Davis Criticized for Taking Nursing Home Exec on Trip

In an act that has outraged senior citizen and nursing home reform advocates, Gov. Gray Davis included the president of a nursing home company with a history of state citations and other problems on his recent overseas trade mission.

The trip came a week after Davis vetoed legislation that would have cracked down on nursing homes by forcing them to hire more staff and doubling fines for offenses.

Ellen Kuykendall, among 21 businesspeople who joined Davis abroad last month, is president and chief executive officer of Horizon West, which runs 30 nursing homes in California, two of which were given the state’s harshest possible citation this year for causing patient deaths.

In addition, Horizon West paid $4 million in February to settle a Medicare fraud claim by the U.S. attorney’s office. The federal government charged that patient care costs had been inflated and that Medicare had been billed for expenses such as Lotto tickets, 90 carafes of wine for a Christmas party and a $195 pair of Saks Fifth Avenue shoes for Kuykendall.

When they learned last week that Kuykendall had been on the trip, representatives of the American Assn. of Retired Persons, which has 2.7 million California members, and other nursing home reformers were incensed because of the potential access it gave her to Davis.

“It’s outrageous,” said Carole Herman, who as president of the Sacramento-based Foundation Aiding the Elderly filed suit against Horizon West in 1997 alleging poor patient care. “Gray Davis was touting himself to be about the elderly . . . and now this? It made me sick to my stomach.”

The governor’s office said Davis knew nothing of Kuykendall’s background although both the Medicare fraud case and one of the nursing home deaths were publicized earlier this year by the Sacramento Bee. She went on the trip as the guest of her business associate, nursing home and golf course developer Martin Harmon, who is a Davis campaign contributor.

Davis’ communications director, Phil Trounstine, said Harmon was among 70 prominent businesspeople extended invitations to travel with the governor.

“On balance, these are people and companies that have made a positive contribution to California’s economy,” Trounstine said. “Do we stand behind the business practice of every business entity in which they’re engaged? No.”

Critics said the governor, whose administration regulates nursing homes, is responsible for knowing whom he takes with him on an official trip. The Kuykendall episode, they contend, illustrates the dangers of honoring contributors with prestigious invitations.

At Horizon West’s Rocklin, Calif., headquarters, where Harmon also has his office, a receptionist said Kuykendall was out until today and could not be reached for comment.

Kuykendall, Harmon and the other travelers paid their own expenses for the trip. And, like most of the other executives, they accompanied Davis on just one leg of the trade mission--in their case to England and Ireland from Oct. 18 to 22. Unlike agribusiness entrepreneur Keith Brackpool, for whom the governor arranged a private meeting with the Egyptian president, Kuykendall received no special appointments with dignitaries, said Davis spokeswoman Hilary McLean.

Kuykendall attended events, with the rest of the delegation, that ranged from a reception hosted by the U.S. ambassador to Britain to a dinner for the entourage.

“It’s face time with the top official in the state!” said AARP spokesman Pat Luby. “Obviously, [we were] not invited to go on the trip, and here’s a nursing home owner . . . and she’s spending some pretty quality time with the governor.”

However, Trounstine said Kuykendall’s access to Davis was quite limited and that neither she nor Harmon had any conversations about nursing homes with the governor.

Davis Vetoed Reform Bill

On Oct. 10, Davis vetoed legislation by Assemblyman Kevin Shelley (D-San Francisco) that was viewed as the most serious attempt to reform California nursing homes in more than a decade.

In his veto message, the governor said he had included money in the budget to increase staffing and pay in nursing homes but that Shelley’s bill committed the state financially too much beyond that.

Trounstine said the governor intends to propose his own legislation next year to increase fines against nursing homes that mistreat patients.

The citations Kuykendall received this year for nursing homes in Roseville, in suburban Sacramento, and Montclair, near Oakland, carried fines of $25,000 each. Such “AA” fines would have doubled in the future under Shelley’s legislation.

In requiring nursing homes to hire more and better-trained workers, the bill also was the state’s first acknowledgment that understaffing often is the underlying cause of poor nursing home care. Inadequate staffing was cited in many of the state’s investigations of Kuykendall’s homes.

Related Firm Gave to Democrats

Though Horizon West has not been a major campaign contributor and has never given money to Davis, the secretary of state’s records show that a related company run by Harmon--Auburn Manor Holding Corp.--has been a longtime Democratic contributor dating to the days of Gov. Jerry Brown.

Auburn Manor, which is landlord for some of the Horizon West nursing homes, gave Davis $12,500 last year and paid $10,000 in June to co-sponsor one of the governor’s golf fund-raisers.

Harmon also lent Democratic state Treasurer Phil Angelides $100,000 last year.

And through Sierra Medical Enterprises, the subsidiary of Horizon West that manages the nursing homes, Harmon used real estate holdings to secure an $850,000 bank loan for Angelides.

On average, the state issues only about 15 of its toughest AA citations annually to California’s 1,400 nursing homes.

In February, Roseville Convalescent Hospital, a Horizon West facility, received such a citation after a patient with a known history of choking choked to death on her food.

State investigators said the home was understaffed.

In April, Montclair Manor Convalescent Hospital received an AA citation when a diabetic patient died after eating very little for two days.

The state said staff failed to continually assess the resident.

According to state records, during the past five years Horizon West facilities received at least 36 A citations, each carrying a $10,000 fine, for problems ranging from patient abuse to a drug overdose that led to a patient’s death.

The firm’s facilities received 89 B-level citations for things such as not brushing a patient’s teeth for 21 days, tying a patient to the toilet, slapping patients and yelling at one for complaining to the state about conditions.

The Medicare fraud case against Horizon West was settled for $4 million even before it was filed in February.

Prompted by a federal audit, U.S. attorneys claimed that the company had characterized standard care as specialized care to qualify for higher reimbursement.

According to court records, three-quarters of the funds to care for about 2,000 patients housed at Horizon West’s nursing homes--$75 million a year--come from the government, including Medicare, Medicaid and veterans funds.

Though the personal purchases the government says were billed to Medicare--clothing, lingerie, shoes, perfume--were a relatively small part of the claim, attorneys found them particularly troubling because they signaled “serious errors in judgment,” said Assistant U.S. Atty. Michael Hirst.

“We don’t see that frequently, and we’re glad that we don’t,” Hirst said.

As a condition of the civil settlement, Horizon West did not have to admit guilt, but it did have to launch a training program to ensure future compliance with Medicare billing rules.