The head of a North Jersey hospital is alleging that a top state Department of Health official carried out a series of retaliatory inspections in an attempt to put him and is hospitals out of business at the behest of the state’s largest healthcare workers union.
In a suit filed in Hudson County Superior Court on Wednesday, Richard Lipsky claimed Assistant Commissioner of Health Stefanie Mozgai repeatedly launched punitive inspections against Columbus Hospital, a long-term acute care center in Newark, and the Meadowlands Hospital Medical Center in Secaucus at the beck and instruction of the Health Professionals & Allied Employees (HPAE).
The suit, which alleges violations of the New Jersey Civil Rights Act and State Constitution, claims Mozgai, who runs health facility inspections, coordinated with the HPAE and private insurers in an effort to drive the hospital out of business.
“Mozgai and other … officials, as part of a pattern of conduct including, but not limited to, threats, intimidation, and coercion, directed and performed an excessive number of interviews at Meadowlands and pursued arbitrary, unjustified and repeated inspections,” according to the complaint.
Attorneys for Lipski and the hospital say in court filings that Mozgai had documented interactions with the healthcare workers union, and that senior staff at the Department of Health took steps to include Mozgai in meetings between the state Commissioner of Health and the HPAE.
The suit alleges that the Department of Health “once again as part of its campaign to threaten, intimidate, and coerce plaintiffs, reappeared suddenly and without advance notice at Columbus allegedly to perform another inspection, on behalf of the federal government, so that they could conceal their misconduct by using federal privilege as a shield.”
According to the court filing, a state health department employee, Sophie Zyloportas, called Columbus in search of on the alleged denial of admission of COVID-19 patients.
That issue came up on June 24, 2020, just two days before a judge was set to decide a motion to quash a subpoena against the Department of Health and Mozgai related to unannounced inspections at Columbus Hospital.
Lipsky claims the New Jersey Department of Health (DOH) inspected the Meadowlands hospital more than 66 times between December 2010 and December 2017, when Lipsky’s company sold the Meadowlands facility to a business owned by businessman Yan Moshe.
The Meadowlands facility faced numerous labor complaints after Lipsky’s firm purchased it in 2010. Officials at HPAE claimed hospital management engaged in wage theft and fired some workers without cause and failed to some employee’s medical claims, among other things.
Lipsky made similar claims in a separate suit alleging RICO and antitrust violations filed against the New Jersey Association of Health Plans in 2016. Then, he charged the Department of Health issue subpoenas for Meadowlands’ executive staff as a result of that coordination.
“As part of the allegations in the NJAHP Matter, Dr. Lipsky alleges, among other things, that the defendant private insurers, and other parties, engaged in a conspiracy with governmental officials, including certain elements and individuals within the DOH, to put Plaintiff Lipsky and his hospital, Meadowlands, out of business,” the court filing alleges.
Wednesday’s brief claims the Department of Health dragged its feet in responding to subpoenas issued in the (New Jersey Association of Health Plans) case, taking more than a year to release documents Lipsky claims were improperly redacted.
“Although the DOH claimed that the reason for the redactions were to preserve patient confidentiality, numerous redactions also included references relating to HPAE and its contacts with the DOH to instigate the numerous inspections at Meadowlands,” the court filing alleges.
He claims that legal action led to other retaliatory inspections conducted by Department of Health officials at the Columbus Hospital.
Lipsky said department officials that are named in the suit conducted a survey with an undisclosed purpose in October of last year, just months after a June 2019 inspection related to the hospital’s accreditation survey.
The recent suit claims a similarly-opaque inspection was conducted at Columbus on June 24, adding that the Department of Health officials who conducted that inspection refused to provide a written description of the complaint that launched the inquiry.
According to the court filing, the Department of Health and Mozgai “have failed, refused and neglected to provide Columbus with any evidence of a written or formal complaint, which resulted in the June 24, 2020 inspection,” the court filing alleges,” through July 7, 2020.
According to allegations made in the court filing, the Department of Health “is known to have a backlog of inspections at facilities extending over many years, but this did not stop the DOH inspectors from repeatedly inspecting Meadowlands.”
“These extraordinary inspection efforts have continued now at Columbus, even in the middle of a pandemic and without legitimate cause,” the lawsuit states.
The lawsuit comes at a time of particular stress for the Department of Health.
Internal politics at the agency have become increasingly bitter over recent weeks. Despite an ongoing pandemic, a cadre of department officials have taken to secretly recording meetings with top officials, including Health Commissioner Judy Persichilli.
In May, Gov. Phil Murphy’s administration fired Assistant Commissioner of Public Health Infrastructure, Laboratories & Emergency Preparedness Christopher Neuwirth, who was the subject of an internal administration probe seeking the source of politically-damaging leaks.
No public reason has been given for Neuwirth’s termination, though sources have alternatively pointed to Neuwirth’s employment at Margolis Healy & Associates, an emergency preparedness consulting firm and Neuwirth’s status as a suspect in the leaks investigation.
The former assistant commissioner claimed he was fired as a scapegoat, later shifting to claim he was fired for refusing to provide COVID-19 tests to a top Murphy administration official.
Mozgai’s husband, Francis Mozgai is employed as director of emergency management for that employs Neuwirth.
Stefanie Mozgai’s financial disclosure said her husband worked for Cozen O’Connor, a politically-connected law firm, though Margolis Healy & Associates CEO Steven J. Healy has confirmed to the New Jersey Globe that Francis Mozgai is employed there as director of emergency management.
Margolis Healy markets their services directly to hospitals, residential facilities, assisted living, and nursing homes, according to their marketing materials.
Stephanie Mozgai heads the office that inspects all of those facilities, although there have been no allegations of conflicts between her job and solicitation of business by her husband’s firm.
In June, Assemblyman Christopher DePhillips (R-Wyckoff) has asked the State Commission of Investigation and the State Comptroller to investigate the relationship between the Department of Health and a private company operated by the Cozen O’Connor law firm.
“A troubling pattern of ethics breaches has been emerging from the Department of Health, and it calls for a thorough and swift investigation,” DePhillips said at the time. “The people of our state deserve to know if their State Health Department has been abusing ethical and transparency protocols, especially during the ongoing pandemic.”
In addition to the Department of Health and Mozgai, seven other state officials were named in the lawsuit: Lisa Pasquito Kiernan, Tamara Toth, Crescenza Zizza, Julie Trott, Christina Petruska, Erin Sembler and Nadine Tenzer.
Donna Leusner, a spokesperson for the Department of Health, told the New Jersey Globe that she was not aware of the litigation. She said Mozgai is on vacation this week.
The HPAE, which was not named in the lawsuit, has not commented on it.