Medical Supply Company Owner Sentenced to 14 Years in Sham Telemedicine Equipment Fraud

Federal prosecutors have built a long running case type around telemarketing driven health care fraud that runs on the machinery of telehealth: a call center recruits Medicare beneficiaries, a telemedicine company produces signed orders, and a supplier bills a federal program for equipment the patient never needed. A sentencing in the Middle District of Florida this month put a 14 year prison term on the supply side of one such operation.

What Loftis was convicted of doing

According to court documents and evidence presented at trial, Dr. Mark Loftis, 39, of Cushing, Oklahoma, ran the scheme through a durable medical equipment company, Back Pain Home Supplies LLC, doing business as EZ Medical Supply and based in Drumright, Oklahoma. A federal jury in the Middle District of Florida convicted him in July 2026, after a 12 day trial, of conspiracy to commit health care fraud and wire fraud. Loftis is a chiropractor and the owner of the business, not a telemedicine clinician who signed the orders.

Prosecutors said Loftis concealed from Medicare who owned and managed the company, including a co-conspirator's management role, and hid that businesses not enrolled in Medicare were submitting claims through it. That concealment let the operation keep billing federal programs while its true structure stayed out of view.

How the scheme worked

Court documents describe a chain that began with marketing, not with patients seeking care. Loftis paid over $1 million in illegal kickbacks, including through a shell marketing company, to marketers, purported telemedicine companies, and a call center that persuaded elderly and disabled Americans to hand over personal and health insurance information. Loftis and his co-conspirators then purchased sham doctors' orders for orthotic braces, continuous glucose monitors, and other equipment that were generated by telemedicine doctors and nurse practitioners who never examined, and often never spoke to, the beneficiaries.

Those orders became the paper that made the claims look legitimate. Loftis and his co-conspirators submitted over $30 million in false and fraudulent claims and were paid over $8 million. Prosecutors said the company frequently billed for multiple orthotic braces at a time, including one example of eight braces for a single beneficiary.

According to the Justice Department, the scheme ran for three years despite a steady stream of complaints from beneficiaries and their families, including reports that elderly parents suffered from dementia and Alzheimer's disease, which made them especially vulnerable to the sales tactics used.

The sentence and penalties

On October 8, 2026, the court sentenced Loftis to 14 years in federal prison. He was also ordered to pay over $8 million in restitution and to forfeit over $560,000. At the time of his conviction, the counts carried a maximum of 20 years.

Where the telehealth piece fits

The telehealth layer matters to prosecutors because it supplies the clinician signature that makes a durable medical equipment claim payable. In this structure a sham order is a commodity the supplier buys, detached from any genuine patient encounter. That is a different thing from a telehealth visit a patient seeks out, where a clinician the patient chose performs a real evaluation and any resulting order follows from it.

Why this matters for telehealth patients

Cases like this are charged as fraud against Medicare and military health programs, not as a verdict on telehealth itself. The conduct here started with a marketer and a call center and ended with a signature that no patient relationship stood behind. A patient initiated telehealth visit, by contrast, starts with the person who wants care. For a related sentencing of the physician side of a similar scheme, see our coverage of an Idaho physician sentenced in a telemedicine Medicare fraud case.

Signs of a durable medical equipment fraud pitch

This is general information, not legal or medical advice, but federal agencies have repeatedly flagged a few common markers of these schemes:

• An unsolicited call, text, or ad offering free braces, continuous glucose monitors, or other equipment, especially if it asks for your Medicare, TRICARE, or CHAMPVA number.
• Pressure to accept equipment you did not ask about and your own clinician did not recommend.
• Orders signed by a doctor or nurse practitioner you never actually spoke with.
• Marketers who stress that the item is free or fully covered by a federal program.

The broader enforcement picture

HHS-OIG, the FBI, the Defense Criminal Investigative Service, and the VA Office of Inspector General investigated the case, and the Justice Department's National Fraud Enforcement Division Health Care Fraud Section prosecuted it. The presence of TRICARE and CHAMPVA in the billing is why the Defense and Veterans Affairs inspectors general took part: those programs serve service members, military families, and veterans. The Justice Department ties the case to its Health Care Fraud Strike Force Program, which it says has charged more than 6,200 defendants who collectively billed federal programs and private insurers more than $45 billion since 2007. For patients and for the telehealth industry, the signature at the center of these cases is exactly where enforcement now focuses.