Two nursing home owners in South Jersey built an empire of misery that turned government healthcare dollars into personal fortunes, according to a devastating investigation just released by New Jersey’s Office of the State Comptroller.
Daryl Hagler and Kenneth Rozenberg, longtime friends and next-door neighbors, controlled Hammonton Center for Rehabilitation and Healthcare in Atlantic County and Deptford Center for Rehabilitation and Healthcare in Gloucester County. Between 2019 and mid-2024, the state sent these two facilities more than $134 million in Medicaid payments meant to care for some of society’s most vulnerable people.
Instead of using that money for nurses, aides, food, and basic dignity, the owners deliberately kept staffing so low that residents routinely sat in soiled diapers for hours, screamed for help that never came, missed critical medications, and in the worst cases became victims of sexual assault or choked to death on food they were never supposed to eat.
The comptroller’s office examined just 146 random days across three years and found the homes met New Jersey’s minimum staffing requirements on only two of those days. On average, Hammonton ran 52 percent below required staffing levels and Deptford 54 percent below. That meant residents received less than half the hands-on care the law demands.
When staff shortages became unbearable, someone inside the buildings dialed 911 more than 3,400 times asking police for help because no one inside could or would respond.
The neglect crossed into outright horror. At Hammonton, two residents were sexually assaulted in 2021. At Deptford, one resident choked and died in 2022 after workers ignored a doctor-ordered pureed diet and handed over a regular sandwich and cookie. Another wheelchair-bound amputee was discharged twice in two days—first to a motel that couldn’t take him, then literally left outside a closed social-services office.
While all this happened, Hagler and Rozenberg were potentially busy moving money.
Investigators discovered the pair owned or controlled at least nine other companies—real estate firms, staffing agencies, IT providers, consulting businesses, even medical labs—mostly registered to themselves, their children, or close employees. They routed $92 million of New Jersey’s Medicaid money through this private network, more than two-thirds of everything the state paid the homes.
The biggest money pump was real estate. The owners set up separate property companies that charged the nursing homes sky-high rent, including $27.8 million labeled “additional rent” that duplicated costs already covered. Another $7.8 million in Medicaid dollars quietly paid down the owners’ personal purchase loans for the buildings, something taxpayers were never supposed to fund.
When it came time to file required financial reports with the state and federal government, Hagler and Rozenberg claimed they had paid their own companies less than $900,000 total. In reality they had shifted more than a hundred times that amount. Hagler personally signed the false reports.
Both facilities earned the federal government’s harshest label—“Special Focus Facilities”—multiple times, a list reserved for the worst-performing nursing homes in America. Yet the money kept flowing and the owners kept cashing out.
State investigators only launched their probe in 2023 after New York’s attorney general sued the same two men for allegedly stealing $83 million from that state’s Medicaid program. Hagler and Rozenberg together own or control 46 nursing homes across New Jersey, New York, Kansas, and Missouri.
Acting State Comptroller Kevin Walsh called the case a textbook example of how weak oversight lets predators hide in plain sight. Nursing homes that deliver terrible care while pulling in huge public payments should trigger immediate red flags, he said, but the system failed to act for years.
The comptroller’s office now plans to claw back up to $123.9 million in overpayments and fraudulent profits, plus almost $1 million in penalties for staffing violations and false claims. Officials also want Hagler, Rozenberg, their family members, and their companies banned from ever touching New Jersey Medicaid money again and will warn the three other states where the men operate.
For the families who trusted Hammonton and Deptford with their loved ones, the damage is already done. One resident’s cry for help went unanswered so long that police were called. Another never woke up after eating the wrong meal. Two others carry the trauma of assault inside what was supposed to be a place of healing.
The report lays bare a simple, cruel equation: the less money spent on care, the more left over for the owners. And for far too long, no one in authority forced them to choose residents over profit.
The New Jersey Digest is a new jersey magazine that has chronicled daily life in the Garden State for over 10 years.