Well, it hit the fan. The Popoff camp went into damage control posthaste, passing out leaflets claiming that Randi was the spawn of the devil and so on. But he never got back on top. You can read all about it in James Randi's book, Faith Healers . It was a step, but a small one.
People still believe in droves, mainly because they're desperate.
But what's so terrible about this con, and that's all it is, is that so many people are seriously hurt by it. First, you have the ill person. If she is seriously ill, not only will the con not help her, but she may be missing some real treatment that might. And worse, she will be told, if she does not get better, that her faith was not strong enough. So she gets blamed for her own misery.