Office of the Attorney General News Release Archive


Wednesday, January 27, 1999

TEXAS ANNOUNCES LARGEST EVER TAKEOVER OF NURSING HOME CHAIN:

Move to ensure the safety and well-being of nearly 1,600 Texans

AUSTIN - The Texas Department of Human Services (DHS) and Attorney General John Cornyn's Office, in response to a lawsuit filed on Monday, today announced the appointment of four trustees to take charge of 13 nursing homes owned and operated by Sensitive Care Incorporated of Fort Worth. The state takeover, the largest such action against a nursing home chain in Texas history, was agreed to by management of Sensitive Care, Inc. Earlier this week, the federal Health Care Financing Administration suspended Medicare payments to this company due to an investigation into a pattern of excessive Medicare billing by Sensitive Care. The 13 nursing homes are located in Harris, Dallas, Tarrant, Bell and Upshur counties. DHS officials will also monitor four nursing homes in Tarrant, Hays, Delta and Hunt counties which are operated by one of Sensitive Care's owners.

"This crackdown, the largest in Texas history, reflects my commitment to go after those who put their bottom line before the care of elderly Texans," stated Attorney General John Cornyn. "Working together with the Department of Human Services, the Attorney General's Office has taken the first step in a battle to enforce high standards for protecting Texas seniors," added General Cornyn.

"Thanks to many hours of hard work by DHS, the Attorney General, and federal officials, nearly 1,600 vulnerable Texans will be protected from the financial instability of this nursing home chain," said Commissioner Eric M. Bost of the Texas Department of Human Services.

The appointment of state trustees was initiated after federal officials informed DHS of an investigation by the United States Department of Health and Human Services into Sensitive Care's billing practices for various medical services performed on Medicare clients in nursing homes. The federal audit uncovered evidence that Sensitive Care was charging the federal government excessive prices for drug costs, nursing care costs, medical equipment and intravenous supplies. Federal officials also learned that Sensitive Care owes more than $14 million to its key medical service suppliers.

In order to halt the pattern of excessive billing, the U.S. Health Care Financing Administration (HCFA) decided to halt all Medicare payments to Sensitive Care. Learning of the pending HCFA action, DHS moved to ensure that the health and safety of nearly 1,600 residents was not jeopardized by the withdrawal of the money. State officials feared that Sensitive Care's financial problems could result in its inability to pay staff and utility bills or purchase food and medical supplies. Earlier today, Sensitive Care management revealed they were unable to cover this month's salary and costs for staff. State officials will work with trustees to ensure payment of salaries and other necessary expenditures are covered in the future.

Trustees Jenny King of Emory, Don Miller of Rowlett, Ed Campbell of DeSoto and David French of Austin will divide control of the 13 troubled facilities. Each trustee has authority over patient care, bank accounts, equipment and corporate files of the nursing homes in their control. The trustees' primary duty is to protect the health and safety of residents while HCFA resolves the over-billing problems. Each trustee has more than 20 years of experience in providing care to nursing home residents, and all of the trustees and were appointed by State District Judge Suzanne Covington.

The headquarters for Sensitive Care Incorporated is listed as 1000 Park Avenue in Fort Worth. Carolyn Goodman and Don King, both of Fort Worth, are the owners of Sensitive Care.

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Contact Ted Delisi, Heather Browne, or Tom Kelley at (512) 463-2050