In 2000, The Nursing Home Business Was Big Business… Little has Changed

caption 1: Barry Braunstein, who seems passionate about the nursing home business, answers audience questions. Nora Martins, from his legal team, is on the left, and his architect David Mammina is to his right. caption 2: Bea Byrd, who sits on both the NYCHA board and the board of the Addabo Center, wonders why she hasn’t heard about the proposal before, Oxford

Nursing Homes as Big Business, Profiting on the Sick, the Infirmed and Medicaid Manipulation, THE BRAUNSTEIN CONNECTION

by LostMessiah, March 19, 2016

The lucrative business of owning nursing homes did not begin in 2000. And it is certainly no less profitable in 2016. With the Braunstein lawsuit of 2016 against the County of Rockland for a failed bid for the Summit Park facility, and Barry Braunstein’s “passion” of getting his hands on a $65,000,000.00 deal in Red Hook, New York, called Oxford Nursing Home, numbers clearly speak. Setting the care of the patients aside, the needs of their families, the financial implications to the sick and infirmed, over the years of evolution of the nursing home business, manipulation of the public healthcare system and Medicare and Medicaid, two of the largest funding entities, has increased. See two of the articles on the subject from the early years, 2000 and 2005.

Going back to 2000…

Excerpts from the article below, for the full article click, here, 

The New York Daily News, July 31, 2000 reports:

FAT CATS FEEDING ON NURSING HOMES Medicaid payments help foot hefty salaries, records show

“Private nursing home owners throughout the city are amassing personal fortunes, with some pulling in millions each year from government programs for the poor and elderly, a Daily News investigation shows. The owners of 100 private nursing homes reaped nearly $24 million in salaries from their businesses in 1998 alone, according to state Health Department records. Some of the owners also put their relatives on nursing home payrolls, giving them six-figure salaries in facilities that often contain only a couple hundred beds. Owners of five nursing homes in the city drew more than $1million each in salary in 1998. Virtually all the owners’ profits are funded by taxpayers through Medicaid, the government program for the poor. The disclosures come as nursing home owners are under increasing scrutiny in New York – home to the highest Medicaid bill in the nation. The total Medicaid tab for nursing home care for 134,000 patients in New York State has ballooned to $5.

3 billion – a sum nearly $2 billion more than the bill for similar care in Texas and California combined, with 218,000 patients. Costs are even higher in New York City, running about $55,000 per patient per year, compared with the state average of $40,000. Of the cost, the federal government pays half, and the state and city share the other half. Owner salaries and profits have caught the attention of the Pataki administration, which last month accused owners of trying to “line their pockets” with taxpayer funds by lobbying for increases in reimbursement rates. And Albany has cited owner profits as a major reason New York’s Medicaid bill is America’s highest. Nursing homes in the state took in $1.

3 billion in profits between 1996 and 1998, which contributed to the Pataki administration’s ire. In addition to their salaries, private nursing home owners in the city took in $140 million in profits in 1998, records show. “In any other industry, the accumulation of $1.

3 billion in profits would be enough, but it appears that nursing home owners want even more taxpayer money to line their pockets,” the state Health Department said in a statement. At the same time, federal officials are preparing a report to Congress that cites nursing home staff shortages as the reason for increases in serious patient problems, including malnutrition and bedsores, that lead to hospitalization. There are two types of nursing homes: privately owned (run for profit) and nonprofit, some run by religious groups. Patient advocates are pushing for changes that would require all nursing homes to maintain a certain ratio of staffers to patients. Currently, staffing levels are determined by each home. Nursing home advocates have joined with union leaders in urging legislators to pass measures that would force owners to spend bigger chunks of their earnings on staff; the typical nursing home resident in New York City gets less than two hours of care per day. Nurses aides – who perform most of the backbreaking, often unpleasant work – are paid an average of $11 per hour. “Private nursing home owners should be able to make a profit on their investment, but not at the expense of the people who are working to provide this care and the families who cannot provide this care themselves,” said Jay Sackman, executive vice president of the Service Employees International Union, Local 1199. “

“7 million in salary in 1998. “It’s a big business,” said administrator Barry Braunstein, listed in state records as Laconia’s sole owner. He said his salary was significantly less than the cited $1.”

” Last month, The News reported that residents at the Clearview Nursing Home in Whitestone, Queens, had been subjected to physical and psychological abuse by night-shift staffers. Government investigators found that residents were assaulted and denied proper feeding and medical care. The U.S. Health Care Financing Administration has fined the home nearly $200,000. Following the report in The News, the owner brought in a new administrator, Howard Small, to run the 179-bed facility. Clearview’s owners took in nearly $985,000 in salary in 1998, state figures show. One of Clearview’s owners, Ernest Dicker, has ownership stakes in at least three other city nursing homes: Shore View Nursing Home and Sea Crest Health Care Center in Brooklyn and Manhattanville in the Bronx. Counted together, those homes paid their owners more than $2.”

“5 million, an aide said she makes $12 an hour caring for scores of elderly patients who require daily bathing and diaper changes. “They keep it all to themselves,” she said. “They don’t want to share it.”

“2. Barry Braunstein: $1,738,000 Sole owner of Laconia Nursing Home in the Bronx. 3. Elaine Liebman: $1,578,271 Principal owner of Grand Manor Nursing and Rehabilitation Center in the Bronx.”

Now for 2005

In an article in New York Times, on July 18, 2005, entitled

New York Medicaid Fraud May Reach Into Billions

[Excerpts from the article below, for the full article click here]

the authors write:

“It [Medicaid] has drawn dentists like Dr. Dolly Rosen, who within 12 months somehow built the state’s biggest Medicaid dental practice out of a Brooklyn storefront, where she claimed to have performed as many as 991 procedures a day in 2003. After The New York Times discovered her extraordinary billings through a computer analysis and questioned the state about them, Dr. Rosen and two associates were indicted on charges of stealing more than $1 million from the program.”

“Nursing home operators have received substantial salaries and profits from Medicaid payments, while keeping staffing levels below the national average. One operator took in $1.5 million in salary and profit in the same year he was fined for neglecting the home’s residents.

Medicaid has even drawn several criminal rings that duped the program into paying for an expensive muscle-building drug intended for AIDS patients that was then diverted to bodybuilders, at a cost of tens of millions. A single doctor in Brooklyn prescribed $11.5 million worth of the drug, the vast majority of it after the state said it had tightened rules for covering the drug.”

“The Times investigation drew upon interviews with scores of current and former officials and health-care providers, including several former investigators who say they left the state disillusioned about its commitment to fighting fraud. A review of thousands of pages of state, federal and local records turned up repeated examples of cost savings and waste reduction used by the federal government and other states, but not by New York.

The investigation found audits on Medicaid spending that were brushed aside, and reports on waste that appear to have been shelved. There have been multiple warnings from watchdog agencies in New York and in Washington that indicate that the program is becoming increasingly porous. Prosecutors said state regulators had all but lost interest in bringing Medicaid thieves to justice, preferring instead to focus on recouping money through a few civil cases that have little deterrent value.”

“According to records obtained from the Health Department under the Freedom of Information Law, 70 executives of nursing homes and clinics personally made more than $500,000 in 2002, the last year for which figures are available. Twenty-five executives made more than $1 million.

For the nursing home executives, that money was earned in salaries and profits, most of which came directly from the daily fee that Medicaid pays for caring for each low-income patient, usually in the range of $200. Salaries are earned by employees of the homes, and profit is earned by owners, although owners are often executive directors or chief executives of the homes, allowing them to benefit in both ways.

Consider three homes in the Bronx. The operator of the Laconia Nursing Home, which receives 90 percent of its revenues from Medicaid, earned $3 million in salary and profit. At the Grand Manor Nursing Home, also 90 percent financed by Medicaid, the operator and three family members earned a total of $2.4 million in salaries and profit. The owner and operator of the Morris Park home, 75 percent financed by Medicaid, took in $1.5 million in salary and profit.”

“Barry Braunstein, operator of the Laconia home, did not respond to three calls seeking comment.”