"Nursing homes' liability limited
Law lets care centers forgo carrying insurance"
Posted: 09/25/2009 07:40:57 PM PDT
Updated: 09/26/2009 11:14:20 PM PDT
In 2007, Grover Brown, a paraplegic 37-year-old, debilitated by multiple sclerosis and Parkinson's disease, developed a pressure sore soon after arriving at the High Street Care Center in East Oakland.
The sore erupted in March. By August, surgeons had removed his tailbone because the wound had festered without treatment, court documents showed.
The infection ate away at the bone through to the marrow, according to state Department of Public Health records, despite repeated treatment orders from physicians to the staff of High Street Care Center.
Brown is suing High Street Care Center, which had a long list of citations from the Department of Public Health — 164 between 2004 and 2008. The facility is owned by Trinity Health Systems, whose president, Randal Kleis, has operated about a dozen facilities across the state under several corporate names.
Brown's treatment was "atrocious," said his lawyer, Jay Renneisen.
But Brown, now 39, likely won't see more than a token settlement from High Street Care Center because skilled-nursing facilities, nursing homes and assisted-living care facilities — charged with caring for the sickest and most helpless Americans whose numbers are rapidly growing each year — are not required to carry liability insurance. The amount of the settlement he may ultimately receive is unlikely to cover the cost of care Brown will require as the result of his shoddy treatment at the High Street Care Center, Renneisen said. The government will end up picking up the tab for his care.
And Kleis' other assets are untouchable because they were legally registered as separate corporate entities — a common way operators shield themselves and their profits, said Kathryn Stebner, a lawyer who has been representing victims of nursing home abuse since 1987. That means going after even the worst operators is an uphill battle that happens infrequently in California.
The state Attorney General's Office, which is California's ultimate watchdog, has gone after fewer than a dozen problem nursing homes for elder abuse and neglect since 2000.
That leaves private attorneys to pursue the operators — almost always after the damage has been done.
Calls for comment from the Attorney General's Office were not returned.
The situation "is unfathomable," Renneisen said. "It doesn't make sense."
'A small business'
Kleis did not return numerous calls to his office and personal phone. But in May 2004, he told the Los Angeles Business Journal that he didn't insure his facilities because rates had risen so steeply since 2000.
"We are a Medi-Cal facility. Your margins are one percent or less," Kleis said in the article. "The last quote I had (included) a $250,000 deductible. Even on your best day you would not make that kind of money. We are a small business."
Medi-Cal began reimbursing facilities for the cost of liability insurance in late 2004 with the expectation that care would improve. But the decision whether to carry insurance was left to nursing-home owners. There was nothing to mandate the improvement.
"Some studies suggest that nursing homes with poorer quality are more likely to be sued and are likely to pay higher premiums for liability insurance," a 2003 AARP Public Policy Institute analysis found.
Strengthened enforcement may improve quality of care and reduce the need for lawsuits, the report continued, "thereby lowering insurance premiums."
'A record of problems'
Brown started to suffer from bed sores after he arrived at the High Street Care Center in 2005, according to Department of Public Health records. He was taken to the skilled nursing facility by the state Department of Corrections and Rehabilitation after the symptoms of his multiple sclerosis worsened while he was serving a four-year prison sentence for check-writing and credit card fraud.
One of the sores never healed properly. But once the wound did begin to fester, he wasn't moved, washed, monitored or medicated with antiseptic, leading to the removal of his tailbone, according to the lawsuit.
Even as the sore turned green and smelled foul, the nurse in charge at the time told an aide that was the way "it was supposed to smell," according to Department of Public Health records.
"They should have taken me to the hospital," Brown said.
The incident was not an isolated mistake, Renneisen said. Brown's lack of care was the consequence of an indifference to the health and safety of residents at the facility, he said.
High Street Care Center had a record of poor care, according to records from the Department of Public Health:
On Dec. 7, 2004, an 82-year-old woman at High Street Care Center was suffering from a bed sore that had penetrated through her tendons and muscles to the bone. She was taken to a hospital, where doctors found she weighed 65 pounds and described her as "extremely emaciated." She went to a new nursing home and immediately began gaining weight.
In January 2005, inspectors discovered that the supervisor of dietary services was not certified.
Just two months after being admitted in March 2005, a 54-year-old breast cancer patient who had trouble swallowing lost 23 percent of her body weight. She dropped from 117 pounds to 90 pounds by May 2, 2005. But staff told her family she was gaining weight.
In December 2005, inspectors described finding a cockroach crawling around the base of trash cans full of dirty diapers in one of the rooms. A resident told inspectors that they were crawling around "all the time."
In 2006, a 59-year-old woman told staff at the Center for Elder Independence, a community day care program for elders she attended for treatment, that a certified nursing aide at High Street Care Center had used a washcloth to cover the woman's nose and mouth. When she cried out in pain for fear of being smothered, the aide hit her on the side of the head. A social worker alerted to the alleged abuse by High Street Care Center staff, also had reported the incident to the Public Health Department. The facility's administrator told inspectors that although the aide denied the allegations, he fired the aide and "believed something had happened to the resident."
Brown said his care has since improved — it's not perfect but it is "considerably better."
"It's not a terrible place," he said. "But it's still difficult."
'A hard case'
Kleis has settled at least two previous wrongful-death lawsuits in the past six years, court records show. In each case, Kleis asserted he was losing money and could not afford insurance.
The MacArthur Care Center, run by Kleis under the company name Trinity Health Systems, had an extensive record of problems and lawsuits. The Department of Public Health cited the facility for 79 deficiencies between 2004 and 2009. Kleis also was sued by the father of a former resident who committed suicide at the facility in March 2003. Elita Young — who suffered from seizures, dementia, diabetes, chronic psychosis and had undergone brain surgery — was found dead in her bed with a shoelace around her neck after she killed herself.
Her father, Ruben Willard White, sued MacArthur Care Center for wrongful death, negligence and dependent adult abuse because she had tried suicide before but the risk was never included in her care plan. Kleis settled with her father for $100,000 out of court in October 2006, a year after the suit was filed. The lawyer, Ted Deacon, said the father, Ruben Willard White, settled because Kleis claimed he didn't have insurance.
A few years earlier in 2003, Kleis was sued for elder abuse, negligence, and other violations at his facility QuailRidge Health Care Center in Pinole after he decided to shut the facility down. The residents there, many of whom required help with the most basic functions, were not told, or not afforded enough time before the closure to find new suitable facilities. This was in defiance of state law, promoting the lawsuit, which claimed that one woman ended up at a substandard nursing home where she died a month later. (The operator of that troubled facility, Lakeshore Convalescent Hospital on Third Avenue, eventually was disqualified in 2008 by the Department of Public Health from receiving Medicare or Medi-Cal payments — the harshest penalty that can be issued by the government.)
Kleis' lawyers said he was not personally responsible because QuailRidge was legally owned by Trinity Ridge Inc., which had gone into bankruptcy. Kleis eventually settled the elder abuse claim, but "it took a long time," said Stebner, who handled the lawsuit. "It was a hard case."
Kleis also settled a 2003 wrongful-death suit against his former facility Country Oaks Care Center in Pomona, one of six he owned at the time, according to court records. He still owns the Villa Maria Care Center in Long Beach under the licensee name Trinity Maria LLC. The facility has been cited by the Department of Health Inspectors 14 times since 2004.
AARP spokesman Mark Beach said every responsible business should have liability insurance especially those like nursing homes and skilled nursing facilities that take care of the most vulnerable and dependent people. It fosters accountability and ensures people are compensated when something happens even if an owner declares bankruptcy, he said.
Having insurance, he added, "is the right thing to do."
So far, the California Legislature has left it up to the industry to decide when to carry insurance. As a result, there is no way of telling how many homes go uninsured.
"The sleazier the operators are, the less likely they are to have insurance," Stebner said. "It's a perfect storm."
Reach Angela Woodall at 510-208-6413.