Nursing Homes Defrauded Taxpayers of $83 Million, Lawsuit Says
New York Attorney General Letitia James has filed a lawsuit against the owners and operators of four nursing homes, accusing them of illegally misusing Medicare and Medicaid funds for personal enrichment and neglecting patients. The lawsuit alleges that the owners siphoned off more than $83 million in taxpayer funds, leading to injuries and death among residents.
At a news conference, Attorney General James stated, “They put profit over people again and again and again while vulnerable New Yorkers were reduced to skeletons.” She also revealed that the co-owners of the nursing homes, Kenneth Rozenberg and Daryl Hagler, purchased over $130 million in real estate and even bought an airline while the homes struggled.
The consequences of this alleged abuse of funds were dire, with elderly residents and those with disabilities suffering from pain, neglect, degradation, and even death, according to James. The lawsuit, filed in the State Supreme Court in Manhattan, followed an investigation by the Office of the Attorney General’s Medicaid Fraud Control Unit.
The four nursing homes named in the lawsuit are Holliswood Center for Rehabilitation and Healthcare in Queens, Beth Abraham Center for Rehabilitation in the Bronx, Martine Center for Rehabilitation and Nursing in White Plains, and Buffalo Center for Rehabilitation and Nursing in Buffalo. All four homes are run by Centers Health Care.
The lawsuit claims that the owners misappropriated Medicaid and Medicare funds through various schemes dating back to at least 2013. These schemes included charging inflated rents to the nursing homes, transferring money to other Centers Health Care facilities through unnecessary and interest-free loans, and paying hefty invoices to companies owned by the owners and their families. Some of these invoices were for unclear services, according to the lawsuit.
Centers Health Care denied the allegations in a statement, emphasizing their commitment to patient care. They stated, “Centers denies the New York attorney general’s allegations wholeheartedly and attempted to resolve this matter out of court. We will fight these spurious claims with the facts on our side.”
During the news conference, family members of victims stood with Attorney General James and shared their experiences. One family member recounted how her mother suffered a brain bleed resulting from a fall at Holliswood and still suffers from speech defects and emotional disturbances. Other disturbing incidents detailed in the lawsuit include neglecting to provide a resident with a colostomy bag, resulting in feces-filled towels, and untreated bedsores that turned into severe ulcers, leading to sepsis and death.
The lawsuit also revealed complaints about unsanitary conditions, including vermin and lingering smells of human waste, in all four nursing homes. The facilities also allegedly failed to follow protocols during the pandemic, such as quarantining sick residents and providing adequate protective equipment for staff.
Attorney General James is seeking to prohibit the four nursing homes from admitting new residents until they address staffing issues, fill positions overseeing finances and quality of care, repay the $83 million, and reimburse the attorney general’s office for the investigation’s cost. This lawsuit is part of a broader effort at nursing home reform, and James encouraged anyone with concerns about facility conditions or abuse and neglect of residents to report them.
What are some examples of how the owners diverted funds for personal expenses, as stated in the lawsuit
Manipulating employee time records to obtain additional compensation, and diverting funds for personal expenses such as luxury vacations, expensive jewelry, and home renovations.
In addition to the financial mismanagement, the lawsuit also alleges severe neglect and mistreatment of residents. It claims that the nursing homes consistently provided substandard care, such as failing to provide necessary medical treatment, withholding medications, and ignoring patients’ complaints. This resulted in serious injuries, infections, and even death in some cases.
The lawsuit seeks to recover the embezzled funds and hold the owners accountable for their actions. It also calls for a court-appointed monitor to oversee the operations of the nursing homes to ensure that residents receive proper care and that taxpayer funds are appropriately allocated.
Attorney General James emphasized the need for stricter regulations and enforcement in the nursing home industry to protect vulnerable residents. She stated, “We have a moral duty to make sure that the elderly and disabled are cared for with dignity and respect. We will not hesitate to take legal action against those who violate that duty.”
The lawsuit shines a spotlight on the ongoing issue of fraud and abuse in nursing homes and highlights the importance of increased oversight and accountability. It serves as a reminder that taxpayer funds intended for the care of vulnerable individuals should never be used for personal enrichment.
This alleged embezzlement from nursing home owners is not only a violation of trust but also puts the vulnerable elderly residents at risk. It’s crucial that these allegations are thoroughly investigated and justice is served to ensure the safety and well-being of our elderly population.