Judge orders SNF owner charged in $1 billion fraud ring to be held without bond

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A Florida nursing home operator charged as the ringleader of a record-setting Medicare fraud scheme will continue to be held without bond, a federal judge said in a final ruling issued last week.

Philip Esformes, 47, was arrested in July along with two others on allegations that he illegally shuffled residents in and out of his facilities, billed Medicare for unqualified residents and received kickbacks to refer beneficiaries to mental health and home healthcare providers.

Miami U.S. District Judge Joan Lenard's order last Wednesday to keep Esformes detained comes amid several pleas from family, friends and residents in support of the operator. Esformes' team has proposed he stay under home confinement until his trial, with 24-hour monitoring paid out of his own pocket.

Prosecutors have argued that Esformes may try to obstruct justice or flee the country if he were released, citing a recently released transcript of a conversation between Esformes and a medical supply company owner Guillermo Delgado. The transcript reportedly details Esformes' plan to fund the Delgado's flight out of the United States in order to avoid trial, backing up prosecutors' attestations that Esformes himself is a flight risk, the Chicago Tribune reported Tuesday.

“Mr. Esformes stands by his lifelong record of hard work and success, of providing quality service to people in his nursing homes, and of helping persons in need,” attorney Michael Pasano told the Tribune. “He adamantly denies any wrongdoing and promises to fight vigorously to show the truth behind the lies being brought against him."

Pasano added that the transcript of the discussion between Esformes and Delgado was misinterpreted by the Department of Justice, and that Delgado fabricated claims against Esformes.

In addition to the transcript, recent court filings add claims of corruption and resident harm to the case against the operator, including an incident where Esformes allegedly told a colleague to “bribe a state regulator” to find out which facilities were slated for inspections, and “modify and falsify files at his facilities before state regulators inspected."

The DOJ's case against Esformes currently ranks as the largest single criminal healthcare fraud case ever brought against individuals.