An Arizona man was sentenced Dec. 19 to 15 years in federal prison and ordered to pay more than $452 million in restitution for orchestrating a telemedicine fraud scheme that led to more than $1 billion in false claims to Medicare and other federal healthcare programs.
“This just sentence is the result of one of the largest telemarketing Medicare fraud cases ever tried to verdict,” Acting Assistant Attorney General Matthew R. Galeotti of the Justice Department’s Criminal Division, said in a Dec. 22 news release from the U.S. Department of Justice.
Here are five things to know:
- Gary Cox, 79, of Maricopa County, was convicted of operating an internet-based platform — Power Mobility Doctor Rx, known as DMERx — that generated false and fraudulent physicians’ orders for medically unnecessary orthotic braces, pain creams and other items. Prosecutors said Medicare and other insurers paid more than $360 million based on those claims.
- Mr. Cox and his co-conspirators targeted hundreds of thousands of Medicare beneficiaries through misleading mailers, television advertisements and calls from offshore call centers. The beneficiaries provided personal information and agreed to receive items they did not medically need.
- The DMERx platform connected durable medical equipment suppliers, pharmacies and marketers with telemedicine companies that paid physicians to sign off on the fraudulent orders based on little or no interaction with patients. The suppliers and pharmacies paid illegal kickbacks in exchange for the signed orders and then submitted claims totaling more than $1 billion.
- Mr. Cox and his co-conspirators concealed the scheme using sham contracts and by removing what one co-conspirator described as “dangerous words” from the physicians’ orders that might trigger Medicare audits.
- In June 2025, Mr. Cox was convicted of conspiracy to commit healthcare fraud and wire fraud, three counts of healthcare fraud, conspiracy to pay and receive healthcare kickbacks, and conspiracy to defraud the United States and make false statements in connection with healthcare matters.
The FBI, the HHS Office of Inspector General, the Department of Veterans Affairs Office of Inspector General and the Defense Criminal Investigative Service investigated the case.
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