Blackman, 42, of Johnson County, Kansas, owned and controlled HealthSplash, which acquired the internet-based platform Power Mobility Doctor Rx, LLC (DMERx) in September 2017. The platform generated false and fraudulent doctors’ orders for durable medical equipment and prescriptions for other items.
According to court documents and evidence presented at trial, Blackman and 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.
All told, Blackman and his co-conspirators billed Medicare and other federal health care benefit programs over $1 billion for this unnecessary equipment. Medicare and the other insurers paid more than $450 million based on these claims.
Blackman and his co-conspirators connected pharmacies, DME suppliers, and 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.
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, and 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.”
Acting Attorney General Todd Blanche called the conviction a victory against "cold, calculated, industrial-scale theft targeting the sick and elderly." Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division said, "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."
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, and five years for the conspiracy to defraud the United States and to make false statements in connection with health care matters conviction.
A sentencing hearing has been scheduled for August 26, 2026. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.