SNF settles fraud, neglect suit for $28M

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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 by the facility's owners and staff.

A civil lawsuit claimed the owners of Medford Multicare Center in Medford, NY, “looted the corporation” by cutting staf ng and service and diverting Medicaid funds to themselves, New York Attorney General Eric Schneiderman said when announcing the settlement in June. 

The settlement “sends a clear message that those who profit from Medicaid at the expense of nursing home residents will be held accountable,” Schneiderman said. 

Medford made headlines in 2012 following the 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 facility's former administrator was sentenced to seven days in jail in connection with that incident, and three nurses and two respiratory therapists were convicted on multiple charges and received sentences ranging from 45 days to nine months in jail. 

The facility also was hit with an additional $10,000  fine in June for attempted falsification of business records in a bid to cover up Rios' death, authorities said.

Medford will have to pay $10 million in restitution to Medicaid as part of the settlement and implement a series of reforms, including retaining an independent operator to manage compliance for  five years, maintaining proper staffing levels for seven years and adding a full-time compliance and risk management officer to the staff. 

The facility also must hold ongoing care training programs for staff and ensure that the full-time nursing staff are managed by registered nursing supervisors. 

Settlement funds will be used to create a resident trust to fund care recommendations made by the operator, Schneiderman said.