Responding to new Lunsford ad, McConnell camp points to Vencor controversy

Shortly after Democratic U.S. Senate nominee Bruce Lunsford hit the airwaves with a new ad painting U.S. Sen. Mitch McConnell (R-Louisville) as an entrenched Washington politician, McConnell's campaign fired back by resurrecting a controversial aspect of Lunsford's business history that has been campaign fodder for the Democrat's opponents in previous campaigns.

"Here is how it works in Washington: the politicians get millions in campaign cash, the special interests get what they want, and we get the short end of the stick," saidU.S. Sen. Mitch McConnell (R-Louisville): Politicker photo Lunsford in his new ad. "Mitch McConnell is the master of this system."

An e-mailed statement from McConnell's campaign manager, Justin Brasell, mimicked the structure of Lunsford's words and targeted Lunsford's tenure as CEO of Vencor and Ventas - a nursing home chain and a healthcare investment trust, respectively.

"At least Lunsford is consistent, going back to the primary every ad he has run has been full of baseless negative attacks," said Brasell. "Here is how it works in Lunsford's world: you run a nursing home business that takes millions from the federal government and then are forced to pay record fines for poor treatment of senior citizens. Then you bankrupt the business but make sure that you walk away with millions. That's how it works in Lunsford's world."

Those comments refer to Vencor and Ventas' $104.5 million settlement with the Federal Government in 2001, which the company agreed to amid charges of "overbilling," "failure of care claims," and "improper" claims on Medicare reports.

Lunsford founded Vencor in the mid-1980s with two partners. Vencor split in two in 1998, becoming Vencor and Ventas, shortly after the Federal Government cut Medicare reimbursement rates. Medicare is a major funding source for nursing chain providers.

Lunsford resigned as CEO of Vencor after the split, in January of 1999, yet stayed on with Ventas until 2003. Vencor declared bankruptcy in September of 1999. Amid re-organization and the settlement, it assumed the name Kindred Healthcare in 2001.

The Lunsford campaign has asserted that the companies did not admit wrongdoing as part of the settlement.

Nevertheless, the Vencor/Ventas settlement and the allegations of financial improprieties and patient abuse at some of the facilities played important roles in Lunsford's earlier campaigns.

During a 2003 run for the Democratic gubernatorial nomination, opponent Ben Chandler (D-Versailles) ran ads featuring Jeri Stevens, a woman who claimed her mother was abused in a Vencor facility.

The issue was resurrected in the Democratic Senate primary campaign this year, when opponent and Louisville businessman Greg Fischer also ran television spots hitting Lunsford on Vencor's past.

While their reply is certain to raise some ire, the McConnell campaign's response did not address an assertion in Lunsford's ad that the four-term incumbent "says nothing" about the indictment of fellow Republican Sen. Ted Stevens, of Alaska.

Stevens was indicted last week on charges that he intentionally concealed over $250,000 of gifts from an oil services company.

McConnell - the Republican leader in the Senate - earlier said the matter should be left to the "legal process."

Update: The Lunsford campaign, which has long held that Vencor never admitted wrongdoing in the settlement referenced by McConnell's camp, asserted that McConnell himself was contorting the issue when reached for a response.

"Mitch McConnell either hasn't told his campaign staff the
truth or he has told them to deliberately distort the truth, because he knows better," said Lunsford's spokesperson, Cary Stemle.