On February 20, the DOJ announced that Johnson County, Kansas resident Gregory Schreck (50) pleaded guilty to operating DMERx, a web-based platform that created phony doctors’ orders to defraud Medicare and other federal health care benefit programs of over $1 billion. He will receive a maximum penalty of 10 years in prison.

Schreck admitted that he and his accomplices targeted 100,000+ Medicare beneficiaries to fork over their personal information and consent to receive medically unnecessary orthotic braces, pain creams, and other items via deceptive mail, television advertisements, and telemarketing calls.

While Schreck served as the company’s vice president, he ran a scheme that connected pharmacies, durable medical equipment (DME) suppliers, and marketers with telemedicine companies that would accept illegal kickbacks and bribes in exchange for signed doctors’ orders that were sent over the DMERx platform. Schreck and his co-conspirators accepted payments to organize these illegal kickback transactions.

DMERx generated fake doctors’ orders that falsely represented a doctor examined and treated the Medicare beneficiaries. In reality, telemedicine companies conducted brief phone calls—or, in some cases, made no contact at all—with beneficiaries, while doctors were paid to sign the orders regardless of medical necessity.

The DME suppliers and pharmacies that paid illegal kickbacks in exchange for these doctors’ orders placed through DMERx billed Medicare and other insurers over $1 billion. Medicare and the insurers paid over $360 million based on the false claims.

The Anti-Kickback Statute forbids paying, offering, receiving, or soliciting any form of payments or compensation to influence referrals for items and services covered by Medicare, Medicaid, and other federally funded healthcare programs.

Constantine Cannon whistleblower partner Marlene Koury commented, “The Anti-Kickback Statute safeguards medical decision-making, ensuring providers act in patients’ best interests, free from financial influence. Whistleblowers are fundamental in exposing fraud that exploits government healthcare programs. Our firm is dedicated to handling these types of cases.”

If you think you might have a case, or would like to learn what it means to be a whistleblower, please contact us. We will connect you with an experienced member of our whistleblower team for a free and confidential consultation.

Read $1B Medicare Scam: Kansas Resident Pleaded Guilty to Illegal Kickback Fraud Scheme at constantinecannon.com