US Software Company CEO Sentenced To 19 Years For Over $1billion Medicare Fraud Scheme
The chief executive officer and owner of a United States healthcare software company, Brett Blackman, has been sentenced to 19 years in federal prison for his role in a massive healthcare fraud scheme that involved more than $1 billion in fraudulent claims submitted to Medicare and other government-funded healthcare programmes.
The 43-year-old businessman from Johnson County, Kansas, was sentenced on Wednesday, October 14, 2026, following his conviction in a case prosecuted by the United States Department of Justice. The department announced the sentence on Thursday, October 15, describing the operation as one of the largest telemedicine-related fraud schemes uncovered by federal investigators.
According to prosecutors, Blackman operated an internet-based platform that generated fraudulent doctors’ orders and prescriptions for medical equipment that patients did not medically need. The documents were subsequently used by suppliers and pharmacies to submit claims to Medicare and other federal healthcare benefit programmes.
Investigators said the fraudulent claims exceeded $1 billion, while Medicare and other insurers paid more than $450 million based on those claims. The scheme targeted hundreds of thousands of beneficiaries across the United States, including elderly and disabled people who rely on government-supported healthcare services.
Blackman owned and controlled HealthSplash, a healthcare technology company that acquired Power Mobility Doctor Rx, LLC, commonly known as DMERx, in September 2017. Prosecutors said the DMERx platform was used to generate doctors’ orders for durable medical equipment, including orthotic braces, as well as prescriptions for other medical products.
According to evidence presented during the trial, Blackman and his co-conspirators connected medical equipment suppliers, pharmacies and marketers with telemedicine companies willing to arrange medical orders in exchange for illegal kickbacks and bribes.
The fraudulent orders allegedly gave the impression that patients had been properly examined and assessed by doctors before the equipment was prescribed. However, prosecutors said many of the supposed medical assessments never took place, with some doctors signing orders without meaningful contact with the beneficiaries.
The investigation found that marketers and call centres aggressively contacted Medicare beneficiaries and persuaded them to accept medical equipment, including braces, regardless of whether the products were medically necessary. The orders were then processed through the platform, allowing suppliers and pharmacies to bill government-funded insurance programmes.
The scale of the operation was reflected in the number of people affected. According to the Department of Justice, Medicare was fraudulently billed for orthotic braces for more than 346,000 beneficiaries. On average, the programme was billed for approximately four braces per beneficiary, while at least 1,200 beneficiaries were each associated with claims for 21 or more orthotic devices prescribed through the platform.
Prosecutors also presented evidence showing how the system operated through an undercover investigation. An undercover agent posing as a Medicare beneficiary was contacted by a foreign call centre and encouraged to accept multiple braces. A doctor subsequently signed orders for the products using the DMERx platform.
One of the orders claimed that the doctor had conducted tests requiring an in-person examination, even though the doctor had not spoken to the supposed patient. Prosecutors said the evidence demonstrated how fraudulent documentation was used to support claims for products that had not been properly prescribed.
Investigators further alleged that the participants concealed the operation through sham contracts and by manipulating doctors’ orders to reduce the likelihood of detection during Medicare audits. The documents were reportedly altered to remove references to telemedicine, making the transactions appear more consistent with conventional medical consultations.
The fraudulent arrangement generated substantial payments for the suppliers and other participants involved. According to prosecutors, companies that purchased the medical orders submitted more than $1 billion in claims to Medicare and other insurers, resulting in payments exceeding $450 million.
The case was investigated by multiple federal agencies, including the Federal Bureau of Investigation, the Department of Veterans Affairs Office of Inspector General and the Defense Criminal Investigative Service, alongside other law enforcement partners.
A federal jury convicted Blackman in May 2026 on several charges, including conspiracy to commit healthcare fraud and wire fraud, conspiracy involving healthcare kickbacks, and conspiracy to defraud the United States and make false statements relating to healthcare matters.
His sentencing follows an earlier prosecution involving another participant in the broader scheme. Gary Cox, a co-defendant and former chief executive associated with the DMERx platform, was sentenced to 15 years in prison in December 2025 after his conviction in a related case.
In announcing Blackman’s sentence, the Department of Justice said the prosecution demonstrated the government’s determination to pursue individuals who exploit public healthcare programmes for financial gain. Officials said the scheme diverted resources intended to support vulnerable patients and undermined the integrity of taxpayer-funded healthcare services.
The case has also highlighted the risks associated with healthcare technology platforms when medical documentation, referral arrangements and billing procedures are abused. While telemedicine can expand access to medical care, prosecutors said the platform in this case was used to generate orders that falsely represented patients as having received proper medical assessments.
The financial consequences extend beyond the companies and individuals who allegedly profited from the scheme. Fraudulent claims place pressure on public healthcare resources and can increase the administrative burden on agencies responsible for verifying medical necessity, detecting suspicious billing patterns and protecting beneficiaries from improper practices.
The prosecution did not establish that every beneficiary contacted by the operation knowingly participated in wrongdoing. Rather, investigators said many beneficiaries were targeted through aggressive marketing and persuaded to accept products that were not medically necessary.
Blackman’s 19-year prison sentence represents a significant punishment in a case involving extensive fraudulent billing, false medical documentation and illegal financial arrangements. The case also demonstrates the potential criminal consequences for executives who knowingly participate in schemes designed to exploit public healthcare programmes.
Street News Reporters will continue to monitor developments in the case, including any further legal proceedings involving other participants, additional enforcement actions and measures introduced by US authorities to prevent similar fraud schemes targeting Medicare and other government-funded healthcare programmes.
