On Thursday, Sept. 20, Robert T. Krasnow Sr. appeared before Circuit Judge Leandra G. Johnson  in a Hamilton County courtroom and pleaded guilty to racketeering for his involvement in connection with the 2008 closure by federal authorities of Trinity Community Hospital (TCH) located at 506 NW 4th Street in Jasper.

In July of 2010, after a lengthy investigation, the Florida Department of Law Enforcement announced that investigators with the Attorney General’s Medicaid Fraud Control Unit, FDLE, and the McHenry County Sheriff’s Office arrested Krasnow Sr. of Gainesville, along with his son Robert A. Krasnow Jr. of Gainesville who was the owner of TCH, Dr. Yong Am Park of Lake City, hospital administrator Christina L. Ortega of Lake City, and licensed practical nurse Ashley Lane Butler of Live Oak. In addition, the former medical director at TCH, Dr. Wayne A. Rahming, and former TCH staff physician, Jorge Prieto, were arrested by Medicaid fraud investigators in a separate scheme involving the unlicensed practice of medicine at a clinic in High Springs.

The investigation of TCH established that over $660,000 in state grant funds dedicated to hospital improvements were received by the corporation, but little if any of those funds were used to make such improvements.

During court proceedings last Thursday defense attorneys Bill Blue and Mark Thomas advised Judge Johnson that their client, Krasnow Sr., had signed a plea agreement with the State Attorney’s Office, whereby he pleaded guilty to a charge of racketeering. The entire racketeering scheme involved not only TCH, but other medical institutions in various Florida counties dating back several years.

The plea agreement combined the racketeering charge and nine counts of Medicaid fraud Krasnow Sr. was originally charged with into just one charge of racketeering. The agreement stated Krasnow Sr. would serve 24 months in Florida State Prison and upon release he would serve seven years probation, with the stipulation he would not work again in the healthcare field. Special conditions of the agreement spelled out that he would pay restitution costs of $130,000 to the Florida Agency for Healthcare Administration, $50,000 in investigative costs to the Florida Attorney General’s Office Medicaid Fraud Control Unit, plus court costs and fees.

The defense asked that sentencing be delayed until Jan. 16, 2013, so their client could seek and receive medical care for diabetes and two other undisclosed ailments.

Judge Johnson denied that request stating the case had gone on long enough and that Krasnow Sr. could most likely be treated for his illnesses by the Department of Corrections medical staff while incarcerated. Instead, a date of Oct. 11, 2012 was set for Krasnow Sr. to return to court for sentencing, pending the outcome of doctors’ evaluations of his needed medical treatment, which will be presented when he returns to court.

Additionally, Krasnow Sr.’s son Robert A. Krasnow Jr., who is currently being held in the Coleman Federal Correctional Complex in Central Florida, will also be summoned to court in Hamilton County on Oct. 11. It was disclosed that he had already signed a plea agreement for his involvement and the state would be ready to accept it on Oct. 11.

According to court records, Natalie Krasnow, the daughter of Krasnow Sr., who was also reportedly involved in the scheme, has already appeared in court and was sentenced to 90 days in the county jail, 10 years probation and ordered to pay restitution of $175,000, plus court costs and fines.

Trinity Community Hospital – the beginning of the end

In Hamilton County the events began to unfold on March 8, 2007 when federal agents from the FBI, FDLE, IRS and the US Attorney General’s Office conducted a raid and seized hundreds of  boxes filled with records from TCH, as well as the adjacent clinic and a storage building on the corner of Hatley and 1st Avenue.

Trinity Community Hospital, Trinity Family Clinic and TCH Clinical Lab in Jasper, Trinity at the Oaks in Live Oak and Quality First Care in Lake City were all owned by H.C. Healthcare, Inc. out of Gainesville. A total of about 300 agents carried out search warrants on all the businesses. The sheriffs of Hamilton, Columbia and Alachua counties, the Ocala Police Department and the McHenry County Sheriff’s Office in Illinois provided substantial assistance during the course of the investigation.

Over a year later on Aug. 13, 2008, the doors to TCH were chained and padlocked by mutual agreement of the facility’s owners and the state Agency for Health Care Administration (AHCA). Handwritten signs were placed at the main entrance to the 42-bed facility notifying patients the emergency room was closed and referring them to other facilities owned by the same company. 
A press release issued by H.C. Healthcare, Inc., stated that while the hospital was closed, TCH would focus on capital improvements, management changes and overall improvements of hospital services to better meet the needs of the local community.

The release further stated, “Trinity expects to reopen its hospital after appropriate changes are made and approved by the AHCA, and thereafter provide more professional and better medical services to the community.”
The doors never did reopen and two years later in July 2010, federal agents arrested seven people on various racketeering and Medicaid fraud charges, among them father and son Krasnow Sr. and Krasnow Jr.

Chief Financial Officer Natalie Krasnow was the corporation’s grants liaison officer with the Florida Department of Health and was instrumental in applying for and accounting for the proper disposition of those funds. The investigation had disclosed that the bulk of those funds were used either to support the activities of the criminal enterprise or diverted to the personal use of Natalie Krasnow or her brother, hospital owner Krasnow Jr. Monies gained through those fraudulent activities were laundered through various bank accounts controlled by Krasnow Jr., and some of the diverted hospital grant funds were traced to a defunct car dealership managed by Natalie Krasnow.

In September 2010, Natalie Krasnow was arrested in Illinois and charged with one count of criminal racketeering, one count of scheming to defraud and one count of aggravated white collar crime, all first-degree felonies. She faced a maximum of 90 years in prison and $30,000 in fines, if convicted on all counts.

The case was prosecuted in Hamilton County on Oct. 5, 2011 by the State Attorney’s Office for the Third Judicial Circuit and specially designated attorneys from the Attorney General’s Medicaid Fraud Control Unit.

The charges of racketeering and scheming to defraud were both reduced to grand theft, and adjudication was withheld on both counts. The State Attorney’s Office dismissed the third charge of aggravated white collar crime. She was sentenced to five years probation each on the first two counts, for a total of 10 years probation.

She was also ordered to make restitution to the Florida Dept. of Health in the amount of $125,000 and to the Florida Attorney General Medicaid Fraud Unit in the amount of $50,000, as well as pay court costs and fines. In addition, she was ordered not to work in the health field while under probation, and can apply for early termination of probation after serving five years, provided there are no violations.

Another provision of her sentencing was to serve 90 days in Hamilton County Jail beginning May 15, 2012. According to HCSO, Krasnow was booked into the county jail on May 17, 2012 to begin serving her 90 day sentence and she was granted work release during that time.

Meanwhile, the residents of Hamilton County have been without a hospital or an emergency room for years and have been forced to go to adjacent counties in order to receive those services. The Hamilton County Board of County Commissioners has had numerous discussions on the issue and they are trying to find a cost effective way to provide hospital and emergency services to the residents of Hamilton County.