Efforts of Entrepreneur Make Sun Healthcare Shine : Health care: Nursing home chain grew out of founder’s desire to spend more time at home. The $350-million business could more than double in size with planned acquisition of competitor.

Andy Turner wanted sun and a slower pace when he left his executive job at a big nursing home chain based in Washington state and moved to New Mexico.

He got the sun. The slower pace didn’t last.

The small nursing home company he started in the basement of his Albuquerque home in 1989 became Sun Healthcare Group Inc., a $350-million business that could more than double in size with the planned acquisition of Mediplex Group, a Boston-based competitor.

The merger, signed last month by the boards of both companies, would give Sun 120 health care facilities in 20 states employing 13,000 people and generating $800 million in annual revenue.

That will make Sun Healthcare one of the biggest national chains of nursing homes, a fast-growing area of the health care industry that is likely to grow even more as the baby boom generation ages.

Sun is still far smaller than the industry leader Beverly Enterprises, a Fort Smith, Ark.-based chain of 900 homes. But under Turner’s guidance, Sun already has outgrown a $5.5-million, 42,000-square-foot corporate headquarters under construction here and isn’t slowing down.

“We made the decision to go ahead and go for it,” Turner said. “It would be conservative to say we could double in size again in five years.”

Turner, 47, said he still finds it ironic that the company grew out of his desire to step back and spend more time at home.

He had spent 15 years in the nursing home industry, from running a nursing home to working as an operations officer for two big chains.

“I was traveling all the time,” he said. “I was responsible for the day-to-day things that went on in the nursing homes.”

Turner was chief of operations at Tacoma, Wash.-based Hillhaven Corp.--the nation’s second-largest nursing home chain--in 1987 when he and two other executives decided to start their own company, Horizon Healthcare, in Albuquerque.

“We wanted sunshine,” Turner said.

He also wanted autonomy, less travel and a slower pace.

But the trappings of success followed. By May, 1987, Horizon owned 67 nursing homes and was selling stock to the public for further expansion. Again, Turner confronted the conflict of work vs. personal life.

“Horizon was growing so fast that my time away from home was the same,” he said.

Horizon wanted to sell seven unprofitable nursing homes--three in Washington and four in Connecticut.

Turner bought them, left Horizon and, on Jan. 1, 1989, founded Sunrise Healthcare. The name came to him one morning as he watched the sun rise from his kitchen window.

“I wound up with a little bitty company with seven homes, based in New Mexico, and I could slow down,” Turner said.

The pace lasted a year and a half.

In 1991, as Sunrise began buying more nursing homes, Turner and his wife, Nora, an occupational therapist, started a second company--Sundance Rehabilitation Corp. Sundance provides physical, occupational and speech therapists to nursing homes that contract with the company to run their rehabilitation programs.

Sundance is now the third-largest employer of therapists in the country, with 800 in 21 major cities, Turner said.

In March, 1993, Sunrise had 25 nursing homes, Sundance was 2 years old, and Turner decided to get into the institutional pharmacy business, providing prescription drugs to nursing homes.

Sunscript Pharmacy Corp. was born.

Sunscript has pharmacies in Chicago, Seattle, Hartford, Conn., Phoenix and Tucson, and plans to open five more in 1994. Sunscript had $20 million in sales in 10 months.

Turner was approached by Wall Street investors about going public last spring.

“That was a big decision,” he said. “Would we be a family-owned smaller business or take the giant step of being a publicly held big company with obligations?”

Turner took the giant step.

He combined Sunrise, Sundance and Sunscript under the Sun Healthcare umbrella. In a public offering last July, he sold 40% of the company to investors in the United States and Europe, raising $50 million.

The money was used to expand the company. Sunrise bought 42 nursing homes, including the Oklahoma City-based Honorcare chain of 14 homes.

A fourth company was started, Sunquest Consulting Inc., which provides Medicare consultation services to nursing homes.

Sun’s biggest coup has been the Mediplex acquisition for about $312 million in cash and stock.

“Here was a little New Mexico company buying a big East Coast company,” Turner said. “The crown jewel was snapped up by a backwater businessman.”

With projected 1993 revenue of more than $400 million, Mediplex is a major provider of so-called subacute care for patients who are too sick to go home but no longer need the intensive services provided by a hospital.

The acquisition places Sun among health care providers who could offer the comprehensive delivery systems that are part of the Clinton administration’s proposed reforms.

“This really brings them into the forefront of the (subacute care) industry,” said Todd Richter, an industry analyst with the Dean Witter-Discover brokerage firm.

“I’m surprised,” Turner said of Sun’s growth. “I was working out of the basement and going upstairs for a sandwich, and five years later it’s an $800-million concern--that’s a big change.”

He attributed the company’s success to a respect for nursing home patients that has generated a culture of putting their needs ahead of profitability. In the world of nursing home care, which has a documented history of provider abuse, sensitivity to patients and their families is a critical attribute.

“You must have an unbending commitment to doing a first-class job of tending to the frail elderly,” Turner said. “If you do well, you will be rewarded financially.”