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Justice Department reaches $7.1 million settlement with Saratoga Center landlords, operators

The Justice Department has reached a settlement with the former landlords and operators of a Saratoga County nursing home accused of making false claims to Medicaid for worthless services. New York State Attorney General Letitia James, who worked with the Justice Department on the case, says the individuals and corporate entities behind the Saratoga Center for Rehabilitation and Skilled Nursing Care in Ballston Spa have agreed to pay $7.168 million as part of the deal.

In early 2017, James says the three individuals serving as the center’s landlords (Leon Melohn, Alan Schwartz, and Jeffrey Vegh) replaced its legally licensed operators with Jack Jaffa, a business associate of his, and various corporate entities – even though none of them had the licenses needed to run the facility. While making false claims to the Medicaid program, James says the new operators allowed conditions at the Saratoga Center to deteriorate, failing to maintain its staff, hot water access, linen supply, and waste disposal. James says residents suffered medication errors, unnecessary falls, and pressure ulcers as a result. In 2019, the facility was placed on the Centers for Medicare and Medicaid Services Special Focus Facility list for the worst nursing homes in the U.S.

The Saratoga Center closed in early 2021, after the Justice Department opened its investigation. As part of the settlement, the defendants will be excluded from Medicare, Medicaid, and all other federal health care programs for at least 10 years.