State authorities have levied a 10-year suspension against the former owner of six Connecticut nursing homes for lying to obtain nearly $1.5 million in state Medicare payments to cover business debts and improvements to his luxury homes.
Attorney General George Jepsen and the state Department of Social Services announced Thursday the suspensions against Earle Lerner of Manchester and Newport, R.I., and his company, Marathon Health Care Group of East Hartford.
The 10-year suspension bars Lerner from owning or working for any Connecticut health care provider that receives Medicaid funds, authorities said.
A phone number listed for Marathon was disconnected and Lerner could not be located Thursday for comment.
Investigators say they determined Lerner used most of a $700,000 first round of fraudulent advance payments from DSS in 2005 to finalize the purchase of a Springfield nursing home.
Lerner obtained another $771,000 in illegal advance payments in July 2006 to pay debts instead of covering increased nursing costs, as he originally claimed, regulators said.
In addition, the DSS investigation found that from 2005 through 2007 Lerner violated state law by failing to deduct personal costs in the cost reports submitted to DSS, which enabled him to obtain payment for tens of thousands of luxury home improvements.
These included a $14,000 gas range and a $12,000 refrigerator and wine cooler for his Manchester home, and central air conditioning for his Newport, R.I. vacation home. Lerner’s actions resulted in DSS paying more than $30,000 for Lerner’s home renovations through an increase in Marathon’s per diem Medicaid rates.
The agency later recovered all the advance payments, authorities said.
In July 2009, Marathon’s six nursing homes with nearly 730 beds that had been seized by the state were sold to a Connecticut partnership for $350,000.
Paradigm Healthcare Development bought the six Marathon facilities in Waterbury, Torrington, Prospect, New Haven, West Haven and Norwalk.
