SNF will pay $28 million to settle fraud, neglect lawsuits

A New York skilled nursing facility has agreed to pay $28 million and implement reforms to settle a lawsuit alleging fraud, neglect and criminal conduct from the facility's owners and staff.
A New York skilled nursing facility has agreed to pay $28 million and implement reforms to settle a lawsuit alleging fraud, neglect and criminal conduct from the facility's owners and staff.

A New York skilled nursing facility has agreed to pay $28 million and implement reforms to settle a lawsuit alleging fraud, neglect and criminal conduct from the facility's owners and staff.

A civil lawsuit claimed the owners of Medford Multicare Center in Medford, NY “looted the corporation” by cutting staffing and service and diverting Medicaid funds to themselves, New York Attorney General Eric Schneiderman said in a Wednesday press release. The suit also alleged criminal conduct from the facility's staff.

Medford's former administrator, along with three nurses and two respiratory therapists, were convicted on an array of charges relating to the 2012 death of Aurelia Rios, a short-term rehabilitation resident who died after staff failed to attach her to a ventilator before she went to bed. The administrator, David Fielding, was sentenced to 7 days in jail; other employees received jail sentences ranging from nine months to 45 days.

In addition to the settlement, Medford was also sentenced as a corporation Wednesday for attempted falsifying of business records in Fielding's coverup of Rios' death. The company was fined an additional $10,000 for the coverup.

“Nothing is more important than securing the safety of those in nursing home facilities, yet, as alleged in our complaint, Medford owners continued to line their pockets with millions in public funding while Medford cut staffing, services and supervision, shirking the duty of caring for some of our most vulnerable citizens,” Schneiderman said. “This settlement sends a clear message that those who profit from Medicaid at the expense of nursing home residents will be held accountable.”  

A call for comment to Medford's administration was not returned by press time Thursday.

As part of the settlement Medford will have to return $10 million in restitution to Medicaid, and implement a series of reforms including:

  • Retaining an independent operator to recommend care improvements and manage the facility's compliance for five years

  • Hire full-time nursing staff, supervised by registered nursing supervisors, to maintain proper staffing levels for seven years and reduce the facility's reliance on agency nursing staff

  • Hold ongoing care training programs for staff

  • Hire a full-time, permanent compliance and risk management officer to oversee the facility's compliance program

The settlement funds will be used, in part, to create a resident care fund that will be used to fund care recommendations by the independent operator. That fund will also require Medford to hire and retain an independent financial monitor, Schneiderman said.