As part of a wider review, in August 2000 I examined recent information about Sun Healthcare describing its conduct after it entered bankruptcy and Andrew Turner's attempts to create another empire when he left Sun Healthcare. This page follows on from that update.
Sun Healthcare and Andrew Turner
Since his departure from Sun Healthcare Andrew Turner has indulged in a corporate smorgasbord forming a string of new companies in the USA and internationally. He has poached and gathered around himself large numbers of Sun staff - his loyal followers.
Turner touts his expertise and his commitment to aged care. He promotes himself as an expert in Quality care and claims that he knows how to care for the elderly. This is the man whose last company was sued by hundreds of patients claiming that it promised them high quality care, which it had no intention of providing. Instead they claim it deliberately understaffed and as a consequence residents in Sun's homes suffered needless complications and died.
Turner has developed a new business model - the silo model which he contrasts with his previous umbrella model. He talks of his expertise in making profits. He is still focussed on growth and claims his new companies will soon be making profits. Sun and Turner are already in the courts suing one another.
Turner remains as persuasive as ever and in spite of his track record the banks are funding his projects - the Albuquerque Bank one of them.
He has joined and for practical purposes runs Ballantrae Healthcare which has moved to Albuquerque. It operated nursing homes.
Turner founded Enduracare, a Dallas-based provider of physical, occupational and speech therapy on contract to patients in nursing homes. It employed ex-Sun staff.
Turner has founded Code Blue Staffing Solutions LLC, an Albuquerque-based temporary staffing company for nursing homes and hospitals.
Turner failed in his bid to buy Sun's international operations but clearly still has international ambitions. He has created an Israeli-based joint-venture company called Kavod Hebrew, which already runs one nursing home. He owns 25 %.
Turner has indicated his intention to start operating in Great Britain within the year. Sun's UK operations have been running at a loss. Sun has been trying to sell its UK operations for some time. Sun's UK managers have formed a holding company KW Holdings Limited which has bought Sun's UK operations for $1. Also transferred is a potential liability of $299 million. One can only wonder whether Turner's hand is in the pie.
Sun is still trying to sell its German operations.
There is no mention of Sun's Australian
holdings, particularly its dominating investment in Alpha Healthcare.
Alpha is busy repaying the money it borrowed from Sun Healthcare. It
has sold and then leased back some hospitals to raise the capital to
do so. There has been no mention of Turner in Australia but I have
heard that he was seen at a shareholder's meeting. We should be very
Out of bankruptcy but not out of trouble
I have not kept track of Andrew Turner but one report indicates that he is still active in health care. Sun Healthcare continued to be the subject of allegations of poor care and understaffing with a report in August 2001 that it "was cited at nearly 40 percent of its facilities for harming patients or placing them in jeopardy". In July 2002 it pleaded "no contest" to a felony charge and agreed to improve staffing and oversight.
In July 2001 Sun entered into an integrity agreement with authorities. In September 2001 it sold some Texas nursing homes to Nationwide Health Properties who leased them to Nexion Health. Sun traded out of bankruptcy in March 2002 but was still under the supervision of the bankruptcy court. It continued to struggle and in November was required to produce US $20 million to cover liability claims at a time when its profits were falling and further cuts were predicted.
Sun was in a long running dispute with a REIT about rental fees and eventually defaulted on payments. The REIT set out to take possession of the 32 facilities and in April the homes were transferred to Care Realty.
In March 2003 Sun warned of its financial difficulties. It lost $444.3 million in 2002 compared with $26.2 million in 2001. On 5 May it indicated that it was in default of loan agreements and would shed half of its remaining 215 facilities (it once owned about 400). On 17 May it indicated that it did not have "adequate liquidity or available sources of financing" to meet its obligations and indicated that it might go under. It had divested itself of 37 facilities in 2003 and might stop operating 43% of its facilities.
It sold off its palatial building in Albuquerque and rented back some space. It sold off its art collection.
Andrew Turner had used shareholders money to set up a $2.3 million company art collection and this is sold. Sun's current chairman Richard K Matros criticised Andrew Turner's management of the company confirming some of the comments made on this web site.
In July 2003 it was still warning of likely bankruptcy.
I have taken extracts from published material and allowed them to tell the story. I have simply written a short introduction and a few comments to give perspective and explain the context of some extracts.
The extracts on these pages are from copyright material. They are reproduced here for educational purposes and to stimulate public debate about the provision of health care. I consider this to be "fair use" and in the public interest. They should not be reproduced for commercial purposes.
Disclaimer: - The material in these pages is selective and not all-inclusive. The extracts do not necessarily reflect the full perspective of the original. Corporate denials and explanations have not been included. No claim is made that all of the matters referred to are true. The intention is to give the flavour of the material and an idea of the extent of any allegations.
CLICK HERE -- for references and extracts of Sun and Turners recent activities.