P Is for Peril

Attorney's Office, the FBI, HHS, HCFA, and MFCU-the Medicare Fraud Control Units. Doesn't deter the fraudsters. Cheaters love rules and regulations. Every time you put up a barrier, they figure out a way around it. One of the many challenges of the entrepreneurial spirit," she added drily. "I saw Pacific Meadows change hands three times and the price came close to doubling with each of those transactions."
    I made another note, thinking about ways to check out the dollar figures on those deals. "Did you work for Endeavor or Silver Age?"
    "Actually, I think Silver Age was a subsidiary of Endeavor. The head of Endeavor was a woman named Peabody. She used to run all her personal expenses through our accounts payable. She'd renovate her house and write it off to Pacific Meadows as 'maintenance and repairs.' Or she'd put in new draperies at home and claim she'd had them installed in all the patients' rooms. Groceries, utility bills, travel and entertainment-she never missed a trick."
    "Isn't that illegal?"
    "Mostly. Some of it was probably legitimate, but a lot was fraudulent. I called a few items to the administrator's attention, but he told me, in effect, I'd better mind my own business. He said the company accountant routinely reviewed the books and everything was okay. I knew if I pressed the point, I'd have been out the door right then. It seemed easier to shut my mouth. When Silver Age came in, someone else handled the books for a while. Then he got fired and I took over again. There was probably some tinkering going on at that point, but I never figured out what it was."
    "Why didn't you quit and find another job?"
    "I loved the work."
    "You could have loved the same work somewhere else, couldn't you?"
    "True, but I got stubborn. I figured one day they'd crash and burn and I'd be there to watch, maybe throw additional fuel on the fire."
    "Did anything change when Dr. Purcell arrived on the scene?"
    "Not the first couple of months. Then I noticed an increase in the number of charge slips for things like ambulance service and physical therapy, portable X-ray equipment, wheelchairs. I started keeping notes and then I wrote a memo to Mr. Harrington, the head of the billing department at Genesis. That was a mistake as it turned out, but I didn't care. He never said as much, but I'm sure he didn't appreciate the effort because it put him on the spot."
    "You were a regular troublemaker."
    "I sincerely hope so."
    "So even before the audit, they were unhappy with you."
    She nodded and said, "Very. They let some time pass and then they fired me. Dr. Purcell tried to intervene, but he had no power and he was overruled. Penelope got upset and she quit in a huff, which really worked in their favor. It made it look like we were guilty of wrongdoing and Genesis was cleaning house. That still gave them Dr. Purcell as a fire wall if the MFCU investigation proceeded…"
    "Which it did."
    "Oh, yes. They're not going to give up until they nail this one down."
    "As I remember it, Joel told me Genesis was part of a group called Millennium Health Care."
    "It is, but my guess is that some, if not all, of those companies are shell corporations, set up to conceal the real ownership."
    "As in what?"
    "Company A, owned by Mr. Smith, buys a residential nursing home. Smith sets up a phony company with a slate of officers who appear to be unconnected to him. His company, A, sells the facility to this second company-also his-at a greatly inflated price, effectively converting the profits into capital gains…"
    "Which are taxed at a lower rate," I said.
    "Right. The second company can use the trumped-up value of the newly purchased facility as collateral for new loans. Meanwhile, bogus company C comes along and leases the building and grounds from the 'new' owner with a substantial boost in rents."
    I held a hand up. "Hang on a minute." I ran the chronology back through my mind, trying to figure out what had caught my attention while she was laying it out to me. It wasn't anything she said; it was something I'd been wondering since I'd arrived at her door. "The night he disappeared, Dr. Purcell left Pacific Meadows at nine o'clock. Did he, by any chance, stop by to talk to you?"
    She paused so long I didn't think she'd answer me. "Yes."
    "About what?"
    "He told me he had a meeting scheduled with the FBI. He thought he knew what was going on and who was behind it, namely Harvey and Joel."
    "But those two wouldn't have been in any jeopardy, would