Nursing home operator Philip Esformes – convicted of one of the biggest Medicare frauds in history and whose 20-year sentence was commuted by President Donald Trump – was denied an appeal hearing by the U.S. Supreme Court on Monday to throw out his conviction altogether.
While Trump commuted Esformes’ prison sentence in December 2020, he left the conviction and financial penalties intact.
In 2019, Esformes was required to forfeit $38.7 million and pay $5.53 million in restitution after being found guilty on 20 counts related to kickbacks, money laundering, obstruction of justice and conspiracy, according to court documents noted in an article published in the South Florida Sun Sentinel newspaper.
Esformes challenged the conviction and the forfeiture order on grounds that the federal prosecutors improperly seized and reviewed records that were shielded by attorney-client privilege and that a district judge should have dismissed the indictment or disqualified the prosecution team, the Sun Sentinel article states.
Esformes co-owned a slew of skilled nursing facilities (SNFs) and assisted living facilities (ALFs) spread out over Illinois, Missouri and Florida. His assets also included a Miami-area hospital, which was used to approve the hospital stay requirement.
In a brief filed with the Supreme Court to counter the latest petition for Esformes’ appeal, the DOJ said Esformes “orchestrated a massive health care fraud scheme.”
“The scheme centered around the payment of bribes and kickbacks to physicians and administrators at a local hospital ‘to refer patients to his skilled nursing facilities who did not need that care,’” said the brief, the Sun Sentinel article noted. “The Esformes network then provided ‘unnecessary and expensive medical services to those patients and fraudulently inflated bills with services that the facilities did not provide.’ When petitioner (Esformes) was done billing the patients at his skilled nursing facilities, the patients were often sent to one of his assisted living facilities. From there, petitioner often sold access to his patients to other corrupt health care providers in exchange for kickbacks. Those providers included laboratories, pharmacies, and partial hospitalization programs that often did not provide services to the patients.”
Last month, the U.S. Department of Justice (DOJ) also attempted to reopen Esformes’ case on a handful of counts on which the jury could not reach a decision. Even though the double-jeopardy principle protects defendants in the U.S. legal system from re-prosecution, it only applies to charges for which jurors have rendered a verdict. And, in the Esformes case, although the jury convicted him on more than two dozen charges, they weren’t able to reach a verdict on six counts. This included the most important count, that of the conspiracy to commit health care and wire fraud.
Those issues have been on hold amid the appeal, according to a Nov. 30 court document, the Sun Sentinel notes.
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