Kansas CEO Gets 19-Year Sentence for Major Medicare Fraud

Brett Blackman, the CEO and owner of HealthSplash, has been sentenced to 19 years in prison for his role in a massive Medicare fraud scheme. The Kansas-based executive was convicted of defrauding Medicare and other federal health care programs out of more than $1 billion, according to the U.S. Department of Justice.

Blackman, 43, orchestrated the scheme through his company, HealthSplash, which acquired Power Mobility Doctor Rx, LLC (DMERx) in September 2017. DMERx was used to generate false doctors’ orders and prescriptions for durable medical equipment (DME), such as orthotic braces, which were then fraudulently billed to Medicare. The fraudulent activity involved more than 346,000 Medicare beneficiaries, with an average of four braces billed per beneficiary.

Fraudulent Scheme

The scheme involved connecting pharmacies, DME suppliers, and marketers with telemedicine companies that accepted illegal kickbacks and bribes in exchange for signed doctors’ orders. These orders falsely represented that doctors had examined and treated Medicare beneficiaries, when in reality, the doctors were paid to sign the orders without any meaningful interaction with the patients.

Evidence presented at trial included testimony from an undercover agent who posed as a Medicare beneficiary. The agent was pressured by a foreign call center to accept multiple braces, and a doctor signed bogus orders for these braces using the DMERx platform. The orders claimed that the doctor had conducted various tests that can only be performed in person, despite the doctor never having interacted with the agent.

The fraudulent claims resulted in Medicare and other insurers being billed over $1 billion, with more than $450 million paid out based on these claims.

Official Statements

Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division stated that the lengthy prison sentence "holds the orchestrator of that scheme accountable." He emphasized the department's commitment to dismantling large-scale fraud operations.

Inspector General Cheryl L. Mason of the Department of Veterans Affairs highlighted the sentence as a warning to those who exploit VA programs for personal profit. Special Agent in Charge Brett D. Skiles of the FBI Miami Field Office added that the scheme undermined the integrity of the health care system and defrauded taxpayer-funded programs.

Acting Special Agent in Charge Nakia Martin Alexander of the DCIS Southeast Field Office reiterated the commitment to protecting the integrity of the TRICARE program and ensuring that military health benefits are used appropriately.

Blackman's conviction and sentencing serve as a significant example of the consequences faced by those who engage in large-scale health care fraud. The case underscores the ongoing efforts of federal agencies to protect taxpayer dollars and maintain the integrity of federal health care programs.