“A briefcase full of $100 bills”

SavaSeniorCare is once again accused of defrauding the government by accepting kickbacks, the original Complaint filed in 2015 was unsealed, revealing that the whistleblower who filed the suit believed the core motivation behind the scheme was revenge on a competitor.  The rest of the filings in the case remain sealed except for the original complaint, as the decline of the governments to intervene triggers the unsealing.

The whistleblower who originally filed the case two years ago, August Bogina III, said in the complaint that he was personal friends with one of the men integral to the scheme, Michael Tutera, who died in 2010. According to Bogina, Tutera was one of two men who ran an insurance brokerage business in Kansas City, and was caught up in the alleged scheme when he and his business partner, Brian Davidson, became acquainted with Jimmy Abrams a principle owner of Illinois-based medical supply company Medline.

Davidson became the point man for a deal in which the three men teamed up in order to get nursing home chain SavaSeniorCare business with the skilled nursing facilities. To kick off the partnership, Davidson allegedly met with Sava owner Murray Forman in New York City in 2005, and the two exchanged a briefcase full of $100 bills, which Bogina said could have been $50,000. The money, which was provided by Medline and given to Davidson to give to Forman, was just the second part of the deal.

In another twist, Forman allegedly told Davidson that he wanted to “exact revenge” on rival skilled nursing facility chain Triad, which Forman said had burned him in a real estate deal a few years earlier.

“To exact such revenge on Triad, Davidson and Tutera met Abrams and proposed a business arrangement whereby Abrams would provide the money necessary to purchase several mortgage notes on real estate where Triad nursing homes were located,” the unsealed complaint said.

Medline’s Abrams allegedly provided $2 million to fund a limited liability company in Texas, Texas LLC, run by a man named John Connolly in order for the company to purchase the mortgage notes on real estate where Triad nursing homes were located. Then shortly after the purchase of the three mortgage notes, Connolly, acting through the Texas LLC, declared Triad in default on the mortgage notes, according to the unsealed complaint.

“With Triad declared in default on mortgages on three properties, Forman was ecstatic with Davidson, Tutera, and Abrams,” the complaint said. “Their roles in the Triad ‘take down’ induced Forman to pursue, on behalf of Sava-Mariner, an agreement for Sava-Mariner to purchase its [durable medical equipment] for its nursing homes from Medline, rather than from its DME supplier at that time, Gulf South Medical Supply.

In order to induce Sava-Mariner to purchase medical supplies from Medline instead of Gulf South, Medline paid illegal remuneration in the form of bribes and kickbacks to Forman, Tutera and Davidson, according to the complaint.

It’s not clear why the governments did not intervene in the case, triggering the unsealing of the complaint. But this complaint is not alone in cases against SavaSeniorCare. A trio of 2015 cases that was consolidated in Tennessee federal court alleges that SavaSeniorCare billed Medicare for unnecessary rehabilitation therapy services in violation of the False Claims Act.

According to the complaint, SavaSeniorCare LLC would pressure its facilities to meet unrealistic financial goals, which would lead to employees’ providing “medically unreasonable, unnecessary and unskilled services” that it would bill to Medicare. Between October 2008 and September 2012, Medicare paid Sava $1.4 billion for inpatient services, the suit claims.

The case is U.S., ex rel, et al. v. Savaseniorcare Administrative Services LLC, et al., case number 1:15-cv-04763 in the U.S. District Court for the Northern District of Illinois.