State AG’s office: Charges for former nursing home operator

Arkansas Attorney General Leslie Rutledge says an arrest warrant has been issued for the former owner of a nursing home group that once operated eight facilities in Arkansas, including one in Independence County.

In a media release from her office on Monday, Rutledge said Joseph Schwartz is accused of eight counts of Medicaid fraud resulting from the submission of false statements in cost reports and other documentation to the Arkansas Medicaid Program.

According to Arkansas Business, Schwartz, of Brooklyn, NY, is the former owner of Skyline Health. Schwartz’s attorney, Bill James, says his client is expected to surrender in January and will plead not guilty to the charges, according to The Associated Press.

In 2018, Skyline allegedly exaggerated its costs by $6,285,216 and received an overpayment of $3,610,912 for the eight nursing home facilities in Arkansas, the release said. Schwartz is also charged with failing to pay $2,012,177 withheld from his Arkansas employees’ paychecks to the state of Arkansas from July 2017 to March 2018.

“These charges come after a 44-month-long investigation into Skyline’s wrongdoings, and I will not sit idly by while anyone defrauds the State and Federal government out of millions of dollars to line their own pockets,” said Attorney General Rutledge. “It’s important for Arkansans to know if they suspect Medicaid Fraud, they should immediately contact my office.”

One of those Arkansas facilities once operated by Skyline included the former Batesville Health and Rehab, the release said. See the chart below from AG Rutledge’s office that highlights the alleged inflated amounts from the eight Skyline facilities in the state.

The case will be prosecuted in cooperation with the Sixth Judicial District Prosecuting Attorney Larry Jegley. The release said the case was referred to the Attorney General’s Office by the Office of Medicaid Inspector General and the investigation was worked in cooperation with the HHS OIG- Office of Investigation, Nebraska Medicaid Fraud and Patient Abuse Unit, Kansas MFCU, Maryland MFCU, and South Dakota MFCU.

Schwartz was also sued in federal court in 2020 by former employees in South Dakota, Kansas, Nebraska, and Arkansas who claimed that they were left without health insurance even though money was deducted from their paychecks, according to The Associated Press.

Medicaid fraud occurs when Medicaid providers use the program to obtain money for which they are not entitled. To report suspected fraud or abuse, contact the Arkansas Attorney General’s Office at (800) 482-8982 or visit ArkansasAG.gov.