New Jersey's Public Advocate Says Assisted Living Company 'Ruthlessly' Evicted Residents Once They Went on Medicaid

A national assisted living company broke its promises to elderly New Jersey residents by throwing them out after allowing them to believe they could convert to Medicaid when their life savings were depleted, a report by the state’s Public Advocate has determined. The report concludes that regulations in New Jersey and around the country are failing to protect elderly residents of such facilities.

The report caps an 18-month investigation into the practices of the Wisconsin-based company Assisted Living Concepts, Inc. The company has more than 200 assisted living facilities nationwide, including eight in New Jersey. 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.

Several years ago, Assisted Living Concepts, Inc. launched an effort to purge its facilities of Medicaid residents. The New Jersey Department of the Public Advocate, Division of Elder Advocacy, launched an investigation after numerous complaints that residents of Assisted Living Concepts facilities in New Jersey were being kicked out of their homes when they had drained their private resources and had to go on Medicaid, despite earlier pledges from the company that Medicaid recipients would be allowed to stay.

“Our investigation clearly demonstrates that Assisted Living Concepts broke its trust with dozens of elderly residents who believed they would be permitted to age in place once their private funds were exhausted,” said Public Advocate Ronald K. Chen. Instead, from mid-2006 on, the company instituted a policy of ruthlessly discharging elderly residents involuntarily once they had spent-down all of their life savings, leaving them essentially destitute and eligible for Medicaid.

Chen said the evictions were “part of a corporate strategy designed to extract the company from doing business with Medicaid and to drive out low- and moderate-income residents.”

The report notes that the company broke no actual laws, although it contends that Assisted Living Concepts violated its licensing agreement with the state about how residents going onto Medicaid would be treated.

Like most states, New Jersey’s system of regulating assisted living facilities provides little meaningful protection to residents facing involuntary discharge. Federal and state laws give powerful protections to nursing home residents, but not to residents of assisted living facilities, even though New Jersey’s Medicaid program pays for care in assisted-living facilities.

The report makes several recommendations, including that the state adopt legislation that would ban assisted-living facilities from discharging residents who convert to Medicaid.

For a press release and link to the Public Advocate’s report, click here.
For a National Public Radio broadcast on the report, click here.
I previously blogged about the Public Advocate’s investigation here.