Ethical Lapses Cost Hospital/Nursing Home Big Time

by Gary Snyder

Part of Revival Home Health Care’s Mission is to : Maintain the highest ethical and clinical standards

Part of their values include: We are honest and ethical in our interactions.

Oops…a lie.

The trustee, Lori Lapin Jones, is going after Revival Home Health Care citing the Racketeer Influenced and Corrupt Organizations Act, she alleges the defendants committed fraud, falsified information to the bankruptcy court and creditors, and lied to the state Department of Health.

Revival Home Health Care, a Brooklyn home-care agency, dramatically unraveled. Instead of saving Peninsula Hospital, the company doomed it. Within weeks, Peninsula declared bankruptcy. The Revival team was accused of mismanagement. A judge-appointed Chapter 11 trustee soon took over, closed the hospital, and sold Peninsula's nursing home.

Revival's offer to save Peninsula was an elaborate plot to milk the hospital for revenue that would be diverted to a web of Revival entities. She alleges that the engineer behind the plot was Steven Zakheim, a Brooklyn health care executive who had already been blacklisted by the state Department of Health for misconduct and whose involvement would have been a red flag for regulators—had they been told he was bankrolling the plan.

Mr. Zakheim's wife, Faye, owned Revival, but the lawsuit claims that Mr. Zakheim controlled all Revival entities as well as several other related companies. The Peninsula takeover was Mr. Zakheim's "illegal scheme to acquire the debtors [Peninsula and its nursing home] and integrate them into his health care empire," according to the lawsuit

A couple of oversights on the part of everyone:

 ·      Mr. Zakheim and Peninsula's president, who was secretly on Revival's payroll despite, in 2005, the Department of Health required the Zakheims to sign affidavits stating he would not have any involvement in Revival Home Health Care's operations or finances. Mr. Zakheim, in fact, ran ambulance companies, a medical supply firm and Revival, the home health care agency. 

·      At least $1.3 million went to people or entities associated with Mr. Zakheim.  

·      In 2003, he submitted a false application for an emergency medical technician license by attesting he had never been convicted of a crime, when he had been convicted of a misdemeanor for sexual assault. It is alleged that Mr. Zakheim  "caused the use of hundreds of forged documents for the purpose of defrauding Medicare of millions of dollars" at his ambulance companies, Metropolitan Ambulance & First Aid Corp. and Metro North Ambulance Corp.

  A longtime friend was installed as the CEO who had no experience.

On Feb. 23, 2012, the DOH suspended the hospital's lab services after finding "serious deficiencies in the administration and operation relating to the clinical laboratory," according to the lawsuit.

Mr. Zakheim's response: "Can't we bribe anyone?"

Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Charity Navigator, Vermont Public Radio, Miami Herald, National Public Radio (NPR), Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), “Betrayal”, (a movie), NBC (on Charity Fraud…TBD), FOX2, ABC Spotlight on the News, WWJ Radio, Marie Claire, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, Charity Navigator, The Chronicle of Philanthropy, St. Petersburg Times, Board Room Insider, USA Today Topics, Accountants News, Newsweek.com, Responsive Philanthropy Magazine, New York Times, Portfolio Magazine, The Virgin Islands Daily News, NANKAI (China) BUSINESS REVIEW, National Religious Broadcasters newsletter, The Charity Governance Blog, American Chronicle, Palm Beach Post, Detroit Free Press, Oakland Press, Nonprofit World, Socially Responsible Business Forum, PNNOnline, Ohio Nonprofit Resources, Nonprofit Good Practice Guide, Nonprofit Startup Guide, Nonprofit Blog, National Coalition of Homeless Newsletter, Finance and Administration Roundtable Newsletter, MichiganNonprofit.com, CORP! Magazine, Crain’s Michigan Nonprofit, ncrp.org, PhilanTopic, Nashville Free Press, Nonprofit Law Blog, Seniors World Chronicle, Carnegie Reporter, Assoc. of Certified Fraud Examiners Examiner, msnbc.com, Worchester (MA) Telegram and Gazette, Carnegie Corporation of America, EO Tax Journal, Wikipedia: Non-profit Organizations; Parent: Wise Austin, Accountants News, Veterans Today, Answers.com, Far-roundtable, #Nonprofit Report, nonprofithelpnews, nonprofit news; National Enquirer, Northwest Herald, The HelpWise Daily, The #Nonprofit Report, Wikipedia (Nonprofit Organization), Answers.com, Nonprofits: On the Brink (2006) Silence: The Impending Threat to the Charitable Sector (2011)