DARBYAttorney General Josh Shapiro today announced Chaim “Charlie” Steg, former Regional Director of Operations at St. Francis Center for Rehabilitation and Healthcare (St. Francis), has pled to his role in recklessly endangering three residents of the facility. This plea comes as the result of a joint investigation conducted by the Office of Attorney General (OAG) and Darby Borough Police through the 44th Statewide Investigating Grand Jury. In addition, St. Francis will be required, through a civil settlement, to maintain an increased minimum staffing level and undergo quarterly audits by the Department of Health to ensure compliance.

“Every resident of every nursing home deserves to be safe, they deserve to be treated with respect and dignity, and they deserve to be heard,” said Attorney General Shapiro. “It is the law to uphold the obligation to keep residents safe. If a facility cuts staff to the point that they can’t give residents the care they need we’re going to find out, and we’re going to hold them accountable.”

The investigation into St. Francis began after the Office of Attorney General received dual referrals from the Pennsylvania Department of Health and the Darby Borough Police Department. The initial investigation began in August 2017, after staff at the Mercy Catholic Medical Center’s Mercy Fitzgerald Campus notified the Delaware County Office of Services for the Aging of concerns they had for the poor condition of several residents transferred from St. Francis.

The investigation identified three St. Francis residents who were victims of neglect. The residents suffered conditions including, pressure wounds, sepsis, dehydration, and bowel obstructions. The evidence showed these outcomes were the result of systemic failures in St. Francis primarily driven by inadequate staffing practices. Steg’s employees repeatedly warned him that St. Francis’ chronic staffing problems endangered the residents. He ignored their warnings and his reckless decision making caused these three Pennsylvanians serious bodily injury and ultimately led to their death.

The Grand Jury found that these serious injuries were avoidable and were a result of Steg’s failure to address well-known staffing deficiencies at St. Francis that detrimentally impacted both the quantity and quality of care delivered to its residents. The Grand Jury heard from 22 witnesses, several of whom testified that they tried to fix staffing issues at St. Francis and were denied by Steg.

One former Director of Nursing said at times she disobeyed orders from Steg to reduce staff just so she could sleep at night.

Another witness testified the conditions were so poor that she filed a complaint with the Department of Health citing concerns over the ratio of nurses to patients. A former staffing coordinator testified that St. Francis was understaffed on a daily basis and she received constant complaints from staff and family members of the residents.

Steg pled to three counts of Recklessly Endangering Another Person. Under the terms of the plea agreement, he will be sentenced to six to 23 months of house arrest followed by three years probation. His probation also has the condition that he cannot staff, manage, own, or operate the nursing, clinical, or medical services of any skilled nursing facility for five years. He will also be required to pay a $15,000 fine and restitution to the families of the victims.

Two interrelated business entities, which played a role in the operation of St. Francis, have reached an agreement with the Office of Attorney General benefiting the residents of St. Francis. These entities are: 1412 Lansdowne Operating LLC, which did business as “St. Francis Center for Rehabilitation and Healthcare” and ran the day to day operations of the facility, and Catholic Facilities Operating LLC, which paid Steg’s salary.

The Office of Attorney General has agreed to more than a $1 million settlement with 1412 Lansdowne Operating and Catholic Facilities Operating. This settlement requires St. Francis to maintain an increased minimum staffing level and undergo an additional year of monitoring to ensure compliance through quarterly audits by the Department of Health. Violations will result in additional financial penalties and an extension of the supervisory period.

The entities have agreed to pay $600,000 into an escrow account for the care of St. Francis residents and $100,000 to a non-profit group, Center for Advocacy for the Rights and Interests of the Elderly. These payments are in addition to fines of $550,000 already paid to the Centers for Medicaid and Medicare Services and the Department of Health as a result of the violations that launched this investigation and are acknowledged by the settlement agreement.

The case was prosecuted by Senior Deputy Attorney General Mark Levenberg and Deputy Attorney General Benjamin McKenna. OAG Special Agent Jen Nutter and Detective Brian Pitts of the Darby Borough Police Department led this joint investigation.

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The Pennsylvania Medicaid Fraud Control Unit receives 75 percent of its funding from the U.S. Department of Health and Human Services under a grant award totaling $10,382,940 for Federal fiscal year (FY) 2021. The remaining 25 percent, totaling $3,460,978 for FY 2021, is funded by Pennsylvania.

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