Florida DME operators sentenced in $34.8 million brace fraud scheme
Sep 6, 2026 edition · GC-2026-0027 · Published 2026-09-06 · Version 2 · Final
Two Florida DME operators received prison sentences after guilty pleas in a $34.8 million brace-fraud scheme that used paid false orders and shifted billing among related suppliers.
What happened
DOJ announced September 4, 2026 sentences of 33 months for Kenneth Charles Kessler III and 24 months for Michael Andrew Gomez. Both had pleaded guilty in May to conspiracy to commit health care fraud. They owned and operated seven Florida durable medical equipment companies that billed Medicare for medically unnecessary orthotic braces, including braces beneficiaries neither needed nor requested. The $34.8 million figure describes the fraudulent billing scheme, rather than a statement that either individual received that amount personally.
According to the court-document account in the announcement, the operators paid kickbacks and bribes for fraudulent signed physician orders and used those orders to ship braces nationwide. They shifted billing among their companies to evade Medicare payment suspensions. DOJ reported that Kessler profited more than $1.4 million and Gomez more than $2.3 million. The related-company structure and order-generation process are distinct elements of the admitted scheme: checking only a supplier's current billing identity would not address the mechanism DOJ described. These are facts of the resolved criminal case, not a new rule changing DME coverage requirements.
Scope and timing
- Authority status
- Final
- Applicability
- Operationally relevant
- Audience
- Health systems, Provider networks
- Jurisdiction
- Federal
Why it matters
DME fraud review needs to connect ownership, order sources and beneficiary receipt across related supplier identities, especially after payment suspensions.
Recommended action
Review DME supplier relationships, paid referral arrangements, individualized order authenticity and beneficiary receipt. Investigate billing shifts among related entities when suspension or other fraud alerts arise.
Case details
- agencies
- DOJ
- entities
- Kenneth Charles Kessler III, Michael Andrew Gomez
- action Type
- Criminal resolution
- event Date
- 2026-09-04
- alleged Conduct
- Medicare billing for unnecessary braces using kickbacks and fraudulent orders; billing shifted between supplier entities.
- resolution
- Prison sentences announced following guilty pleas; the $34.8 million figure is scheme billing, not the amount of a fine.
Operational lessons
- Validate referrals and orders independently.
- Monitor related supplier entities and payment suspension evasion.
Sources
- Florida DME fraud sentencing announcementOfficial · U.S. Department of Justice · 2026-09-04 · Source review 2026-09-06
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