Philip Esformes spent the last four years in prison until President Donald Trump commuted his sentence in December 2020. A year earlier, the already incarcerated 52-year-old businessman was found guilty of 20 additional counts of bribery, money laundering, and obstruction of justice in one of the most significant Medicare fraud cases ever tried by the U.S. government. According to evidence at his trial, Esformes bribed physicians to admit patients into his skilled nursing facilities and billed medically unnecessary services to Medicare and Medicaid.
While his nursing home residents lived in squalor, Esformes used his ill-gotten gains to support a lavish lifestyle, including purchasing a $1.6 million Ferrari, a $360,000 watch, and homes in Miami, Chicago, and LA. Between 2010 and 2016, Esformes personally pocketed nearly $40 million in payments.
The history of systematic abuse and fraud occurring at his nursing home facilities went back to 1998 when the Chicago Tribune found that he and his father, Morris Esformes, recruited homeless people at shelters to live in his nursing facilities. In 2006, the father and son paid a $15.4 million settlement to the US Department of Justice Medicaid fraud civil lawsuit. In 2016, the Department of Justice charged Esformes with $1 billion in Medicare fraud, the largest in US history, at which point he was arrested and jailed. Among other Government allegations, Esformes’ skilled nursing and assisted living facilities filed false claims for services over a period of 14 years.
Why was the prison sentence of Philip Esformes commuted? Prosecutors who spent years building cases against him were bewildered and disheartened by the news. They describe Esformes as the biggest-ever Medicare fraudster, while his presiding judge, U.S. District Judge Robert Scola, termed his case a violation of trust of epic proportions. For decades, he and his family-owned skilled nursing facilities and assisted living facilities that served as ATM’s for their opulent lifestyle.
Additional Reasons why Medicare Nursing Home Fraud is a Problem
It turned out that the Esformes family still had enough money to hire attorneys to lobby on his behalf with former President Trump. They argued that Esformes was “in declining health” and that he had served a sufficiently long amount of time for his crimes. Days after his release, Esformes was shown dancing at his daughter Serena’s wedding, clearly suffering no ill-effects from his years behind bars.
Unfortunately, setting Esformes free sent the wrong message about Medicare fraud and the systematic abuse of nursing home finances. Apparently, stealing more than a billion dollars from the U.S. government qualifies for a relative slap on the wrist. We can only hope that the new administration in Washington will see things differently.