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Feds joining lawsuit against ex-nursing home operator

LUMBERTON  — Federal officials are joining a whistleblower lawsuit claiming a former south Mississippi nursing home operator withheld care to pad profits.

The suit, originally filed by Academy Health Center, accuses the former operator of a Lumberton nursing home of claiming money from Medicare and Medicaid for services that he didn’t provide or for services so bad they were “effectively worthless.”

Douglas K. Mittleider and companies he controlled ran the nursing home from October 2005 until May 2012. The suit says Mittleider and his companies withheld employees and supplies, letting the nursing home run down while providing only the bare minimum of cash to operate. Among items that were supposedly rationed to save money were towels, garbage bags, laundry bags, medical tubing and oxygen bottles. Staff members were sometimes asked to delay cashing their paychecks.

The suit says residents suffered pressure ulcers, falls, dehydration and malnutrition. In one case, a snake was found in the bed of a patient complaining of leg pain. Residents complained of being hungry and one administrator used personal money to buy them snacks, the suit says.

“It is critically important that we confront nursing home operators who put their own economic gain over the needs of their residents,” Stuart F. Delery, principal deputy assistant attorney general for the Civil Division of the Department of Justice, said in a statement. “Operators who bill Medicare and Medicaid while failing to provide essential services or bill for services so grossly substandard as to be effectively worthless, will be pursued for false claims, including multiple damages and penalties.”

Academy says the Lumberton home, which operated as Oxford Health & Rehabilitation Center, is one example of a nationwide scam by Mittleider to bilk nursing homes for money while stiffing creditors. Academy says Mittleider controls at least 34 nursing homes.

Mittleider could not immediately be reached for comment Monday.

Under the lawsuit filed by Academy, Mittleider could face triple damages for all the money his companies have received from federal programs, plus civil penalties. Academy would get a portion of any recovery since it brought the suit on the government’s behalf.

“They’re pleased to see the Department of Justice has intervened,” said Julie Mitchell, a lawyer for Academy. She said Academy is again directly running the nursing home, which is now operating as Lamar Health & Rehabilitation Center.

In 2005, Academy leased the nursing home to Hyperion Foundation, a nonprofit entity that Academy says Mittleider controlled. Hyperion fell behind in its lease payments to Academy, and filed for Chapter 11 bankruptcy reorganization before Academy could evict Hyperion in 2008.


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