Between 2022 and 2024, Alexandra Gehrke and Jeffrey King of Phoenix, Arizona orchestrated one of the largest wound-care fraud schemes in U.S. healthcare history. Through companies including Apex Medical LLC and Viking Medical Consultants, the couple caused over $1.2 billion in false claims to be submitted to Medicare and other insurance programs for expensive amniotic wound grafts. Federal investigators found that the grafts were frequently medically unnecessary and applied to elderly or terminally ill patients, including hospice patients who were unlikely to benefit from the treatment. According to the U.S. Department of Justice, the couple relied on untrained sales representatives to locate vulnerable patients and then ordered large grafts regardless of whether they were medically appropriate, often billing for graft sizes far larger than the wounds themselves.

The scheme violated fundamental Medicare compliance standards and the medical necessity principles that guide Local Coverage Determinations (LCDs) for wound-care products. LCD policies exist to ensure that advanced treatments such as cellular and tissue-based grafts are used only when clinically appropriate and properly documented. In this case, investigators determined that financial incentives and illegal kickbacks drove clinical decisions rather than legitimate patient care. In October 2025, Gehrke was sentenced to 15.5 years in federal prison, and King received 14 years, with each ordered to pay more than $600 million in restitution. Cases like this demonstrate why strict adherence to Medicare coverage rules and documentation standards is essential. When providers ignore these requirements and allow profit to dictate treatment decisions, it not only creates massive waste and abuse in the healthcare system but also undermines the ethical duty to provide appropriate care to vulnerable patients.