Tag Archives: James Populus

Report: California low-balling nursing home penalties

How can Shlomo Rechnitz and Brius Healthcare assemble a stable of 81 California nursing homes while racking up 386 health and safety violations over a recent three-year period?

The answer may be found in a report issued last week by Disability Rights California. The nonprofit concluded that the state often issues strikingly different penalties for seemingly identical violations and often declines to seek the maximum penalty for nursing homes found to have violated safety rules.

Issuing lower-level penalties helps unsafe facilities stay open and deprives the state of lost fine revenue, the report found. And it keeps patients and their families in the dark about the safety risks posed by certain facilities.

The Sacramento Bee highlighted one of Rechnitz’s nursing homes to illustrate this practice in its article detailing the report.

In 2010, Armando Reagan was rushed from Rechnitz’s Vedugo Valley Skilled Nursing & Wellness Centre in suburban Los Angeles to a hospital bleeding from bedsores in his groin. Within an hour, he was dead.

Instead of issuing Verdugo Valley the harshest punishment – A Type AA citation and a $100,000 fine, the California Department of Public Health issued a milder Type A citation and a $20,000 fine.

That decision had consequences, the Bee noted, because Verdugo Valley had already received a AA citation in 2009. Had Reagan’s death in 2010 also resulted in an AA citation, the state would have had to revoke or suspend the facility’s license.

Instead, the facility remained open and was later hit with another AA citation in connection with the 2014 death of James Populus.

In fact, Disability Rights California found that state regulators classified more deaths as Class A Citations than Class AA citations between 2000 and 2014.

Insurer sues Shlomo Rechnitz in connection with Los Angeles nursing home death

Shlomo Rechnitz’s nursing home just outside Glendale, Calif. has been fined, charged with involuntary manslaughter and indicted by a Los Angeles Grand Jury stemming from two patient deaths.

Now the company that insured the home is suing Rechnitz, the state’s largest nursing home operator, accusing him of omitting those facts when he applied for an insurance policy.

The lawsuit filed in federal court late last year by the Michagan-based firm ProAssurance could prove costly to Rechnitz, a billionaire, who recently found himself knee-deep in a Ponzi scheme.

ProAssurance is asking a federal judge to rescind its policy for Verdugo Valley Skilled Nursing & Wellness Center, LLC – a subsidiary of Rechnitz’s Brius Healthcare Inc., which controls one out of every 14 nursing home beds in California. ProAssurance is also asking the judge to declare that it has no duty to pay up if Rechnitz and Verdugo Valley lose an ongoing wrongful death lawsuit.

That could leave Rechnitz on the hook for any damages a jury awards to Carl Populus, whose 58-year-old brother James Populus died after receiving “grossly negligent” care at Verdugo Valley three years ago, according to a 2015 investigation by state Attorney General Kamala Harris.

The investigation found that the facility’s failure to provide proper medical care  led Populus to suffer “severe weight loss, sepsis and pneumonia.”

When a nurse reported that Populus had become verbally unresponsive and had a weak pulse, facility managers waited over an hour to call for an ambulance, according to court papers. Populus died at a nearby hospital six days later of “multiple system failure due to sepsis” with infections throughout his body, state investigators determined.

Prosecutors also filed felony abuse charges against two nurses at the facility.

Yet, according to court papers, Rechnitz’s facility answered “No” on its insurance application when asked by ProAssurance if it had ever been “the subject or investigatory or disciplinary proceedings or reprimanded by an administrative or governmental agency or professional association.”

The facility also made no mention on the application that the California Department of Public Health had issued it a Class AA Citation and a $100,000 fine in 2009 in connection to the suicide of 34-year-old Charles Morrill.

The CDPH later reduced the fine to $45,000, but a grand jury in Los Angeles County indicted the facility alleging that it had permitted Morrill to suffer “unjustifiable physical pain and mental suffering.” It further held that the home was complicit in Morrill ending his life by discharging a fire extinguisher down his throat.

Rechnitz still owns Verdugo Valley, but last year state regulators rejected his bid to buy five more nursing homes. They cited records showing that  his homes had racked up 386 serious violations over the previous three years — none more serious than the death of  Populus.

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