Public Advocate Participates in Chapin House, Assisted Living Arguments

PUBLIC ADVOCATE PRESS RELEASE:
TRENTON — A Wisconsin-based assisted living company that operates eight facilities in South Jersey, including the Chapin House in Rio Grande, and has been cited by the state for inappropriately discharging elderly patients once they become eligible for Medicaid was set to have its appeal of those charges heard by an appeals court.
Oral argument was set to begin on Tuesday, Dec. 8 at 9:30 a.m. on the 8th Floor of the Hughes Justice Complex in Trenton.
Attorneys from the New Jersey Department of the Public Advocate, which has been involved in a multi-year investigation of the company, Assisted Living Concepts Inc., will participate in oral arguments in the case.
In spring 2009, the Public Advocate unveiled the results of an investigation that showed that Assisted Living Concepts Inc. has pursued a policy of involuntarily discharging elderly residents once they deplete all of their life savings – a process known as “spending down.” The Public Advocate has alleged that the company’s policy left many senior citizens broke and with limited housing alternatives.
In October 2007 the Department of Health and Senior Services advised ALC that it was in violation of its Certificate of Need when it attempted to discharge then 83-year-old Betty Merklinger from Chapin House in Rio Grande, Cape May County. In October 2008, ALC appealed that DHSS determination.
The company’s Certificate of Need, which is part of the state licensing process, states that the company will not discharge residents who have exhausted – or spent down — all of their private funds and will need to apply for Medicaid. Specifically, the company’s Certificate of Need states: “Residents will not be asked to move from the Residence because of spend-down situations.”
ALC believes that the agreement is not binding. The Public Advocate believes that it is and has entered this appeal amicus curiae, or “friend of the court,” to support the position taken by the Department of Health and Senior Services.
Assisted Living Concepts Inc. operates eight facilities southern New Jersey, and more than 200 facilities in 20 states. The facilities in New Jersey include: Baker House in Vineland, Goldfinch House in Bridgeton and Maurice House in Millville, all in Cumberland County; Lindsay House in Pennsville, Salem County; Mey House in Egg Harbor Township, Atlantic County; Chapin House in Rio Grande, Cape May County; Granville House in Burlington, Burlington County; and Post House in Glassboro, Gloucester County.
According to the April 2009 Public Advocate’s report, the company knowingly broke its promises to low- and moderate-income elderly residents by allowing them to believe they could convert to Medicaid when their life savings were depleted. Instead, the company routinely ejects senior citizens once they have no assets and are forced to rely on Medicaid to cover the cost of their care.
The Public Advocate’s report recommended that actions be taken to strengthen protections for senior citizens living in assisted living facilities. The recommendations include: requiring that a set percentage of beds be set aside for Medicaid recipients; outlawing guarantor agreements that make families responsible for a senior citizen’s cost of care; simplifying and expediting Medicaid eligibility utilizing a one-door entry system; enacting regulations that would allow seniors to be protected by the Consumer Fraud Act; and requiring assisted living facilities to provide residents with a consumer-friendly disclosure form that specifically outlines the facility’s Medicaid acceptance policies.