Medicare Fraud Conspiracy Led to Over $1 Billion in Payments for Equipment and Other Items

Billions of dollars are lost every year through both Medicare fraud and online scams. According to the Department of Justice (DOJ), a scheme that combined both types of illegal behavior led to the misappropriation of more than $1 billion dollars. Now, the executive at the head of the operation faces a prison sentence of several years. 

Gregory Schreck, 50, of Johnson County, Kansas, has pleaded guilty to operating an internet-based platform that targeted Medicare recipients, then used their personal information to submit bogus claims. Schreck’s company, DMERx, generated false and fraudulent doctors’ orders for orthotic braces, pain creams and other medical items. He faces up to 10 years in prison. 

There were many ways in which DMERx was able to make contact with vulnerable seniors, including mailers, television commercials and telephone solicitations from offshore call centers. From there, the company would convince Medicare recipients to provide personally identifiable information and agree to accept medically unnecessary items. DMERx then formulated fraudulent doctor’s orders for these devices and medications. In all, hundreds of thousands of older Americans were targeted, and the company collected more than $1 billion in payments. 

The consequences of such schemes are far-reaching. Fraudulent claims drain resources from vital healthcare programs like Medicare, which millions of Americans rely on for essential medical services. Additionally, these schemes often exploit vulnerable populations, such as the elderly, who may not fully understand the implications of providing their personal information or agreeing to unnecessary medical items. 

Given the number of claims involved and the fact DMERx blasted advertisements through various media outlets, it might seem unbelievable that the fraudulent activity was able to persist for so long. However, many of these marketing campaigns are made to sound like the company is performing a service for Medicare beneficiaries who have no idea that their personal data is being used to cheat money out of the government. 

Employees and others with inside information are often the key to cracking these illegal operations. Our attorneys at Kardell Law Group are strong advocates for honest individuals who are aware of Medicare fraud and other forms of deception designed to misappropriate taxpayer money. When you speak with us, we’ll assess whether a potential whistleblower claim exists and advise if you might be entitled to a share of any government recovery.