Trial begins in Comprehensive Healthcare's nursing home fraud case

One by one, defense attorneys for five nursing home administrators accused of health care fraud told a federal jury Thursday in Pittsburgh that their clients were innocent.

That there was actually no fraud at all, but sloppy record keeping.

That their clients did not receive any financial benefits for their alleged actions.

That the witnesses cooperating against the defendants are lying to protect themselves.

“We’re here because, sometimes, the justice system makes a mistake,” said J. Kirk Ogrosky, who represents the owner charged in the case. “They took a minor regulatory issue and turned it into something it is not.”

On Thursday, the trial for five Comprehensive Healthcare Management Services employees and two nursing homes — Brighton Rehabilitation and Wellness Center in Beaver County and Mt. Lebanon Rehabilitation and Wellness Center — began before U.S. District Judge Robert J. Colville.

The case is expected to last five weeks.

The defendants include Comprehensive CEO Sam Halper of Miami Beach, Fla.; Brighton Rehab Director of Nursing Eva Hamilton of Beaver; Michelle Romeo of Hillsville, Lawrence County, who was a regional manager with oversight over nurses at the two facilities; Director of Social Services Johnna Haller of Monaca; and former Mt. Lebanon Rehab administrator Susan Gilbert of Cecil. Prosecutors say they conspired with each other to defraud the government and drive up profits.

“This is a case about greed, lies and cover up,” Assistant U.S. Attorney Nicole Stockey said in her opening statement.

She said there was a scheme involving staffing and one involving Medicare and Medicaid reimbursement.

In the first, Stockey said, the administrators falsified documents to make it appear that the nursing homes were meeting the government-mandated staffing ratios to care for their patients. They did that, she said, by listing “ghost employees” and “ghost hours.”

“They weren’t working,” she said. “They weren’t even in the building.”

Sometimes, Stockey said, employees would punch in and then leave.

“These are not technical glitches. They’re not mistakes on staffing sheets. They did it intentionally, and they did it knowingly,” Stockey said.

Halper bought the 500-bed Brighton facility in 2014 and the 100-bed Mt. Lebanon facility in 2017, the prosecutor said.

He was involved in the day-to-day operations of the facilities, including hiring and firing, salaries, patient admissions and discharges, Stockey said. She said there were significant changes at Brighton Rehab, which had operated prior to being purchased as the Beaver County-owned Friendship Ridge.

“Some of the changes he made were to cut costs, and one of the ways he did that was to cut staff,” Stockey said.

As part of the reimbursement scheme, Stockey said, staff members were told to delay patient discharges and keep patients at the rehab facilities longer. The prosecutor said staff members also were told to lie to make patients appear to be sicker than they were and to recommend unnecessary therapy.

“The sicker the patient, the more care the patient needs, the higher the reimbursement,” Stockey said. “It’s not a crime to make money. But it is a crime to lie and cheat and falsify documents to do so.”

Ogrosky, who represents Halper, told the jury there was no scheme, just “errors on the forms.”

“They turned it into a criminal, federal conspiracy. The state could have reviewed this and said, ‘Here’s a citation,’” Ogrosky said.

“They assumed these people were guilty and brought these charges based on assumptions,” he added.

Halper was working as a nursing home administrator in New York City when he got a call that Friendship Ridge was for sale, his lawyer said. Halper didn’t have the money to buy the facility, but was able to serve as its administrator. In exchange, he became a 12% owner. He moved to Western Pennsylvania in 2014.

Ogrosky said there was no evidence Halper was involved in filling out any of the staffing forms.

Instead, he said that there were a handful of lower-level staff members who purposely lied and cheated on staffing forms to steal money from Comprehensive.

Now, some of those same people have received immunity and will testify against the administrators on trial, the defense said.

“This is nonsense,” Ogrosky said. “We shouldn’t be here.”

Paul E. Pelletier, who represents Hamilton, said his client never received money to lie or to protect her job as director of nursing, he said.

“There’s not going to be any evidence she did anything to preserve her job,” Pelletier said.

Attorney Jonathan Meltz, who represents Gilbert, told the jurors there will be days — and maybe even weeks — when they don’t even hear his client’s name.

“Her life has been turned upside down. Her reputation, for the time being, destroyed based on liars and cheaters — people who were stealing and given immunity by the government,” Meltz said.

He said there is no evidence to show that Gilbert knew what the staff at Mt. Lebanon was doing.

“Susan trusted her staff that the forms they filled out were accurate and truthful. She relied on her staff to do their jobs.”

Matthew Kussmaul, who represents Romeo, said his client was hired in mid-2015 and was responsible for resident assessments.

Comprehensive operated 17 facilities, with about 2,000 residents, he said. That means that over seven years, there were 56,000 assessments. The government, he said, will show the jury only 50 — or 0.089% of the assessments.

“That’s a rounding error,” he said.

Romeo is accused of falsifying records for the residents’ activities of daily living, such as when she asked staff if they were sure a patient didn’t need additional help with mobility.

“Look again. Look again. Look again,” Romeo told her staff.

“Sometimes, she focused her questions on getting reimbursements, and there’s nothing wrong with that,” Kussmaul said. “The prosecution is going to try to convince you that ‘look again’ means commit fraud.”

Amy Carver, who represents Haller, said her client’s job as the director of social services was to ensure patients had the resources they needed and that they got home safely.

“She is entirely innocent,” Carver said. “She did her job and did the best she could to ensure accuracy. The evidence will show there was no hiding, no concealing, no furtiveness. It’s not complicated. The evidence will show the government theories simply do not make sense.”

The government’s first witness was Stephanie Nusser.

She started at Friendship Ridge in February 2013 as a temporary social worker and was later promoted to director of social services after the facility became Brighton Rehab. She left the facility in 2017.

Nusser, who is not facing charges and was not given immunity, told the jury that Halper gave her a directive to pass down to other social workers — that they needed to increase residents’ depression scores to increase reimbursements for services.

“Residents in a nursing home should be depressed or would be depressed,” Halper told her. “If we could get those scores up, the money that comes back takes care of those residents.”

At a meeting, she said Halper gave the social work staff a kind of pep talk.

“They had started to realize Comprehensive was much different than Friendship Ridge. They were much more financially driven,” Nusser said.

She said Halper threatened staff members that if they weren’t willing to change the scores, he could find people to replace them.

She also testified that Halper gave her instructions to move patients from traditional managed care insurance plans to Medicare, because the facilities received higher reimbursements with less oversight through Medicare.

She said Halper also told Nusser to convince patients to sign up for Medicaid — a program offered to lower-income patients. But because patients were fearful they would lose their homes with Medicaid, she said, Halper told her to call it “assistance.”

“It was mostly just a play on words to get people to be more cooperative,” Nusser said.

One afternoon, Nusser continued, Halper traced a patient’s signature, showing her how easy it was to do.

Nusser said she didn’t know what to say to him.

“I was shocked. I was mortified. I was scared,” she said.

Nusser will return to the stand on cross-examination when the case resumes on Monday.