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Illinois Nursing Homes Owners Involved in Illegal Pharmaceutical Sales

A new lawsuit filed in Illinois this week alleges illegal kickbacks in a sale of a Chicago-based pharmaceutical company owned by the operators of Illinois nursing homes, reports the Chicago Tribune. The suit charges pharmaceutical giant Omnicare, Inc. with paying kickbacks in its purchase of Chicago based company Total Pharmacy. Total Pharmacy is owned by Chicago nursing home operators Phillip and Morris Esformes.

The lawsuit was filed by two whistleblowers, Maureen Nehls and Adam Resnik, both former employees and consultants for Total Pharmacy.

Nehls and Resnik described the details of the illegal activity, explaining how Omnicare agreed to pay more money (ultimately $25 million) to buy Total Pharmacy, so long as they also received guaranteed contracts to provide medical drugs to many of the nursing homes owned by the Esformeses. In addition, the Esformeses were allowed to keep an additional $7 million in accounts receivable, a hidden payment to avoid taxes and inflate the actual value of the sale for the Esformeses.

Federal anti-kickback law forbid pharmacies from paying nursing home owners to induce them to buy Medicare and Medicaid funded medicine for residents. The logic behind the law is simple: Nursing home owners should not personally gain at the taxpayers’ expense and nursing home residents should not be pawns in an attempt at personal enrichment for nursing home owners.

However, the Esformeses have shown that making money out of their nursing homes matters more than the care of the residents for whom they are responsible. The claims in this kickback lawsuit are merely the latest in a series of elder abuse and nursing home negligence at the Esformes-run Chicago nursing homes.

Among the Esformeses many Chicago nursing homes are Presidential Pavilion at 80th and Western and Burnham Healthcare in the south suburbs. Several of the 28 homes owed by the father-son team have been subjects of state and federal investigations for providing inadequate treatment. In one of those investigations, the Esformeses instigated a patient-brokering scheme, where residents were brought to local psychiatry hospitals to receive treatment, even when the patient did not have any need for such treatment. In other words, nursing home resident were used as pawns all to allow the nursing home operators to make more money.

These appalling acts committed by nursing home operators highlight the perilous situation of many vulnerable nursing home residents. The only way to ensure that these forms of elder abuse are eliminated is to provide close oversight of all owners and operators of our nursing homes.

Our Chicago nursing home lawyers at Levin & Perconti have spent years putting the magnifying glass on illegal, inadequate, and improper activity at Chicago nursing homes. If you suspect any such treatment at a facility, please contact our office so we can help put our considerable resources behind the uncovering the abuse. No elderly resident should have to sacrifice their health and well-being because greedy owners want to fill their wallet. Contact our office today.