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Joint Legislative Audit Committee votes to audit local skilled nursing facility

Brius Heathcare, Shlomo Rechnitz and Public Funds – Audit

On June 28th, the Joint Legislative Audit Committee (JLAC) voted to approve an audit of California’s largest nursing home owner, Brius Healthcare Services, and whether the company misused hundreds of millions of dollars in government health care funds to benefit its affiliated businesses.  That same day an audit was approved on the administration of public funds by the Los Angeles Homeless Services Authority.

Related:  Inglewood nursing home slammed for abuse allegations

North Coast Assemblyman Jim Wood (D-Healdsburg) is a member of the Joint Legislative Audit Committee that voted in favor of the audit Wednesday afternoon. He said the Los Angeles-based Brius Healthcare Services has a “very convoluted” system of nursing homes under limited partnerships and has connections with other businesses founded by Brius Healthcare’s CEO Shlomo Rechnitz.  Wood has also authored AB 275 as a direct result.

“Brius controls one in 14 [nursing home] beds in California and it is a very convoluted network of limited partnerships and all sorts of other mechanisms out there,” Wood said to the Times-Standard. “Part of this audit is to see if they are all legitimate. … Our feeling is the way they’re doing this is to maximize profits. It’s not about providing high quality care for people.”

Brius’ spokesman Stefan Friedman wrote in a statement to the Times-Standard that Brius representatives were present at the committee hearing today and were in full support of the proposed audit.

“Not only will the audit results prove that Brius has abided by all applicable rules and regulations, it will also show that Brius went well above and beyond its duties and obligations to subsidize the care of California’s most vulnerable,” Friedman said.

Brius Healthcare, which owns five of the six nursing homes in Humboldt County and over 80 nursing homes statewide, received over $500 million in reimbursement funds in 2015 from the MediCal and Medicare government health plan programs, which made up 80 percent of its profits, Wood said.

Wood and his North Coast legislative colleague Sen. Mike McGuire (D-Healdsburg) said Brius paid out more than $67 million that year to businesses with similar or related ownership for the purchase of services, goods and supplies, and paid more than $46 million to companies established Rechnitz that serve as landlords for their nursing home facilities.

The Legislature is currently considering Wood’s Assembly Bill 275, which is a direct response to Brius Healthcare’s planned nursing home closures in Humboldt County.

The bill would require the nursing homes to give residents at least 90 days notice if it changes license status or operations, such as full closure; gives the state Department of Public Health the ability to require that the nursing home create a patient transfer plan; and requires companies planning to close two or more nursing homes at the same time to submit a community impact report.

Read the full article on times-standard.com.

 



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