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A Massachusetts nursing home operator has agreed to pay a state-record total of $4 million and hire an independent compliance monitor to settle allegations that understaffing at its 16 facilities led to substandard care and harmed patients, the state attorney general's office said Monday.

Record Settlement and Allocation of Funds

Next Step Healthcare LLC will pay $750,000 directly to the state, which will divide the funds between the state's Medicare program, MassHealth, and a Department of Public Health-administered Long-Term Care Facility Quality Improvement fund, according to the announcement from Attorney General Andrea Joy Campbell.

Next Step will be required to spend the remaining $3.25 million on increasing staffing and retention over the next three years to bring the facilities into compliance with state regulations. This task will be overseen by the compliance monitor, the attorney general's office said.

Massachusetts Nursing Home $4M Fine : Largest Settlement to Date

Campbell said it was the largest settlement ever reached between the attorney general's office and a nursing home operator. The deal follows a years-long investigation by her office after the Department of Public Health received multiple complaints regarding substandard care and regulatory violations at Next Step's facilities.

"For years, Next Step prioritized profit over care by failing to adequately staff its nursing homes," Campbell said in the announcement.

Massachusetts Nursing Home $4M Fine : Investigation Findings

The attorney general's office said it learned through its investigation that the company had implemented staffing cuts in 2019 and continued to under-staff the facilities despite new state regulations setting minimum staffing requirements that went into effect in 2021. These actions were found to be in violation of the Massachusetts False Claims Act and the state's consumer protection law due to the substandard care and fraudulent MassHealth claims.

Future Compliance and Oversight

The settlement was reached prior to any court action being filed. Campbell emphasized that she hopes this settlement "will send a message that this conduct will not be tolerated and ensure that Next Step's facilities comply with staffing requirements moving forward, assuring that vulnerable elderly residents receive the proper care they need."

Next Step, based in Woburn, Massachusetts, operates nursing homes in Attleboro, Fall River, Fitchburg, Lee, Malden, Melrose, Middleborough, Newton, Norwood, Plymouth, Taunton, Walpole, Westborough, and Worcester.

A message seeking comment from the company did not immediately receive a response Monday morning.