to file, with the OIG, a surety bond in a reasonable amount
if the OIG identifies acts or behavior that indicate suspected fraud,
waste, or abuse involving criminal conduct relating to the provider's
services under the program that indicates the need for protection
against potential future acts of fraud, waste, or abuse. The amount
of the surety bond shall not exceed the maximum amount allowed by
state or federal law, plus the maximum amount of penalties allowed
by state and federal law.
(c) The surety bond required of a provider or person,
by the OIG, under subsections (a) and (b) of this section must be
payable to HHSC to compensate HHSC for damages resulting from, or
penalties or fines imposed in connection with, an act of fraud, waste,
or abuse committed by the provider or person under the program.
(d) The OIG may require a provider of medical assistance
or person to file with the OIG a surety bond in an amount and manner
specified by the OIG. A surety bond may be required if the OIG identifies
acts or behavior that indicate suspected fraud, waste, or abuse that
involves criminal conduct that relates to the provider's services
under the program and that indicate the need for protection against
potential loss of recoupment of overpayments, penalties, damages,
or other debts assessed against the provider by the OIG, due to potential
default of the provider or failure of the provider to reimburse the
OIG assessed amounts. Among other reasons, a surety bond may be imposed
in connection with a settlement agreement, a provisional, probationary,
or closed end contract, or as a condition of reinstatement.
(e) Subject to subsection (f) or (g) of this section,
the OIG may require each provider of medical assistance that establishes
a resident's trust fund account to post a surety bond to secure the
account. The bond must be payable to HHSC to compensate residents
of the bonded provider for trust funds that are lost, stolen, or otherwise
unaccounted for if the provider does not repay any deficiency in a
resident's trust fund account to the person legally entitled to receive
the funds.
(f) For that portion of a case involving a resident's
trust fund accounts, the OIG does not require the amount of a surety
bond posted for a single facility provider under subsection (e) of
this section to exceed the average of the total average monthly balance
of all of the provider's resident trust fund accounts for the 12-month
period preceding the bond issuance or renewal date. This limitation
does not apply to any type of violations other than resident trust
fund accounts.
(g) If an employee of a provider of medical assistance
is responsible for the loss of funds in a resident's trust fund account,
the resident, the resident's family, and the resident's legal representative
are not obligated to make any payments to the provider that would
have been made out of the trust fund had the loss not occurred.
(h) Failure by a provider or person to post a surety
bond timely and as required by the OIG may result in imposition of
any of the administrative actions or sanctions and/or imposition of
damages and penalties, as specified in Subchapter G of this chapter
(relating to Administrative Actions and Sanctions).
(i) Surety bonds required by the OIG are considered
administrative actions. Administrative actions are further described
in §371.1701 of this chapter (relating to Administrative Actions).
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