This is part two of a series of about five (maybe more) articles that seek to explore some of the lesser known details of Dr. Elias Ghanem.
In my last article, I shared a brief life synopsis of the great and wonderful Dr. Elias Ghanem…Dr Feelgood…Physician to the Stars. His life indeed sounds enviable but as I discussed, my gut has been telling me there is more to his story than the picture that has been painted by his friends, family and local press.
So I did some digging. And what I have found has made my head spin.
His hunger for fame, money and power led him to consort with a number of rather questionable characters. He involved himself in businesses that connected to the much darker underbelly of Las Vegas and beyond. I will try to stay away from too much speculation. Instead I will let the facts speak for themselves - you can make your own conclusions.
Throughout my research, I have relied on too many sources to name them all here. However I would like to recognize in particular two fantastic sources that helped me to understand and articulate the context of Las Vegas: The Money and The Power: The Making of Las Vegas and Its Hold on America, and Mr. Mob: The Life and Crimes of Moe Dalitz.
They are long but wonderfully detailed works which I would recommend to anyone trying to get their heads around how Las Vegas emerged out of the Great Depression and grew from a small dusty and hot Nevadan watering hole into what it is today. And assist in finding the “receipts” of relationships, connections and conversations of the 1950s through to the 80s. Sometimes to go forward you first have to go back.
To whet your appetite, I will start off by giving you a list of some of the interesting events that I will touch on.
The early 1970’s battles between the distributors of the fountain of youth drug, Gerovital, and the FDA
The 1977 plane crash of Frank Sinatra’s mom
The 1977 crash of a drug-running plane in Columbia and subsequent attempted rescue of its American crew
The 1978 launch of the phenomenally popular Soloflex all-in-one workout machine
The 1979 assassination of federal judge John D. Wood by Woody Harrelson’s father, Charles
The 1990 murder of FBI Special Agent John Bailey
And, of course, Elvis’s death
I’ll leave it to you to imagine in the meantime what in the world they all have to do with the fresh faced Arab-Israeli immigrant doctor Elias Ghanem. All will be answered in time, I promise you.
And now, ladies and gentlemen, may I present to you: the first tentacle of the Ghanem Octopus
Introducing… Sunrise Hospital
On December 8, 1958, the $1.5 million dollar, 62-bed, private Sunrise Hospital opened to great fanfare in Las Vegas. The hospital was deemed a welcome addition to the city as the existing state-owned hospitals were struggling to meet the demands of the the exponentially growing community.
The ribbon cutting ceremony was led by Senator Elect Howard Cannon. The lovely Averill Dalitz and Evelyn Roen played hosts. Roy Cohn, an investor in the hospital, was also present. (If you don’t know Roy, I suggest you do a bit of research on him. His life is fascinating, but he’s not the focus of my story today).
The opening of the hospital had been a long time in coming for Irvin (Irv) Molasky and Merv Adelson. They first conceived the idea in 1956, apparently a result of their conversations with physicians who were tired of government politics and wanted access to modern facilities.
Using their real estate development company, Paradise Development, they began to recruit partners and financing. When the initial financing from a local savings and loan company ran out, Irv and Merv turned to the tight-knit Cleveland mobster trio of Morris (Moe) Dalitz, Allard Roen, and Sam Garfield, who were more than happy to help out… in return for the piece of the action.
In addition to shares in the hospital, Dalitz got to play doctor. He was installed as a “second vice-president” of the hospital. His accountant, Eli Boyer, was installed as well in a leadership role.
They brought in other names to give the hospital the air of respectability. In addition to the signatures of Irv and Merv, the incorporation papers also featured the autograph of future Supreme Court Justice David Zenoff. (An interesting factoid about Zenoff is that he presided over the wedding of Elvis and Priscilla Presley). Top doctors were enticed to the hospital. Dr. Leon Steinberg helped them set up the first radiology center in Southwest Nevada.
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Sunrise became in many ways a one-shop shop for the Vegas community. Its network of subsidiaries included pharmacies, clinical laboratories and x-ray facilities. The hospital quickly grew to 100 beds, then 128. In late 1959 when the hospital needed more funding, Jimmy Hoffa was happy to be of service, arranging a $1m loan from the Teamster union’s pension fund.
Hoffa took steps to protect the Teamster’s investment. He secured a union mandate that, in order to access union insurance, members of the Teamster union as well as the 5,000 member strong Culinary Union had to get their medical services from Sunrise (or a very low grade county hospital, making the choice rather easy). To sweeten the deal for the Teamsters, this mandate came alongside another arrangement stipulating that employers had to pay $6.50 per employee per month to cover the costs. According to Molasky, this setup became “an early form of managed care”. A good illustration of the monopoly Sunrise had in Vegas is a chlorine leak that happened at the Stardust Casino on April 2, 1962. Of 62 people taken to hospitals for treatment, 60 of them went to Sunrise.
The hospital was bursting at the seams. At one point Sunrise introduced a deal for patients that would actually return money to them if they moved their stay to a weekend. A further expansion occurred in 1963 where a separate medical center was built adjacent to the Las Vegas Hilton, enabling a higher level of cooperation and interaction with the various casinos on the main strip and to relieve some of the congestion.
Irv and Merv, together with Dalitz, parlayed the financial success of Sunrise and the access to Teamster funding into a real estate empire throughout Nevada and beyond. They built the Stardust Country Club replete with a golf course, and went on to build a $12.5m shopping center. In 1967 they sold some of their gambling holdings to Howard Hughes and soon they were building the luxurious Rancho La Costa in San Diego. Dalitz would hire Wallace Groves, a Bahamas-based associate of Meyer Lansky, to handle the land sales of the resort.
In 1975, the publication Penthouse published an article on La Costa, exposing the connections the resort had with organized crime. The article was later retracted after a $522m libel lawsuit was settled with the publisher of the magazine, Bob Guccione.
The managed health care insurance system would get an unexpected boost in July 1968 when Moe Dalitz, Allard Roen, Jimmy Hoffa’s wife (standing in for her imprisoned husband), Sidney Korshak, Wallace Groves and Allen Dorfman came together at Rancho La Costa for a meeting. The group was a powerful mix of mob and Teamster movers and shakers. The topics for discussion? The sale of the Stardust casino. How to replicate the success of the Sunrise Hospital nationally. Oh, and according to author Gus Russo, a $1m payoff to presidential candidate Richard Nixon was also arranged.
Real estate wasn’t enough for Irv and Merv. They decided to try their hands at the movie business, founding Lorimar Productions. The company initially produced made-for-television movies and then expanded into TV series. Its first major hit was the series The Waltons, followed up with well-loved series such as Eight is Enough, Dallas, and Full House. The company was later rolled up into Warner Bros Television Studios.
I could go on about the background of the men who built, owned and ran Sunrise hospital but hopefully this paints the picture that Sunrise was the brainchild of mob, union and real estate interests, seeking to squeeze as much profit out as possible from the growth of Las Vegas.
It also starts to paint a rather dark picture of the world of managed health care and insurance which should encourage all of us to take a second look at how our health premiums are being spent and what role hospitals and group health organizations play in spending those premiums. But the topic of health care is not what we are here to explore.
What does this have to do with Dr. Ghanem? Let me explain.
Dr. Feelgood and Sunshine
Elias Ghanem, a fresh-faced medical program graduate walked into the mobster and union-owned hospital in 1971 to be an emergency room physician.
The path of hard times was not far behind him. As the Nevada state senate recognized after his death, it was only the early 1960s when Ghanem had arrived in the country “looking for the American Dream with little more than $90 to his name and a scholarship to a North Carolina college, and at times lived out of his car while subsequently working his way through Duke University School of Medicine”. Wow, such a rags to riches story makes you really respect the guy, huh?
Regardless of where he came from, Ghanem was now in the glittering world of Las Vegas with a job at the well-funded, well-utilized Sunrise. It wouldn’t be long before Las Vegas would begin to hear of this man. Mentions of his name would soon surface in the press in connection with Elvis. He finagled a position at the Las Vegas Hilton as the house doctor and his book of business grew exponentially from there, with celebrities like Liberace, Bill Cosby, Johnny Cash, Michael Jackson, Ann-Margret, and Wayne Newton seeking his services. .
What made Ghanem so appealing to drive the word-of-mouth referrals? It is a well-known fact that many of the Vegas performers suffered from “Vegas Throat” due to the hot and dry climate. Did he have an amazing cure for this? Or perhaps he had a treatment to help give them energy to perform night after night? Something for weight loss? It’s been documented that he had Liberace as well as Elvis on various intensive diets.
Others have a specific view on what made Ghanem so appealing to the celebrities. Paul Anka wrote in his memoirs, “There was a Dr. Elias Ghanem, a Palestinian from Haifa. He was the fight doctor, he’d be at all the big fights in Vegas. Real debonair, good-looking guy. He was the guy who was so helpful in writing scripts for Presley, Elvis gave him a Cadillac… Elias Ghanem who gave Presley all those pills, Presley and Ann-Margaret. Ghanem was a ‘scriptwriter to the stars’”.
By 1973 Ghanem had ownership in a new charter airline set up to service private charters as well as provide emergency air ambulance services. He had ownership in a newly opened restaurant. A couple years later he invested in and promoted a fountain of youth drug called Gerovital, albeit with mixed success. (More on these businesses later). His pièce de résistance was perhaps when he opened his own 24-hour health clinics in 1976, bringing many if not all of his clients with him when he left Sunrise and jumpstarting his healthcare empire.
I couldn’t find mention of how Ghanem financed his clinic business. Given a couple relationships he had that I will go into in my next posts, it is very likely that one source of support was the Teamster pension fund. As readers may recall from my last post, when Ghanem created his Prime Health network in 1984, he very quickly secured the the patronage of the Culinary Union to provide medical services to its members. It would not be until 1987 before the union would be deemed to have shed the organized crime influence that had infected the union for more than 30 years. I can imagine there was some sort of “scratch my back, I’ll scratch yours” arrangement. This is of course only speculation.
I just came across another interesting quote that makes me wonder if some of his funding and support came from more, let’s just say, international sources. In Alanna Nash’s book Elvis and the Memphis Mafia, she quotes Lamar Fike, one of Elvis’s closest friends as saying “(Elias’s) contacts were very wealthy individuals. Like Adnan and Esam Khashoggi…. With friends like that Elias didn’t have to rely on Elvis’s wealth to get him by.”
In case the name doesn’t ring a bell, Adnan was the Saudi billionaire businessman arms dealer known in particular for the roles he played in the Iran Contra affair and in helping Ferdinand and Imelda Marcos pillage the Philippines.
Poor boy from Haifa who came to the US with just $90 in his pocket, you say?
Mmm hmmm..
Stay tuned for my next installment where I put direct more sunshine on Ghanem’s past.