If you think the following scenario is uncommon, then you haven't been in the medical billing industry long enough. What follows is a sample of what can go very wrong when billing Medicare for somebody's, well, whatever it was supposed to be.

You've just got your DME software all setup. The patients are in, the inventory is in, the doctors and facilities are in, the insurance carriers are in and you're ready to start billing.

And this is what happens.

John Doe pops up on your computer. He's a recent patient at Doctor Jones. It appears that he has been treated for some disease of the lungs and he has prescribed an oxygen concentrator for the patient and several months of oxygen to be given to the patient. The medical billing person goes through the procedure and bills Medicare for the oxygen concentrator and oxygen for the first month. This goes on for about 11 months.

On the twelfth month, the patient dies and the equipment needs to be picked up. Mind you, Medicare has been paying for this item for almost a year now. The maintenance men go to the patient's home to pick up the concentrator and find, not a concentrator, but a wheelchair. You can imagine their confusion. Well, they call up the DME company and tell them what they found. The DME company says, "Well of course there is a wheelchair at the home. John Doe had his legs amputated".

Oops. To say the least anyway. Now, we've got a real problem. For starters, we've been collecting money for an item that is a heck of a lot more money than what the patient actually got. That's fraud and a serious crime. Second, Medicare obviously doesn't know about this or they wouldn't have paid on the item. So what do you do? Do you tell them?

Here is where it gets sticky. Medicare IS going to find out, first of all, that the patient is dead and then they're going to find out how the patient died. And then they're going to put two and two together and realize that this patient never had an oxygen concentrator. That's when the investigation begins.

Can you see where this is going? At best, the company is going to get charged back for the misbilling. At worst, they're going to get charged with fraud. Somewhere in between there are other things that can happen but we won't get into them. None of them are pleasant.

Where this is all going is simply, as soon as you find out about the error, report it to Medicare immediately. If you report the problem, the chances are that you will simply be charged back for the error and paid for the wheelchair instead.