Yahoo Movies This Fertilizer King Funneled Cuomo $1 Million—and Got a New York Health-Care Empire
He’s an international man of mystery—a reclusive billionaire who once bought a lower Manhattan skyscraper in cash. He’s cut multimillion-dollar business deals with now-sanctioned figures in Russian autocrat Vladimir Putin’s circle. And, thanks in part to Gov. Andrew Cuomo and his administration, he was left in charge of the health and well-being of thousands of poor and elderly New Yorkers throughout the COVID-19 pandemic.
Typical assessments peg Alexander Rovt’s total donations to Cuomo, and to the New York State Democratic Party organization the governor controls, at around $320,000. But The Daily Beast determined that the real figure, including the contributions from Rovt’s numerous corporate entities and his tight-knit clan of business associates and family members, is more than three times that amount: over $1 million, making him one of the governor’s biggest and most consistent contributors.
Today, with help from the governor, who has near total control over New York’s heavily subsidized health-care industry, Rovt sits atop an empire of private hospitals and for-profit nursing homes and home health agencies.
Cuomo’s camp insists the Ukrainian-born Rovt’s donations had nothing to do with his rise in New York’s tightly regulated health-care market. “Political donations have zero bearing on policy,” asserted spokesman Jack Sterne.
But in 2020 a decade of decisions collided with COVID-19. Cuomo’s mishandling of the pandemic’s early surge has attracted increasing criticism and scrutiny in recent months, and the vast domain Rovt built with his state contracts, grants, and approvals were the scene of some of the outbreak’s worst carnage.
Data on fatalities during the first and worst wave of the pandemic is notoriously unreliable, especially in New York. But in March of last year, Brookdale Hospital—where Rovt has presided as chairman for more than eight years—became a nationally televised poster child for health system failure, with images of choked hallways and duct-taped plastic sheeting in its wards.
Dr. Oriana Ramirez, who completed her residency last summer at Brookdale in impoverished Brownsville, Brooklyn, compared the conditions at the medical center to those that compelled her to leave her native Venezuela.
“When I tell you it was horrible, I tell you there were patients on the floor in the [emergency department],” she said, noting the gulf between Rovt’s wealth and the care Brookdale provided. “I saw that all the time during residency the disparities between what the big bosses are to what we offered in the hospital.”
Ramirez described to The Daily Beast how chronic understaffing left her and her peers working 16 hours at a time without a bathroom break and 24 hours without going home. The residents at a hospital helmed by a billionaire who bought Manhattan real estate in cash had to crowdfund not only personal protective equipment, as staff at a few other New York facilities did, but even basic medical supplies like IV bags and crash carts.
By that May, 70 percent of emergency medicine residents at Brookdale had tested positive for the virus. By contrast, a study at another hard-hit Brooklyn hospital in June found COVID-19 antibodies in only a little more than a third of its residents working in the emergency room.
Ramirez helped treat the patient who became the face of the situation at Brookdale.
When 30-year-old teacher Rana Zoe Mungin began displaying COVID-19 symptoms in mid-March, she went to Brookdale twice, only to be treated for asthma and return home without a test for the coronavirus.
When she went back the third time, it was in an ambulance her sister Mia Mungin had summoned. Mia said Rana had to wait a full day, much of it on a ramp, before getting admitted into the intensive care unit. In text messages, Mia said her sister described the hospital as “a circus” and “a war zone.” After Mia waited hours to get word on her sister’s status, a doctor told her Rana was fine.
The next morning, Mia Mungin got very different news: Her sister had tested positive for COVID-19—and she was the “sickest person in the hospital.” Mia Mungin said she was unable to see her sister and only received sporadic updates from the hospital.
“They basically told me she was dying and there was nothing that we could do,” Mungin told The Daily Beast. “I knew I wanted her out of Brookdale because she was just not getting well.”
A transfer to the prestigious Mount Sinai hospital in Manhattan was eventually approved. But Brookdale wouldn’t let Rana go, her sister said. According to Mia Mungin, the Brooklyn hospital explained that it kept her because she was responding positively to treatment for the pneumonia she had abruptly developed.
Rana eventually made it to Mount Sinai but died less than a month later from complications related to the virus.
“I really felt like they [Brookdale] were leaving her to die,” Mungin said.
Dr. Ramirez asserted that Mungin family’s tragedy was far from unique and blamed the hospital for not taking steps to ensure it had adequate staff.
“She is right that the system didn’t work,” she said. “The system doesn’t work even without COVID.”
Brookdale did not respond to repeated requests for comment.
Fifty miles to the east, at Brookside Multicare Nursing Center on Long Island, the 353-bed pendant jewel in the Rovt’s chain of senior homes, workers The Daily Beast spoke with described an environment bordering on the nightmarish. Employees ranging from kitchen staff to nursing complained of years of insufficient staffing and rushed work, a problem the pandemic only exacerbated when dozens of staff and patients fell ill.
One licensed practical nurse, Keisha Wallace, outlined how in the early days of the pandemic she worked with infected and uninfected patients in the same unit and on the same shift. Not only have she and her colleagues had to buy their own PPE, they also had to replace their stethoscopes and blood pressure machines out of pocket. The supplies the home provides, such as gloves and cleaning materials, have been of consistently low quality.
“I took a washcloth the other day, and it was like a tissue you get out of a tissue box,” she said.
A union shop steward, Wallace said she gets complaints daily from co-workers who tested positive for COVID-19 and had to quarantine but didn’t receive the pay for that period the law entitles them to. Darryl Jackson, a Brookside cook, described management pulling workers “right off the line” in the middle of shifts because their test results suddenly came back positive. Those employees had no choice to go home ill to their families and had to wait months for their compensation.
“It tore through my department,” said Jackson. “A lot of my colleagues felt victimized.”
Brookside insisted that it has complied with all health-care guidelines, provided adequate equipment to all its employees, and has now paid all outstanding compensation owed to those who became infected. It also noted that it has a four-star overall rating from Medicare.gov, although its health rating is just three stars, and that appears to be based on an inspection from January 2020, before the first documented case of COVID-19 in New York.
COVID Deaths in NY Nursing Homes Undercounted by Up to 50 Percent: AG
It’s unlikely Brookside or Brookdale, or any health care entity Rovt is associated with, will face significant legal costs related to their handling of the pandemic. At the urging of the industry, Cuomo became one of the first governors in the nation to shield both nursing homes and hospitals from liability related to COVID-19 care. This broad-based protection extends to any “administrator, executive, supervisor, board member, trustee, or other person responsible for directing, supervising or managing a healthcare facility.” In a report on the extent of COVID-19’s destruction in nursing home facilities released in January, the state attorney general warned that these provisions could grant “blanket immunity for causing harm to residents.”
The legal language reflected Cuomo’s closeness to the medical sector, one of the biggest employers in the state. Institutions serving the poor and elderly are heavily dependent on New York’s largest-in-the nation Medicaid program, which the governor controls.
But there are few figures in the health-care field—or in any field—quite like Rovt.
Rovt, a registered Republican, began to attract widespread interest in the American media in early 2017, when it emerged that he had attempted to deliver a massively over-the-limit contribution to then-President Trump on Election Day. He periodically resurfaced in the ensuing years for allegedly having helped hatch a pro-Kremlin Crimean “peace plan” peddled by then-presidential fixer Michael Cohen, for having potential ties to a secret $3.5 million mortgage extended to convicted ex-Trump campaign chairman Paul Manafort, and for supplying a jet for ex-New York City Mayor Rudy Giuliani’s escapades in Eastern Europe. In each incident, Rovt denied having any direct knowledge or involvement.
Despite his riches and clout, Rovt had spent decades avoiding serious scrutiny. His pre-Trump cameos in the U.S. press usually resulted from his dabblings in real estate. Eyes bugged in 2012 when he bought a building across from the New York Stock Exchange for $303 million in an unheard-of all-cash transaction. It was one of several highly unusual debt-free real estate purchases in New York by Rovt, who simply explained that he “hated mortgages.”
But few appeared to be asking where the money for the purchase had come from. After all, in 2010, Rovt had taken out a $4.5 million mortgage to purchase the 58th Street headquarters of his fertilizer company, IBE Trade Corp.
In an email to The Daily Beast, IBE Chairman Steven Plotnick acknowledged that foreign asset sales had provided at least some of the funds for Rovt’s real estate investments. And when it came to foreign asset sales, Rovt had a bumper 2011.
That February, Rovt sold the sprawling Severodonetsk Azot chemical works—which he had just acquired control of thanks to a bargain basement sale by the Ukrainian government—to energy magnate Dmytro Firtash. Firtash was a key backer of since-deposed Ukrainian President Viktor Yanukovych, and reports would subsequently identify him as one of the main financial links between Yanukovych’s regime and Putin’s.
Not long afterward, Rovt and his partner, a Russian senator and former Soviet fertilizer czar, sold their stake in a different plant for $1 billion to oligarch Arkady Rotenberg, Putin’s childhood friend and judo sparring partner.
Rovt used the cash to finance his real estate purchases and to build a new business kingdom for himself in America, one founded not on petrochemical plant food but on people’s lives. And he had the help of a new ally: Andrew Cuomo.
Rovt’s entry into the health-care field was hardly auspicious. In 2001, he joined the board of financially strapped and state-dependent Brookdale Hospital. By 2007, he had become the institution’s vice chairman and imported Plotnick onto the board with him. IBE Trade Corp’s in-house counsel, Irina Benfeld, joined in 2010.
Then scandal struck. That same year, Brookdale’s CEO was ensnared in state and federal probes that uncovered a bribery and kickback scheme involving three state lawmakers and hospital dollars. Rovt was never accused of wrongdoing, but he had long cultivated a relationship with one of the implicated legislators. All four of the accused were convicted and imprisoned for their crimes.
The State Department of Health urged the state attorney general’s office to probe Brookdale’s board. But the state attorney general at that time was Cuomo, and he was running for governor with Rovt’s financial backing.
The $65,200 Cuomo got that first campaign from Rovt and his wife was just the start.
Over the next decade, the couple and their son would dump almost $430,000 more into the governor’s coffers. The family and IBE poured another $256,000 into those of the state Democratic Party, which Cuomo controls and uses to cover his political expenses and prop up his allies. Another $235,800 would arrive via the entities the family uses to operate its real estate portfolio, while a business associate who manages the properties kicked in another $10,000.
Shortly after entering office in 2011, Cuomo commissioned a group of public health experts to study the problem of Brooklyn’s struggling hospitals. The panel’s findings on Brookdale were scathing: It was the most heavily leveraged medical center in the borough and the least popular among patients. As a solution, it recommended the more financially stable Kingsbrook Jewish Hospital “take the lead in establishing an integrated system with Brookdale,” and with “a new governance structure and a new board of directors.” Despite impending “financial collapse” at Rovt’s hospital, it warned that a “state bail-out of the facility in its current configuration, under current leadership, is neither feasible, nor rational.”
Instead of following these recommendations, over the next five years Cuomo-controlled agencies pumped around $100 million in grants into Brookdale—even as independent auditors awarded it year after year of failing safety grades and consistently ranked it among the worst hospitals in America. The hospital faced more than 100 patient lawsuits in 2012, the same year Rovt became Brookdale’s chairman and joined the board of Maimonides Medical Center, a more affluent institution several miles away.
Cuomo’s Department of Health agreed to withdraw its request for an investigation of Brookdale’s board if the facility dropped the management company with which its convicted CEO had been associated. In 2016, Cuomo arranged for a new study on Brooklyn’s hospitals, this one authored by a former aide to his father, the late Gov. Mario Cuomo.
Its recommendation: Brookdale and another hard-up hospital, Interfaith Medical Center, should absorb Kingsbrook’s inpatient care and surgical services, and a new operating entity should take over the administration of all three facilities.
That new entity, based at Brookdale Hospital, came into existence just a few months later. The organizing documents for One Brooklyn Health System bore the signature of its new chairman: Alexander Rovt. And it soon formed the core of the $1.4 billion Vital Brooklyn initiative Cuomo announced in early 2017.
Cuomo’s team insisted that it could not implement the 2011 plan’s recommendations for a Kingsbrook-led unification because the funding for the merger didn’t exist until the governor put it in his budget in 2017.
“The Vital Brooklyn initiative is about one thing: keeping New Yorkers healthy, and that’s exactly what it is doing,” said Sterne, the Cuomo spokesman.
But the timing of this appropriation was entirely at the discretion of the governor, who sets the budget in New York and controls the relevant state bonding authorities. Further, Cuomo’s office maintained it was One Brooklyn’s board of directors that picked Rovt as the chair—though public records show Rovt already held the position at the time of One Brooklyn’s incorporation and the filing of its bylaws.
It is difficult to determine to what extent Rovt has profited directly from his positions at Brookdale and One Brooklyn Health, which are officially unpaid. Brookdale’s 2011 financial disclosure stated that Rovt had a “business relationship” with the medical center. But it provided no details on the sort of sums involved, and no subsequent filing has mentioned it since. Rovt had previously offered to lend the hospital money in exchange for holding its real estate as collateral, but the 2011 documents show no outstanding loans from board members.
Brookdale changed accountants after Rovt became chairman the following year, and Plotnick said no one at IBE remembers what this business relationship was.
But Rovt has clearly used his affiliations with the Brooklyn hospitals to launch his for-profit health care ventures. Working with another Ukrainian-born business partner, Rovt has spent the past decade rapidly expanding a network of home health agencies, with the help of approvals and $160 million in contracts from Cuomo’s state Department of Health—and with referrals from Brookdale, Kingsbrook, and Maimonides.
The medical data firm Dexur supplied The Daily Beast with the three most recent years of Medicare and Medicaid figures from Rovt-linked institutions. In that short span, the numbers show more than $1 million in business has flowed to Prime Home Health Services from those three hospitals.
On his 2016 application to the state to take over a chain of nursing homes in Queens and the New York City suburbs, Rovt cited his history with Brookdale, Maimonides, and Prime as proof of his experience and qualifications. Cuomo’s appointees approved the plan, which Rovt’s own estimates said would yield $4.78 million in profits in just the first year.
The real numbers may be much higher. Advocates have long complained that taxpayer dollars disappear into subcontracted companies belonging to nursing home owners. Like many owners, Rovt splits his nursing homes’ operations and their physical facilities between two corporate entities, with the former paying rent to the latter, even though he holds a 90 percent stake in both.
Plotnick acknowledged to The Daily Beast that the Prime network of home health agencies have a similar arrangement, paying for the use of their Rovt-owned Brooklyn headquarters. The lack of transparency makes it impossible to see whether the homes, or the Prime companies, have done business with any other Rovt-controlled firms. Plotnick said he did not believe the homes or the agencies had made any payments other than rent to companies belonging to the billionaire.
More than 13,000 New Yorkers have died in nursing homes during the pandemic—a recurring source of scandal for Cuomo, who initially ordered the facilities to take back COVID-19 patients released from hospitals. In recent weeks, it has emerged his administration deliberately undercounted the number of residents who subsequently died.
Plotnick claimed not to understand a question from The Daily Beast that highlighted the contrast between Rovt’s wealth and the poor conditions and lack of basic supplies reported at the medical institutions he controls. Asked to describe Rovt’s relationship with Cuomo, his answer was brusque.
“Alex Rovt is a tireless advocate for the Brooklyn health care system and Governor Cuomo is the chief executive of New York State,” Plotnick wrote. “That is their relationship.”
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