FBI raids Carmel home of American Senior Communities CEO

UPDATE WEDNESDAY 1 P.M.: American Senior Communities released a statement that said the company is cooperating with a federal investigation after the FBI, and other agencies, raided the home of its CEO, James G. Burkhart, on Tuesday.

The statement reads, in full:

"American Senior Communities’ most important priority is to continue to provide excellent care to our patients and residents. ASC has been contacted by the federal government in connection with an investigation into certain individuals or practices. ASC is fully cooperating with the government and is conducting its own review to ascertain the relevant facts. ASC is in compliance with all federal, state and local laws and regulations and will continue to conduct its business in accordance with the highest standards of integrity."

EARLIER:

A cadre of federal agents raided the Carmel home of an executive of a chain of nursing homes Tuesday morning. But the most important question remains unanswered: Why?

The home is owned by James G. Burkhart, the CEO of American Senior Communities, according to Hamilton County property records. FBI investigators also were at the Southside headquarters of American Senior Communities, at 6900 Gray Road, according to reports.

American Senior Communities manages nearly 100 senior care facilities and is one of the largest nursing home management companies in Indiana. Among those are 60 sites, including skilled nursing facilities and assisted living facilities throughout the state, that the company manages under a contract with Marion County’s public health agency.

“Thorough oversight of health care costs in this nation is in every citizen’s interests, and ASC will be an active partner with the government in this investigation,” Burkhart said in a statement through attorney Larry Mackey.

“ASC cares for thousands of residents in scores of facilities across Indiana and has built a decade-long record and reputation for excellence in caring for those most in need. We will keep our focus on our residents while we cooperate fully in this cost review.”

The Health & Hospital Corporation of Marion County is not the target of an investigation, said a spokesman for the entity, which also oversees Eskenazi Health and the Marion County Public Health Department.

“HHC is assured that HHC and its employees are not the target or subject of any investigation and that this investigation is not related to the care that any patient has received at any of HHC’s nursing homes,” said Curt Brantingham, a spokesman for the corporation, in an email. “Moreover, this investigation will not impact the care that residents receive at any of HHC’s nursing homes.”

Officials from the FBI, IRS and Office of the Inspector General were among those participating in the raids.

“The FBI is conducting an investigation into criminal activity in the Carmel area,” FBI spokeswoman Wendy Osborne told The Indianapolis Star. But that’s all she would say. Brantingham referred additional questions to the U.S. Attorney's office. That office declined to comment.

The Office of Inspector General for the U.S. Department of Health and Human Services participated in Tuesday’s raid, but a spokeswoman said she also could not provide any details about the raid, or what might have been seized. The office investigates allegations or suspicions of fraud, waste and abuse in federal health care programs such as Medicare and Medicaid.

American Senior Communities serves more than 6,600 seniors and employs more than 8,200 people, according to the corporation’s website. The company's frequent television ads salute the accomplishments of elderly nursing home residents.

On Tuesday morning, an FBI truck was parked in the front drive of the house in the 700 block of Suffolk Lane, near Clay Center Road and Main Street. The red-brick, 9,000-square-foot home sits in Claybridge at Springmill, a subdivision of million-dollar homes. A Carmel Police Department vehicle sat in front of the home.

The subdivision is full of sprawling, stately homes, set far back from the residential streets. The neighborhood was mostly quiet Tuesday, with a few walkers and joggers occasionally passing and looking on curiously.

A certified public accountant, Burkhart worked for the accounting firm Ernst & Young before entering the health care field.

Burkhart is a member of the Eskenazi Health Foundation Board and a trustee at Brebeuf Jesuit Preparatory School, from which his two children graduated.

Burkhart is also chairman of the board of directors of the Indiana Health Care Association, which represents nursing homes in Indiana.

The association released a statement Tuesday:

“The Indiana Health Care Association just learned of the investigation this morning. We will continue to gather information as it becomes available. Right now, our most important priority is the care of the Hoosiers in our 330 member centers across the state.”

In 2010, American Senior Communities agreed to pay $376,432 in penalties to settle a complaint that it employed seven workers who were ineligible under federal rules for reasons including the loss of licenses and a criminal conviction. At the time, it was the largest such settlement to date.

But whether that has anything at all to do with Tuesday’s raid is unclear.

Star reporters Shari Rudavsky and Maureen Groppe contributed to this story.