Firm operating senior facilities to fight N.J. order

A Wisconsin company that was ordered Friday by state health officials to stop providing unauthorized health care at four former South Jersey assisted-living facilities will "pursue the appropriate legal remedies" to dismiss the order and related fines, according to a written statement.

The state Department of Health and Senior Services levied $262,500 in fines against Assisted Living Concepts of Menomonee Falls, Wis., with penalties to accrue every day that the company continues to provide health services at Granville House in Burlington, Mey House in Egg Harbor Township, and Lindsay House in Pennsville.

The order also applies to Goldfinch House in Bridgeton, which is currently unoccupied.

The company has been under close scrutiny since state investigations discovered it had improperly discharged patients after they had spent down their life savings and sought to pay by Medicaid.

New Jersey's former ombudsman for the elderly warned last month that the continued legal wrangling over the status of these facilities was putting their residents at legal and medical risk.

President and chief executive officer Laurie Bebo said Assisted Living Concepts was in the process of converting the facilities either to multiple dwellings or boarding homes under Department of Community Affairs rules.

"This registration process can be lengthy," Bebo said. "In the interim, we have demonstrated that seniors living in these retirement communities either receive no health-care services or receive services from a variety of home-health or personal-companion service companies, just like many senior-living communities in New Jersey.

"We are not marketing these buildings as assisted-living facilities," she added, "and the staff employed by these communities provides no health-care services."

Assisted Living Concepts voluntarily surrendered assisted-living licenses at the four facilities in July, after DHSS ordered the company to stop discharging residents who converted from private pay to Medicaid. The appellate division of the state Superior Court upheld the state's order.

At that time, Assisted Living Concepts officials indicated that they planned to change the four residences to apartments for the elderly, but the facilities failed to meet state apartment regulations, and the Community Affairs Department, which monitors requirements such as kitchens, locked doors, and fire protections, denied the company's applications.

According to DHSS, Assisted Living Concepts discharged 18 residents from the four homes after the company gave up the assisted-living licenses.

A temporary permit allowing the company to operate the four buildings expired Oct. 15.

After the licenses were surrendered, residents continued to receive health-care services through an affiliate of Assisted Living Concepts, called Swan Home Health.

Assisted Living Concepts operates more than 200 residences for the elderly nationwide, including three other assisted-living facilities in South Jersey and 11 residences in Pennsylvania. Facilities in other states also have come under scrutiny for discharging residents who wanted to convert to Medicaid payment.

The situation at the four former assisted-living facilities in South Jersey came to light through the efforts of Gwen Orlowski, the former state ombudsman for the institutionalized elderly and director of elder advocacy.

Orlowski said Monday that, while she was pleased DHSS had issued a cease-and-desist order, she was troubled that the company was apparently still undecided about whether the facilities should be licensed as multiple dwellings or boarding homes, which have vastly different regulations.

It "speaks to me that they should have never been allowed to surrender" their assisted-living licenses, Orlowski said.

"Before giving back their license," she said, "they had an obligation to safely discharge everybody who was there."

A Health Department spokeswoman declined to say what steps the state would take next.

"We've taken action by issuing the cease-and-desist order," said spokeswoman Marilyn Riley. "It's now up to Assisted Living Concepts to respond. So far, they have not officially responded to the department, and the fine is continuing to accrue."

The department continues to monitor the situation, she said, and is working closely with the Department of Community Affairs.

"It's a pending legal matter," Riley said, "and we can't comment on it."

Bebo said she was disappointed with DHSS's actions.

"We continue to meet the expectations of the tenants who reside with us," she said, "and believe last Friday's action by the Department of Health unnecessarily creates disruption for the peace of mind and well being of our tenants and their families."