An Arizona man will spend the next 15 years in federal prison after orchestrating a massive telemarketing scheme that attempted to drain more than $1 billion from Medicare and other federal health programs.
Gary Cox, 79, of Maricopa County, was sentenced Friday for his role as the architect behind Power Mobility Doctor Rx, LLC (DMERx). In addition to the prison term, the court ordered Cox to pay more than $452 million in restitution.
The sentencing culminates a case that federal prosecutors described as one of the largest telemarketing Medicare fraud schemes ever taken to trial.
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According to evidence presented in court, Cox used his platform, DMERx, to connect corrupt marketers and medical equipment suppliers with doctors willing to sign fraudulent orders in exchange for kickbacks. The operation targeted hundreds of thousands of elderly beneficiaries, flooding them with misleading TV ads, junk mail, and spam calls offering unnecessary orthotic braces and pain creams.
Prosecutors revealed that the “medical treatment” behind these orders was virtually non-existent. Doctors paid by the scheme signed off on prescriptions after only brief phone calls with patients, or in some cases, with no interaction at all.
To keep the money flowing, Cox and his co-conspirators actively hid their tracks. Evidence at trial showed the group utilized sham contracts and scrubbed doctors’ orders of what one insider termed “dangerous words”—language they feared would trigger red flags and audits from Medicare.
While the group billed insurers more than $1 billion, the actual financial damage was severe. Medicare and other insurers paid out over $360 million on the fraudulent claims.
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“Telemedicine scammers who use junk mailers, spam calls and the internet to target senior citizens steal taxpayer money and harm vulnerable populations,” said Acting Assistant Attorney General Matthew R. Galeotti. “This just sentence is the result of one of the largest telemarketing Medicare fraud cases ever tried to verdict.”
Christian J. Schrank, Deputy Inspector General for Investigations at the HHS-OIG, called the operation a “massive betrayal of trust” built on greed.
“This sentence sends a clear message: those who exploit telemedicine to prey on seniors and steal from taxpayer-funded health care programs will be held accountable,” Schrank said.
Cox was convicted in June 2025 on multiple charges, including conspiracy to commit health care fraud, wire fraud, and conspiracy to pay and receive health care kickbacks. The investigation was a joint effort by the FBI, HHS-OIG, the Department of Defense’s Office of Inspector General, and the DCIS.
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