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DOJ Crackdown on Nursing Homes to Include Criminal Counts

Sept. 30, 2019, 9:16 AM

The Department of Justice is making a push this fall to identify criminal charges that can be brought alongside civil actions against nursing homes and staff accused of abusing and defrauding elderly patients, DOJ attorneys told Bloomberg Law.

The attoneys say the agency is seeking to “amplify” the work of its Elder Justice Initiative, which was launched in 2018 to protect the nation’s elderly. Federal prosecutors will be looking at potential criminal charges such as wire fraud and health-care fraud when they uncover false claims for government reimbursements of care.

News of the Justice Department’s push for criminal charges is likely to raise alarm bells among the nation’s more than 15,000 nursing homes. One industry trade group said criminal charges are not the way to correct what it said are rare cases of poor care.

The Justice Department’s civil division has historically used the False Claims Act to pursue nursing homes that bill the federal government for services not rendered or care that is grossly substandard, said Andy Mao, deputy director of the commercial litigation branch of the DOJ’s Civil Division who heads the Elder Justice Initiative.

But in egregious cases, criminal charges may also be warranted, federal prosecutors say.

“We need to go after cases civilly because they a providing grossly substandard care and, in the appropriate case, refer it for a parallel criminal prosecution,” said Toni Bacon, an associate deputy attorney general.

“As America’s aging, it’s becoming a larger problem and we need to be able on the federal side to identify who is the worst of the worst,” she said.

There were 15,600 nursing homes in the U.S. as of 2016, according to data from the Centers for Disease Control and Prevention.

Almost all of them, 95.2%, were authorized or certified to participate in Medicaid in 2016, according to data from the National Center for Health Statistics. Participation rates were similarly high for adult day services centers (76.9%), home health agencies (78.4%), and residential care communities (48.3%).

Medicare generally does not cover long-term care, making Medicaid the most common source of reimbursement for nursing home care.

Criminal Interest

If a provider bills the Centers for Medicare & Medicaid Services for services that are not rendered, that false representation is often made through the mail or online, creating the potential for not only a violation of the False Claims Act, but a criminal wire fraud charge as well, a DOJ official said.

“I think there has not been quite as much criminal interest, but I hope that’s changing,” the official said. “We are collaborating with the consumer protection branch, which has indicated that they are willing to explore what criminal angles there may be.”

The agency earlier this month brought criminal embezzlement, health-care fraud, and wire fraud charges against a Connecticut woman accused of stealing $150,000 from the trust accounts of residents at Bridgeport Health Care Center and Bridgeport Manor, two nursing and rehabilitation facilities.

Poor-quality care is a common problem in nursing homes with inadequate staffing levels and untrained staff, said Eric Carlson, directing attorney at Justice in Aging, a nonprofit legal advocacy organization that fights senior poverty.

“That’s where you see the bed sores and infections, the malnutrition and some of the other unfortunately common issues that arise in nursing facilities,” he said.

Carlson welcomes the DOJ crackdown on bad actors. The agency needs to be aggressive, he said.

“If something meets the standard for a criminal violation, it should be prosecuted as a criminal charge,” Carlson said.

Early Opposition

Not everyone agrees.

The American Health Care Association, which bills itself as the nation’s largest association of long-term and post-acute care providers, said instances of abuse, neglect, and fraud are rare and that “the overwhelming majority of nursing home staff provide high-quality resident care.”

“Criminalizing poor quality is not the answer,” David Gifford, AHCA’s senior vice president of quality and regulatory affairs and chief medical officer, said in a statement to Bloomberg Law.

The AHCA said it has been working with health-care providers and other interested parties to identify reforms that will “further improve the lives of America’s elderly, including policies that help facilities retain more high-quality staff, bring more transparency to abuse and neglect reporting, and provide consumers additional information to help them make informed decisions.”

To contact the reporter on this story: Lydia Wheeler in Washington at

To contact the editors responsible for this story: Fawn Johnson at; Brent Bierman at