$1 Billion Medicare Fraud Case Ends In Conviction: HealthSplash Founder Faces Up To 20 Years In Prison

Seniors and vulnerable Americans accessing government benefits to cover utilities, medical bills, and essentials are increasingly falling prey to rapidly rising scams. As part of the US government's crackdown on online scams, a federal jury convicted a company founder of defrauding citizens availing Medicare benefits in a highly complex fraudulent scheme.

HealthSplash CEO Brett Blackman faces up to 20 years in prison after a federal jury in the Southern District of Florida convicted the 42-year-old resident of Johnson County in Kansas of conspiracy to commit health care fraud and wire fraud, pay and receive health care kickbacks, and defraud the US and make false statements in connection with healthcare-related matters.

Blackman is the founder and owner of software platform HealthSplash, which acquired Power Mobility Doctor Rx (DMERx) in 2017. The newly-acquired company generated false and fraudulent doctors' orders and prescriptions for durable medical equipment in a scheme that swindled $1 billion from Medicare and other government programmes, according to DOJ's official press release.

Medicare and the other insurers paid over $450 million based on these fraudulent claims, and Blackman concealed the scheme for as long as possible through false contracts and by manipulating the doctors' orders to avoid audits.

'The defendant orchestrated a massive telemarketing scheme that used foreign call centres and spam mailers to target our country's senior citizens and defraud government health care benefit programs,' said assistant Attorney General Colin McDonald.

A sentencing is scheduled for 26th August, and a federal district court judge will determine any sentence after considering statutory factors.

Targeting Vulnerable Medicare Beneficiaries

Court documents revealed that Blackman along with his co-conspirators aggressively targeted countless Medicare beneficiaries to convince them to accept medically unnecessary orthotic braces and other items. The accused then arranged for purported telemedicine doctors to sign false prescription orders so that they could bill Medicare for them.

Blackman connected pharmacies, DME suppliers, and marketers with telemedicine firms accepting illegal kickbacks for doctors' orders created using the DMERx platform, and they took a commission in exchange for the referrals.

According to the US Department of Justice press release mid-May, the fraudulent DMERx-generated doctors' prescriptions indicated that a doctor had really examined and treated the Medicare beneficiaries, but instead, the doctors were simply paid to sign orders and prescriptions without meaningful interaction with patients. 'In some cases, no interaction at all,' according to the DOJ.

'This illegitimate operation stole more than $1 billion from American taxpayers — including hundreds of thousands of Medicare beneficiaries. 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,' stated acting Attorney General Todd Blanche.

An undercover agent who posed as a Medicare beneficiary showed that the scheme started with a foreign call centre that pushed the agent to agree to a doctor signing bogus orders for the braces using the DMERx platform.

'The scale of greed in this case is staggering. Brett Blackman and his co-conspirators systematically preyed upon hundreds of thousands of elderly and vulnerable Medicare beneficiaries, converting a platform meant for modern healthcare into a $1 billion vehicle for outright fraud,' said Brett Skiles, Special Agent in Charge, FBI Miami.