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LINCOLN - A Medicaid fraud case with local ties continues nearly three years after it was initially filed by the Nebraska Attorney General’s Office but it may be coming to a conclusion in spring 2025.
A New York man, Joseph Schwartz, is being accused of carrying out a $59.6 million Medicaid fraud scheme involving the ownership of a chain of nursing homes from 2016-2018 including facilities in Wausa and Hartington.
Schwartz is being charged criminally in New Jersey and has civil suits pending or resolved in Arkansas. It is not immediately known if other states have pending litigation against him.
According to plea agreement documents filed by the U.S. Attorney’s Office in the District of New Jersey, Schwartz agreed to plead guilty to two counts - willfully failing to pay over employment taxes and willfully failing to file an annual Form 5500 which is a disclosure and compliance tool used for the Department of Labor.
After he pleaded guilty, the other 20 charges leveled against him were dismissed.
The plea agreement lists maximum penalties including prison time and fines but sentencing will be left up to the sentencing judge with judgment set for April 25, 2025. As part of the plea agreement, both sentences can run consecutively.
According to court documents, restitution of $5 million was agreed upon, due at the time of sentencing.
In Nebraska’s civil case filed January 2022 in Lancaster County District Court, the Nebraska Attorney General’s Office sought to recover the Medicaid payments made to Schwartz.
In the complaint, Schwartz is accused of directing and controlling the major operations of 22 Nebraska nursing homes. He operated nursing homes under the name Golden Living Center in both Hartington and Wausa.
In March 2018, the facilities were put in receivership after the business failed to make payroll. The Wausa facility was later forced to close and the Hartington facility changed ownership and is now known as Arbor Care Center.
According to a Cedar County News story at that time, at least a dozen Hartington area residents had indicated payroll checks were not able to be cashed. Some Hartington businesses indicated they also had trouble cashing checks from the facility.
The receivership was determined necessary by the Nebraska Department of Health and Human Services to protect the health and welfare of the facility’s residents.
The attorney general’s office alleges the company made decisions that harmed the nursing homes for Schwartz’s own financial benefit, and he made or used false documents and statements to make Medicaid claims.
According to the lawsuit, local facilities had little control over the financial operations with no operating budget or monthly financial reports tracking expenses.
The Nebraska suit claims Schwartz determined which bills got paid. Often vendors that were owned by Schwartz or his business associates were paid while others weren’t.
According to the most recent court filings, the Nebraska Attorney General’s Office indicated they were in productive settlement talks with Schwartz.
