Former assisted living community and nursing home owner Philip Esformes pleaded guilty to healthcare fraud on Thursday and received a sentence of time served, ending a case the federal government at one time valued at more than $1 billion and labeled “the largest healthcare fraud scheme charged by the US Justice Department.”
Esformes pleaded guilty to one count of conspiracy to commit healthcare fraud in front of Senior Judge Robert N. Scola Jr. of the US District Court for the Southern District of Florida. The Justice Department agreed to drop five other counts against him, according to CNBC. Sentenced to time served, Esformes already has served four years stemming from charges filed in 2016.
It had been reported earlier this month that Esformes had reached a plea deal with federal prosecutors.
Former President Trump commuted Esformes’ 20-year prison sentence in December 2020, but he left intact the remaining parts of his sentence, including three years of supervised release, restitution payments and the forfeiture of property equivalent to the value traced back to Esformes’ money laundering offenses.
Esformes will pay almost the entire restitution and financial judgment owed to the US government, according to the Miami Herald. In all, he will pay a total $5.5 million in restitution to the federal Medicare program, as well as at least $14 million from the sale of real estate and other business assets toward an outstanding forfeiture penalty of $38.7 million — the amount he received form Medicare through fraudulent billing at his assisted living communities and skilled nursing facilities between 2010 and 2016.
According to federal prosecutors, Esformes already has paid the restitution amount and is expected to pay at laste $30 million toward his forfeiture obligation, the media outlet stated.
Under the terms of the plea deal, Esformes faces no further restrictions or fines.
Esformes had been convicted in 2019 on charges including conspiracy to defraud the United States, money laundering, paying and receiving kickbacks, bribery, wire fraud and obstruction of justice. The jury, however, did not reach a verdict on six counts, which prosecutors said they intended to pursue.
Federal prosecutors were free to retry Esformes on the six counts after the US Supreme Court in December declined to hear an appeal.
It marked the second time in 2023 that the high court denied an appeal from Esformes. In April, Justice Clarence Thomas rejected an emergency appeal seeking to stay a decision from the 11th US Circuit Court of Appeals affirming his 2019 conviction on 20 charges. Esformes’ attorneys had argued that the case should be thrown out after the government improperly seized and used documents protected by attorney-client privilege.
Esformes first was charged in 2016. The federal government, in part, alleged that he would move skilled nursing residents to his assisted living communities when they were at or near the end of Medicare’s 100-day post-hospital benefit period for skilled nursing. “After the required 60-day waiting period between consecutive admissions to an [sic] SNF, a physician or physician assistant would readmit the beneficiary to the hospital, re-initiating the cycle,” according to a federal motion in 2016.
Meanwhile, the government alleged, Esformes provided access to assisted living residents “for any healthcare provider willing to pay a kickback” — including pharmacies, home health agencies, physician groups, therapy companies, partial hospitalization programs, laboratories and diagnostic companies — even though many of the services for which they were paid were not medically necessary or were never provided.
