Telemedicine Owner Sentenced in $56M Medicare Fraud Scheme

A federal court has sentenced Darryl Cox, the owner of a Georgia-based telemedicine company, to 7 years in prison for orchestrating a $56 million Medicare fraud and kickback scheme that targeted beneficiaries across multiple states. Cox previously pleaded guilty to conspiracy to commit healthcare fraud and conspiracy to pay and receive kickbacks after he and his co-conspirators caused the submission of thousands of false and fraudulent claims to Medicare for durable medical equipment (DME) and other services that were medically unnecessary or never provided. The extensive fraud also involved recruiting beneficiaries through illegitimate marketing and paying illegal kickbacks to induce orders for DME to be billed to the federal healthcare program.

According to investigators from the HHS Office of Inspector General (HHS-OIG), Cox used multiple shell companies and sham arrangements to conceal his ownership interest in providers and facilitate the submission of fraudulent claims. The scheme exploited both the telemedicine model and vulnerable Medicare beneficiaries, undermining trust in virtual care and burdening taxpayers with unwarranted costs. The court also ordered Cox to forfeit more than $28 million in proceeds obtained from the scheme, emphasizing the severe consequences of engaging in healthcare fraud and illegal referral incentives.