Nursing Home and its CEO Plead Guilty to Fraud and Tax Conspiracy
Atrium Health and Senior Living has pleaded guilty to health care fraud and tax conspiracy, along with CEO Kevin Breslin. The company is headquartered in Little Falls Township, N.J. Photo credit: Google Street View.
Breslin was fired in 2018, and a jury returned an indictment on Feb. 1, 2023. Sentencing for the guilty plea is scheduled for May 7, according to the DOJ press release. Breslin agreed to pay back all of the money lost in restitution. He also faces a maximum of 15 years in prison.
Breslin in Charge of Overall Operations
Breslin joined Atrium in June 2014 and was in charge of the business’s overall operations, including staffing, budgeting and payroll, as well as making the final decisions regarding financial spending and reporting, according to an indictment obtained by The Daily Muck. Breslin made a $1 million yearly salary plus $30,000 to $40,000 weekly for being a 20% owner.
Atrium’s skilled nursing facility (SNF) locations in Michigan and Wisconsin had more than 1,900 beds and employed over 1,700 individuals in April 2016, according to the indictment.
Between January 2015 and September 2018, Atrium’s Wisconsin locations billed Medicare over $189 million in SNF services and received about $49 million. They billed Medicaid $218 million and received $93 million, say prosecutors, Instead of using these funds to care for the residents, the money was used for other purposes.
With the funds being diverted to other means, the Wisconsin SNF locations lacked the funding to adequately staff the facilities and departments in nursing, kitchen and housekeeping, among others, according to the indictment.
The money was instead used to pay $37 million in weekly payments to owners and returns to investors who put more than $20 million into a new construction project in New Jersey, according to the indictment.
The funds also went to construction costs for the New Jersey projects and personal expenses for one of the Atrium owners, including a $60,000 monthly mortgage payment to SummitBridge Investments, $60,000 monthly IRS back taxes payments, and $75,000 monthly for an Apple Chase loan, according to the indictment.
Misspent Funds Resulted in Patient Neglect
The lack of funds in the Wisconsin SNF locations caused a deficit of Certified Nursing Assistants (CNAs) at the sites, leaving residents without needed care, including rotating bed-ridden residents to prevent bed sores, cleaning and changing soiled residents and their linens, responding to call buttons and keeping proper charts, according to the indictment.
There was also a lack of supplies, like respiratory masks and wound care supplies, as well as a lack of services like physical therapy, according to the indictment. Safety measures, like having an operational fire alarm, were also often overlooked due to cost.
Owners Stole Money Instead of Using It on Residents
Between 2015 and 2016, Atrium claimed that its 23 Wisconsin locations were operating up to the standard code requirements, which allowed them to bill Medicare and Medicaid for the services, according to the indictment. However, weekly payments of $172,000 were sent to the owners and not the facility to which the money was supposed to be appropriated.
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