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New Jersey Office of the State Comptroller: Medicaid Fraud Division · January 19, 2001 · Primary source

OSC Sues Hammonton and Deptford Nursing Home Owners and Associates for Medicaid Fraud; Bridgeton Nursing Home Suspension Set for March 13, 2026

Score 87PRIMARYregulatoryState MFCUNJ

Summary

The New Jersey Office of the State Comptroller filed a Superior Court lawsuit on January 19, 2026 against 33 defendants, including the owners and associates of Hammonton Center for Rehabilitation and Healthcare and Deptford Center for Rehabilitation and Healthcare, alleging a multi-year scheme to divert Medicaid funds through related-party real estate transactions, inflated rents, excessive loans, and undisclosed fees totaling $124 million in sought restitution. OSC simultaneously issued a final notice terminating Medicaid funding to South Jersey Extended Care in Bridgeton effective March 13, 2026, following denial of a proposed new ownership group's Medicaid enrollment application on grounds of fraud risk and lack of transparency. The complaint seeks restitution, disgorgement of Medicaid overpayments, civil penalties for false claims and staffing violations, and damages against all 33 defendants.

What this may mean

The lawsuit against the Hammonton and Deptford Center owners targets $124 million in alleged Medicaid overpayments diverted through nine related entities and seeks civil penalties for false claims and staffing violations, establishing state-level false claims and Medicaid fraud liability for SNF owners who use layered ownership structures to conceal self-dealing. The Medicaid termination of South Jersey Extended Care on March 13, 2026 ends that facility's participation in the Medicaid program and demonstrates that OSC will deny new ownership group enrollment applications where undisclosed financial ties to prior operators and complex LLC structures signal unacceptable fraud risk.

Informational only. Not legal, medical, financial, or other professional advice. Always consult a qualified professional familiar with your specific facts before relying on any item.

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