Patrick Cassells, the Texas owner of three durable medical equipment (DME) companies, has been sentenced to 90 months in federal prison for his role in a $59.9 million Medicare fraud scheme.
The sentence follows his June 2024 guilty plea to conspiracy to commit health care fraud in the Southern District of Texas.
The case, announced by the U.S. Department of Justice, highlights ongoing federal scrutiny of health care providers and the critical importance of robust compliance programmes for medical supply businesses.
What Happened
Court filings show that Patrick Cassells, 65, of Fulshear, Texas, operated three durable medical equipment (DME) companies and intentionally concealed his ownership of one by falsely listing another individual as the owner in a Medicare enrolment application.
Leading up to 2024, he paid kickbacks to co-conspirators who provided signed doctors’ orders and other documentation used to bill Medicare for orthotic braces, including knee, back, shoulder, and wrist braces.
The orders were issued without actual patient examination or treatment, yet Cassells submitted claims asserting the medical necessity of the equipment.
The scheme generated $59.9 million in false claims to Medicare, of which the programme paid more than $27 million. Some proceeds were used to purchase personal vehicles and vehicles intended for export to Nigeria.
Overall, Cassells created a system in which fraudulent claims were disguised as legitimate marketing leads and medical orders, exploiting procedural gaps in Medicare enrolment and reliance on documentation provided by third parties.
Government Case and Penalties
According to the Department of Justice, Patrick Cassells’ conduct involved a deliberate attempt to defraud Medicare through kickbacks and misrepresentation of medical necessity.
In announcing the sentence, Assistant Attorney General A. Tysen Duva noted the case as part of the Criminal Division’s ongoing enforcement efforts against health care fraud.
U.S. Attorney Nicholas J. Ganjei and other DOJ officials highlighted that multi-agency coordination, including the Department of Health and Human Services Office of Inspector General (HHS-OIG), the FBI, and the Texas Medicaid Fraud Control Unit, was key to uncovering the scheme.
Cassells was convicted on one count of conspiracy to commit health care fraud and sentenced to 90 months in prison. He was also ordered to pay $25,402,614.97 in restitution. Additionally, the court ordered the forfeiture of specific assets, including four vehicles and three Houston-area properties.
No additional charges or civil actions are noted in the DOJ release. His June 2024 guilty plea established criminal liability, and sentencing has now been completed.
Why This Matters for Business
For executives and legal teams, the case highlights several risk and compliance lessons:
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Ownership and Disclosure Controls – Concealing ownership or misrepresenting it in enrolment documentation increases exposure to federal enforcement.
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Kickback and Payment Practices – Payments to intermediaries for documentation, even if described as marketing, may constitute illegal kickbacks.
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Medical Necessity Documentation – Submitting claims without actual patient assessment creates direct liability under federal health care fraud statutes.
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Asset Exposure – Restitution and forfeiture demonstrate that personal and corporate assets can be seized to satisfy penalties.
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Cross-Agency Enforcement – Multi-agency investigations show that internal controls must anticipate coordinated scrutiny from federal and state regulators.
These lessons provide practical guidance for compliance officers and legal teams seeking to mitigate risk and strengthen controls in federally billed health care programmes.
Enforcement and Resolution
Based on the DOJ release, this case reflects the continuing operation of the Health Care Fraud Strike Force Program, which since March 2007 has charged over 6,200 defendants responsible for more than $45 billion in billings to federal health care programmes.
The case signals sustained federal focus on durable medical equipment providers and fraudulent billing practices, particularly involving kickbacks and misrepresentation of medical necessity.
Sentencing has been completed, and the DOJ notes that the investigation concluded with this conviction and the associated restitution and forfeiture. No further proceedings or broader industry trends are indicated in the release.
Case Details
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Court: U.S. District Court for the Southern District of Texas (Houston Division)
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District: Southern District of Texas
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Case posture: Sentencing completed following guilty plea
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Lead investigative agencies: HHS-OIG Dallas Region, FBI Houston Field Office, Texas Medicaid Fraud Control Unit
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DOJ components: Criminal Division Fraud Section, Southern District of Texas U.S. Attorney’s Office
- Date of announcement: 9 March 2026
People Also Ask
Who is Patrick Cassells and what was he convicted of?
Patrick Cassells is a 65-year-old Texas resident who owned three durable medical equipment (DME) companies. He pleaded guilty in June 2024 and was convicted of conspiracy to commit health care fraud related to submitting false Medicare claims.
How much restitution and forfeiture did Patrick Cassells face?
Cassells was ordered to pay $25,402,614.97 in restitution and forfeiture. He also forfeited four vehicles and three properties in the Houston area.
What agencies investigated the $59M Medicare fraud case?
The investigation was conducted by the Department of Health and Human Services Office of Inspector General (HHS-OIG), the FBI Houston Field Office, and the Texas Medicaid Fraud Control Unit.