Express Scripts now requires some applicants who wish to contract with their company to obtain a $500,000 performance bond for a minimum of the first two years of the contract.
According to Express Scripts, this bond requirement “guarantees to the obligee (Express Scripts) that the principal will carry out the performance of their contract according to terms and conditions agreed to by the parties.” Express Scripts may also require that the bond extend beyond the initial two-year period.
What Is an Express Scripts Performance Surety Bond?
Express Scripts partners with pharmacies throughout the country to deliver medications to customers’ homes. As a partnering pharmacy, Express Scripts requires pharmacies to obtain a performance surety bond as a form of protection. This surety bond ensures that pharmacies will obey the business contract they’ve entered into.
How Does an Express Scripts Performance Surety Bond Work?
An Express Scripts performance surety bond is a three-party agreement that works similarly to other surety bonds.
The Obligee
The obligee in the agreement is Express Scripts, because they are the organizer requiring the bond be posted by the partnering pharmacy.
The Principal
The principal in the agreement is the pharmacy who must purchase the bond to successfully partner with Express Scripts.
The Surety
The surety company in the agreement provides the bond to the pharmacy and pays any claims made against the bond.
Who Needs an Express Scripts Performance Surety Bond?
Any qualified applicant who wishes to enter a contract with Express Scripts must get a performance surety bond of $500,000. The surety bond guarantees that the pharmacy abides by the contract and protects Express Scripts if the pharmacy breaches the agreement.
How Much Does an Express Scripts Performance Surety Bond Cost?
The total cost to the pharmacy for an Express Scripts performance surety bond will be a percentage of the total bond amount. The percentage can range from one to 10 percent and will depend on the personal credit history and financial background of the applicant.
Requirements for Obtaining the Bond
In order to obtain a surety bond that Express Scripts will accept, pharmacies must ensure the surety they apply with has an AM Best rating of at least A-VIII. Also, pharmacies who post this bond must hold an active bond for a minimum of two years.
Why Choose JW Surety Bonds?
We are the nation’s largest volume bond producer, and we provide the lowest rates in the industry. It is crucial that you understand your responsibility to pay any claims filed on your bond.
When you partner with our company, you will have a dedicated claim specialist assigned to your account to ensure claim payouts are either reduced or avoided all together.
Get a Free Quote Instantly Online
If you’re ready to get a surety bond for this new bond requirement, you can simply apply online.
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