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Trump's pardons included health care executives behind massive frauds

Fred Schulte, Kaiser Health News on

Published in News & Features

At the last minute, President Donald Trump granted pardons to several individuals convicted in huge Medicare swindles that prosecutors alleged often harmed or endangered elderly and infirm patients while fleecing taxpayers.

“These aren’t just technical financial crimes. These were major, major crimes,” said Louis Saccoccio, chief executive officer of the National Health Care Anti-Fraud Association, an advocacy group.

The list of some 200 Trump pardons or commutations, most issued as he vacated the White House this week, included at least seven doctors or health care entrepreneurs who ran discredited health care enterprises, from nursing homes to pain clinics. One is a former doctor and California hospital owner embroiled in a massive workers’ compensation kickback scheme that prosecutors alleged prompted more than 14,000 dubious spinal surgeries. Another was in prison after prosecutors accused him of ripping off more than $1 billion from Medicare and Medicaid through nursing homes and other senior care facilities, among the largest frauds in U.S. history.

“All of us are shaking our heads with these insurance fraud criminals just walking free,” said Matthew Smith, executive director of the Coalition Against Insurance Fraud. The White House argued all deserved a second chance. One man was said to have devoted himself to prayer, while another planned to resume charity work or other community service. Others won clemency at the request of prominent Republican ex-attorneys general or others who argued their crimes were victimless or said critical errors by prosecutors had led to improper convictions.

Trump commuted the sentence of former nursing home magnate Philip Esformes in late December. He was serving a 20-year sentence for bilking $1 billion from Medicare and Medicaid. An FBI agent called him “a man driven by almost unbounded greed.” Prosecutors said that Esformes used proceeds from his crimes to make a series of “extravagant purchases, including luxury automobiles and a $360,000 watch.”

Esformes also bribed the basketball coach at the University of Pennsylvania “in exchange for his assistance in gaining admission for his son into the university,” according to prosecutors.

 

Fraud investigators had cheered the conviction. In 2019, the National Health Care Anti-Fraud Association gave its annual award to the team responsible for making the case. Saccoccio said that such cases are complex and that investigators sometimes spend years and put their “heart and soul” into them. “They get a conviction and then they see this happen. It has to be somewhat demoralizing.”

Tim McCormack, a Maine lawyer who represented a whistleblower in a 2007 kickback case involving Esformes, said these cases “are not just about stealing money.”

“This is about betraying their duty to their patients. This is about using their vulnerable, sick and trusting patients as an ATM to line their already rich pockets,” he said. He added: “These pardons send the message that if you are rich and connected and powerful enough, then you are above the law.”

The Trump White House saw things much differently.

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