BOSTON—The owner of Expansion Media (Expansion) and Hybrid Management Group (Hybrid) plead guilty on April 3 in connection with a $110 million telemedicine fraud scheme involving medically unnecessary durable medical equipment (DME), including orthotics such as back and knee braces.
Steven Richardson, 40, of Parkland, Florida, pleaded guilty to one count of conspiracy to commit health care fraud. U.S. District Court Judge Nathaniel M. Gorton scheduled sentencing for July 18, 2024. Richardson was charged by Information in February 2024.
Between March 2016 and January 2023, Richardson, through his companies Expansion and Hybrid, entered into business relationships with telemarketing companies that generated leads by targeting Medicare beneficiaries. The telemarketers then paid Expansion and Hybrid on a per-order basis to generate orders for DME for these beneficiaries. To arrange for these orders to be signed, Richardson worked with medical staffing companies—including one in Massachusetts—to find doctors and nurses who were willing to review and sign prepopulated orders, typically without any contact with the beneficiaries. The records falsely portrayed the medical providers as having performed a legitimate examination of the beneficiary. Richardson then provided the signed orders to the telemarketing companies, which sold the orders to DME suppliers. Richardson knew that these DME suppliers would use the signed orders to submit claims to Medicare for DME that was medically unnecessary, based on false documentation and tainted by kickbacks.
The charge of conspiracy to commit health care fraud provides for a sentence of up to 10 years in prison, supervised release for up to three years and a fine of up to $250,000 or twice the gross gain or loss, whichever is greater. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes that govern the determination of a sentence in a criminal case.
