Note to providers: Go down swinging or get eaten alive

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James M. Berklan
James M. Berklan

Conventional wisdom says to stay away from bears when you see them in the wild. But I learned long ago in wilderness first aid training that sometimes that doesn't work out. Sometimes, the bears come looking for trouble and attack — whether or not you merit such attention.

That's when you have to scrap like hell, thrash about and do anything you can to cause a ruckus and save yourself.

What does this have to do with long-term care providers? Possibly everything.

That's the case for one Maryland former provider that finds itself pursued by government officials who have at least maimed the former operator already. 

On Tuesday, he took one on the chin when the Maryland Court of Appeals ruled 7-0 that the state's attorney general may, in fact, seek a court order blocking involuntary discharge of skilled nursing residents — as long as it can be proved that one resident was illegally evicted. As a result, the case will drop back to a circuit court for further adjudication.

The focus is Neiswanger Management Services LLC, the former operator of four remaining Maryland nursing facilities. Attorney General Brian E. Frosh claims that NMS wrongly discharged more than 1,000 residents so that more lucrative payers could be brought in.

While authorities say NMS was involved in excessive, callous "patient dumping," some observers believe Frosh political ambitions are at the heart of zealous prosecution. Certainly NMS owner Matt Neiswanger is in that camp.

Last March, he filed a lawsuit against state officials, claiming “regulatory assault.” While such a “1983” claim (named after a section of legal code) is not often filed, nor won, Neiswanger clearly feels he is on firm footing.

His legal team is seeking compensatory and punitive damages for allegedly biased actions carried out by the executive director of the state's Office of Health Care Quality, the secretary of the Maryland Department of Health and Mental Hygiene, and two state surveyors.

Neiswanger claims regulators dragged their feet in dealing with NMS corrective measures, applied extra surveyors and hours at his facilities, and told investigators to make sure they could cite the operator for some kind of wrongdoing.

The case reminds me of a dispute that took place for over a decade in upstate New York. I still recall Brook Chambery calling to tell me about how unfairly regulators targeted his operations and forced him out of business, leading him to almost single-handedly battle the state. He claimed officials loaded him with penalties and then refused to rescind mistakes or adjudicate findings in a timely manner after he protested their findings and rules.

Chambery and his mother had their license revoked by the state and they were forced to close Beechwood Restorative Care Center in 1999, some 44 years after it opened.

He challenged state officials' in federal court and finally won a $25 million settlement in 2012.

Are the conditions the same for Neiswanger and NMS? Not exactly, but there are some similar mileposts. A judge, for example, ruled that the state wrongly banned admissions and ordered a reversal. Neiswanger believes personal vendettas are in play, partly because he's challenged officials openly.

It's the first time the attorney general of Maryland has pursued a False Claims Act complaint in this manner. If it can happen in Maryland, then it could happen in any state that has a patient-rights statute. Once one state tries it and succeeds, others are sure to follow.

Challenging discharge procedures and then trying to use that complaint retroactively to claim poor care and false billings should put a chill through any provider.

Neiswanger might not prevail in state court, but he's counting on his federal complaint to turn out better. He's fighting with all he has — causing a legal ruckus, if you will — to save what he can.

Some lessons are clear here. One, make sure your documentation is accurate, timely and complete.

Next, know that even as the prey, you can get compensation if you feel you're unfairly targeted.

In brief, if you feel like you're getting picked on, you should fight back.

Before this is all over, industry watchers could be in for some very interesting sparring, and a valuable education.

Follow Editor James M. Berklan @JimBerklan.

Daily Editors' Notes

McKnight's Daily Editors' Notes features commentary on the latest in long-term care news and issues. Entries are written by Editorial Director John O'Connor, Editor James M. Berklan, Senior Editor Elizabeth Newman and Staff Writer Marty Stempniak.

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