11 Children Died at NJ Rehab Facility; Whistleblower Says Problems Go Much Deeper

The Wanaque Center for Nursing and Rehabilitation in Haskell, NJ made headlines for an outbreak of adenovirus that killed 11 children and threatened the lives of dozens of others. According to the facility, the outbreak has been contained and patients are no longer in danger. But based on an ongoing lawsuit, the problems at Wanaque go much deeper, and much further back, than this incident.

11 Children Died at NJ Rehab Facility; Whistleblower Says Problems Go Much Deeper

Wanaque is a rehab and nursing home known for its pediatric center. The facility has 92 pediatric beds for “medically fragile” children from newborns to 22 years of age. Many of these patients have respiratory issues that require them to be on ventilators.

Adenovirus type 7, the virus that caused the tragic deaths at Wanaque, doesn’t usually cause serious illness, but it can be fatal for people with weakened immune systems—exactly the type of patients who make up Wanaque’s pediatric center. Whether there was a viral outbreak or not, caregivers should have been trained to use proper hygiene techniques to prevent the spread of illness among this vulnerable population.

A surprise inspection by the NJ Health Department, however, showed that nurses were not washing their hands correctly, which was likely the reason why adenovirus spread so quickly throughout the facility.

To make matters worse, children who came down with the virus were not taken to the hospital at the first sign of illness. According to two Wanaque nurses who spoke anonymously to the NJ Star-Ledger, senior staff did everything they could to keep sick children at the facility, even after others had died. Nurses were encouraged to mask symptoms by administering ineffective medication and turning air conditioners on full blast to bring down sick children’s fevers.

Why was Wanaque so slow to send children to the hospital? The anonymous nurses said the facility wanted to avoid raising suspicion from the health department. They also said Wanaque leaders were acutely aware that sending a child to the hospital meant losing Medicaid dollars.

Medicaid generally reimburses rehab and long-term care centers for every day a patient spends at the facility. In New Jersey, every rehab facility is required to hold a patient’s bed for 10 days if they go to the hospital, which gives them a chance to return before the bed is given to a new patient. The NJ Medicaid program used to reimburse facilities while patients were at the hospital, but in 2012, that law was eliminated entirely.

Now, rehab centers are still required to hold patients’ beds, but they stop getting paid as soon as patients are out the door, and they don’t get paid again until patients are back (or the beds are given to new patients). Nursing homes and rehab facilities are essentially incentivized to keep patients in their beds, even if they need more acute medical attention.

This reluctance to send patients to the hospital likely contributed to the deaths of the 11 children in the adenovirus outbreak, but it’s not a recent phenomenon. According to a Medicaid fraud whistleblower lawsuit filed in 2014, Wanaque has a pattern of cutting corners and gaming the system to maximize profits.

The lawsuit, which was filed by Dr. Frank Briglia, says that Wanaque carefully chose the patients it admitted to increase Medicaid reimbursement. At any given time, about 75 percent of the facility’s pediatric beds were filled with children from New York state. Coincidentally, New York pays more in Medicaid reimbursement: Wanaque gets a whopping $742.62 per day for each New York child, compared to just $518.46 for each NJ child. What’s more, the New York Medicaid program continues to reimburse facilities while patients are in the hospital.

Patients are free to seek medical care in any state they want, and medical facilities are free to admit them. But Dr. Briglia said Wanaque’s preference for NY patients prevented New Jersey children from accessing much-needed care. Wanaque is one of only four pediatric rehab centers in all of New Jersey.

In addition to the scheme to admit more New York patients, Dr. Briglia said Wanaque deliberately sought out patients who would fetch higher Medicaid reimbursement, like children dependent on ventilators. However, Wanaque was unable to provide adequate resources for these medically fragile patients—Dr. Briglia said the facility didn’t hire enough staff or invest in necessary technology, like backup ventilator equipment.

The lawsuit filed by Dr. Briglia, who is the former medical director of Wanaque’s pediatric center, names the facility’s previous owner, Wanaque Convalescent Center and Seniors Management North. The company sold Wanaque to Continuum Healthcare in 2014, but Dr. Briglia said many of the same people are in key leadership roles and the same problems are happening. He has firsthand knowledge of this, not only because of his former position with Wanaque, but also because he now manages the pediatric emergency room where several of the adenovirus-infected children were eventually taken.

The 2014 lawsuit is not related to the recent adenovirus outbreak, but it certainly adds credibility to Dr. Briglia’s case. Wanaque has tried to get the lawsuit dismissed and the Department of Justice has not taken the case on so far, but the complaint was amended last year and Dr. Briglia continues to push forward. Meanwhile, the New Jersey State Senate is holding a hearing to suss out the problems at Wanaque that led to the children’s deaths.

Although we’ll never know for sure if getting to the hospital earlier would have saved these children, perhaps it would have given them a fighting chance at life. If you’re aware of Medicaid fraud, it’s your duty to report it. You might not only be saving taxpayer dollars, but someone’s life.

Under the U.S. and state False Claims Acts, whistleblowers that report healthcare fraud involving Medicaid or Medicare could be entitled to a percentage of any verdict or settlement. Report fraud today, and you might earn a multimillion-dollar reward - hundreds of whistleblowers have already received rewards.


Medicaid Fraud Hotline: 888.742.7248 or Report Online
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