Biden’s brother used his name to promote a hospital chain. Then it collapsed — Politico
You know you’re in trouble when you’re a leftist and Politico attacks you!
In 2017, a hospital operator set out to build a rural health care empire with the help of a Philadelphia-area consultant. The consultant, Jim Biden, had no experience running hospitals. But he did understand the federal government and had ties to labor unions. Perhaps more importantly, he was Joe Biden’s younger brother.
The final years of the Obama administration had cemented the former vice president’s towering stature in the world of health care, where he had made the fight against cancer a top federal priority and, then, a centerpiece of his legacy-building efforts.
For then 67-year-old Jim Biden, the third of four Biden siblings, his ties to his older brother made up much of his pitch as he pursued deals that could help Americore make money from drug rehab, lab testing, and even cancer treatment.
“This would be a perfect platform to expose my Brothers team to [your] protocol,” Jim Biden wrote to the CEO of a Tampa-area company that controlled licensing rights to an experimental cancer treatment the hospital operator wanted to offer. “Could provide a great opportunity for some real exposure.”
The email, obtained by POLITICO from a person close to the company, documents one of the many ways in which Jim Biden invoked his brother’s name and clout in the course of his work with Americore, which has since gone bankrupt, wreaking havoc in rural communities in the process.
Jim Biden spoke of plans to give his brother equity in Americore, according to one former Americore executive, and install him on its board, according to a second. He also said that if Americore could find a winning business model for rural health care, his brother could promote the company in a future presidential campaign, a third former executive told POLITICO. All were granted anonymity to discuss a company mired in legal and political controversy
In order to fund Americore’s expansion, Jim Biden offered to secure capital from investors in the Middle East, according to the emails and executives. When the expected money did not arrive, it aggravated Americore’s preexisting financial issues. The company collapsed, leaving behind unpaid bills and neglected patients.
The management failures took a human toll as hospital staff went unpaid, services dwindled, and authorities were forced to intervene. At Americore’s hospital in southeastern Kentucky — ravaged by staff departures and dwindling medical supplies — a patient died of cardiac arrest in late 2018 after receiving substandard care, according to a Department of Health and Human Services report obtained by POLITICO.
Four years after its bankruptcy, federal investigators are still pursuing questions about what else happened at Americore.
In September, the Securities and Exchange Commission accused one of Jim Biden’s business partners of fraud related to loans to the company, allegations the business partner has denied.
Meanwhile, the Justice Department found that Americore’s hospital in Pennsylvania entered into sham service agreements and paid kickbacks as part of a scheme that billed the government for medically unnecessary lab tests the hospital shipped out to be performed elsewhere.
Those actions are at the center of a federal prosecution of a $100 million conspiracy to defraud Medicare that has netted a guilty plea from the recipient of the kickbacks and, according to a person familiar with the case, remains ongoing.
Now, House Republicans pursuing an impeachment inquiry focused on the relationship between the president and his relatives’ business dealings have also homed in on Americore. The House Oversight Committee is set to interview Jim Biden on Feb. 21 as part of the inquiry.
As the layers of activity that occurred in and around Americore are peeled back in a federal prosecution in Pennsylvania, a bankruptcy court in Kentucky, and tense witness interviews on Capitol Hill, a POLITICO investigation renders the most detailed picture to date of the ways in which Joe Biden’s relatives leveraged his public stature to advance a private business venture.
The investigation — based on public records, court filings, dozens of interviews and hundreds of exclusively obtained internal documents — reveals that Jim Biden’s role at Americore was larger than previously reported: In some internal documents and investor materials his name is included among its top handful of leaders. He also helped the company seal regulatory approval to acquire the Pennsylvania hospital and personally fired Americore’s chief financial officer, according to the emails obtained by POLITICO.
The investigation also reveals that Joe Biden’s name and inner circle were more involved with the company than has been understood: In addition to the accounts provided by former executives, investor materials described Jim Biden as an adviser to his older brother. And on top of Joe Biden’s own previously reported encounter with the firm’s CEO, at least three of Joe Biden’s relatives did work with Americore. They include Jim Biden’s wife, Sara, and his son, Jamie. The president’s son, Hunter Biden also met with its CEO, and his personal doctor — current White House physician Kevin O’Connor — joined a meeting with Jim Biden and the president of a hospital being acquired by Americore, according to a former executive and emails obtained by POLITICO.
While the extent to which Joe Biden’s relatives have invoked their ties to him to advance their business careers has been a subject of ongoing controversy, the documents obtained by POLITICO demonstrate that Joe Biden was a central element of Jim Biden’s pitch to potential partners and investors during this period.
None of these Biden family members would answer specific questions related to Americore. The White House did not respond to detailed requests for comment.
Jim Biden has not been accused of criminal wrongdoing. His attorney, Paul Fishman, said in a statement that he “conducted himself ethically and honorably in all his business dealings.” A spokesman for Jim Biden declined to answer detailed follow-up questions, writing, “We are not able to participate in this story at this time.”
POLITICO’s investigation did not find that Joe Biden involved himself in the firm or took actions on its behalf. However, Joe Biden did benefit indirectly from his brother’s work with the firm. On the same day Jim Biden received a $200,000 payment from Americore, he made out a check for his brother Joe. The White House has said the check was for repayment of a loan, but did not respond to questions about the circumstances of the loan, including whether Joe Biden was aware of his brother’s income from Americore.
Otherwise, Joe Biden remained on the sidelines as his name and relatives became intertwined with a company that was pitched as a vehicle for his legacy, but stands accused of defrauding taxpayers instead.
“I was sold that Americore was going to be the salvation of rural hospitals,” said one of the former executives. “The whole thing was a scam, and it didn’t take that long to figure it out.”
Mississippi Roots
Jim Biden’s involvement with Americore traces back to his family’s decades-long ties to a circle of Mississippi attorneys that supported Joe Biden’s national political ambitions when he served in the Senate.
Since serving as finance chairman of his brother’s first Senate campaign in his early 20s, Jim Biden had regularly struck up business relationships with Joe Biden’s political backers, including the Mississippians.
The circle orbited around tort lawyer Dickie Scruggs, a brother-in-law of former Republican Senate Majority Leader Trent Lott, who achieved fame and fortune in the 1990s through his scorched-earth legal fights against big tobacco companies.
One of Scruggs’ associates had worked for Joe Biden’s 1988 presidential campaign, and when Scruggs needed congressional support for a large tobacco settlement, he hired Jim Biden as a consultant.
Then, in 2007, Scruggs became an early supporter of Joe Biden’s Democratic presidential primary bid, but the high-flying tort lawyer’s star soon came crashing down when he was caught trying to bribe a judge in a dispute over attorney’s fees.
Scruggs’ downfall also dealt a blow to Jim Biden: As his big brother wielded the gavel of the Senate Foreign Relations Committee and pursued his second presidential run, he was preparing to launch an international lobbying firm with two Scruggs associates. When both of the men were implicated in the bribery scheme and convicted along with Scruggs, the lobbying business was abandoned.
Jim Biden’s dealings went much further with Joey Langston, another lawyer convicted for trying to bribe a judge for Scruggs. When Langston got out of prison, he went into the health care field, and Jim Biden joined him.
Like the Bidens, Langston’s family is a close-knit clan. Just as Jim Biden regularly involved his nephew Hunter in his ventures, Joey Langston sometimes did business with his son, Keaton Langston. A former business partner of the Langstons recalled being struck in a business meeting when Keaton Langston referred to his father as “daddy.”
ome details of the Jim Biden-Joey Langston relationship have emerged from the impeachment inquiry in recent months.
According to a person familiar with Joey Langston’s congressional interview earlier this month, he told investigators that he has lent Jim Biden $800,000, that he has received only $400,000 in repayment, and that he has no documentation of the loans.
According to a second person familiar with the interview transcript, Joey Langston said he has not spoken to Joe Biden in more than a decade and did not know of Joe Biden having any involvement in his brother’s dealings.
Many details of the relationship between Jim Biden and Joey Langston remain sketchy. Sometime around 2015, the two men became involved in a business called Trina Health, in which Jim Biden at one point described himself as a partner.
Trina championed a controversial method for treating diabetes that some insurers balked at paying for. Trina’s founder, G. Ford Gilbert, lobbied the state’s legislature to force insurers to pay for his product. But he was caught bribing the majority leader of Alabama’s House of Representatives, Republican Micky Hammon, leading to Gilbert’s conviction.
Jim Biden and Joey Langston, who were not implicated in the scheme, moved on from Trina, but maintained an interest in the business of health care.S
The Biden Brand
In early 2017, Joe Biden was in legacy-building mode.
His son Beau Biden’s battle with brain cancer had inspired the Cancer Moonshot, a federal push to cure the disease, and closely linked the Biden name with health care in the public imagination.
In the waning days of the Obama administration, the outgoing vice president announced he would continue the cancer fight with a nonprofit, the Biden Cancer Initiative. In June, the nonprofit officially launched.
At the time, Jim Biden was in empire-building mode. Like his older brother, his plans included health care.
One aspect involved a business that allowed hospitals to outsource the complicated, but often lucrative, work of performing medical tests to a specialized service.
In May 2017, a company that provided lab services, Fountain Health, LLC, was incorporated in Mississippi with Keaton Langston listed as its sole member. And it was through Fountain Health that Jim Biden first found his way to Americore, according to one of the hospital operator’s former executives.
At the time, Americore had recently been founded by a Canadian entrepreneur, Grant White, as a vehicle for taking over distressed rural hospitals. White believed he could create a better business model for these facilities by capitalizing on the value of their underlying real estate, and the company was in the process of acquiring a handful of hospitals across the eastern half of the United States.
One of them was in Pineville, the seat of Bell County in southeastern Kentucky. That’s where both Langstons and Jim Biden showed up in May 2017 to pitch Americore on outsourcing its lab services, according to the former Americore executive.
White, who had little experience running clinical labs himself, was sold on the idea.
By early June, Fountain had made a deal with a hospital that Americore had recently agreed to acquire outside of Pittsburgh, according to a contract obtained by POLITICO.
The contract was included in a cache of tens of thousands of internal Americore documents, dealing with all aspects of the business, which changed hands in the course of one of the many private disputes related to the company. POLITICO, which first began reporting on Jim Biden’s Americore involvement in 2019, recently obtained the cache, and this article draws on hundreds of the documents within it.
Jim Biden’s representatives declined to respond to questions about whether he has a relationship with Fountain Health.
As relations deepened between Fountain Health and Americore in the summer of 2017, Jim Biden grew closer to White. He saw even more potential in struggling rural hospitals than the value contained in their real estate.
In addition to cancer treatment, he believed he could help Americore land contracts from the Veterans Affairs Department, an area rife with federal subsidies, and from labor groups, political allies of his older brother with whom he had built longstanding business ties over the decades, according to emails and the former Americore executives.
A few weeks after Fountain concluded the deal with Ellwood City Hospital in Pennsylvania, Jim Biden took O’Connor, an army veteran who served as Joe Biden’s government-provided doctor during the Obama administration, to meet with the hospital’s president, Beverly Annarumo.
“You and your team clearly share our vision, and I look forward to seeing you again in coming months,” O’Connor, who now serves as Biden’s White House physician, wrote to Annarumo later that week. Annarumo did not respond to requests for comment.
The White House did not respond to requests to interview O’Connor. The physician, who also lists an affiliation with the George Washington University’s medical school, did not respond to an email sent to him through the university’s website.
As the summer wore on, plans for a health care empire continued apace.
On July 12, Joey Langston emailed Jim Biden, Keaton Langston, White and two others to schedule a “meeting for Fountain Health partners” the next week.
“Jim will report to the group the results of his discussions earlier today with a contact at [Blue Cross Blue Shield],” he wrote. “There will also be discussion about how to proceed with the Union contacts that have been made by Jim and Keaton, within the last two weeks.”
The partners’ meeting had to be put off so that White and Jim Biden could attend a meeting in Ellwood City, where Americore’s hospital acquisition faced review by the state.
Once the acquisition was completed, Joey Langston wrote in another email to Jim Biden and others, Fountain could dramatically increase the samples it sent to Ellwood City for lab testing.
But before the deal could close, it needed to be reviewed by the office of Pennsylvania’s attorney general. At the time, that was Josh Shapiro, who, as the Democratic nominee for that post in 2016, had campaigned alongside Joe Biden.
Approval was no guarantee. Americore’s efforts to acquire a hospital in southwest Virginia were encountering resistance: Local authorities had learned about financial problems in Pineville, where the hospital had just failed to make payroll, and about one of White’s previous ventures in Canada, in which investors had been saddled with losses.
In Pennsylvania, the company had a leg up. With his roots in Scranton, and his three decades representing neighboring Delaware, Joe Biden had earned the honorific of Pennsylvania’s “ third senator,” and an endorsement from a Biden could help ease concerns about Americore’s trustworthiness.
On a Thursday afternoon in July, Shapiro’s office held a hearing at the hospital to solicit feedback on the proposed takeover. In a show of support, Jim Biden accompanied White, who noted the presence of his new ally. “We also have Jim Biden here as one of our strategic partners,” White said, according to a transcript of the hearing obtained under Pennsylvania’s Right-to-Know Law. “Very familiar person I’m sure.”
In the weeks that followed, Shapiro recommended the approval of Americore’s acquisition of the hospital, which began going by the name Ellwood City Medical Center, according to a September 2017 order issued by Lawrence County judge David Acker that greenlit the takeover.
Representatives for the attorney general’s office directed requests for more information about the approval to the state’s public records process, where a request for documents remains pending. Representatives for Shapiro, who now serves as governor, did not respond to requests for comment.
Americore’s bid enjoyed support from some local stakeholders, and it is unclear what role Jim Biden’s help played in the approval.
His appearance at the Ellwood City hearing had been a rare sign of visible support. As a personal business bio he sent Grant White a few days after the hearing made clear, he preferred to operate in the background.
“Jim has been advising his brother in relation to implementing the Cancer Moonshot, his nephew Beau Biden’s legacy foundation and other Biden family projects,” the bio states. “Through the years, Jim has personally met and has maintained relationships with many key governmental and business leaders throughout the world. He remains the closest personal advisor to his brother. He prides himself in maintaining a low business and political profile.”
Big Brother
In private, Jim Biden was less shy, especially when it came to invoking his older brother.
Several former Americore executives said Joe Biden was central to Jim Biden’s ambitions for the company.
One said that Jim Biden explained to him “His brother was very interested in rural health care and very interested in veterans’ health care and it was something he really wanted to get behind.”
In fact, Jim Biden told the executive, if Americore successfully demonstrated a model for revitalizing rural health care, Joe Biden could run on it in 2020. “This would help his brother get elected if it were to take off and go,” the former executive explained.
Another former executive said that Jim Biden spoke of plans — which did not come to pass — to give Joe Biden equity in Americore.
The plans were part of broader discussions about Jim Biden taking an equity stake of his own in the company, this person said.
A third former executive said that White and Jim Biden spoke of plans to put Joe Biden on Americore’s board.
None of them recalled any indication that Joe Biden ever did involve himself in the company, though his younger brother also invoked him in the course of wooing potential business partners and acquisition targets outside of Americore.
One person on the receiving end of Jim Biden’s health care pitch recalled a phone call in which Jim Biden said he was sitting in a car next to his brother Joe. Joe Biden has said that he never discussed business with his brother.
Previously, an executive who was suing Jim Biden told POLITICO that in a call with the maker of an oral health care rinse he had offered to have the product promoted by the Biden Cancer Initiative. At the time, a spokesman for Jim Biden dismissed that allegation as “pure fantasy.”
The newly obtained email sent to another potential business partner confirms that Joe Biden at times was featured in Jim Biden’s pitch. “This would be a perfect platform to expose my Brothers team to [your] protocol,” he wrote to Jonathan Brenner, the CEO of Tampa-area health care firm Medicus. Brenner did not respond to requests for comment.
While Joe Biden has said he never discussed business with Jim Biden, he did have a chance to meet Americore’s CEO.
In September of 2017, White attended a fundraiser for the Beau Biden Foundation, a nonprofit dedicated to fighting child abuse, alongside Jim Biden. At the event at the Wilmington Country Club, White met Joe Biden, though there is no indication they discussed business.
The next month, White met Jim and Hunter Biden for lunch at the Mandarin Oriental Hotel in Manhattan. The trio discussed the possibility that Americore could land an investment from associates of Jim and Hunter Biden affiliated with CEFC, a Chinese energy firm, according to a person familiar with the conversation.
Tracy Schmaler, a communications consultant who has been fielding media inquiries on behalf of Hunter Biden’s legal team, did not respond to a request for information about the encounter.
In November, Jim and Hunter’s plans with the Chinese businessmen were upended when one of them, Patrick Ho, was arrested by the FBI for bribing government officials in Chad and Uganda.
As he looked elsewhere for investment capital, Jim Biden enlisted the help of more relatives.
Emails also show that his son, Jamie Biden — a creative type known for his turn as a long-haired DJ in the Hamptons — pitched in, helping to create a video presentation about Americore intended to entice investors.
Jim Biden’s wife, Sara Biden, an attorney and a partner in Jim’s consulting firm, Lion Hall Group, was more involved. She helped prepare investor presentations and for a time was given her own Americore email address, according to emails obtained by POLITICO.
Neither Jamie Biden nor Sara Biden responded to requests for comment.
