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= NA AU OUN NK 09 04: DM INDEX NO. 617709/2022
NYSCEF BOC. NO. 695 RECEIVED NYSCEF: 09/29/2023
EXHIBIT B
INDEX NO. 602249/2022
(FILED: WHEEN0 COUNTY CLERK 09/29/2022 04:79 PM
NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2024
ASSURANCE OF DISCONTINUANCE MADE
PURSUANT TO EXECUTIVE LAW § 63(15)
BETWEEN THE ATTORNEY GENERAL OF THE STATE OF NEW YORK, for the
PEOPLE OF THE STATE OF NEW YORK, AND DEFENDANTS
MORDECHAI KLEIN, NORMAN RAUSMAN, MARTIN RAUSMAN,
HENRY RAUSMAN, MICHAEL RAUSMAN,
SUSAN ASCHKENAZI,
THE NURSING CARE CENTER AT MEDFORD d/b/a
MEDFORD MULTICARE CENTER FOR LIVING, INC., AND
MEDFORD MULTICARE MANAGEMENT, LLC
DATED: June4,2016
WHEREAS, the Attorney General of the State of New York (the “Attorney General”),
on behalf the People of the State of New York, commenced an action in the Supreme Court of
the State of New York, County of Suffolk, J. Molia, Index no. 2941/14 (hereinafter referred to
as the “Action”) against The Nursing Care Center at Medford d/b/a Medford Multicare Center
for Living, Inc. (“Medford”) and its owners Mordechai Klein, Norman Rausman, Martin
Rausman, Henry Rausman, Michael Rausman, and Susan Aschkenazi (the “Defendant Owners”),
Medford Multicare Management, LLC (“Medford Management”) et al., pursuant to Executive
Law § 63(12), Social Services Law § 145-b, State Finance Law Section § 189(1) and the
common law, originally filed on February 11, 2014, and amended on June 30, 2014 (the
“Amended Complaint”), and had previously conducted an investigation through the Medicaid
Fraud Control Unit (the “MFCU Investigation”) into the activity of Medford, a 320-bed for-
profit nursing home located in Medford, Suffolk County;
WHEREAS, at all times relevant hereto, Medford was enrolled in the New York State
Medicaid Assistance Program (‘Medicaid”) program and received funds covering costs of
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nursing home and therapy services provided to Medicaid recipients, and received over $280
million from the Medicaid program to provide critical care to its residents;
WHEREAS the Participating Defendants include Medford, Medford Management, and
the Defendant Owners, who can bind Medford to all acts required under this Assurance of
Discontinuance (“AOD” or “Agreement”);
WHEREAS, the following constitute the Attorney General’s findings from such
investigation, including what is alleged in the Amended Complaint, (excluding for pars. 45 and
46 of the Amended Complaint), as set forth below in Pars. A-L, hereinafter referred to as the
“Covered Conduct” and;
WHEREAS the Participating Defendants neither admit nor deny the Attorney General’s
findings and/or liability for the Covered Conduct but agree that the Attorney General’s findings
are admissible in an action by the Attorney General to enforce this Assurance of Discontinuance.
Findings as to Criminal Conduct, Single Incidents
A Between 2009 and 2014, the Attorney General secured the convictions of nineteen
caregivers employed by Medford related to numerous acts of criminal patient neglect,
falsification of business records and willful disregard for the reporting requirements, in violation
of the Penal Law and the Public Health Law.
Findings as to Criminal Conduct, October 26, 2012 Death
B On May 23, 2015, ten additional persons were charged by indictment in
connection with the death of a 72-year-old ventilator-dependent resident on October 26, 2012,
including Medford’s Administrator David Fielding and Defendant Medford for covering up the
circumstances of the death.
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Cc. By July 2015, eight Medford employees were convicted of crimes relating to the
October 26, 2012 death and related falsification of business records, and failure to report the
neglect as required by law, in violation of the Penal Law and Public Health Law. One licensed
professional was convicted of Criminally Negligent Homicide, and the Director of Respiratory
Therapy for Medford was convicted of Falsifying Business Records in the First Degree.
D. On or about September 11, 2015, David Fielding, former Administrator of
Medford, pled guilty to two felony counts of Falsifying Business Records in the First Degree and
one misdemeanor count of Wilful Violation of Health Laws, arising from acts to cover up the
October 26, 2012 death.
E. On October 8, 2015, Defendant Medford pled guilty to Attempted Falsifying
Business Records in the Second Degree in violation of Penal Law Section 175.05(4), a Class A
Misdemeanor in satisfaction of the charges arising from the acts of its former Administrator
David Fielding on behalf of Medford.
Findings as to Persistent Deficient Care
F Between 2004 and 2014, the New York State Department of Health (the “DOH”)
cited Medford with approximately 150 violations of state and federal regulations designed to
ensure that adequate care is provided to nursing home residents.
G DOH found that Medford placed its residents in “Immediate Jeopardy” of
“serious injury, harm impairment and death” on five separate occasions: Medford was cited with
one Immediate Jeopardy in 2004, a year after Medford opened; one occurred in April of 2009,
which was revised in August of 2010: two occurred in July of 2014, in connection with the
death of two Medford residents; and one occurred as recently as August of 2015, after the
Amended Complaint was filed.
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H On September 2, 2014, Medford was placed into the Special Focus Facility
program administered by the U.S. Department of Health and Human Services, Center for
Medicaid and Medicare Service “due to its history of non-compliance with quality of care and
safety requirements;”
I The Attorney General has found that direct-care staffing and supervision at
Medford was per se inadequate throughout most of the time of Medford’s operation;
J The Attorney General determined that Defendant Owners underfunded direct care
staffing at Medford and failed to provide adequate supervision of staff and its high managerial
agents in order to divert millions of dollars to themselves through exorbitant salaries, bogus
management fees through a shell company and self-serving charitable donations;
K The Attorney General concluded that as a result of Defendant Owners’ diversion
of public funds, the residents of Medford, including residents protected by the New York State
Medicaid Assistance Program (“Medicaid ”), did not receive the care they were entitled to
receive, and for which Medford was paid; and
L By his Amended Complaint, the Attorney General therefore asserted claims
against Medford , the Participating Defendants, Medford Management, et al. under the
Executive Law Sections 63-c and 63(12), the Public Health Law, State Finance Law Section
189(1), Social Services Law Section 145-b, and other statutes and the common law, for
restitution, damages, and equitable relief.
: WHEREAS, the Attorney General finds the relief and promises set forth in this
Agreement appropriate and in the public interest, in the interests of the current and future
residents of Medford, and in furtherance of Medicaid program integrity;
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WHEREAS, the New York State Department of Health (“DOH”) instituted an
administrative claims withholding procedure on February 20, 2014 and has withheld Medicaid
reimbursement payments due and payable to Medford at the rate of twenty (20%) since then
(“Withheld Funds”);
WHEREAS, the Attorney General, on behalf of the State of New York, and the
Participating Defendants Medford, Mordechai Klein, Norman Rausman, Martin Rausman,
Michael Rausman Henry Rausman, Susan Aschkenazi, and Medford Management (the
“Participating Defendants”) wish to enter into this Agreement as of the date set forth above to
resolve the pending litigation; and
NOW THEREFORE, the Participating Defendants and the Attorney General (the
“Parties”) enter into this Agreement, an Assurance of Discontinuance (the “Agreement” or
“AOD”) as follows:
Section I:
MONETARY RELIEF
1 Participating Defendants shall pay the sum of TWENTY EIGHT MILLION ONE
HUNDRED THOUSAND DOLLARS ($28,100,000.00) as set forth in Paragraphs 2 to 7, below,
in satisfaction of the Attorney General’s civil claims arising from the Covered Conduct.
2 Participating Defendants shall be jointly and severally liable to make the
payments set forth herein.
Restitution to the Medicaid Program
3 Commencing upon the Effective Date of this Agreement, or as soon thereafter as
feasible, if all other terms and conditions precedent to the Effective Date have been met, DOH
shall discontinue the 20% administrative claims withholding procedure on Medford, and shall
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remit a portion of such Withheld Funds in the amount of TEN MILLION DOLLARS
($10,000,000.00) to the Medicaid Program (the “New York State Medicaid Settlement Amount”)
through the Medicaid Fraud Control Unit Restitution Fund. Participating Defendants hereby
waive any claims to said Withheld Funds and consent to the foregoing application of such funds.
Medford Resident Care Fund
4 Prior to the Effective Date, Participating Defendants shall establish a fund to be
used exclusively for the benefit of the residents of Medford (the “Medford Resident Care Fund”)
that shall fund the quality care reforms recommended by the Independent Operator (the
“Independent Operator”) set forth below. The Medford Resident Care Fund shall be established
at a financial institution licensed in the State of New York, subject to the approval by the
Attorney General.
5 Participating Defendants shall be credited:
(a) FIVE MILLION SEVEN HUNDRED THOUSAND DOLLARS
($5,700,000.00) in funding previously made to the facility in 2015 at the
request of the Independent Operator for necessary improvements in patient
care in 2015.
(b) THREE MILLION FOUR HUNDRED THOUSAND DOLLARS
($3,400,000.00) representing funds previously diverted to Defendant Medford
Multicare Management and thereafter to Defendant Owners, and returned to
Medford during the pendency of the MFCU Investigation.
6 Upon the Effective Date, the Medford Resident Care Fund shall be funded with
the sum of FIVE MILLION TWO HUNDRED TWENTY- SIX THOUSAND SEVEN
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HUNDRED TWENTY NINE DOLLARS ($5,226,729.00) in four (4) installments
annually as follows:
a. SEVEN HUNDRED TWENTY- SIX THOUSAND SEVEN HUNDRED
TWENTY NINE DOLLARS ($726,729.00) on or before the Effective Date;
a. ONE MILLION FIVE HUNDRED THOUSAND DOLLARS
($1,500,000.00) on or before May, 2017;
b. ONE MILLION FIVE HUNDRED THOUSAND DOLLARS
($1,500,000.00) on or before May, 2018; and
c. ONE MILLION FIVE HUNDRED THOUSAND DOLLARS
($1,500,000.00) on or before May, 2019.
7 DOH shall remit an additional THREE MILLION SEVEN HUNDRED
SEVENTY THREE THOUSAND TWO HUNDRED SEVENTY ONE DOLLARS AND
THIRTY SIX CENTS ($3,773,271.36) in administrative claim Withheld Funds, plus any and all
Withheld Funds withheld since June 9, 2016, to the Medford Resident Care Fund. Defendants
hereby waive any claims to said withheld funds and consent to the deposit of such funds into the
Medford Resident Care Fund to be used as set forth below.
8 Proof of payment made by the Participating Defendants into the Medford
Resident Care Fund shall be provided to the Attorney General within five (5) days of payment
thereof.
9 In the event that the Independent Operator determines that additional funds are
necessary to implement quality assurance reforms, the Participating Defendants shall promptly
make additional payments into the Medford Resident Care Fund to fund such improvements,
subject to review by the Independent Financial Monitor.
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10. The parties expect that the funds in the Medford Resident Care Fund will be
completely expended during the term of this Agreement, in accordance with its provisions. Upon
request by Independent Operator and consent of the Attorney General, any funds remaining in
the Medford Resident Care Fund at the end of the term of this Agreement shall be used for the
benefit of the Medford residents and subject to the continued oversight of the Independent
Financial Monitor until such funds are expended. Any other proposed disposition of said funds
shall require prior approval of the Attorney General.
11. All funds paid into the Medford Resident Care Fund by Participating Defendants,
and/or transferred into the Medford Resident Care Fund with the consent of Participating
Defendants, are additional to and not in limitation of Participating Defendants’ obligation,
Medicaid Providers, to provide appropriate, adequate and timely care for the residents of its
nursing homes regardless of cost. Accordingly, the Medford Resident Care Fund shall not be
funded by the Participating Defendants with Medicaid payments made to Medford or Medicaid
payments made to any other nursing home individually or partly owned by any of the Defendant
Owners. This prohibition stated in the preceding sentence applies to distributions from nursing
homes individually or partly owned by any of the Defendant Owners to the extent that any such
distribution is in an amount that would adversely impact the delivery of appropriate, adequate
and timely care and services for the residents of each of these other nursing homes.
12. Nothing in this Agreement constitutes an agreement by the State of New York
concerning the characterization of the payments made or transferred by or to Participating
Defendants for purposes of federal or state tax laws.
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13. No portion of the following payments and/or costs shall be claimed as a
reimbursable expense on the facility’s Medicaid or Medicare Cost Reports, Cost Statements,
Information Statements or Payment Requests submitted by Medford to Medicaid or Medicare:
a. the payments Medford and the Participating Defendants make to New York State
pursuant to this Agreement, including the Medicaid Restitution Settlement Amount of
TEN MILLION DOLLARS ($10,000,000);
b the cost of the MFCU Investigation, litigation of the Civil Complaint and its
amendment, and the costs and expenses of the trial of the eight Medford employees in
2015 ($200,000) (Paragraph 24);
c. the cost of the Independent Financial Monitor, and any forensic accounting,
accounting or other services that the Independent Financial Monitor determines necessary
to carry out the responsibilities set forth within this AOD;
d Participating Defendants investigation, defense and audit undertaken in response
to the Attorney General’s the Civil Complaint and its Amendment thereto and the
criminal trial of the eight Medford employees, and this Agreement (including attorneys’
fees); and
€. the negotiation of this Agreement.
14, Participating Defendants are prohibited from making any withdrawals from the
Medford Resident Care Fund.
15. Participating Defendants agree not to take any draws or distributions from
Medford, except to pay taxes arising from Medford’s business operations, until one year after all
of the following conditions are met:
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a Medford is removed from the CMS Special Focus Facility program due to
successful completion of the conditions of that program; and
b. The Medford Resident Care Fund is fully funded.
16. Participating Defendants shall not make donations or other eleemosynary
transfers from Medford for the term of this Agreement.
17. Under no circumstances shall funding of the Independent Financial Monitor, the
Compliance & Risk Management Officer or any contractual or non-contractual litigation costs,
be charged directly or indirectly to the Medford Resident Care Fund.
Independent Financial Monitor
18. Defendant Medford shall hire an Independent Financial Monitor to verify and
audit transactions relating to the Medford Resident Care Fund. The Independent Financial
Monitor is empowered to retain any forensic accounting, accounting or other services that the
Independent Financial Monitor determines necessary to carry out the responsibilities set forth
within this AOD. Participating Defendants agree to pay promptly for any such services.
19. The Independent Financial Monitor will report directly to the Attorney General.
20. The Independent Financial Monitor will be given all powers necessary for direct
access to all information concerning the Medford Resident Care Fund. The Independent
Financial Monitor shall be the sole signatory on the Medford Resident Care Fund.
21. Participating Defendants shall provide the Independent Financial Monitor
unconditional access to (i) the books and records of Medford, (ii) the books and records of any
vendor in which any Participating Defendant has any ownership or controlling interest and which
has received funds from, does business with or is proposed to do business with Medford, as well
as access to any outside accounting firm for Medford, which, in the Independent Financial
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Monitor’s sole discretion, is necessary to carry out the Independent Financial Monitor’s
responsibilities.
22. The Independent Financial Monitor will receive and review copies of all bank
records for Medford, and shall forward copies of such statements to the Attorney General
quarterly or at such earlier frequency as the Independent Financial Monitor determines.
23. The Independent Financial Monitor will have the right to communicate with the
Attorney General, other state or federal regulators and prosecutors, including particularly any
agency authorized to pursue any and all remedies without notice to, or the consent of, the
Participating Defendants.
Other Financial Terms
24, Participating Defendants shall remit TWO HUNDRED THOUSAND DOLLARS
($200,000.00) to the Attorney General for the cost of the MFCU Investigation, litigation of the
Civil Complaint and its amendment, and the costs and expenses of the trial of the eight Medford
employees in 2015. Said payment shall be remitted on or before the Effective Date.
Section II:
GOVERNANCE AND QUALITY CARE REFORMS
INDEPENDENT OPERATOR
25. Participating Defendants shall retain an Independent Operator to oversee the
management and operations of Medford on a day-to-day basis, which shall be on-site though a
principal or directly employed staffer. Lisa Wickens-Alteri, RN, President, of Whiteman Health
& Human Services LLC will be the first Independent Operator. The Attorney General accepts
that nomination.
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26. The Independent Operator’s employment contract will be provided to MFCU
prior to the Effective Date, and is subject to approval by MFCU. To the extent that DOH
determines the contract is a management contract pursuant to 10 NYCRR §§ 405.3(f) &
600.9(d), the Participating Defendants will obtain DOH approval as needed, and will implement
all terms of this AOD throughout its term.
27. The Independent Operator or her designated representative approved by the
Attorney General, shall be on-site at Medford no less than 20 days per month during the first
year of this Agreement, and shall make a recommendation to the Attorney General upon the
conclusion of the first year of this Agreement as to a specific visitation plan for subsequent years
of this Agreement. The Attorney General’s Office may, in its sole discretion, approve or modify
such recommendation.
28. The Independent Operator shall have powers equivalent to a Temporary Operator
provided under Public Health Law Section 2806-A with regard to hospitals in addition to any
specific powers set forth herein. Participating Defendants consent to the designation and
appointment of the Independent Operator as a Temporary Operator if the New York State
Department of Health shall require such designation and appointment.
29. Participating Defendants shall implement all recommendations made by the
Independent Operator and Compliance& Risk Management Officer to ensure adequate,
appropriate and timely delivery of care to Medford residents.
30. Medford’s Administrator, Director of Nursing Services, and the Medical Director,
and Compliance & Risk Management Officer shall be subordinate to the Independent Operator
except where specific professional medical duties are non-delegable, and said Senior Staffs’
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employment shall be terminated, if necessary, in the sole discretion of the Independent Operator,
subject to the review of the Governing Body.
31. The Independent Operator shall have the following authority in addition to the
general authority set forth above:
a) To conduct and hire consultants and/or surveyors to perform and train
staff, with the Compliance & Risk Management Officer, to conduct mock
surveys;
b) Develop and implement, in consultation with MFCU, mandatory training
for Defendant Owners, Operator, the Administrator, the Director of
Nursing,-Medical Director, and RN Supervisors, within 120 days of the
Effective Date; and annually thereafter. Defendant Owners, the
Administrator, the Director of Nursing, Medical Director, Operators and
Supervisors of Medford (“Senior Staff”) agree to attend and shall attend
this mandatory training set forth herein.
33. Subject to constitutional privileges, Participating Defendants shall fully and
promptly cooperate with the Independent Operator and shall use their best efforts to ensure that
Medford’s officers, employees, agents, and vendors cooperate with the Independent Operator.
34. The Independent Operator’s initial term of engagement will be for five (5) years
from the Effective Date. Participating Defendants will promptly retain a substitute Independent
Operator, with prior approval from the Attorney General, in the event the Independent Operator
is unable to complete the appointment. The term of engagement of the Independent Operator,
and, if necessary, the Term of this Agreement, shall be extended in one year increments upon
each occurrence of any of the following:
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(a) A finding by NYS DOH of Immediate Jeopardy, Level L, as to conditions
as Medford, or a finding by NYS DOH that Medford be reinstated in the
CMS Special Focus Facility program;
(b) A determination by the Independent Operator, subject to review by the
Attorney General, that the Participating Defendants have failed to comply
with any material obligation hereunder;
(c) A determination by the Independent Financial Monitor, subject to review
by the Attorney General, that the Participating Defendants have failed to
comply with any material obligation hereunder,
(d) A determination by the Attorney General that the Participating Defendants
have failed to comply with any material obligation hereunder;
35. The Independent Operator, or approved designee, in addition to engagement at
Medford, shall conduct a one-time quality of care review (“Review”) within the first six (6)
months of the Effective Date, including an assessment of direct care staffing levels, at any
nursing home individually or jointly owned by any of the Defendant Owners (the “Affiliated
Nursing Homes”). The recommendations made by the Independent Operator, or approved
designee, as a result of the quality of care review of the Affiliated Nursing Homes, as well as the
likely effects of any failure on behalf of the owners and managers of those Affiliated Nursing
Homes to implement those recommendations, shall be memorialized in a report prepared by the
Independent Operator or approved designee, and emailed and mailed to all of the owners and
managers of each said Affiliated Nursing Home, and maintained onsite in the records of each
Affiliated Nursing Home, respectively, for a period of at least ten years. Certification that such
reviews were conducted and that such reports were prepared by the Independent Operator and
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distributed as required herein and shall be provided to the Attorney General within sixty days of
completion thereof.
36. The Independent Operator shall provide reports concerning Medford to the
Attorney General on a quarterly basis, concerning all activities under this Agreement including a
final report with recommendations concerning staffing, quality indicators and other
recommendations the Independent Operator deems necessary.
Reform of Governing Body
37. Participating Defendants shall form a new governing body for Medford that is
legally responsible for the overall management and operation of the facility, as required by 10
NYCRR Section 415.26 5(b), (the “Governing Body”), within 30 days after the Effective Date,
or after receiving approval from the Department of Health and/or the Public Health and Health
Planning Council as required by 10 NYCRR § 401.3(b) & 415 if such approval is required.
38. For the first three years of this Agreement, the Governing Body will be comprised
of three (3) members and shall include the Independent Operator, the Independent Financial
Monitor, and Participating Defendant Norman Rausman. Two additional board members who are
independent and have no familial or business relationship with the Owners and Operators of
Medford and who are professionals from the health care community, such as a physician and a
nurse, shall be elected by the existing board to the Governing Body, three years from the
Effective Date of this Agreement.
39. The Governing Body shall adopt by-laws within sixty (60) days of the Effective
Date, or within sixty (60) days after receiving approval from the Department of Health and/or the
Public Health and Health Planning Council as required by 10 NYCRR § 401.3(b) & 415 if such
approval is required, which by-laws are subject to the approval of the Attorney General. The
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bylaws shall include a provision requiring that the voting majority of the Governing Body shall
be independent and shall have no familial or business relationship with then Owners and
Operators of Medford.
40. Minutes of the meetings of the Governing Body shall be taken and shall include
the recommendations made by the Independent Operator, discussion of those recommendations,
and the approval or other disposition of those recommendations. Copies of the minutes from and
resolutions of the Governing Body’s meetings shall be provided to the Attorney General after
ratification by the Governing Body thereafter or thirty (30) days after each meeting, whichever
time period is shorter.
4. Nothing in this Agreement shall limit the Governing Body’s duties and
obligations under other applicable law.
Compliance & Risk Management Officer
42. The Participating Defendants shall hire a full-time Compliance & Risk
Management Officer, selected by or approved by the Independent Operator. The Compliance &
Risk Management Officer will be under the daily supervision of the Independent Operator and
report to the Governing Board in order to ensure compliance with the Agreement as well as to
implement the following policies and procedures:
1 Develop and implement an investigative protocol with the Independent Operator,
to properly investigate and report allegations of neglect and abuse of any Medford
resident to the Department of Health as required by the PHL, as well as
misconduct related to Medford’s operations if the Independent Operator believes
that the misconduct may violate criminal law, or may violate civil or
administrative law or is otherwise reportable.
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a. The Compliance & Risk Management Officer will promptly report
such misconduct in writing to the Independent Operator and the
Governing Body.
Copies of such written reports will be provided to the Attorney
General by the Governing Body and the Independent Operator
within three (3) days upon receipt thereof.
2. To respond and produce promptly and completely, on behalf of Medford,
documents, surveillance camera video footage and other tangible evidence in
response to requests for information from regulatory authorities, including the
Attorney General, in consultation with the Independent Operator, subject to the
provisions set forth in Paragraph 53 (Cooperation with the Attorney General).
The Compliance & Risk Management Officer, with the approval of the Governing
Body and the Independent Operator, will develop policies and procedures for the
accurate making and retention of records, including but not limited the purchase
and training for the use of:
a. Add-on technology and/or software to ensure the accurate making
and retention of records, and the “real time” access by the
Independent Operator and the Compliance & Risk Management
Officer to track (a) staffing levels for every shift and every unit;
and (b) medication administered to Medford’s residents;
Installation of a uniform surveillance video camera system in the
facility, as directed by the Independent Operator;
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c. The adoption of surveillance camera video footage
retention policy of one year or such other period of time as
recommended by the Independent Operator and approved
by the Attorney General;
Resident/family — initiated personal surveillance cameras
(also known in the industry as “Granny cams”) shall be
explicitly permitted and supported for all Medford
residents;
Retention of Incident and Accident Reports for seven (7)
years.
43. To oversee, in consultation with the Independent Operator, the education and in-
servicing of Medford direct care staff which includes:
1 a minimum two week orientation program for each newly hired staffer, which
may be adapted in detail by the Independent Operator to be commensurate with
the work experience and licensing requirements of new hires;
proper re-training for existing staff and tracking the attendance at such training;
in-servicings
arranging for Dementia training for all direct care and supervisory staff (by
Engaging Alzheimer’s, LLC or an Attorney General-approved equivalent
program); and
conducting other training as directed by the Independent Operator.
44, Participating Defendants shall vest the Compliance & Risk Management Officer
with the following powers:
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a. to interview any of Defendant’s officers, directors, employees and patients
(upon patient consent) which, in the Compliance & Risk Management
Officer’s sole discretion, are necessary and appropriate to carry out the
Compliance Officer’s responsibilities. Subject to constitutional privileges,
Participating Defendants agree to fully and promptly cooperate with the
Compliance & Risk Management Officer and shall use their best efforts to
cause Medford’s officers, directors, and employees to fully and promptly
cooperate with the Compliance & Risk Management Officer.. Participating
Defendants acknowledge that Obstruction of Justice is a.crime.
to examine all books and records of Medford which, in the Compliance&
Risk Officer’s sole discretion, are necessary or appropriate to carry out the
Compliance & Risk Management Officer’s responsibilities.
to communicate with state and federal regulators or investigating agencies
without the consent of Medford or any defendant and provide its reports to
such entities.
The Compliance & Risk Management Officer will meet with the
Administrator and Director of Nursing at Medford on, at minimum, bi-
weekly, to address areas of concern, if any, identified by the Compliance &
Risk Management Officer and to outline any assistance the Compliance &
Risk Management Officer may request.
45. The Compliance & Risk Management Officer Officer’s full time employment by
Medford will continue after the Term of this Agreement, as part of Medford’s ongoing
19
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operations. After the completion of the Independent’s Operator’s Term and/or Extended Term,
the Compliance & Risk Management Officer will report directly to the Governing Body.
Direct Care Improvements
46. Participating Defendants commit to the Attorney General, to DOH, to Medford’s
residents and their families, and the taxpayers of New York that they will institute all direct care
improvements, revise all care systems and adopt all policies recommended by the Independent
Operator, to assure that all caregivers are properly trained and supervised and that each and
every Medford resident is treated with dignity and respect; that caregivers provide timely,
consistent, safe, appropriate, adequate and professional services at all times; and that the
misconduct uncovered by the MFCU investigations shall not be repeated.
47. Participating Defendants acknowledge that minimum requirements under New
York law, rules and regulation, as well as minimum standards of nursing home industry practice,
are not sufficient to meet Participating Defendants’ obligations under this Agreement and shall
not constitute a defense to breach of this Agreement or grounds for objection to any directive of
the Independent Operator, Compliance & Risk Management Officer or Independent Financial
Monitor.
48. Participating Defendants shall maintain direct care and supervisory staffing
implemented by the Independent Operator to date and shall implement further increases in direct
care and supervisory staffing as directed by the Independent Operator for a period of the Term of
this Agreement plus two (2) additional years. Such improvements shall also include, but are not
limited to:
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In addition to the Director of Nursing and the Assistant Director of Nursing, a
Registered Nurse must be assigned to, and work on, each unit on the 7am to
3pm shift,
In addition to subsection (a), an RN Supervisor will
Preview
= NA AU OUN NK 09 04: DM INDEX NO. 617709/2022 NYSCEF BOC. NO. 695 RECEIVED NYSCEF: 09/29/2023 EXHIBIT B INDEX NO. 602249/2022 (FILED: WHEEN0 COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2024 ASSURANCE OF DISCONTINUANCE MADE PURSUANT TO EXECUTIVE LAW § 63(15) BETWEEN THE ATTORNEY GENERAL OF THE STATE OF NEW YORK, for the PEOPLE OF THE STATE OF NEW YORK, AND DEFENDANTS MORDECHAI KLEIN, NORMAN RAUSMAN, MARTIN RAUSMAN, HENRY RAUSMAN, MICHAEL RAUSMAN, SUSAN ASCHKENAZI, THE NURSING CARE CENTER AT MEDFORD d/b/a MEDFORD MULTICARE CENTER FOR LIVING, INC., AND MEDFORD MULTICARE MANAGEMENT, LLC DATED: June4,2016 WHEREAS, the Attorney General of the State of New York (the “Attorney General”), on behalf the People of the State of New York, commenced an action in the Supreme Court of the State of New York, County of Suffolk, J. Molia, Index no. 2941/14 (hereinafter referred to as the “Action”) against The Nursing Care Center at Medford d/b/a Medford Multicare Center for Living, Inc. (“Medford”) and its owners Mordechai Klein, Norman Rausman, Martin Rausman, Henry Rausman, Michael Rausman, and Susan Aschkenazi (the “Defendant Owners”), Medford Multicare Management, LLC (“Medford Management”) et al., pursuant to Executive Law § 63(12), Social Services Law § 145-b, State Finance Law Section § 189(1) and the common law, originally filed on February 11, 2014, and amended on June 30, 2014 (the “Amended Complaint”), and had previously conducted an investigation through the Medicaid Fraud Control Unit (the “MFCU Investigation”) into the activity of Medford, a 320-bed for- profit nursing home located in Medford, Suffolk County; WHEREAS, at all times relevant hereto, Medford was enrolled in the New York State Medicaid Assistance Program (‘Medicaid”) program and received funds covering costs of INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2024 nursing home and therapy services provided to Medicaid recipients, and received over $280 million from the Medicaid program to provide critical care to its residents; WHEREAS the Participating Defendants include Medford, Medford Management, and the Defendant Owners, who can bind Medford to all acts required under this Assurance of Discontinuance (“AOD” or “Agreement”); WHEREAS, the following constitute the Attorney General’s findings from such investigation, including what is alleged in the Amended Complaint, (excluding for pars. 45 and 46 of the Amended Complaint), as set forth below in Pars. A-L, hereinafter referred to as the “Covered Conduct” and; WHEREAS the Participating Defendants neither admit nor deny the Attorney General’s findings and/or liability for the Covered Conduct but agree that the Attorney General’s findings are admissible in an action by the Attorney General to enforce this Assurance of Discontinuance. Findings as to Criminal Conduct, Single Incidents A Between 2009 and 2014, the Attorney General secured the convictions of nineteen caregivers employed by Medford related to numerous acts of criminal patient neglect, falsification of business records and willful disregard for the reporting requirements, in violation of the Penal Law and the Public Health Law. Findings as to Criminal Conduct, October 26, 2012 Death B On May 23, 2015, ten additional persons were charged by indictment in connection with the death of a 72-year-old ventilator-dependent resident on October 26, 2012, including Medford’s Administrator David Fielding and Defendant Medford for covering up the circumstances of the death. INDEX NO. 602249/2022 (FILED: WHEEAD COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2024 Cc. By July 2015, eight Medford employees were convicted of crimes relating to the October 26, 2012 death and related falsification of business records, and failure to report the neglect as required by law, in violation of the Penal Law and Public Health Law. One licensed professional was convicted of Criminally Negligent Homicide, and the Director of Respiratory Therapy for Medford was convicted of Falsifying Business Records in the First Degree. D. On or about September 11, 2015, David Fielding, former Administrator of Medford, pled guilty to two felony counts of Falsifying Business Records in the First Degree and one misdemeanor count of Wilful Violation of Health Laws, arising from acts to cover up the October 26, 2012 death. E. On October 8, 2015, Defendant Medford pled guilty to Attempted Falsifying Business Records in the Second Degree in violation of Penal Law Section 175.05(4), a Class A Misdemeanor in satisfaction of the charges arising from the acts of its former Administrator David Fielding on behalf of Medford. Findings as to Persistent Deficient Care F Between 2004 and 2014, the New York State Department of Health (the “DOH”) cited Medford with approximately 150 violations of state and federal regulations designed to ensure that adequate care is provided to nursing home residents. G DOH found that Medford placed its residents in “Immediate Jeopardy” of “serious injury, harm impairment and death” on five separate occasions: Medford was cited with one Immediate Jeopardy in 2004, a year after Medford opened; one occurred in April of 2009, which was revised in August of 2010: two occurred in July of 2014, in connection with the death of two Medford residents; and one occurred as recently as August of 2015, after the Amended Complaint was filed. INDEX NO. 602249/2022 (FILED: WHEEAD COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2022 H On September 2, 2014, Medford was placed into the Special Focus Facility program administered by the U.S. Department of Health and Human Services, Center for Medicaid and Medicare Service “due to its history of non-compliance with quality of care and safety requirements;” I The Attorney General has found that direct-care staffing and supervision at Medford was per se inadequate throughout most of the time of Medford’s operation; J The Attorney General determined that Defendant Owners underfunded direct care staffing at Medford and failed to provide adequate supervision of staff and its high managerial agents in order to divert millions of dollars to themselves through exorbitant salaries, bogus management fees through a shell company and self-serving charitable donations; K The Attorney General concluded that as a result of Defendant Owners’ diversion of public funds, the residents of Medford, including residents protected by the New York State Medicaid Assistance Program (“Medicaid ”), did not receive the care they were entitled to receive, and for which Medford was paid; and L By his Amended Complaint, the Attorney General therefore asserted claims against Medford , the Participating Defendants, Medford Management, et al. under the Executive Law Sections 63-c and 63(12), the Public Health Law, State Finance Law Section 189(1), Social Services Law Section 145-b, and other statutes and the common law, for restitution, damages, and equitable relief. : WHEREAS, the Attorney General finds the relief and promises set forth in this Agreement appropriate and in the public interest, in the interests of the current and future residents of Medford, and in furtherance of Medicaid program integrity; INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF 09/29/2022 WHEREAS, the New York State Department of Health (“DOH”) instituted an administrative claims withholding procedure on February 20, 2014 and has withheld Medicaid reimbursement payments due and payable to Medford at the rate of twenty (20%) since then (“Withheld Funds”); WHEREAS, the Attorney General, on behalf of the State of New York, and the Participating Defendants Medford, Mordechai Klein, Norman Rausman, Martin Rausman, Michael Rausman Henry Rausman, Susan Aschkenazi, and Medford Management (the “Participating Defendants”) wish to enter into this Agreement as of the date set forth above to resolve the pending litigation; and NOW THEREFORE, the Participating Defendants and the Attorney General (the “Parties”) enter into this Agreement, an Assurance of Discontinuance (the “Agreement” or “AOD”) as follows: Section I: MONETARY RELIEF 1 Participating Defendants shall pay the sum of TWENTY EIGHT MILLION ONE HUNDRED THOUSAND DOLLARS ($28,100,000.00) as set forth in Paragraphs 2 to 7, below, in satisfaction of the Attorney General’s civil claims arising from the Covered Conduct. 2 Participating Defendants shall be jointly and severally liable to make the payments set forth herein. Restitution to the Medicaid Program 3 Commencing upon the Effective Date of this Agreement, or as soon thereafter as feasible, if all other terms and conditions precedent to the Effective Date have been met, DOH shall discontinue the 20% administrative claims withholding procedure on Medford, and shall INDEX NO. 602249/2022 (FILED: WHEEAD COUNTY CLERK 09/29/2022 04:29 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2022 remit a portion of such Withheld Funds in the amount of TEN MILLION DOLLARS ($10,000,000.00) to the Medicaid Program (the “New York State Medicaid Settlement Amount”) through the Medicaid Fraud Control Unit Restitution Fund. Participating Defendants hereby waive any claims to said Withheld Funds and consent to the foregoing application of such funds. Medford Resident Care Fund 4 Prior to the Effective Date, Participating Defendants shall establish a fund to be used exclusively for the benefit of the residents of Medford (the “Medford Resident Care Fund”) that shall fund the quality care reforms recommended by the Independent Operator (the “Independent Operator”) set forth below. The Medford Resident Care Fund shall be established at a financial institution licensed in the State of New York, subject to the approval by the Attorney General. 5 Participating Defendants shall be credited: (a) FIVE MILLION SEVEN HUNDRED THOUSAND DOLLARS ($5,700,000.00) in funding previously made to the facility in 2015 at the request of the Independent Operator for necessary improvements in patient care in 2015. (b) THREE MILLION FOUR HUNDRED THOUSAND DOLLARS ($3,400,000.00) representing funds previously diverted to Defendant Medford Multicare Management and thereafter to Defendant Owners, and returned to Medford during the pendency of the MFCU Investigation. 6 Upon the Effective Date, the Medford Resident Care Fund shall be funded with the sum of FIVE MILLION TWO HUNDRED TWENTY- SIX THOUSAND SEVEN INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2022 HUNDRED TWENTY NINE DOLLARS ($5,226,729.00) in four (4) installments annually as follows: a. SEVEN HUNDRED TWENTY- SIX THOUSAND SEVEN HUNDRED TWENTY NINE DOLLARS ($726,729.00) on or before the Effective Date; a. ONE MILLION FIVE HUNDRED THOUSAND DOLLARS ($1,500,000.00) on or before May, 2017; b. ONE MILLION FIVE HUNDRED THOUSAND DOLLARS ($1,500,000.00) on or before May, 2018; and c. ONE MILLION FIVE HUNDRED THOUSAND DOLLARS ($1,500,000.00) on or before May, 2019. 7 DOH shall remit an additional THREE MILLION SEVEN HUNDRED SEVENTY THREE THOUSAND TWO HUNDRED SEVENTY ONE DOLLARS AND THIRTY SIX CENTS ($3,773,271.36) in administrative claim Withheld Funds, plus any and all Withheld Funds withheld since June 9, 2016, to the Medford Resident Care Fund. Defendants hereby waive any claims to said withheld funds and consent to the deposit of such funds into the Medford Resident Care Fund to be used as set forth below. 8 Proof of payment made by the Participating Defendants into the Medford Resident Care Fund shall be provided to the Attorney General within five (5) days of payment thereof. 9 In the event that the Independent Operator determines that additional funds are necessary to implement quality assurance reforms, the Participating Defendants shall promptly make additional payments into the Medford Resident Care Fund to fund such improvements, subject to review by the Independent Financial Monitor. INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2022 10. The parties expect that the funds in the Medford Resident Care Fund will be completely expended during the term of this Agreement, in accordance with its provisions. Upon request by Independent Operator and consent of the Attorney General, any funds remaining in the Medford Resident Care Fund at the end of the term of this Agreement shall be used for the benefit of the Medford residents and subject to the continued oversight of the Independent Financial Monitor until such funds are expended. Any other proposed disposition of said funds shall require prior approval of the Attorney General. 11. All funds paid into the Medford Resident Care Fund by Participating Defendants, and/or transferred into the Medford Resident Care Fund with the consent of Participating Defendants, are additional to and not in limitation of Participating Defendants’ obligation, Medicaid Providers, to provide appropriate, adequate and timely care for the residents of its nursing homes regardless of cost. Accordingly, the Medford Resident Care Fund shall not be funded by the Participating Defendants with Medicaid payments made to Medford or Medicaid payments made to any other nursing home individually or partly owned by any of the Defendant Owners. This prohibition stated in the preceding sentence applies to distributions from nursing homes individually or partly owned by any of the Defendant Owners to the extent that any such distribution is in an amount that would adversely impact the delivery of appropriate, adequate and timely care and services for the residents of each of these other nursing homes. 12. Nothing in this Agreement constitutes an agreement by the State of New York concerning the characterization of the payments made or transferred by or to Participating Defendants for purposes of federal or state tax laws. INDEX NO. 602249/2022 (FILED: WHEEAD COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF:: 09/29/2024 13. No portion of the following payments and/or costs shall be claimed as a reimbursable expense on the facility’s Medicaid or Medicare Cost Reports, Cost Statements, Information Statements or Payment Requests submitted by Medford to Medicaid or Medicare: a. the payments Medford and the Participating Defendants make to New York State pursuant to this Agreement, including the Medicaid Restitution Settlement Amount of TEN MILLION DOLLARS ($10,000,000); b the cost of the MFCU Investigation, litigation of the Civil Complaint and its amendment, and the costs and expenses of the trial of the eight Medford employees in 2015 ($200,000) (Paragraph 24); c. the cost of the Independent Financial Monitor, and any forensic accounting, accounting or other services that the Independent Financial Monitor determines necessary to carry out the responsibilities set forth within this AOD; d Participating Defendants investigation, defense and audit undertaken in response to the Attorney General’s the Civil Complaint and its Amendment thereto and the criminal trial of the eight Medford employees, and this Agreement (including attorneys’ fees); and €. the negotiation of this Agreement. 14, Participating Defendants are prohibited from making any withdrawals from the Medford Resident Care Fund. 15. Participating Defendants agree not to take any draws or distributions from Medford, except to pay taxes arising from Medford’s business operations, until one year after all of the following conditions are met: INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2027 04:29 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2022 a Medford is removed from the CMS Special Focus Facility program due to successful completion of the conditions of that program; and b. The Medford Resident Care Fund is fully funded. 16. Participating Defendants shall not make donations or other eleemosynary transfers from Medford for the term of this Agreement. 17. Under no circumstances shall funding of the Independent Financial Monitor, the Compliance & Risk Management Officer or any contractual or non-contractual litigation costs, be charged directly or indirectly to the Medford Resident Care Fund. Independent Financial Monitor 18. Defendant Medford shall hire an Independent Financial Monitor to verify and audit transactions relating to the Medford Resident Care Fund. The Independent Financial Monitor is empowered to retain any forensic accounting, accounting or other services that the Independent Financial Monitor determines necessary to carry out the responsibilities set forth within this AOD. Participating Defendants agree to pay promptly for any such services. 19. The Independent Financial Monitor will report directly to the Attorney General. 20. The Independent Financial Monitor will be given all powers necessary for direct access to all information concerning the Medford Resident Care Fund. The Independent Financial Monitor shall be the sole signatory on the Medford Resident Care Fund. 21. Participating Defendants shall provide the Independent Financial Monitor unconditional access to (i) the books and records of Medford, (ii) the books and records of any vendor in which any Participating Defendant has any ownership or controlling interest and which has received funds from, does business with or is proposed to do business with Medford, as well as access to any outside accounting firm for Medford, which, in the Independent Financial 10 INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2024 Monitor’s sole discretion, is necessary to carry out the Independent Financial Monitor’s responsibilities. 22. The Independent Financial Monitor will receive and review copies of all bank records for Medford, and shall forward copies of such statements to the Attorney General quarterly or at such earlier frequency as the Independent Financial Monitor determines. 23. The Independent Financial Monitor will have the right to communicate with the Attorney General, other state or federal regulators and prosecutors, including particularly any agency authorized to pursue any and all remedies without notice to, or the consent of, the Participating Defendants. Other Financial Terms 24, Participating Defendants shall remit TWO HUNDRED THOUSAND DOLLARS ($200,000.00) to the Attorney General for the cost of the MFCU Investigation, litigation of the Civil Complaint and its amendment, and the costs and expenses of the trial of the eight Medford employees in 2015. Said payment shall be remitted on or before the Effective Date. Section II: GOVERNANCE AND QUALITY CARE REFORMS INDEPENDENT OPERATOR 25. Participating Defendants shall retain an Independent Operator to oversee the management and operations of Medford on a day-to-day basis, which shall be on-site though a principal or directly employed staffer. Lisa Wickens-Alteri, RN, President, of Whiteman Health & Human Services LLC will be the first Independent Operator. The Attorney General accepts that nomination. 11 INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2022 26. The Independent Operator’s employment contract will be provided to MFCU prior to the Effective Date, and is subject to approval by MFCU. To the extent that DOH determines the contract is a management contract pursuant to 10 NYCRR §§ 405.3(f) & 600.9(d), the Participating Defendants will obtain DOH approval as needed, and will implement all terms of this AOD throughout its term. 27. The Independent Operator or her designated representative approved by the Attorney General, shall be on-site at Medford no less than 20 days per month during the first year of this Agreement, and shall make a recommendation to the Attorney General upon the conclusion of the first year of this Agreement as to a specific visitation plan for subsequent years of this Agreement. The Attorney General’s Office may, in its sole discretion, approve or modify such recommendation. 28. The Independent Operator shall have powers equivalent to a Temporary Operator provided under Public Health Law Section 2806-A with regard to hospitals in addition to any specific powers set forth herein. Participating Defendants consent to the designation and appointment of the Independent Operator as a Temporary Operator if the New York State Department of Health shall require such designation and appointment. 29. Participating Defendants shall implement all recommendations made by the Independent Operator and Compliance& Risk Management Officer to ensure adequate, appropriate and timely delivery of care to Medford residents. 30. Medford’s Administrator, Director of Nursing Services, and the Medical Director, and Compliance & Risk Management Officer shall be subordinate to the Independent Operator except where specific professional medical duties are non-delegable, and said Senior Staffs’ 12 INDEX NO. 602249/2022 (FILED: WHEEAD COUNTY CLERK 09/29/2022 04:29 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2024 employment shall be terminated, if necessary, in the sole discretion of the Independent Operator, subject to the review of the Governing Body. 31. The Independent Operator shall have the following authority in addition to the general authority set forth above: a) To conduct and hire consultants and/or surveyors to perform and train staff, with the Compliance & Risk Management Officer, to conduct mock surveys; b) Develop and implement, in consultation with MFCU, mandatory training for Defendant Owners, Operator, the Administrator, the Director of Nursing,-Medical Director, and RN Supervisors, within 120 days of the Effective Date; and annually thereafter. Defendant Owners, the Administrator, the Director of Nursing, Medical Director, Operators and Supervisors of Medford (“Senior Staff”) agree to attend and shall attend this mandatory training set forth herein. 33. Subject to constitutional privileges, Participating Defendants shall fully and promptly cooperate with the Independent Operator and shall use their best efforts to ensure that Medford’s officers, employees, agents, and vendors cooperate with the Independent Operator. 34. The Independent Operator’s initial term of engagement will be for five (5) years from the Effective Date. Participating Defendants will promptly retain a substitute Independent Operator, with prior approval from the Attorney General, in the event the Independent Operator is unable to complete the appointment. The term of engagement of the Independent Operator, and, if necessary, the Term of this Agreement, shall be extended in one year increments upon each occurrence of any of the following: 13 INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2022 (a) A finding by NYS DOH of Immediate Jeopardy, Level L, as to conditions as Medford, or a finding by NYS DOH that Medford be reinstated in the CMS Special Focus Facility program; (b) A determination by the Independent Operator, subject to review by the Attorney General, that the Participating Defendants have failed to comply with any material obligation hereunder; (c) A determination by the Independent Financial Monitor, subject to review by the Attorney General, that the Participating Defendants have failed to comply with any material obligation hereunder, (d) A determination by the Attorney General that the Participating Defendants have failed to comply with any material obligation hereunder; 35. The Independent Operator, or approved designee, in addition to engagement at Medford, shall conduct a one-time quality of care review (“Review”) within the first six (6) months of the Effective Date, including an assessment of direct care staffing levels, at any nursing home individually or jointly owned by any of the Defendant Owners (the “Affiliated Nursing Homes”). The recommendations made by the Independent Operator, or approved designee, as a result of the quality of care review of the Affiliated Nursing Homes, as well as the likely effects of any failure on behalf of the owners and managers of those Affiliated Nursing Homes to implement those recommendations, shall be memorialized in a report prepared by the Independent Operator or approved designee, and emailed and mailed to all of the owners and managers of each said Affiliated Nursing Home, and maintained onsite in the records of each Affiliated Nursing Home, respectively, for a period of at least ten years. Certification that such reviews were conducted and that such reports were prepared by the Independent Operator and 14 INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2024 distributed as required herein and shall be provided to the Attorney General within sixty days of completion thereof. 36. The Independent Operator shall provide reports concerning Medford to the Attorney General on a quarterly basis, concerning all activities under this Agreement including a final report with recommendations concerning staffing, quality indicators and other recommendations the Independent Operator deems necessary. Reform of Governing Body 37. Participating Defendants shall form a new governing body for Medford that is legally responsible for the overall management and operation of the facility, as required by 10 NYCRR Section 415.26 5(b), (the “Governing Body”), within 30 days after the Effective Date, or after receiving approval from the Department of Health and/or the Public Health and Health Planning Council as required by 10 NYCRR § 401.3(b) & 415 if such approval is required. 38. For the first three years of this Agreement, the Governing Body will be comprised of three (3) members and shall include the Independent Operator, the Independent Financial Monitor, and Participating Defendant Norman Rausman. Two additional board members who are independent and have no familial or business relationship with the Owners and Operators of Medford and who are professionals from the health care community, such as a physician and a nurse, shall be elected by the existing board to the Governing Body, three years from the Effective Date of this Agreement. 39. The Governing Body shall adopt by-laws within sixty (60) days of the Effective Date, or within sixty (60) days after receiving approval from the Department of Health and/or the Public Health and Health Planning Council as required by 10 NYCRR § 401.3(b) & 415 if such approval is required, which by-laws are subject to the approval of the Attorney General. The 15 INDEX NO. 602249/2022 (FILED: WHEEND0 COUNTY CLERK 09/29/2022 04:29 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2022 bylaws shall include a provision requiring that the voting majority of the Governing Body shall be independent and shall have no familial or business relationship with then Owners and Operators of Medford. 40. Minutes of the meetings of the Governing Body shall be taken and shall include the recommendations made by the Independent Operator, discussion of those recommendations, and the approval or other disposition of those recommendations. Copies of the minutes from and resolutions of the Governing Body’s meetings shall be provided to the Attorney General after ratification by the Governing Body thereafter or thirty (30) days after each meeting, whichever time period is shorter. 4. Nothing in this Agreement shall limit the Governing Body’s duties and obligations under other applicable law. Compliance & Risk Management Officer 42. The Participating Defendants shall hire a full-time Compliance & Risk Management Officer, selected by or approved by the Independent Operator. The Compliance & Risk Management Officer will be under the daily supervision of the Independent Operator and report to the Governing Board in order to ensure compliance with the Agreement as well as to implement the following policies and procedures: 1 Develop and implement an investigative protocol with the Independent Operator, to properly investigate and report allegations of neglect and abuse of any Medford resident to the Department of Health as required by the PHL, as well as misconduct related to Medford’s operations if the Independent Operator believes that the misconduct may violate criminal law, or may violate civil or administrative law or is otherwise reportable. 16 INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2022 a. The Compliance & Risk Management Officer will promptly report such misconduct in writing to the Independent Operator and the Governing Body. Copies of such written reports will be provided to the Attorney General by the Governing Body and the Independent Operator within three (3) days upon receipt thereof. 2. To respond and produce promptly and completely, on behalf of Medford, documents, surveillance camera video footage and other tangible evidence in response to requests for information from regulatory authorities, including the Attorney General, in consultation with the Independent Operator, subject to the provisions set forth in Paragraph 53 (Cooperation with the Attorney General). The Compliance & Risk Management Officer, with the approval of the Governing Body and the Independent Operator, will develop policies and procedures for the accurate making and retention of records, including but not limited the purchase and training for the use of: a. Add-on technology and/or software to ensure the accurate making and retention of records, and the “real time” access by the Independent Operator and the Compliance & Risk Management Officer to track (a) staffing levels for every shift and every unit; and (b) medication administered to Medford’s residents; Installation of a uniform surveillance video camera system in the facility, as directed by the Independent Operator; 17 INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2027 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2024 c. The adoption of surveillance camera video footage retention policy of one year or such other period of time as recommended by the Independent Operator and approved by the Attorney General; Resident/family — initiated personal surveillance cameras (also known in the industry as “Granny cams”) shall be explicitly permitted and supported for all Medford residents; Retention of Incident and Accident Reports for seven (7) years. 43. To oversee, in consultation with the Independent Operator, the education and in- servicing of Medford direct care staff which includes: 1 a minimum two week orientation program for each newly hired staffer, which may be adapted in detail by the Independent Operator to be commensurate with the work experience and licensing requirements of new hires; proper re-training for existing staff and tracking the attendance at such training; in-servicings arranging for Dementia training for all direct care and supervisory staff (by Engaging Alzheimer’s, LLC or an Attorney General-approved equivalent program); and conducting other training as directed by the Independent Operator. 44, Participating Defendants shall vest the Compliance & Risk Management Officer with the following powers: 18 INDEX NO. 602249/2022 (FILED: WHEEND COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF 09/29/2022 a. to interview any of Defendant’s officers, directors, employees and patients (upon patient consent) which, in the Compliance & Risk Management Officer’s sole discretion, are necessary and appropriate to carry out the Compliance Officer’s responsibilities. Subject to constitutional privileges, Participating Defendants agree to fully and promptly cooperate with the Compliance & Risk Management Officer and shall use their best efforts to cause Medford’s officers, directors, and employees to fully and promptly cooperate with the Compliance & Risk Management Officer.. Participating Defendants acknowledge that Obstruction of Justice is a.crime. to examine all books and records of Medford which, in the Compliance& Risk Officer’s sole discretion, are necessary or appropriate to carry out the Compliance & Risk Management Officer’s responsibilities. to communicate with state and federal regulators or investigating agencies without the consent of Medford or any defendant and provide its reports to such entities. The Compliance & Risk Management Officer will meet with the Administrator and Director of Nursing at Medford on, at minimum, bi- weekly, to address areas of concern, if any, identified by the Compliance & Risk Management Officer and to outline any assistance the Compliance & Risk Management Officer may request. 45. The Compliance & Risk Management Officer Officer’s full time employment by Medford will continue after the Term of this Agreement, as part of Medford’s ongoing 19 INDEX NO. 602249/2022 (FILED: WHEEAD COUNTY CLERK 09/29/2022 04:79 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2022 operations. After the completion of the Independent’s Operator’s Term and/or Extended Term, the Compliance & Risk Management Officer will report directly to the Governing Body. Direct Care Improvements 46. Participating Defendants commit to the Attorney General, to DOH, to Medford’s residents and their families, and the taxpayers of New York that they will institute all direct care improvements, revise all care systems and adopt all policies recommended by the Independent Operator, to assure that all caregivers are properly trained and supervised and that each and every Medford resident is treated with dignity and respect; that caregivers provide timely, consistent, safe, appropriate, adequate and professional services at all times; and that the misconduct uncovered by the MFCU investigations shall not be repeated. 47. Participating Defendants acknowledge that minimum requirements under New York law, rules and regulation, as well as minimum standards of nursing home industry practice, are not sufficient to meet Participating Defendants’ obligations under this Agreement and shall not constitute a defense to breach of this Agreement or grounds for objection to any directive of the Independent Operator, Compliance & Risk Management Officer or Independent Financial Monitor. 48. Participating Defendants shall maintain direct care and supervisory staffing implemented by the Independent Operator to date and shall implement further increases in direct care and supervisory staffing as directed by the Independent Operator for a period of the Term of this Agreement plus two (2) additional years. Such improvements shall also include, but are not limited to: 20 INDEX NO. 602249/2022 (FILED: WHEBAD- COUNTY CLERK 09/29/2022 04:29 PM NYSCEF DOC. NO. 695 RECEIVED NYSCEF: 09/29/2024 In addition to the Director of Nursing and the Assistant Director of Nursing, a Registered Nurse must be assigned to, and work on, each unit on the 7am to 3pm shift, In addition to subsection (a), an RN Supervisor will