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Read Making a Killing

home / healthcare / in the media

Newsday (New York)
Apr 19, 2004

by DAWN MACKEEN. STAFF WRITER

SUNRISE CENTERS; A rift in care under 1 roof

For six years, the nation's largest assisted living chain has operated in New York without being licensed by the state health department.

When the state determined in 2002 that a Sunrise facility should be regulated because it was providing health care, the company responded by suing. Sunrise officials argue that they only offer retirement housing, that residents' medical care is provided by a separate agency licensed by the state.

But critics - ranging from consumer advocates to competing state-licensed facilities - charge that the argument made by the $1.2 billion corporation is nothing more than a ruse to evade costly regulation. And they say it raises worrisome questions about the lack of oversight for facilities that increasingly care for some of state's most vulnerable citizens.

"I think it's outrageous that they are suing the state," said Cynthia Rudder, executive director of the Long Term Care Community Coalition, a Manhattan-based advocacy group. "We would not allow a nursing home or hospital to be built on the corner without having them follow standards of care."

Headquartered in McLean, Va., Sunrise Senior Living is a publicly traded corporation with many subsidiaries, including one that manages facilities and another that provides health care. As it stands in New York, the only part of Sunrise that's regulated by the state health department is the health care provider, Dignity Home Care Inc.

That's not enough when so many at-risk individuals, including those with dementia, are living in a facility, the state argues. Home care agencies only have to be inspected once every three years, instead of every 12 to 18 months for adult care facilities. And the lack of regulation over the centers means they have no state criteria for the discharge of sickly residents.

Additionally, the state argues in legal papers that Sunrise doesn't have to meet state health department standards for resident safety, sanitation or evacuation in a fire.

A two-tiered approach

The state argues that the distinction between the home care agency and the facility run by Sunrise exists largely on paper, noting that bills for rent and Dignity services have been paid for with one check. And while Sunrise allows residents to contract with other home care agencies, in addition to Dignity, the company lists many conditions and restrictions upon doing so, according to the lawsuit.

Only 16 of the 97 residents at Sunrise at Fleetwood in Mount Vernon, which is the facility at the center of the lawsuit, did not receive services from Dignity at the time inspectors visited in 2002. State inspectors also noted that residents weren't always able to distinguish between Dignity's workers and Sunrise's.

But Dignity officials say that the two operations are very much separate. "We make that very clear," said Maureen Wolfe, Dignity's area director of patient care. "We are licensed by the department of health to care for patients. The building itself isn't, but the agency is."

Maribeth Bersani, national director of Sunrise Senior Living's government affairs, says Sunrise's facilities are subject to some government oversight. "I would say Sunrise is regulated," Bersani said, noting that facilities need "all sorts of zoning approvals" before building, including from the local fire marshal and local health department. And company officials say they have their own policies for admitting and retaining residents.

'An unlevel playing field'

But operators of some licensed facilities - such as Kevin Hunter, a vice-president of Sterling Glen - say this two-tiered regulatory system creates "an unlevel playing field" for them.

Pamela Hamilton Giblon, vice president of the Long Hill Alliance, which operates five licensed facilities on Long Island, complains that unlicensed centers "can do whatever they want. They can take people who are actually nursing home candidates and let them in," she said. "We can't do that."

The state also alleged in its legal response that the dementia program at Sunrise appears to be an unlicensed nursing home. "Of particular concern is the Reminiscence Program which provides for the provision of services to persons suffering Alzheimer's or other related dementia," the state wrote. "These residents are particularly dependent upon others for services and are clearly not capable of living independently or without close, if not constant, monitoring."

Sunrise Senior Living is a company that touts itself as a pioneer of assisted living, founded more than 20 years ago explicitly to fill the "void" in long-term care. Visitors to the corporation's Web site can even type in the local zip code select the "assisted living" box, and receive a list of its Long Island facilities.

Yet in interviews with Newsday, Sunrise officials contend that these very centers do not provide assisted living. They say that's provided by Dignity.

Marketing assisted living

But, in fact, "assisted living" was in its company title - and marketing material - until last year, when the corporation changed its name from Sunrise Assisted Living to Sunrise Senior Living.

The name was changed to reflect its new range of services after the acquisition of Marriott Senior Living Services Inc., according to Sunrise. This expansion, along with addition of EdenCare Senior Living Services, substantially increased Sunrise's operations to include independent living and skilled nursing care.

At the same time, the company shifted its focus from building, owning and operating centers to managing them, according to its annual report.

Now, there are 36,765 residents living in 373 senior centers in 34 states, the District of Columbia, Canada and the United Kingdom. in last year's annual report, the corporation reported a net income of $62 million, a 14 percent increase over 2002.

"They will spend millions in the court process to fight regulations," said Jamie Court, president of the Santa Monica, Calif.-based Foundation for Taxpayers and Consumer Rights. "For the patients and their families in the facilities, it means they won't be as safe as they can be."

Legality and pending laws

Sunrise officials say they received permission in 1997 to operate without licensure from the state's department of social services, just before the health department assumed oversight of adult care facilities. That permission, they say, included use of "assisted living" because it was already in its corporate name.

Dignity was formed specifically for Sunrise's New York properties in 1998. That was the same year that Sunrise's first center opened in Glen Cove. But by the next year, the state health department was already receiving complaints about the quality of Dignity's care, according to the lawsuit. And while investigating "the department became aware of a dementia unit within the
facility."

Since the Sunrise lawsuit was filed, no enforcement action has ensued, no fines have been levied and Sunrise in Mount Vernon has continued to operate without health department oversight.

A Sunrise spokeswoman said that the suit was put on hold until New York passes assisted living legislation. But state officials said that agreement was only valid until June 2003, the end of last year's legislative session. They said they are in the process of considering their legal options.

Sunrise officials say that their intention is to resolve this legislatively and that they are supportive of oversight and certification of facilities.

"The current system is confusing and requires a clear definition of what assisted living is and what its purpose is so that seniors and their families can make informed decisions," Sunrise's spokesman Jamison Gosselin wrote in an e-mail response to questions from Newsday.

It's an issue that clearly won't go away. State officials said the agency is now investigating 53 other places - including seven on Long Island - to see if they require licensing.

Last year, the state did determine that another assisted living center, this one operated by Atria in Manhattan, needed to be regulated. That corporation, which has declined to comment, also filed suit to halt oversight.

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