Two former long-term care executives and their associates pleaded not guilty after an initial court appearance to a fraud scheme totaling $16 million.
U.S. Attorney Josh J. Minkler announced the federal indictments against former American Senior Communities (ASC) CEO James G. Burkhart and COO Daniel Benson, Burkhart’s friend and associate Steven Ganote and brother Joshua Burkhart, who worked for the accounting firm that prepared cost reports for the defrauded healthcare companies.
The defendants are accused of exploiting vendor relationships for goods and services to steal discounts and rebates. According to court documents, they laundered millions of dollars for personal gain by overcharging for vendor services and funneling the overcharged amounts back to the defendants through shell companies.
They are charged with conspiring to defraud ASC, Medicare, Indiana Medicaid and Health & Hospital Corp. of Marion County. Together they face 32 counts on acts alleged to have occurred between January 2009 and September 2015. Minkler said additional charges could be filed against vendors and other co-conspirators. If convicted, the defendants could serve up to 20 years in prison for conspiracy to commit mail, wire and healthcare fraud. They also face 20 years in prison for each mail or wire fraud count; 20 years in prison for certain money laundering counts; and 10 years in prison for other money laundering counts. James Burkhart, Benson and Ganote also face up to five years each in prison for conspiracy to violate the Anti-Kickback Statute.
Federal agents raided Burkhart’s home and ASC headquarters in September 2015.
ASC manages nearly 100 senior care facilities, more than half of which are skilled nursing and assisted living centers manages under a contract with Marion County’s public health agency. The company is actively cooperating with the United States Attorney's Office and other federal agencies in their investigation. "Noting in the investigation or this prosecution involves resident care," according to a copmany statement. "ASC's primary focus continues to be exceptional resident care."
Related: FBI raids Indiana nursing home CEO