'Massive Scam' At NJ Nursing Home Detailed In New State Report

BRIDGETON, NJ — The operators of New Jersey's worst-rated nursing home kept millions of dollars for themselves while residents lived "in a dismal, understaffed, and under resourced facility," a state watchdog said.

On Thursday, the Office of the State Comptroller moved to suspend South Jersey Extended Care and related businesses from Medicaid funding after saying its owner and operators engaged in “a massive scam, perpetrated for years."

Inspections at the for-profit nursing home in Bridgeton revealed that residents were mistreated or neglected "with regularity," including in one instance where a nurse's aide confined a resident with dementia to their room by tying the door handle with a plastic trash bag, the Comptroller said.

Another state surveyor documented alleged abuse, with a resident falling out of a wheelchair and ending up in the hospital after being "roughly handled" by a staff member.

South Jersey Extended Care has received consistent one-star ratingsfrom the U.S. Centers for Medicare and Medicaid Services, Acting Comptroller Kevin Walsh noted. Because of this, the Comptroller's Medicaid Fraud Team began looking into the 167-bed nursing home in 2018, with the review period going until last year.

During the review period, the nursing home had around 110 residents, many of whom were under 60 years old and/or had been diagnosed with mental illness, according to a report.

According to the Comptroller, the facility is owned by Mordechay “Mark” Weisz, but operated by his cousin Michael Konig and Konig's brother-in-law, Steven Krausman. Investigators discovered that South Jersey Extended Care received $35.6 million in Medicaid funds from April 2018 to March 2023, but paid $38.9 million over that period to healthcare service companies that Konig and Krausman owned or controlled.

“These individuals were able to amass a fortune by pretending to be independent parties," Walsh said. "In reality, they operated as one unit, providing terrible care to the sick, the elderly, and the poor, so they could make big profits.”

Konig’s company Broadway Health Care Management was paid over $10 million to provide nursing and other services at the facility over the course of two years, but the home was "perpetually understaffed," according to the report. Thus, residents received their medications later than needed and were not cared for attentively, the report said.

There were also unqualified people in senior positions, according to the Comptroller — including a Director of Nursing whose license had been suspended, and a Director of Social Work who was also not licensed.

Inspection reports from the Department of Health detailed "bleak, unhygienic conditions" such as a bedroom that reeked of urine and had a catheter bag on the floor, a toilet that had been broken for days and was full of "brown debris and paper products," and rooms with stained walls or curtains.

Businesses owned or controlled by Krausman and Konig also had contracts to provide medical supplies to nine other New Jersey nursing homes and charged inflated prices, the Comptroller's report said.

“Our report lays bare in great detail how unscrupulous nursing home operators are able to exploit weaknesses in the system and fleece the Medicaid program,” said Walsh. “We owe it to nursing home residents, and taxpayers, to take this moment seriously, to learn from this investigation, and to ensure this can’t happen again.”

Read the Comptroller's full report here.