South Carolina Nursing Home Blog : South Carolina Nursing Home Lawyer & Attorney : Poliakoff & Associates Law Firm : Elderly Care, Senior Care

Seattle PI reported the arrest of Gloria Corpuz Hall who was the operator of a Federal Way home for the elderly.  She is facing felony theft charges on allegations that she stole thousands of dollars from a deceased resident.  Prosecutors contend Gloria Corpuz Hall stole $21,775 from the accounts of an elderly woman who had been living at Hall's adult family home, Liberty Adult Care.

According to charging documents, Hall -- a 54-year-old Federal Way resident also known as Gloria Castillo Corpuz -- began drawing money from the woman's accounts months after her death on Jan. 21.  A review of the woman's bank statements, the detective continued, showed Hall had transferred money or forged checks on the woman's accounts at least 20 times.

Hall is alleged to have admitted to the thefts when confronted by police. Writing the court, the Federal Way detective said Hall complained that "she was behind on her mortgage and needed the money."  Charged with only one count of first-degree theft, Hall has not been jailed in the case
 

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New Jersey Newsroom had an article about nursing home operator Victor Napenas pleading guilty to Medicaid Fraud.  Napenas owned Valley Rest Nursing Home in New Jersey.  A state investigation discovered that he billed the Medicaid program for $302,877 in improper and unsubstantiated costs, including more than $100,000 in personal expenses.  The investigation began when state Department of Health and Senior Services (DHSS) surveyors noted severe deficiencies in the care delivered to residents.  The investigation discovered that the cost report included at least $302,877 in improper charges, including personal expenses and other amounts Napenas could not document or prove were spent for patient care.  Napenas issued business credit cards to himself and his wife through the nursing home, which they used for personal purchases, including trips to the Philippines, dance lessons and large family dinners. Napenas had those credit card charges and other personal expenses totaling more than $100,000 inserted into the cost report, resulting in reimbursement from Medicaid.

In pleading guilty, Napenas admitted that he fraudulently obtained payment from Medicaid for personal expenses unrelated to patient care. Prosecutors will recommend that Napenas be sentenced to only 90 days in a county jail as a condition of three years of probation. He must pay $302,877 in restitution to the Medicaid program, $45,263 in penalties, and $31,859 in provider taxes owed to the state. He will be prohibited from acting as a Medicaid provider for eight years.   Why should he ever be allowed to be a health care provider?

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The Tennessean had an article about the arrest of Regina Jacobs.  The nursing home employee is charged with stealing more than $400,000 from the nursing home where she
worked for more than 10 years. I wonder how long it was going on?  How could she be so greedy?

Officers with the Tennessee Bureau of Investigation arrested her after she was indicted by the Wilson County grand jury on three counts of theft over $60,000, two counts of theft over $10,000 and one count of theft over $1,000.

In December 2008, the nursing home, Quality Care Health Center, finally discovered that Jacobs, a business office manager, had been cashing checks intended to cover patient costs and keeping the money.  An internal investigation and audit at the nursing home revealed that about 70 patients' accounts had been affected.

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The Wall Street journal had an interesting article about Omnicare's legal troubles.  Mr. Gemunder's was CEO of Covington, Ky.-based Omnicare, the nation's largest dispenser of pharmaceuticals to nursing homes serving 1.4 million beds in 47 states.  Obviously, Omnicare gets its profits from Medicare, Medicaid and health insurance.

Mr. Gemunder had been in charge since 1981, but recently retired with a large lump-sum pension payout.  He's getting a $91 million pension payout, plus severance, vesting of restricted stock  that bring his final payday to at least $130 million. And that's on top of the $14 million he bagged last year.

And what did the shareholders get for their money? Omnicare shares took a tumble last week after the company reported a shocking drop in the number of prescriptions it fills.

And what did the taxpayers and customers get? Omnicare has litigation costs amid evidence of kickback and billing schemes.  For example, in November 2009, Omnicare announced it would pay $98 million to settle a civil case brought by the Justice Department that it paid kickbacks to nursing homes and took kickbacks from pharmaceutical companies, including Johnson & Johnson. Omnicare also agreed to pay $49.5 million in 2006 to settle Medicare fraud claims. And last month, new details emerged in a continuing kickback lawsuit in Illinois.

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The Chicago Tribune had an article about new details in the OmniCare kickback scheme that included many of the country's for profit nursing home chains.  Omnicare — which supplies medicine to roughly 1.4 million nursing home residents in facilities across the U.S. and enjoys an 85 percent share of this market.  Court documents add new details to a whistle-blower lawsuit alleging that the giant pharmaceutical firm Omnicare Inc. paid kickbacks to Illinois' most prominent nursing home families.

The new filing, which contains 164 pages of internal company records and other documents, is intended to bolster pending civil allegations that Omnicare significantly inflated the purchase price it paid in 2004 for a pharmacy company purportedly controlled by Chicago nursing home operators Philip Esformes and his father, Morris Esformes.

Omnicare's $32 million purchase of that company, Total Pharmacy, included roughly $16 million that was a kickback to secure long-term pharmacy contracts with nearly three dozen nursing homes the Esformeses operated or controlled

The new documents include copies of handwritten notes from a March 2004 meeting at Morris Esformes' Lincolnwood headquarters between Omnicare CEO Joel Gemunder and Morris Esformes to discuss the sale of Total Pharmacy to Omnicare.   Gemunder offered to pay $15 million for Total Pharmacy if three-year contracts were in place with Esformes-controlled homes, $20 million if there were five-year contracts and $25 million if there were 10-year contracts. In the final sale, Omnicare paid the $25 million and let Total Pharmacy keep $7 million worth of accounts receivable, making the sale worth $32 million.

The new court filing also includes other handwritten notes taken two days after the meeting that allegedly show Morris Esformes agreed to backdate nursing home pharmacy contracts "in order to avoid the appearance of impropriety," according to the lawsuit.

Philip and Morris Esformes, who are listed as part-owners of 28 nursing homes in Illinois and Florida, and had ties to others in Missouri, have not been charged with any crime in the sale of Total Pharmacy.

The whitsle blowers include two industry insiders: pharmacy executive Maureen Nehls, who served as vice president of pharmacy operations for Total Pharmacy, and former health care dealmaker Adam Resnick, a consultant to Total Pharmacy at the time of the sale.

The Tribune in April reported that the Esformeses were embroiled in what prosecutors called a "horrific" patient-brokering scheme in which unsuspecting nursing home residents were shuttled to and from a local psychiatric hospital for unnecessary treatments. 

Government authorities in Boston have won settlements in federal court based on Resnick's information about other deals involving Omnicare and separate East Coast nursing home chains including Mariner and SavaSeniorCare owned and operated ath time by Murray Forman and Leonard Grunstein.

The False Claims Act allows private citizens to file lawsuits against companies and individuals defrauding the government and recover funds on the government's behalf.

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The Jackson Sun News had an incredible story about a nursing home who hired a woman with a long history of fraud and forgery.  Sheila Watson was arrested and charged with one count of identity theft, four counts of criminal simulation, four counts of forgery, one count of criminal impersonation and one count of theft over $1,000.  Watson was the social services director at Bells Nursing Home.  Watson is also an ex-convict who has used at least half a dozen different names in a long history of state and federal fraud, forgery and theft convictions.

The investigation into Watson — who has worked at the nursing home since July — began when the nursing home received a call from a state agency.  The investigation is still ongoing but "They said she did a great job and was a good employee," Klyce said. "We've looked at her computer and couldn't find any evidence at this point."

When the Sheriff's Department began investigating, authorities soon discovered Watson's job application was only the tip of the iceberg, he said:

She had borrowed money from the Bank of Crockett County using false documents. She was wanted in Iowa on charges of theft over $10,000. She was on probation but was using a different name and job description to report to her probation officer.

Watson was arrested as Sheila F. Hayes in November 2002 on federal charges of forgery, theft of property and identity theft, according to The Jackson Sun's archives.

She was accused of stealing mail from 135 victims in West and Middle Tennessee for the purpose of stealing identities and embezzling money. She later pleaded guilty to one count of mail theft and was sentenced to five years in prison and three years' probation.

At the time, the judge said Hayes had the highest criminal history score of any woman he had seen in his 20 years as a judge. The bulk of her prior convictions were for theft and fraud, but she was also convicted of escape from a Metro Nashville jail. Watson had charges stretching back to 1989, most of them in Middle and West Tennessee. She reported to a probation officer in Jackson under the name Sheila Hayes and told them she worked for a construction company.

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According to the AmLaw Daily, another disgruntled investor has filed a civil suit against Troutman Sanders, real estate partner Leonard Grunstein, and corporate partner Lawrence Levinson.   Also named as defendants are Murray Forman, an investment banker and business partner of Grunstein's, Harry Grunstein, the lawyer's brother, along with several entities created and controlled by the defendants that operate and control nursing home and health care investments.
The action comes after the three were named as defendants in a civil suit filed in state court in Manhattan by New York real estate investor Rubin Schron.

In this latest lawsuit, filed in New York State Supreme Court, plaintiff Allen Bodner accuses the defendants of legal malpractice and breach of fiduciary duty as part of a scheme to divest Bodner and a company he controlled of an interest in a lucrative health care and real estate venture.

Bodner's 54-page complaint claims Grunstein, the former head of Troutman's real estate capitalization and investment practice groups, "accounted for a substantial portion of the revenues of Troutman's New York office, much of which was attributable to the legal representation of Rubin Schron and companies associated with him."   Grunstein served as his attorney and was the "mastermind" and "legal architect" behind a series of transactions named in the complaint. Bodner further claims that Grunstein concealed his "conflicting personal financial interests" in several of those transactions, which allowed Grunstein and the other defendants to misappropriate "the real estate and health care assets" that were under the control of Bodner and his holding company.

According to a letter filed by Coles in the Schron suit, several firms have lined up advisory roles as the litigation expands. Arent Fox, Latham & Watkins, Atlanta's Arnall Golden Gregory, and New York's Brodegaard & Simone are representing several companies named as defendants in the dueling civil suits. Grunstein's brother, Harry, who now lives in Israel, has retained New York's Davidoff Malito & Hutcher, while Troutman and Levinson have turned to New York's Friedman Kaplan Seiler & Adelman.
 

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News4Jax had an article about a nursing home Administrator indicted for embezzlement, money laundering, credit card fraud and identity theft, accused of stealing hundreds of thousands of dollars from Riverview Nursing and Rehabilitation Center.  Mary Burroughs stole the money over a one-year period from the center, a nonprofit organization that received millions of dollars in federal funding.

"The U.S. Attorney's Office is committed to investigating and prosecuting financial fraud and regaining what victims of these crimes have lost," U.S. attorney Edward Tarver said in a news release.

According to the indictment, between May 1, 2009, and April 30, Burroughs used her position as administrator to cause Riverview to issue multiple checks from its Wachovia money market account to cash, which she then used to purchase cashier's checks made payable to Burrough's Heating & Air and others.  Burroughs embezzled more than $235,000 from the Riverview money market account.  In addition, the indictment says that Burroughs used a Riverview credit card in the name of an employee she had terminated to make thousands of dollars of unauthorized and personal charges.

The indictment also says that Burroughs, without permission or authority, had others rip out copper piping and other metal objects from a Riverview building to be sold as scrap metal.

The indictment charges Burroughs with five counts of stealing from a program receiving federal funds and one count of credit card fraud.  Finally, the indictment charges Burroughs with one count of aggravated identity theft, which requires a two-year consecutive prison sentence to any other sentence imposed.

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The Business Journal reported an incredible story about Sunrise Senior Living giving bonuses to executives who have lost $16 million in the last year.  This is what is wrong with Corporate America.  Sunrise takes taxpayer money through Medicaid and Medicare; provides poor care while stuffing their pockets, and then before declaring bankruptcy siphon the rest of the money by paying themselves bonuses for poor performance.. 

Sunrise Senior Living, Inc., is paying 2010 bonus payments to its executive officers, equal to one-third of their respective target annual bonus amounts, according to a filing with the Securities and Exchange Commission. The compensation committee of the company's board will pay CEO Mark Ordan $325,000, while CFO Julie Pangelinan and CIO Gregory Neeb will receive $133,333 each.

As stated in the SEC filing, the "compensation committee" awarded the bonuses to these executive for their “extraordinary work” during the recession. Sunrise reported a net loss of $16 million during the first quarter of 2010. The company is also in default on $241 million of debt.

All three executives remain eligible to receive the remainder of their 2010 bonuses at the discretion of the compensation committee.

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NorthJersey.com had an interesting article on CareOne, LLC which owns and operates dozens of nursing homes in New Jersey.  There have been multiple lawsuits and allegations of kickbacks, theft and sexually improper behavior between the executives.

Straus formed CareOne in 1999, and now has 29 facilities across New Jersey.  Through affiliates, it owns and operates another 37 facilities in eight states. The company is ranked 13th in the nation, by the number of nursing homes, and is one of the two largest in New Jersey, according to National Investment Center for the Seniors Housing & Care Industry (NIC), a Maryland-based research company.  Straus co-founded a Medicare managed care company, Aveta. CareOne is one of several of Straus companies, including a real estate management company and a pharmacy serving 27,000 patients a day, which together have revenue of about $1.2 billion and 15,000 employees.

CareOne and two related companies have accused William G. Burris Jr., a former executive vice president of construction and development, of conspiring to "convert, steal and embezzle millions of dollars." CareOne claims that Burris inflated vendor contracts in return for kickbacks, along with co-defendants that include his wife, his sister, another CareOne executive and five CareOne vendors.

Burris claims that the company wrongly fired him in retaliation for his effort to stop a pattern of sexual improprieties against female employees allegedly committed by CareOne owner Daniel E. Straus.  Burris alleges that at CareOne Straus pursued "romantic and physical relationships with female employees and tolerated similar conduct by others." It cites a 2006 suit filed by an employee who claimed that Straus created a sexually hostile environment at the company.  Burris alleges that CareOne fired him after he expressed concern to a corporate counsel about the claim by a female assistant that Straus had sexually harassed her in a restaurant.

The termination enabled the company to deny him the right to two ownership stakes in the company. One was a 0.8 percent share, which was worth about $3-6 million. The other was an interest held by his wife. Burris wants the court to restore his rights to both ownership stakes.

The company wants the court to rule that Burris' termination severed his ownership rights and that his wife's interest was never vested. The company also is seeking damages from Burris, and wants a full accounting and return of all money he obtained in his "wrongful conduct." The racketeering suit seeks compensation and triple damages for Burris' conduct.

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