NY-AG v. Cold Spring Hills Center for Nursing and Rehabilitation

Cold Spring Hills Center for Nursing and Rehabilitation allegedly diverted over $22.6 million in Medicaid and Medicare funds from resident care through a fraudulent network of companies. According to NY-AG, the owners repeatedly cut staffing which created poor working conditions and endangered residents. Cold Spring Hills' operators used 13 companies to create the appearance that they were paying for services for the nursing home but were in fact diverting Medicaid and Medicare funds to themselves. The lawsuit alleges that the respondents paid more than $15.3 million in fraudulent “rent” to Cold Spring Realty, and paid more than $5.2 million to several deceptive entities for supposed “consulting.” In addition, the lawsuit alleges that the respondents engaged in a $2 million fraudulent promissory note scheme when they purchased the facility. The respondents also funneled another $10.6 million in concealed self-dealing transactions through what were ostensibly insurance companies, and another $8.1 million through an entity that purportedly provided services and supplies. The lawsuit details instances of resident neglect and mistreatment.

Summary generated from official New York Attorney General press release