In 2025, the
National Health Care Fraud Takedown resulted in criminal charges against 324 defendants for schemes involving more than $14.6 billion in intended losses. While the scheme netted nearly 100 medical professionals, one key aspect that escaped most news headlines was their involvement in multiple fraud schemes. However, this pattern is not new.
As fraud examiners, particularly in health care, it is important to recognize that fraudsters exploit areas with weaker controls. For example, nurse practitioner
Sandra Jackson agreed to pay $38,000 to resolve allegations that she violated the False Claims Act by submitting claims for both genetic testing and durable medical equipment (DME) that were medically unnecessary and for patients she had never examined. This common and lucrative telehealth scheme crossed two types of health care fraud.
DME, such as braces, orthotics, catheters and other devices, have long been considered a profitable area for fraudsters. Like Jackson, including additional laboratory testing (such as genetic testing) is a way to increase billing costs and revenue. In many cases, neither the DME nor the tests are helpful to the patient.
In 2025, a Miami
man was charged with money laundering. He owned a DME company which submitted more than $113 million in claims for orthotic braces, wound dressings and continuous glucose monitors that beneficiaries did not need or receive. Prosecutors allege he then laundered over $200,000 in proceeds from these false and fraudulent claims through accounts and entities overseas.
A review of Department of Justice (DOJ) and U.S. Department of Health and Human Services Office of Inspector General (HHS OIG) enforcement actions and press releases since 2015 identified various schemes that have been linked together. Many have been driven by telehealth or even telemarketing firms that claim to be working for health care companies or doctors.
Genetic Testing Fraud (CGx & PGx)
One of the largest growth areas involves the billing of expensive cancer genomic (CGx) or pharmacogenetic (PGx) tests that are medically unnecessary. In 2019,
HHS OIG led a major enforcement action targeting these types of fraud. In that case, numerous defendants were arrested and over $1.7 billion in provider payments were suspended pending further investigation. Using bribes and kickbacks, laboratories received referrals of Medicare beneficiaries from medical professionals. Typically, the test results were not provided to the beneficiaries or were worthless. A telemarketing network lured hundreds of thousands of elderly or disabled patients. Others involved allegedly paid doctors to prescribe CGx testing, either without any patient interaction or with only a brief telephonic conversation with patients they had no pre-existing medical relationship with.
Wound Care & Elder Care
In 2024,
Alexandra Gehrke and Jeffrey King of Scottsdale, Arizona, were indicted for a scheme to fraudulently bill Medicare $900 million for expensive amniotic allografts, a form of wound care. The defendants targeted elderly Medicare patients, many of whom were terminally ill and in hospice care. Without any medical training or coordinating with medical professionals, these two caused unnecessary and extremely expensive amniotic grafts to be applied to these vulnerable patients’ wounds indiscriminately. They also failed to use proper infection control protocols. Finally, the participants used the expensive allografts on wounds that did not qualify, such as superficial wounds. They also billed for larger wounds than were actually treated. The indictment charged that the two received more than $330 million in illegal kickbacks from a distributor and the couple ultimately pleaded guilty in early 2025.
Kickbacks & Elder Care
Two Florida women were indicted for
conspiring to pay kickbacks to other health care providers and to “patient recruiters” in a scheme between June 2017 through March 2020 to direct individuals to the home health services company one of the women owned. The second woman charged was the director of nursing for the home health agency and helped formulate false contracts, sham agreements, and falsified invoices to conceal the kickbacks. The kickback amounts ranged from $320 to more than $2,000. Prosecutors, writing in their trial brief,
described a key piece of evidence seized during the search warrant executed at the business: “A patient referral logbook seized during a search of the business premises will show the defendant was keeping track of how many patients were referred by four different patient recruiters. This served as a kickback ledger’ and on one page it listed the amounts each patient recruiter was paid per referral.”
A Little Bit of Everything
As these cases attest, fraudsters routinely identify gaps in the system for their benefit. One such case is a former chief financial officer of a telemedicine company,
William Balsamo, who was charged in a scheme to provide doctors’ orders to pharmacies, DME companies, and laboratories in exchange for kickbacks. The scheme led to more than $9.1 million in losses to Medicare. Using the guise of a technology company that enabled patients to obtain telehealth services, the company obtained signed doctors’ orders by paying kickbacks to companies that had relationships with telemedicine doctors. They then sold the orders to the pharmacies, DME companies and laboratories (sometimes through intermediary marketers and resellers) in exchange for illegal kickbacks. Many of these items were medically unnecessary and not covered by health insurance. The conspiracy Balsamo was part of used code words to disguise payments to providers, such as “credits” or “consults.” Balsamo and others targeted medical staffing companies to identify providers who would be willing to write orders and prescriptions in exchange for the kickbacks.
All About Money, Not Care
The examples above, and so many more, show how financial incentives often drive misconduct — and care, if it occurs at all, is often secondary. Health care fraud enforcement actions over the last 10 years continue to prove that these frauds rarely exist in isolation and are often interconnected. Fraudsters who exploit one weak point in the system are often quick to identify and monetize others, creating overlapping schemes that amplify both financial losses and patient harm.
For fraud examiners, compliance professionals and investigators, recognizing these “double whammy” patterns is critical for earlier risk detection and disrupting schemes before they spread.
