A former owner of two telemedicine companies has been sentenced to two years in federal prison for his role in a $110 million Medicare fraud scheme involving medically unnecessary durable medical equipment, including back and knee braces.
Steven Richardson, 42, was sentenced in federal court in Boston on August 20 and will serve two years of supervised release after his prison term. He previously pleaded guilty in April 2024 to conspiracy to commit health care fraud.
The case centered on a system that connected Medicare beneficiaries, telemarketing companies, medical staffing companies and DME suppliers. According to the Justice Department, Richardson’s companies helped generate medical orders that were then used to support Medicare claims for equipment that beneficiaries did not medically need.
The key numbers behind the case
| Detail | What investigators found |
|---|---|
| $110 million | Size of the Medicare fraud scheme |
| March 2016–January 2023 | Period covered by the scheme |
| 2 companies | Expansion Media and Hybrid Management Group |
| 42 | Richardson’s age at sentencing |
| 2 years | Federal prison sentence |
| 2 years | Supervised release |
| April 2024 | Richardson pleaded guilty |
| February 2024 | Richardson was charged |
| DME involved | Including back and knee braces |
The scheme operated for nearly seven years, according to federal prosecutors. Richardson used Expansion Media and Hybrid Management Group to work with telemarketing companies that targeted Medicare beneficiaries.
How the Medicare scheme allegedly worked
The operation did not rely on a single company. Instead, different businesses played different roles in producing and moving the medical orders.
1. Telemarketers targeted Medicare beneficiaries
Telemarketing companies generated leads by contacting Medicare beneficiaries.
Richardson’s companies then entered business relationships with those telemarketers. The telemarketers paid Expansion and Hybrid on a per-order basis to generate DME orders for the beneficiaries.
That created a financial incentive tied directly to the number of medical orders produced.
2. Medical orders were prepared before the examination
Richardson worked with medical staffing companies to locate doctors and nurses willing to review and sign prepopulated DME orders.
According to the DOJ, those providers typically had no contact with the beneficiaries.
The records nevertheless falsely represented that the medical providers had conducted legitimate examinations.
That became a critical part of the scheme: paperwork was created to make the DME orders appear medically supported.
3. Signed orders moved through the network
After the orders were signed, Richardson provided them to the telemarketing companies.
Those companies then sold the signed orders to DME suppliers.
The suppliers could use the documentation to submit claims to Medicare.
According to prosecutors, Richardson knew the suppliers would use the orders to seek Medicare reimbursement for equipment that was medically unnecessary. The claims were also allegedly supported by false documentation and tainted by kickbacks.
Back and knee braces were among the equipment involved
The scheme involved durable medical equipment, or DME, including orthotics such as back braces and knee braces.
DME can be legitimately covered by Medicare when it meets applicable coverage and medical-necessity requirements. The issue in this case was the alleged use of medical orders and documentation to obtain reimbursement for equipment that prosecutors said beneficiaries did not medically need.
The distinction is important because the case was not about telemedicine itself. It was about using a telemedicine-related business structure and medical-order process to facilitate fraudulent Medicare billing.
Why the order-generation process mattered
The case illustrates how several separate parts of the healthcare system could be connected.
A simplified version of the alleged flow was:
Medicare beneficiary → telemarketing lead → telemedicine DME order → medical provider signature → telemarketing company → DME supplier → Medicare claim
The problem, according to the government, was that the medical documentation did not reflect genuine examinations and the resulting orders were used for medically unnecessary equipment.
Richardson’s companies were at the center of the order pipeline
Richardson was the former owner of Expansion Media and Hybrid Management Group.
Rather than operating as DME suppliers themselves, the companies participated in the process that generated the orders later used by suppliers to bill Medicare.
Federal prosecutors said Richardson knew the DME suppliers would use the signed orders to submit claims based on false documentation.
The operation continued from March 2016 through January 2023, covering a period of almost seven years before it ended.
From federal charge to sentencing
The federal case moved through several stages.
Richardson was charged in February 2024 with conspiracy to commit health care fraud. Two months later, in April 2024, he pleaded guilty to the charge.
The charge carried a statutory maximum of up to 10 years in prison, along with potential supervised release and financial penalties. His eventual sentence was two years in prison followed by two years of supervised release.
Multiple federal agencies investigated the case
The sentencing announcement involved several federal agencies, including:
- HHS Office of Inspector General
- Federal Bureau of Investigation
- U.S. Postal Inspection Service
- U.S. Department of Labor
- Defense Criminal Investigative Service
- U.S. Attorney’s Office for the District of Massachusetts
The case was prosecuted by Assistant U.S. Attorneys Alexandra Brazier and Lindsey Ross of the Affirmative Civil Enforcement Unit.
The bigger Medicare fraud concern
The Richardson case shows why fraudulent DME billing can involve much more than a supplier submitting an improper claim.
The alleged operation connected beneficiary targeting, order generation, provider signatures, medical documentation and DME billing into one pipeline.
For Medicare, that creates multiple points where false information can enter the claims process.
The case also follows other federal DME and telemedicine prosecutions in Massachusetts. In 2023, another telemedicine company owner pleaded guilty in a separate $44 million Medicare fraud case involving medically unnecessary DME and genetic testing, using a similar order-generation structure involving telemarketing companies, medical staffing companies and DME suppliers.
That separate case is useful context, but it should not be presented as part of Richardson’s $110 million scheme.
What Medicare beneficiaries should take away
Medicare beneficiaries should be cautious when contacted unexpectedly about medical equipment, particularly when a caller pushes them to accept braces or other equipment they did not request or discuss with their healthcare provider.
A beneficiary should not assume that an order is legitimate simply because someone says it has been approved by a doctor or is covered by Medicare.
The Richardson case demonstrates how fraudulent operations can use legitimate-looking medical documentation to make unnecessary equipment appear appropriate for Medicare billing.
The bottom line
A federal court has sentenced former telemedicine company owner Steven Richardson to two years in prison after he pleaded guilty to his role in a $110 million Medicare fraud scheme.
The case involved a network that allegedly turned Medicare beneficiary leads into DME orders through prepopulated paperwork and provider signatures, before those orders were passed to suppliers for Medicare billing. The operation ran from 2016 to January 2023, and Richardson will serve two additional years of supervised release after his prison sentence.
