The U.S. Attorney's Office for the Southern District of New York has issued subpoenas investigating Middletown, N.Y.-based Crystal Run Healthcare, which received $25.4 million in state grants after numerous people associated with the system donated to the re-election campaign of Gov. Andrew Cuomo, according to the Times Union.
Crystal Run executives and their spouses, as well as physicians, donated at least $400,000 to the campaign, with 10 $25,000 contributions coming during an October 2013 fundraiser. Many of those donors had not contributed to a New York election in over 10 years before their contribution to Gov. Cuomo's campaign.
In March 2016, the New York Department of Health awarded Crystal Run $25.4 million is state grants to help build two facilities that had already broken ground.
Six former Crystal Run physicians filed a lawsuit in December 2017 alleging they should have been consulted about the donations since they regularly made "capital contributions" to the system. Their lawsuit claims the donations were not made by individuals but through pooled company resources.
Crystal Run, Gov. Cuomo's office and the Department of Health all said they have no knowledge of the subpoenas. The Department of Health told the Times Union that the grants awarded to Crystal Health were competitively bid and whether or not construction had begun does not determine whether a project will receive subsidies.