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The state Comptroller previously suspended the owners of Deptford Center for Rehabilitation and Healthcare and Hammonton Center for Rehabilitation and Healthcare from New Jersey Medicaid.
A Superior Court judge ordered the appointment of Allen Wilen of the Eisner Advisory Group, LLC to run the nursing homes effective June 17, according to the New Jersey Comptroller's Office.
The judge's appointment means that the receiver has complete control and authority over the finances and operations of both South Jersey nursing homes, the Comptroller said in a press statement.
The state Department of Health sought the court order, noting that both facilities rely almost exclusively on Medicaid funding and would have been in "dire financial straits if suspended from Medicaid," according to state officials.
Citing poor conditions in the facilities and evidence of massive Medicaid fraud in the owners’ New York facilities, the NJ Comptroller's Medicaid Fraud Division previously notified the owners, Kenneth Rozenberg, Beth Rozenberg, and Daryl Hagler and their entities that they would be suspended effective June 17 from New Jersey Medicaid unless they completely dissociated from the facilities.
The state Comptroller noted in its Jan. 25 suspension letter that the Hammonton Center and Deptford Center have been cited repeatedly for serious health and safety violations that negatively impacted residents’ care, as previously reported by Daily Voice.
Both Hammonton Center and Deptford Center also have received low ratings for health and safety from the federal Centers for Medicare and Medicaid Services.
“When there is evidence of fraud of this magnitude, and when there is a record of siphoning of public funds and self-dealing, we have a duty to act," Acting State Comptroller Kevin Walsh said in the press statement. "To protect New Jersey Medicaid and the residents who rely on it, we will stop the flow of Medicaid funds to those involved in fraud and require them to step aside.”
Due to the receivership, the Comptroller temporarily lifted the suspension, pending the outcome of the New York fraud case, the Comptroller’s investigation, or until and if the receiver determines the facilities should be closed, according to a letter the state sent to Hagler and the Rozenbergs.
The owners said in court filings that they have found a likely buyer and agreed to the appointment of a receiver, the Comptroller said.
Until the Department of Health approves the sale, the receiver is authorized to take any action “necessary or appropriate to conserve the property and promote the health, safety, and welfare” of residents, according to the court order. Additionally, the order bars the owners from “taking any action that could interfere” with the receiver’s responsibilities, such as liquidating assets, officials said.
Hagler and the Rozenbergs were accused of siphoning $83 million from nursing homes funded by New York Medicaid and Medicare to enrich themselves. In July 2023, a New York State Supreme Court judge found evidence of “repeated and persistent fraud” so credible that she appointed a financial monitor and health monitor to assess and manage the operations of their New York nursing homes.
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