After 45 years on the bench and hundreds, if not thousands, of difficult cases, U.S. District Judge John T. Curtin doesn’t use words like “struggle” lightly.
But that is exactly how Curtin described the 21-year legal battle waged by thousands of sick, poor and elderly nursing home residents, almost all of them now dead.
The victims spent years trying to prove that New York State stole from them, and in the end, they won an $11 million settlement for their families.
The class-action suit claimed that up to 16,000 nursing home residents were cheated out of insurance co-payments, deductibles and other costs when the state began charging them twice for the same service.
Curtin last month closed the book on the 1991 suit that accused the state of double-billing Medicare and Medicaid, and he used the occasion to take note of the victims’ “long struggle” for justice.
“It took a lot of doing,” the judge said of the lawsuit. “Certainly, it was a long road. It could have been better, and it could have been worse.”
Henry W. Killeen III, a lawyer who joined the plaintiffs’ side in 2000, said it was one of the most shocking cases that he has been associated with.
“I don’t think in my 35 years of practicing law I’ve seen a more shocking and disturbing case,” he said. “I sort of believed what they taught in civics class – these guys are supposed to do the public good.”
Judges like Curtin handle thousands of cases, but there are always a few that stand out, and Conrad v. Perales is one of them.
Some of it may be the length of time – Curtin was 70 and only halfway through his current tenure when the case was filed. Some of it may be what many see as an outrage – the allegations of neglect and wrongdoing by state social services officials.
Even more so, it may have to do with the plaintiffs, who by all accounts were among the most vulnerable in society – nursing home residents who were not only poor and elderly but also, in many cases, disabled.
“These folks were entitled to relief,” Curtin said. “Many of the plaintiffs were elderly, not in good health and not very sophisticated in these matters. They needed someone to lean on.”
In Curtin, they found a judge with the longevity and perseverance to oversee a case that would take 15 years to settle and another six years to locate all the heirs and refund the money.
The victims also found Anthony Szczygiel, a University at Buffalo Law School professor who uncovered the alleged wrongdoing while running a law school clinic in 1989.
“They were elderly, they were poor, and they were often the sickest people in the nursing home,” Szczygiel said of his clients.
With their help, he developed a lawsuit that accused the state of stealing their money as part of an illegal double-billing scheme designed to overcharge Medicaid and Medicare.
State officials never admitted any guilt in the course of the suit, and a spokeswoman with the State Attorney General’s Office declined to comment for this story.
Killeen said his outrage over the state’s actions seemed to grow each year he was on the case. Over time, he began to believe that the state knew what it did was wrong and did it anyway.
“I’ve been in high-stakes litigation across the country, and I’ve never seen anything like this,” he said of Conrad v. Perales.
The original suit accused state welfare officials of concocting a scheme in which nursing homes across the state would bill both Medicare and Medicaid for the same service. The nursing home would keep the higher payment, while the state would take the smaller one.
As part of the scam, the nursing homes charged residents the co-payments or other patient contributions often associated with nursing home services.
Szczygiel said he noticed the double-billing in 1989 and took the state to court two years later.
“They knew the impact of what they were doing and did it anyway,” he said. “They thought they could get away with it because, who was going to complain?”
Unbeknown to him or the court, federal auditors also uncovered the scheme and ordered New York State to refund millions of dollars in Medicare and Medicaid overpayments.
During this same period, state officials advised Curtin that they were willing to refund any money taken illegally from nursing home patients,
That changed in 1999. New York began to argue that it should not have to refund the money and claimed that State Social Services Commissioner Cesar Perales, the lead defendant in the suit, had sought a federal waiver allowing the double-billing practice.
When the state couldn’t produce records of that waiver request, Curtin declared that New York’s actions had created a “substantial failure of justice.”
“They always changed their mind,” Peter Dellinger, an attorney at Empire Justice Center who also represented the nursing home residents, said of the state. “These were all poor and elderly people, and the longer the state delayed, the more people that died. What they did was pretty awful.”
The state’s actions became suspect enough that the plaintiffs’ lawyers sought outside expertise on the professional ethical behavior of the state’s lawyers.
In 2005, Geoffrey C. Hazard Jr., a law professor at the University of Pennsylvania and an expert on legal ethics, filed an affidavit condemning New York’s handling of the case.
He accused state officials of knowing what they did was wrong, of misleading the court throughout the litigation and of filing false affidavits and destroying evidence.
“Taken as a whole, the conduct of defendants and their counsel has stalled all progress on the merits of this case for years,” Hazard said at the time. “In my experience, I have never encountered such an egregious failure to comply with elementary discovery obligations as is involved here.”
Why would the state drag its feet and for so long?
Lawyers in the case differ on the reasons.
“Was this a conscious plan to rip off old people?” asked Dellinger. “I don’t think so. I think it was a series of neglectful and inept steps by a bureaucracy in Albany that just didn’t make it a priority.”
The two sides finally reached a settlement in 2006 that set aside $11 million for the nursing home residents. The amounts owed to individuals ranged from a few hundred dollars to several thousand dollars.
Szczygiel said the amounts may seem small but not when you understand that the people who were cheated out of that money were poor and elderly and often disabled.
“Being able to keep that money would have made a world of difference to these people,” he said, “There was a callous disregard by Albany as to the impact of what they did.”
Last month, after more than five years of tracking down the family members of those who have died, Curtin closed the book on Conrad v. Perales, when the last of the victims or their families were tracked down and paid.
“We finally came to the end,’ Curtin said last week, ”after a long struggle.”