Despite paying a $98 million settlement for kickback schemes, Omnicare managed to pull in 4th qtr profits over $80 million. Omnicare is the nation’s largest nursing home pharmacy.  See article here.   The financial results for its fourth quarter, reporting nearly tripled profits compared to the previous year after settling fraud allegations with the U.S. Justice Department as recently as last November.  See report here.

Omnicare paid a $98 million settlement in 2009 to end a Justice Department investigation that  the company engaged in kickback schemes with two Atlanta nursing homes involving pharmacy service contracts.

I guess fraud, kickbacks, and paying lobbyists is profitable.


The New York Times had an article about the Senate Finance Committee’s long overdue investigation into patient deaths and substandard treatment at long-term care hospitals, small specialty medical centers that treat chronically ill patients.  The committee oversees Medicare. The federal program spends almost $5 billion annually on the hospitals, providing about 60 percent of their total revenue.   This is a follow up to their article about the lack of oversight in LTC hospitals.

The investigation focuses on the Select Medical Corporation, a greedy for-profit corporation that runs 89 long-term care hospitals, more than any other company.   In a letter sent to Select’s chief executive, Robert Ortenzio, demanding that Select provide records about staffing levels and quality data at its hospitals including  policies for patient monitoring, emergency situations and staffing, including physician involvement at its hospitals and staff turnover. Former employees of Select have said that the company’s hospitals are understaffed and rely heavily on temporary nurses.
The letter is not a subpoena, but companies usually respond voluntarily to such requests for information.

The letter also requests that Select disclose information about its discharge policies. Former employees have also said that the company presses to keep patients for 25 days and then discharge them almost immediately, because patients are most profitable if they stay exactly 25 days under government reimbursement rules. At some Select hospitals, the 25th day is called the “magic day,” ex-employees say.

The Senate also asked that the Government Accountability Office, Congress’s investigative agency, examine federal and state oversight of all long-term care hospitals, saying that they worried the facilities might expose patients “to an unreasonable risk of harm.”

Unlike other specialized hospitals, including psychiatric or children’s hospitals, long-term care hospitals do not treat specific types of patients or offer services unavailable in regular medical centers. They are defined solely by the fact that they keep patients longer than other hospitals. They are also smaller than a typical hospital, averaging about 60 beds, and do not have emergency rooms.

The questions about long-term care hospitals center on the for-profit side of the industry, led by Select and Kindred Healthcare, another publicly traded company.

Robert Ortenzio and his father, Rocco, have collectively made $400 million (mostly from taxpayers)since founding the company,  State inspection reports and lawsuits paint a disquieting picture of the care that Select provides.  In 2007 and 2008, Select’s hospitals were cited at a rate four times that of regular hospitals for serious violations of Medicare rules.


Chicago Tribune ran an article about the federal investigation into another corrupt business scheme involving nursing home operators.  Dr. Roland Borrasi told co-workers he made cash payoffs to prominent nursing home operators in exchange for access to a lucrative pool of patients.  Federal prosecutors, who last year secured the conviction of Borrasi for taking more than $500,000 in kickbacks from Rock Creek, did not specify which nursing home operators Borrasi allegedly paid.  The article centers around the greedy Esformeses and their relationship to Borrasi.  The Esformeses were part of a group of "businessmen" that previously paid the U.S. Justice Department $15.4 million to settle civil claims of kickbacks and health care fraud stemming from a Florida patient-brokering case. They deny wrongdoing though. 

Lynn Madeja, Borrasi’s medical biller and mistress, told government agents that Borrasi had said: "I got to give Philip [Esformes] $1,000 or $10,000." To use Esformes’ patients, Borrasi told her, he "had to make it up" with cash, said Madeja, who assisted authorities in their investigation. Borrasi said "it was Esformes’ way or no way," Madeja’s statement said.

In addition, the medical director of Rock Creek Center psychiatric hospital, Dr. Naseem Chaudhry, told federal agents about a conversation in which Borrasi allegedly said he was upset because Rock Creek owed him $200,000. "He was concerned because he needed to give half of it to Esformes," Chaudhry said. Chaudhry pleaded guilty Wednesday to a count of health care fraud.

Abhin Singla, a member of Borrasi’s medical group, told investigators "Esformes controls the flow of patients in and out of his nursing homes to ensure that he is receiving the maximum allowed benefit."   Singla was with Borrasi when Esformes called and told Borrasi to admit at least five nursing home patients to various hospitals. Borrasi quickly did so without asking about their conditions.  Borrasi told Singla "someone would find something wrong with the patients to justify the admissions," Singla said.   Singla stepped forward to help because he was appalled by the "fraudulent use of public health care dollars and compromise to patient care."

Esformes, who operates nursing homes Florida as well as Illinois, denies invovlement but his attorney attacked everyone’s credibility.   One of Esformes’ numerous defense attorneys, Michael Pasano argued that "Borrasi stands convicted," and the co-workers who quote him had no direct knowledge of any a lleged payments and are biased and "lack credibility,".

But former Rock Creek discharge planner and social worker Kimberly Reevas, who helped authorities unravel the scheme, told agents Philip Esformes was often at the hospital and was deeply involved with hospital staff in steering patients to his facilities.

At one meeting, Reevas said, Esformes explained to Rock Creek social workers the type of patients they should send to each of his nursing homes. According to Reevas, "Esformes further instructed the social workers to only send patients with public aid, public aid pending, disability, or Medicare."

 Clearly they were gaming the system and were more concerned by maximum profit and greed then the care provided by the overworked and underappreciated staff.

Teresa Jackson was kind enough to write the below blog entry.  Teresa Jackson writes on the subject of OnlineNursePractitionerSchools.

Very often in life, we’re forced to do things we would rather not do, and sending a loved one to a nursing home is one such decision that we make because it’s the most practical thing to do. We’re unable to provide them with the care and comfort that they need, and they are bound to be more comfortable in an environment where they can interact with people of their own age and spend their last days in relative peace. Nursing homes are refuges for old people whose families cannot care for them because of various reasons, and when you choose one for your loved one, you do so with the utmost care. Even so, there may come a time when you’re forced to consider a change, simply because:

Your loved one is not satisfied: A nursing home is home to the elderly, one where they hope to live out their last days in peace and quiet. So unless they’re completely satisfied with the care they’re receiving and are able to relate to and interact with the other members of the home, your loved ones are bound to be unhappy. If this is the case, then it’s time to think of a change, even though it might be inconvenient or more expensive. The idea behind sending your loved one to a nursing home is to keep them in relative comfort even though you’re not able to look after them. So if they’re not satisfied for some reason, you must consider a change.

It’s too far to visit regularly: You’re bound to want to visit often if you’re close to your loved one, but if the commute is too difficult to make, your visits become few and far between. Relationships go downhill when they’re not fostered, so if you value the one you share with your loved one, it’s time to move them to a place closer to home so you and your family can visit often.

There is evidence of mistreatment: When you know or even suspect that your loved one is not being treated well at the facility, it’s definitely time for a change. You can complain all you want and hope that they’re going to be treated better, but in general, the quality of treatment in the short term shows what you can expect in the long term. So if you want your loved one to be happy and treated with the respect and dignity they deserve during their twilight years, it’s best you move them to another nursing home when you know they’re not being given the care they need.

Changing nursing homes is a little difficult, especially if it involves a significant amount of cost and time on your part. But when it comes to ensuring the comfort and mental peace of your loved one, you must do what’s necessary.

This guest article is written by Teresa Jackson, she writes on the subject of OnlineNursePractitionerSchools . She invites your questions, comments at her email address :

The Atlanta Journal Constitution reported the unanimous Georgia Supreme Court decision striking down arbitrary caps on jury awards in medical malpractice cases, part of the state’s 2005 tort reform law.  The state high court determined that a $350,000 cap on noneconomic damages, which includes compensation for a plaintiff’s pain and suffering, violates the right to a jury trial as guaranteed under the Georgia Constitution.

The 2005 law’s cap on damage awards "clearly nullifies the jury’s findings of fact regarding damages and thereby undermines the jury’s basic function," Chief Justice Carol Hunstein wrote for the court. She added, "The very existence of the caps, in any amount, is violative of the right to trial by jury."

The ruling upheld a $1.265 million jury award to Betty Nestlehutt after an operation in 2006 resulted in Nestlehutt’s face covered with gaping wounds that required prolonged, excruciating treatments to keep them from becoming infected. The wounds left her permanently disfigured.

About two dozen states have enacted caps on damage awards in medical malpractice cases. Last month, the Illinois Supreme Court declared unconstitutional a $500,000 cap against doctors and a $1 million cap against hospitals. Georgia’s tort reform law limited awards to $350,000 against doctors and capped total awards at $1.05 million in cases involving multiple health-care providers and medical facilities.


The Ohio Supreme Court has enacted a monumental change that impacts doctors and patients, shifting malpractice judgments from doctors’ insurers to the taxpayers.  More info at WCPO.  The decision limits recovery, ignores the right to a jury trial, and promotes injustice and inadequate compensation. The ruling means your private doctor can make a serious medical mistake – take off the wrong leg, operate on the wrong side of your brain – and you can never sue him in a jury trial.   No other state has ruled the same way. 

The Theobald ruling was named after Keith Theobald. Theobald was a healthy, fit husband and father of two young children, when an elderly driver clipped his pickup truck as he was driving to work 11 years ago. The impact flipped the truck across all lanes of the highway into a field, crashing in a stand of trees. Rescue workers found Theobald hanging upside down in a tree. He was paralyzed from his chest down.

Theobald and his wife, Jacqueline, took the news in stride. “I remember pre-operatively we said, ‘You can still do basketball with Jake (his then 5-year-old son) and watch TV and share things with the kids. We’ll get a van and we’ll adapt it.’” Keith Theobald agreed. He felt he could still work and live a full life. “I could do about anything. The wheelchair doesn’t hold you back.”

Theobald could see and use his arms after the accident. He was alert and ready the next day when doctors at University Hospital suggested surgery might improve his back injury.

Instead, he woke up in a different world. Not only was he still paralyzed, but now he also was blind and had lost the use of his armsMedical records prove a series of mistakes during surgery led to oxygen deprivation and injuries worse than the accident had caused.

Trapped in darkness and unable to move on his own, Theobald will need round-the-clock care the rest of his life. He sued the doctors who did the surgery, only to get this devastating shock: The doctors weren’t liable. They had immunity from all malpractice claims because they had students in the room with them.

In the Theobald case, the Ohio Supreme Court ruled that doctors who sign with a state university like the University of Cincinnati to let medical students learn from them, even if that just mean one student walking in the room for a second, now are considered state employees. As such, they get immunity if anything goes wrong on the job, even in their private practices.

Jacqueline Theobald says, “The state didn’t come in and take care of Keith. The university didn’t come take care of him. This doctor took care of him. We’re suing the doctor.”

But the Ohio Supreme Court said they couldn’t sue the doctor because some students were allegedly in the operating room, the doctors were teaching per their State of Ohio U.C contracts. Therefore those doctors were not liable for any mistakes. Instead, the Supreme Court ruled that the Theobalds belonged in the Court of Claims, a separate court set up in 1980 to handle suits against the state, usually against public state employees like highway workers, never before used to protect private doctors in their private practices.

The Court of Claims has no juries. Single judges, hired by the state, issue rulings for or against the state. The top award is $250,000, no matter the severity of the damages. Most importantly, the taxpayers foot the bill, not doctors’ malpractice insurers who must pay when suits are filed in county courts of common pleas.

Of course, Keith Theobald never knew to ask if a student would be watching his operation, and if so what the impact might be. But if you think doctors from now on will have to tell patients and get consent to have students in the room, you’d be wrong. The Supreme Court ruled the law doesn’t demand disclosure. No one has to inform patients they could lose their rights to sue the doctors without ever knowing it.

Keith Theobald hasn’t lost hope for a medical miracle. But in the end, he never did get a chance at even the Court of Claims the Ohio Supreme Court said he should access. That’s because the same state attorneys for U.C. who argued that’s the court where the Theobalds belonged, now argued it was too late. The statute of limitations had passed. No recovery, not even $250,000, for Keith Theobald’s lifetime injuries.


The Star-Tribune had an article about serious medication mistakes three times within 16 days at Fair Oaks Lodge nursing home, sending three residents to the hospital and causing the death of one of them. The "significant medication errors" at Fair  Oaks Lodge in Wadena indicated a systems failure at the facility, prompting state Health Department investigators to place blame for
the mistakes with the home. In addition, state investigators who visited the facility 2 1/2 months after the death observed a medication error rate of 18 percent during one evening’s staff rounds.

In 2008, state records show, there were 253 allegations of medication errors, up from 199 a year
earlier. Homes themselves report the vast majority of medication errors so the underreporting affects the numbers.

Fair Oaks Lodge is owned and operated by Tri-County Hospital in Wadena. Tri-County is
a private, not-for-profit health care organization that employs nearly 350 people. Joel Beiswenger, CEO of Tri-County Health Care, said the organization is considering an appeal, but added that in communications with relatives of the resident who died, "we acknowledged that an error occurred."

According to the report, the resident who died, an 82-year-old Alzheimer’s patient, was mistakenly given three medications on June 1. Her blood pressure quickly dropped and "her pupils were fixed and nonresponsive." She was taken by ambulance to an emergency room, then admitted to an
intensive care unit. Three days later, she was taken off life support and died.

The state report also found:

• The first improperly medicated patient was given his scheduled dose of Tylenol at 3:45 p.m. on May 27 and then another 500 milligrams only two hours and five minutes later. Along with the second dose of Tylenol, he was given a medication to treat hypertension.

Within minutes, the resident "became unresponsive for approximately two to three minutes," the report said. An aide said he gave the resident his medication early because the man "liked to go to bed early."  The aide told investigators that was standard practice in that unit at the time.

• In the case of the woman who died, a trained medication aide mistakenly gave her drugs for the central nervous system, the heart and an antipsychotic medication.

• In the third instance, on June 12, a trained medication aide set up the drugs, but a nurse then gave them to the wrong resident. The resident spent four to six hours in the emergency room.


I read two articles about the fatal medication errors at Britthaven of Chapel Hill.  One article was done by WRAL, and the other article was from News Observer. Several patients tested positive for opiates when there was no order for those medications.  Nine Alzheimer’s patients tested positive for strong pain-control drugs that they weren’t supposed to be receiving.  Often, nursing homes will use chemical restraints on demented residents to keep them quiet and sedated.

The Britthaven of Chapel Hill nursing home, which has a spotty record of patient care, notified state authorities after one patient’s blood tests showed the presence of opiates.  That patient died.  Dr. Allen Mask of WRAL’s Health Team said side-effects of opiates include sedation, drowsiness, nausea and constipation.  "In high enough doses, it can cause respiratory depression, cause you to stop breathing," Mask said.

When that patient’s blood results came back positive for opiates, nursing home staff grew alarmed. They noted that some other patients in the home’s 29-bed Alzheimer’s unit showed signs of lethargy, and were also tested.  Opiates were found in at least two other patients, who were admitted at UNC Hospitals. Britthaven then notified authorities, including the Chapel Hill Police Department and the state Department of Health and Human Services, which oversees adult care facilities.

No drugs were out of order or missing at the nursing home. 

Britthaven has had regulatory issues in recent years at its Chapel Hill facility, which has 133 beds. Prior to the current incident, the nursing home had been designated a "special focus facility" because of persistently poor care.  During inspections in 2008 and 2009, the nursing home was found to have subjected some residents to imminent jeopardy by failing to protect them from abuse. Residents got only about half the state average of hour of care by certified nursing assistants. In November, Britthaven paid a federal fine of $7,117.54 for failing to provide enough supervision to prevent accidents to residents.


The Boston Channel had an article about the epidemic of sexual predators living and working in nursing homes.  Team 5 Investigates discovered level 3 sex offenders – the ones deemed by the state to be the most dangerous and likely to reoffend – living and working inside Massachusetts nursing homes.

“They’re all living under the same roof,” said Wes Bledsoe, president and co-founder of A Perfect Cause, a national organization dedicated to protecting nursing home patients. “Typically there’s not enough staff or security to protect those residents.”  “When you put predators in with the prey, someone is going to get bit,” said Bledsoe. “We have documented over 60 cases where child molesters have, in fact, sexually, physically assaulted, even raped other long-term care residents,” said Bledsoe.

The article gives many examples of sexual predators but experts point to a particularly vicious 2005 case in Norwood, Mass. John Enos, 69, a level 3 sex offender confined to a wheelchair allegedly raped his 90-year-old nursing home roommate. Enos had previously served 15 years in prison for sexually assaulting his own 9-year-old daughter.

That case helped prompt a change in Massachusetts law. With few exceptions, it is now illegal for level 3 sex offenders to live in nursing homes. But in what some call a loophole, the statute says level 3 offenders cannot live in nursing homes “knowingly or willingly.”

“It’s outrageous that there should be any loophole in any law that allows sex offenders anywhere near nursing homes,” said attorney Wendy Murphy.

There is also no law on the books requiring that nursing homes notify anyone – not residents, staff or visitors — when level 3 sex offenders are living and working in their facilities.


Another lawsuit involving nursing home owners and operators Murray Forman, Leonard Grunstein, and Rubin Schron.  Forman and Grunstein are accusing Schron of  treating their company as "his personal piggy bank" and looted it for more than $100 million.   Rubin Schron first fattened his piggy bank in 2006, with $40 million that he claimed was repayment of a capital contribution from CAM-Elm Co., his family-owned business that’s majority owner of plaintiff SMV Property Holdings.

Schron took $66 million more in 2008 and 2009 to recoup money he lost in personal investments, including rate swaps with Citibank, shareholders say in New York County Court.  Schron’s eight children were majority owners of CAM-Elm, giving them the right to remove their father from his position, but since they did not, the plaintiffs say, they are suing them too.

"Schron is not content with the substantial economic returns that he, his family, and his companies have "legitimately" earned. Instead, Schron has resorted to theft, improper accounting manipulation, and more, against those who trusted him and relied on him," the complaint states.

Schron has also accused Leonard Grunstein and Murray Forman of "stealing from the company," so they added a defamation charge to the claims of misappropriation.   Of course, truth is the ultimate defense to defamation.

The plaintiffs seek an accounting and $105 million in damages and want Schron booted from his position and new managers appointed.  See full Complaint here.