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Suit: Home's owners endangered residents while taking huge raises

Medford Nursing Facility located at 3115 Horseblock on

Medford Nursing Facility located at 3115 Horseblock on Feb. 11, 2014. Photo Credit: James Carbone

Despite warnings from state health regulators that Medford Multicare Center for Living's lack of compliance was putting residents in danger, the nursing home's owners continued to cut costs while giving themselves raises, court records show.

The salary of Mordechai Klein, the nursing home's fiscal coordinator, grew from $810,000 in 2010 to $2.43 million in 2011, according to a lawsuit filed in Suffolk this week by New York State Attorney General Eric T. Schneiderman. During the same period, building coordinator Norman Rausman's salary increased from $225,000 to $597,000.

The men each put in 14-hour weeks at the nursing home, which the lawsuit said faced chronic staffing shortages.

Nine workers were arrested Tuesday on neglect and other charges, some related to the 2012 death of a patient.

Schneiderman's lawsuit says that collectively, the six owners received compensation totaling $9.9 million in 2011, nearly doubled the $5.6 million they earned in 2010. The $9.9 million pay is on top of the $2.9 million the owners paid themselves through Medford Multicare Management LLC, a management company state officials described as a shell corporation.

"As these staggering numbers amply demonstrate, there was no shortage of cash available to the owners to fund better care for the residents," the lawsuit claims.

Hank Sheinkopf, a spokesman for the nursing home, declined to address specific allegations, and instead issued a statement.

The owners, Sheinkopf said, have invested "tens of millions of dollars" of their own money into the facility since it opened.

"In fact, last year they opened a state-of-the-art 6,000-square-foot rehabilitation center at a cost of more than a million dollars," he said.

Schneiderman's office said the owners "looted" $60 million from the nursing home by paying themselves salaries and profits and by funneling Medicaid funds, money intended for residents' care, to their family-run charities.

Sheinkopf disputes the amount, saying the $60 million does not account for "several" million dollars in loans the nursing home took out to build, operate and improve the facility.

In 2011, the year Klein received $7 million in compensation, he complained in emails to the nursing home administrator that $6.40 was too much to spend on food per resident per day, the suit claims. The facility has 320 beds.

Klein also complained that other costs, such as overtime, $10,000 a month for X-rays and $44,374 for nursing supplies, were too high.

The following year, Klein complained about the costs of food and supplements, asking the administrator to bring food cost down from $6.32 to $5.75, a saving of 57 cents per resident per day.

"Let's not forget that the vents and tube feeders don't eat that much . . . " Klein said in an email to the administrator.

He also complained that $6.05 was too much to spend in medical supplies per person per day. Other homes spent an average of $3.50, he said.

The cost cutting began in 2005, when the owners ordered reductions on medications, diapers, linens and food supplies, according to the lawsuit. Incontinent residents were allowed one diaper per eight-hour shift.

"The staff was forced by their sense of human decency to horde supplies in order to provide basic care to the residents," the lawsuit said.

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