A federal judge rejected a skilled nursing executive’s appeal to overturn his 15-year exclusion from Medicare, ruling that his staffing decisions were a “straightforward” obstacle to routine checks that could have saved three residents’ lives.
The Department of Health and Human Services Office of Inspector General originally excluded Chaim Charles Steg after three residents of his nursing home died from complications from serious injuries.
A grand jury found those injuries could have been avoided if longstanding staffing deficiencies had been addressed at St. Francis Center for Rehabilitation and Healthcare in Darby, PA, where Steg was the regional director of operations.
Steg pleaded no contest to three counts of Recklessly Endangering Another Person in 2021.
In the June ruling, which was unearthed by the Center for Medicare Advocacy last week, Judge Steven Kessel cited a probable cause affidavit connecting Steg’s management to the resident deaths at the nursing facility.
“Despite making multi-million dollar annual profits… [Steg], as Regional Director of Operations at St. Francis, recklessly chose not to adequately invest in adequate staffing and did not adjust other operational factors within his control to mitigate the ongoing staffing crisis. St. Francis was understaffed on a daily basis for months at a time and much of the staff that they did have was inexperienced and not sufficiently trained,” the affidavit said.
Kessel emphasized that Steg was aware of staffing and resident neglect concerns at St. Francis and could have taken reasonable action to fix them.
“The allegations that are the basis for Petitioner’s nolo contendere plea thus draw a straightforward connection between Petitioner’s actions and the deaths of three residents at St. Francis,” the ruling stated. “His decisions as Regional Director of St. Francis had a direct impact on the neglect suffered by the residents. Those decisions were also directly related to the delivery, or in this case, the non-delivery, of health care services to the residents.”
Multiple employees testified that they had tried to address the staffing problems but encountered resistance from Steg, including instructions to further reduce staff.
In his appeal, Steg claimed he never admitted to resident neglect or abuse and that any crimes he’s accused of are unproven.
Kessel disagreed, explaining that Steg’s no contest plea has the same meaning for his case as a guilty plea or conviction.
“The facts and conclusions delineated in the probable cause affidavit describe exactly the crimes of which [Steg] was convicted. He may not now wish them away by asserting that he merely pled nolo contendere to them,” the ruling explains. “While the defendant may not admit his guilt, he is barred legally from denying it as well.”
A settlement coinciding with Steg’s no contest plea required St. Francis to hire more staff and undergo quarterly audits from the Pennsylvania Department of Health to ensure compliance.
