A recent $30 million healthcare fraud case has once again highlighted — why honest billing, clear communication, and proper documentation are non-negotiable in the durable medical equipment (DME) industry. The case involved false DME claims, kickbacks, and misuse of provider credentials to bill Medicare for equipment that patients did not need or use. While the fraudster has now pleaded guilty, the damage to the healthcare system or the DME provider—and the trust of Medicare beneficiaries—is already done. In fact, after the whole event, the durable medical equipment industry and its billing operation is under strict federal surveillance and probably why the federal body is giving it more attention.
DME Billing: Why It's Under the Federal Microscope
The Centers for Medicare & Medicaid Services (CMS) is not taking DME fraud lightly. In recent years, CMS has increased its audits (TPE and PI), claim reviews, and data analytics programs to catch unusual billing behavior. One of the top red flags? Billing for equipment that patients never requested, never used, or did not need.
In this case, telemarketing companies contacted patients and generated orders for items like knee and back braces—without any real medical necessity. In many instances, the patients never even spoke to a licensed medical professional. In others, provider IDs were used without their permission.
CMS has made it clear that such behavior will not be tolerated. When fraudulent DME claims are discovered, not only are the companies penalized, but trust in legitimate providers also erodes.
Being a wake-up call for all DME suppliers. If you're someone running a DME business, this is the time to double-check your processes, especially when it comes to patient communication and billing accuracy and proper pre-billing solutions. Fortunately, you can avoid audits and penalties by following the practices mentioned below.
Vital practices to avoid DME billing issues:
In DME billing, always make sure the patient needs and uses the equipment—whether it's a CPAP, hospital bed, or wheelchair. You can face billing issues and audits if your patient doesn't understand or use the specific equipment. Always confirm the order before you ship it to your patients, follow up after delivery, and make sure you document everything carefully. This keeps your billing clean and helps your patients. Also, be careful with marketing contracts. CMS doesn't allow payments based on the number of leads or orders—that's considered a kickback. You can break the rule for paying per order, even if it is written in your contract. You should always avoid a commission-based model and work with CMS-approved vendors to keep your business safe.
The recent $30 million fraud case isn't just about one person or company. It reflects on the entire DME industry. Every time a patient receives an unnecessary brace, or a provider ID is misused, the system loses trust. And when CMS steps in, even honest suppliers can face stricter rules and more audits. You can help rebuild that trust. Communicate clearly with your patients. Follow every billing rule. Work with a DME billing company that cares about compliance as much as collections.
How a DME Billing Company Can Help You Stay Compliant
Running a DME business is more than just delivering equipment. You need to stay on top of changing billing rules, manage prior authorization, monitor usage, and handle denials. A good DME billing company can make all the difference.
A DME billing company helps you in many ways. They talk to patients, confirm equipment use, and keep records to protect you during audits. They know what CMS needs—like delivery proof, doctor's orders, and usage logs. They watch for billing issues that could trigger audits. They also handle prior authorizations so everything is approved before billing. Each expert in a professional billing company knows how to work on popular DME billing tools like Brightree, Kareo, DME Works, etc. Billing experts also check claims for mistakes, fix them before submission, and implement the perfect denial management measures to handle claim rejections.
So, ensure a perfect DME billing mechanism by partnering up with a perfect billing partner today!
