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Health care facility where vegetative woman gave birth has been investigated for criminal fraud; regulators wanted to pull patients out and cut funding in 2016

The Arizona healthcare facility where a patient who had been in a persistent vegetative state for most of her life gave birth in December was the subject of a fraud investigation in 2016 in which regulators recommended that patients be removed from the facility.

Hacienda HealthCare is currently the focus of a rape investigation following the 29-year-old patient’s pregnancy, which purportedly went undetected by staffers until she went into labor. Investigators are reportedly collecting DNA samples from male staffers at the facility, and it is unclear if anyone outside of Hacienda HealthCare is being asked to submit samples.

Though initial reports said that the woman had been in a vegetative state for about a decade, court records show that the patient has been at the facility since she was a toddler, following a near-drowning incident. She is also a quadriplegic.

AZFamily.com reports that Hacienda HealthCare was subject to a previous criminal investigation beginning in 2016, prompted by allegations that the nonprofit facility committed fraud by over-billing the state of taxpayer money by up to $4 million.

Records obtained by the news outlet showed that the Arizona Department of Economic Security had accused the healthcare facility, which reportedly receives over $20 million in taxpayer funds to care for seriously ill, disabled and/or incapacitated patients, of overcharging the state in 2014 for maintenance, wages, and other operating costs. As part of the investigation, auditors reportedly presented findings to the Attorney General’s office showing that the cost of per-patient care at Hacienda HealthCare was nearly three times the average cost at comparable facilities.

During the investigation, regulators reportedly wanted to terminate contracts between Hacienda HealthCare and the state, and remove patients from the facility. But by 2017, the criminal case had been dropped for reasons not entirely clear in the report, and no charges related to the fraud were ever filed. Still, Arizona’s Medicaid agency is continuing to seek financial records that the facility should be required by law to turn over, and the Attorney General has reportedly accused Hacienda’s former CEO, who resigned in January amid the rape investigation, of unlawfully withholding records.

But Hacienda has continued to receive state funding. Officials reportedly determined that no new patients be admitted into the nursing facility following the pregnancy and live birth that prompted a rape investigation.

CrimeOnline will continue to provide updates to this developing story as more information becomes available.