Nursing Home Owners Stole $83M From Medicaid and Medicare, AG Letitia James Alleges in Lawsuit

New York Attorney General Letitia James has filed a lawsuit against nursing home operator Centers Health Care, accusing its owners of hoarding $83 million in government funding from Medicaid and Medicare while leaving their facilities understaffed and neglecting the center’s elderly residents.

According to Reuters, James is attempting to block four Centers Health Care locations from accepting new residents until it can prove its safety and compliance with properly staffing its facilities. She also demanded that the company hire financial and healthcare monitors to meet the necessary requirements. The lawsuit calls for the owners, Kenneth Rozenberg and Daryl Hagler, and others allegedly involved in the fraud, to return the stolen funds.

Centers Health Care and its affiliates deny the claims, according to a statement released by company spokesperson Jeffrey Jacomowitz. “We will fight these spurious claims with the facts on our side,” he said.

The lawsuit focuses on four residents allegedly subjected to inhumane neglect and mistreatment. One citation detailed the death of a man who developed sepsis from an untreated bedsore, while another chronicled a woman who, after falling out of bed, suffered brain damage due to receiving no treatment. According to Reuters, residents were often left in soiled undergarments and ignored by staff when calling for help. The lawsuit also alleges that Centers Health Care facilities failed to follow proper COVID-19 protocols and did not require staff to be masked, resulting in more than 400 fatalities in 2020.

James’ lawsuit alleges that the mismanaged funds were used to line the pockets of Rozenberg and Hagler, and their families and associates. One such scheme included Rozenberg’s daughter, who was allegedly paid millions of dollars by companies affiliated with Centers Health Care despite having no contract with the facilities.

“They put profit over people again and again and again while vulnerable New Yorkers were reduced to skeletons,” said James.