Healthcare company CEO convicted of $1 billion Medicare fraud conspiracy

Alongside others involved in the scam, Blackman connected pharmacies, DME suppliers, and marketers with telehealth companies that would accept illegal kickbacks and bribes.

Blackman and his co-conspirators targeted hundreds of thousands of Medicare beneficiaries through misleading mailers, television advertisements, and calls from offshore call centers to coerce them to accept medically unnecessary orthotic braces, pain creams, and other devices, according to court documents and evidence presented at trial.

Prosecutors say they then paid purported telemedicine physicians to sign bogus prescription orders for these items to obtain reimbursements from Medicare, despite no meaningful interaction with the patients, and at times, no interaction at all. Blackman and his accomplices took a cut for themselves as an illicit referral fee.

Blackman faces a maximum penalty of 20 years in prison for the conspiracy to commit healthcare fraud and wire fraud conviction, five years for the healthcare kickbacks conviction, and five years for conspiring to defraud the United States and making false statements in connection with healthcare matters. Blackman’s co-defendant, Gary Cox, was convicted in a prior trial and sentenced to 15 years in prison.

Officials with the Justice Department told the Washington Examiner that this was one of the largest fraud busts completed under the Trump administration and one of the largest ever in the state of Florida.

“The Department of Justice crushed one of the most egregious fraud schemes in Florida history,” acting Attorney General Todd Blanche said in a statement. “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.”

“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,” added Assistant Attorney General Colin M. McDonald of the DOJ’s National Fraud Enforcement Division. “The Fraud Division will continue to aggressively prosecute health care fraud schemes, hold criminals accountable, and protect the integrity of America’s health care system.”

On April 7, the DOJ announced the creation of its fraud division, focused on investigating and prosecuting all forms of taxpayer theft. The division’s work supports President Donald Trump’s anti-fraud task force, a whole-of-government effort chaired by Vice President JD Vance to root out fraud, waste, and abuse within federal benefit programs.