Part 4: A dysfunctional system

Daniel S. Paglione lived through gun battles with the Japanese navy as a young sailor in World War II. He died, at age 80, after two miserable years at a Bucks County assisted-living facility where he was sometimes left to lie in his own feces, his family says.

Paglione, a diabetic who had Alzheimer's disease, suffered head wounds from repeated falls that his caregivers at Alterra Healthcare Corp. took few if any steps to prevent, the family's lawsuit alleges. Blackened ulcers developed on his heels.

Without admitting wrongdoing, the company settled the case in 2005 for $525,000, court records show.

Like thousands across the country, Paglione's children had put their trust in Alterra, a Wisconsin company that had grown to become the nation's largest operator of assisted-living facilities. In the late 1990s, Alterra boasted 22,000 residents at 475 facilities in 28 states.

But even as it boomed, Alterra was running into trouble. The chain was hit by a stream of lawsuits, a series of state fines and a pair of criminal cases that together pointed to a troubling pattern of harm to Alterra's residents.

Critics call Alterra a case study of how a hodgepodge of state-by-state assisted-living regulations failed to protect people from the perils of an ailing national chain.

"Unfortunately, the Alterra debacle hasn't raised awareness and insight to any national level, so that this same situation couldn't reoccur," said Karen Love, a former assisted-living manager who helped form the Washington-based Consumer Consortium on Assisted Living.

Paglione was one of more than 220 residents across the country who are alleged to have suffered neglect, injuries or death as a result of substandard care at Alterra as company finances deteriorated between 1999 and 2003, according to an Inquirer review of thousands of pages of civil court, insurance and bankruptcy records. That number includes 54 deaths.

Residents were beaten and raped by employees or other residents. They were given the wrong medication or left to lie in their own excrement. Some died of neglect, court and regulatory records show, while others, suffering from dementia, died of cold or heat after Alterra failed to prevent them from wandering off the premises.

"They gave a beautiful story. When you walked in you thought, 'Wow, this is the answer,' " said Kathryn Garner, whose late mother, Mildred, was assaulted and severely wounded by another resident in August 2000 at an Alterra facility in Winston-Salem, N.C.

"It was a mistake I will never forgive myself for."

Alterra filed for bankruptcy in 2003, and in 2005 its homes were absorbed by another assisted-living chain called Brookdale Senior Living.

Mark J. Schulte, cochief executive officer of Chicago-based Brookdale, acknowledged in a recent interview that "tragic incidents" happened at what he called "old Alterra." He said he could not address them. Brookdale is a different company with a different culture, he said.

"These kinds of incidents to me are unacceptable and some of them outrageous, but I can't in 2007 either comment on them or do anything about them," he said.

"I can tell you that we do everything to keep residents safe and make sure bad things don't happen."

Brookdale has been using the Alterra name but will phase it out this year, Schulte said. He said Brookdale's regulatory record these days is "way above average."

Unlike nursing homes, assisted-living facilities are not subject to federal oversight. Licensing standards vary from state to state, and the rules are generally less stringent than those governing skilled-nursing facilities.

Also, it's much harder for consumers to research the history of personal-care homes. In contrast with nursing homes, there is no national clearinghouse of fines and enforcement actions.

To be sure, many Alterra residents had good experiences. And mistakes can happen at any facility that houses disabled elderly people; Alterra is not the only chain that has been the target of lawsuits and regulatory actions.