Georgia Defrauds Medicaid
Max Blau is a freelance journalist in Atlanta. NPR, VOX, Kaiser Health News and Georgia Health News feature his work. He wrote a great article for Georgia Public Broadcasting. It is an incredible story of corruption, greed, and ignorance.
Ronnie Rollins
Ronnie Rollins thought of a loophole to exploit a federal program. Rollins discovered the “Upper Payment Limit” program, or UPL. This program allows government-owned nursing homes to receive bonus payments. The program means to compensate nursing home owned by the public affiliated with a hospital. The program would increase payments for care provided to nursing home residents.
“The UPL process is complex: A nursing home owned by a government agency wires funds to Georgia’s Medicaid agency; Georgia sends money to CMS; CMS returns the payment, along with a bonus amount, to Georgia; Georgia takes a cut of the bonus dollars and wires the rest back to the local agency’s nursing home.”
Rollins owned a chain of nursing homes but clearly did not qualify for the program. Rollins donated more than $1 million to Georgia’s top Republican officials.
He convinced ignorant officials to use public agencies to siphon bonus payments from Medicaid. The fraudulent scheme needed public officials to lie to the federal government. The true owners were not those public agencies. Not his privately-owned chain of nursing homes. Clear fraud, right?
Rollins then asked Georgia’s Department of Community Health for a legal opinion. (Of course, they should have asked the federal government.) DCH approved Rollins’ plan if the department received a cut of the bonus payments. Clear corruption, right?
“Inappropriate” Bonus Payments
Eventually, federal officials discovered the fraudulent loophole. Watchdogs found that tens of millions of taxpayer dollars passed through a tiny public agency. The public agency clearly did not own dozens of nursing homes. Finally, federal officials ordered Georgia’s Medicaid agency to “immediately cease and desist” obtaining bonus payments.
Rollins knew the bonus payments, along with tax-exempt bonds, would make him rich. For the last 20 years, Rollins received $300 million in additional payments under the bonus program. Now, he threatens Georgia’s ability to collect future Medicaid funds.
“The Centers for Medicare and Medicaid Services, the federal agency responsible for America’s major public health care programs, ruled in 2014 that a portion of the bonus payments that flowed to Rollins’ chain were “inappropriate.” Payments under the program have halted, and CMS is now seeking $76 million in repayment from the state for the allegedly improper reimbursements.”
Georgia Health News and ProPublica’s investigation
The investigation analyzed state and federal health data, government records, court filings and state agency emails obtained under Georgia’s open records act. GHN and ProPublica contacted top health care insiders. Investigators interviewed nearly two dozen people.
“Since CMS closed the loophole six years ago, Rollins’ Ethica nursing home network has been slapped with more than $1.2 million in fines for violating standards designed to keep patients safe. Some of those facilities have reported below-average staffing levels. From 2013 to 2018, the network recorded more than twice the number of deficiencies per nursing home than the average facility in Georgia.”
The COVID-19 death rate for the company’s 55 homes is 4.9%, compared with the statewide nursing home death rate of 3.3%. Over half of Rollins’ 55 nursing homes have experienced coronavirus outbreaks, each of them with more than 30 residents testing positive. Nearly 17% of the more than 1,500 residents who tested positive at Ethica nursing homes have died, according to an analysis of state records.
During the pandemic, his nursing homes suffered shortages of personal protective equipment. Staffers made 15,000 pieces of gear from scratch including gowns made from plastic sheets. Occupational Safety and Health Administration accused Rollins of “not effectively developed or implemented an infectious disease preparedness and response plan.”
Political Protection?
But Rollins is protected by Georgia’s Republican Political Establishment. He donated more than $200,000 to state GOP races. Follow the money. Rollins said that state officials have never even asked him to pay back the $76 million. Rollins even secured a seat on the rural hospital stabilization committee.
Which helps explain why Joseph R. Biden Jr. has moved ahead of Trump in a range of polling averages. Surging alongside him are Jon Ossoff and the Rev. Dr. Raphael Warnock, the Democratic candidates vying for the state’s two open Senate seats.
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