Plaza Rehab and Citadel Consulting: A Monthly Quota for Taking Residents Out of Their Plans

The Plaza Rehab and Citadel Medicare Advantage settlement required the companies to pay $7.85 million over a scheme to move nursing-home residents out of their chosen plans without proper consent and increase the facility’s Medicare revenue. Plaza staff carried out coverage changes, sometimes claiming consent from residents whose own mental-status assessments showed they could not give it. The companies admitted those practices.

Plaza Rehab and Nursing Center is the Bronx skilled nursing facility in the case. Citadel Consulting Group, doing business as Citadel Care Centers, directed the work. The Department of Justice announced the settlement on June 29, 2022. The government joined a private whistleblower case under the False Claims Act.

This Medicare Advantage fraud case follows the money out of the plan and into the nursing home. The coverage residents had chosen paid the facility less. Changing that coverage became a management target. Residents lost the plans they chose, and Medicare paid Plaza money the facility admitted it was not owed.

Why Original Medicare Paid the Facility More

Plaza earned greater revenues when residents were enrolled in Original Medicare instead of Medicare Advantage. The companies admitted that financial incentive.

Under Original Medicare, the Centers for Medicare & Medicaid Services pays a skilled nursing facility directly on a fee-for-service basis. With Medicare Advantage, the facility sends its claims to the private company operating the resident’s plan. That company pays the facility an agreed amount.

The government alleged that this preference was well known in the skilled nursing facility industry. At Plaza, the companies admitted that it became pressure on staff to change residents’ coverage after admission. A resident could enter the facility with a Medicare Advantage plan already selected, then have that choice undone by facility staff.

Citadel Set the Quota and Selected Candidates

Citadel’s monthly Medicare Advantage disenrollment quota turned a reimbursement preference into an assigned task. The government alleged that Citadel pressured Plaza staff between September 2016 and February 2019. The settlement admissions identified the person directing the work by function: a Citadel manager responsible for new admission practices.

The Justice Department reproduced the companies’ admission:

Citadel supplied both the target and potential residents to move. Plaza employees performed the coverage changes under the manager’s direction and pressure.

That division matters to someone working inside a nursing home or its management company. The instruction to increase Original Medicare enrollment, the selection of residents and the completed coverage changes connect management’s revenue objective to particular people. An admissions employee may recognize the instruction. A billing employee may recognize the resulting change in who pays the facility.

Consent Forms and Assessments Told Different Stories

When a nursing home changes Medicare Advantage coverage without consent, the resident’s choice can disappear between the admission process and the enrollment entry. At Plaza, the companies admitted that staff often changed coverage without first obtaining consent from the resident or an authorized representative.

The government alleged that staff were supposed to obtain signed disenrollment forms before making a change but often proceeded without them. According to the government’s account of its complaint, employees also made numerous changes without speaking to the resident or an authorized representative, or explaining the consequences of switching to Original Medicare.

The admissions went further than missing paperwork. In approximately 19 instances, staff purportedly obtained consent from residents whose mental-status assessments showed they lacked the capacity to consent because of their health condition. Plaza regularly failed to consider those assessments and did not evaluate residents’ capacity to agree to the insurance change.

The facility’s own assessments said those residents could not consent to the switch. Staff claimed those residents had consented anyway. For someone who knows both the assessment process and the admissions process, that is a concrete connection: what the facility knew about a resident, and what staff treated as permission to change that resident’s coverage.

The Website Entry Changed More Than Drug Coverage

Plaza staff used residents’ personal information on Medicare.gov to make the coverage changes. The companies’ admissions describe a specific sequence: staff disenrolled residents from their chosen Medicare prescription drug plans, which automatically disenrolled them from their Medicare Advantage plans and enrolled them in Original Medicare.

The drug-plan entry did work beyond the drug plan. It changed the resident’s broader Medicare coverage and opened the direct payment path to Plaza.

The admissions also addressed who staff claimed to be online. In some instances, employees misrepresented that they were the person named on the enrollment form, someone helping that person complete it, or someone authorized to act on the person’s behalf. In those instances, the use of a resident’s personal information carried a representation about permission that the consent history could contradict.

The companies accepted responsibility for the payment result as well. The government paid Plaza under Original Medicare for residents improperly enrolled without their consent. Plaza admitted that it was not entitled to those payments.

Residents Carried the Change Beyond Discharge

The switch could affect residents’ out-of-pocket payments, the services and care covered, and their drug coverage. Those were the potential consequences the government identified when it alleged that residents and families often did not request, consent to or know about the change.

Plaza’s admitted revenue advantage answered the facility’s question about payment. It did not answer the resident’s question about which coverage suited their needs.

The admissions followed the practice through discharge. Plaza and Citadel often did not offer residents help re-enrolling in Medicare Advantage when they left the facility. The nursing-home stay could end without the resident receiving help to restore the plan they had selected before it.

Morris Park Shows the Same Financial Incentive

Morris Park Nursing Home reached a separate settlement in May 2023 over conduct that included switching residents’ Medicare coverage without consent to increase the facility’s payments. That Bronx matter also carried factual admissions.

Morris Park admitted that, in several instances, it disenrolled residents even after residents or family members said they did not want to switch. The government’s explanation of the incentive was the same: Original Medicare was usually more profitable for the facility.

At Plaza, the admissions expose how a management company put that preference into operation through a quota, candidate selection and staff direction. At Morris Park, the admitted refusal to honor residents’ stated wishes makes the same conflict plain. The facility wanted the more profitable coverage even when the resident wanted to keep the existing plan.

What the Plaza and Citadel Settlement Required

The settlement reached beyond payment and admissions. Citadel agreed to take steps to ensure that all skilled nursing facilities operating as Citadel Care Centers complied with applicable guidance on Medicare health plan enrollments and disenrollments.

Plaza and Citadel also entered a five-year Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General, effective June 17, 2022, according to the OIG agreement listing.

The Whistleblower Case Behind the Settlement

A private whistleblower brought the case that the government joined. The admissions show why knowledge inside the business matters: a monthly target, a resident selected for disenrollment, an assessment overlooked and an online representation can explain how the government ended up paying the facility.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

You Saw Who Ordered the Coverage Change

If you saw residents selected for disenrollment or consent concerns pushed aside to meet a revenue target, speak to one of our whistleblower experts about how the work happened. We connect your knowledge of admissions, assessments and billing to the decisions behind the payments to build your strongest whistleblower case. We bring in healthcare fraud whistleblower lawyers who understand nursing-home coverage cases and stay beside you as partners throughout the case.