The Deptford and Hammonton nursing homes face a Medicaid suspension on May 24

New Jersey plans to suspend two South Jersey nursing homes from Medicaid, state regulators said on Thursday, citing the facilities’ poor care and evidence in New York of massive Medicaid fraud by their owners.

The suspension takes effect on May 25.

The facilities facing suspension by the New Jersey Comptroller’s Medicaid Fraud Unit are Deptford Center for Rehabilitation and Healthcare and Hammonton Center for Rehabilitation and Healthcare. Both have one-star quality ratings from the federal government and have been cited repeatedly for health and safety violations, according to the comptroller.

The owners, Kenneth Rozenberg, Beth Rozenberg, and Daryl Hagler, have faced sanctions in New York, including a judge’s appointment of a financial monitor and a health monitor to oversee four facilities there. The monitors were appointed following a New York Attorney General’s Office lawsuit alleging that the Rozenbergs and Hagler siphoned $83 million from four New York nursing homes between 2013 and 2022 in order to enrich themselves.

“When there is evidence of fraud of this magnitude, and when a judge has acted to prevent further siphoning and self-dealing, we have a duty to act. To protect New Jersey Medicaid and the residents who rely on it, we must stop the flow of Medicaid funds to these individuals, and we must require them to step aside,” acting State Comptroller Kevin Walsh said in a news release.

Jeff Jacomowitz, spokesperson for the company that manages the facilities, said in an email: “Centers Health Care does not comment on pending litigation. We will continue to fight the New York Attorney General’s spurious claims and will respond to the New Jersey copycat claims in due course.”

Hundreds of nursing home beds affected

Deptford Center and Hammonton Center both have 240 beds. Details on how many people are being cared for in the two nursing homes were not immediately available.

Laurie Facciarossa Brewer, New Jersey’s long-term care ombudsman, said it is likely that the majority of them have Medicaid, which is a joint federal and state insurance program for low-income individuals.

Facciarossa Brewer called the suspension of the two nursing homes “richly deserved.” Losing Medicaid would put the owners in a difficult spot, she said.

The owners could sell the facilities or close them, but it’s rare for a New Jersey nursing home to close, she said. Buyers typically take over.

That’s what happened in 2017, when another Centers Healthcare facility lost access to both Medicare and Medicaid. The closure was announced, but a buyer stepped in before that happened.

If Deptford and Hammonton were to close, the ombudsman office would help find new placements for the residents, Facciarossa Brewer said.

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