A federal jury in the Southern District of Florida convicted the founder and owner of HealthSplash yesterday for his role in operating a platform that generated false doctors’ orders and prescriptions to defraud Medicare and other federal health care benefit programs out of more than $1 billion. “The Department of Justice crushed one of the most egregious fraud schemes in Florida history,” said Acting Attorney General Todd Blanche. “This illegitimate operation stole more than $1 billion from American taxpayers — including hundreds of thousands of Medicare beneficiaries.
Key details of the case
This was cold, calculated, industrial-scale theft targeting the sick and elderly, coercing vulnerable people into buying unnecessary medical equipment. We will not rest until every fraudster ripping off the American people is held accountable.”. “The defendant orchestrated a massive telemarketing scheme that used foreign call centers and spam mailers to target our country’s senior citizens and defraud government health care benefit programs,” said Assistant Attorney General Colin M.
Moreover, mcDonald of the Justice Department’s National Fraud Enforcement Division. “The Fraud Division will continue to aggressively prosecute health care fraud schemes, hold criminals accountable. Protect the integrity of America’s health care system.”.
According to court documents and evidence presented at trial, Brett Blackman, 42, of Johnson County, Kansas. His co-conspirators aggressively targeted hundreds of thousands of Medicare beneficiaries to get them to accept medically unnecessary orthotic braces and other items. They then arranged for purported telemedicine doctors to sign bogus prescription orders for these items, so that their co-conspirators could bill Medicare for them.
Enforcement actions and official statements
In addition, all told, Blackman and his co-conspirators billed Medicare and other federal health care benefit programs over $1 billion for this unnecessary equipment. Blackman owned, controlled, and was the CEO of HealthSplash, which acquired Power Mobility Doctor Rx, LLC (DMERx) in September 2017. DMERx was an internet-based platform that generated false and fraudulent doctors’ orders for durable medical equipment (DME) and prescriptions for other items.
As part of the scheme, Blackman and his co-conspirators connected pharmacies, DME suppliers. Marketers with telemedicine companies that would accept illegal kickbacks and bribes in exchange for signed doctors’ orders created using the DMERx platform. Blackman and his co-conspirators took a cut for themselves in exchange for the referrals. For complete details, refer to the official DOJ press release.
Consequently, “This conviction further underscores our dedication to protecting the integrity of military healthcare from large-scale exploitation,” said Special Agent in Charge Jason J. Sargenski of the Department of Defense Office of Inspector General’s Defense Criminal Investigative Service (DCIS), Southeast Field Office. “Fraud of this magnitude drains vital resources and jeopardizes the care promised to our service members, retirees, and their families.
Notably, dCIS, alongside our partners, remains steadfast in rooting out and dismantling these schemes, ensuring every conspirator faces justice.”. “This verdict shows exactly what happens when people exploit Medicare for personal gain,” said Acting Deputy Inspector General for Investigations Scott J. Lampert of the U.S. For related coverage, see Gang members sentenced to 50 years each for murdering fellow gang member — DOJ.
Specifically, department of Health and Human Services Office of Inspector General (HHS‑OIG). “The actions of this defendant severely undermined the integrity of the Medicare program. Working alongside our law enforcement partners, HHS‑OIG will continue to relentlessly pursue those who try to profit by defrauding federal health care programs.”.
Subsequently, “This conviction sends a clear message that those who exploit VA programs and services for personal profit will be found and held accountable,” said Acting Special Agent in Charge Greg Wentz with the VA Office of Inspector General Southeast Field Office. “The VA OIG remains committed to working alongside our law enforcement partners to uncover complex fraud schemes, protect veterans and taxpayers. Ensure accountability.”. For related coverage, see Illinois tax preparer convicted at trial after stealing more than $11 million from taxpayers in COVID-19 assistance fraud scheme — DOJ.
At the same time, the fraudulent doctors’ orders and prescriptions generated by DMERx falsely represented that a doctor had actually examined and treated the Medicare beneficiaries when, in fact, the doctors were simply paid to sign orders and prescriptions without any meaningful interaction with the beneficiary. In some cases, no interaction at all. Doctors signed these orders and prescriptions without regard to whether the equipment was medically necessary.
Testimony and evidence presented at trial from an undercover agent who posed as a Medicare beneficiary showed the scheme in action—starting with a foreign call center that pushed the undercover agent to agree to multiple braces to a doctor signing bogus orders for the braces using Blackman’s DMERx platform. The doctor’s order for one of these undercover agent beneficiaries claimed that the doctor conducted various tests that can only be performed in person even though the doctor never even spoke with the undercover agent “patient.”. The DME suppliers and pharmacies that were paying illegal kickbacks for these orders billed Medicare and other insurers for more than $1 billion.
Furthermore, medicare and the other insurers paid more than $450 million based on these claims. According to evidence presented at trial, Blackman and his co-conspirators concealed the scheme through sham contracts and by manipulating the doctors’ orders to avoid Medicare audits. The jury convicted Blackman of conspiracy to commit health care fraud and wire fraud, conspiracy to pay and receive health care kickbacks.
Investigation and prosecution details
Conspiracy to defraud the United States and to make false statements in connection with health care matters. Blackman’s co-defendant, Gary Cox, was convicted in a prior trial and sentenced to 15 years in prison. Blackman faces a maximum penalty of 20 years in prison for the conspiracy to commit health care fraud and wire fraud conviction, five years for the conspiracy to pay and receive health care kickbacks conviction. Five years for the conspiracy to defraud the United States and to make false statements in connection with health care matters conviction.