Now 23 2005 13:53 NOW-23-2085 13:54 AHCA LEGAL DEPARTMENT P.@1/89 STATE OF FLORIDA DIVISION OF ADMINISTRATIVE HEARINGS SUN VILLAGE HOMES, INC., Petitioner, AHCA No.;: 2005006782 v- DOAH No.: 05-3136 STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Respondent . ADMINISTRATIVE COMPLAINT (FILED AS AN AMENDED CHARGING DOCUMENT) COMES NOW the State of Florida, Agency for Health Care Administration (“AHCA” or “Agency”), by and through the undersigned counsel, and files this administrative complaint against Sun Village Homes, Inc. pursuant to Chapter 400, Part IIL, and Section 120.60, Florida Statutes, (2004), and alleges: NATURE OF THE ACTION 1. This is an action to deny the renewal license of an assisted living facility (ALF) pursuant to Section 400.414(1) (j) & (nm) Florida Statutes (2004) for the protection of public health, safety and welfare. Now 23 2005 13:53 NOU-23-2885 13:55 AHCA LEGAL DEPARTMENT P.B27a5 JURISDICTION AND VENUE 2. This Court has jurisdiction pursuant to Sections 120.569 and 120.57 Florida Statutes (2004) and Chapter 28-106, Florida Administrative Code (2004), 3. Venue lies in Miami-Dade County pursuant to Section 120.57 Florida Statutes (2004) and Rule 28-106.207, Florida Administrative Code (2004). PARTIES 4. ABCA is the regulatory authority responsible for licensure and enforcement of all applicable statutes and rules governing assisted living facilities pursuant to Chapter 400, Part III, Florida Statutes (2004) and Chapter 58A-5 Florida Administrative Code (2004). 5. Sun Village Homes, Ine. operates a 29-bed assisted living facility located at 1350-1360 West 31 Street, Hialeah, Florida 33012 and is licensed as an assisted living facility under license number 6051. Sun Village Homes, Inc. was at all times material herete a licensed facility under the licensing authority of AHCA and was required to comply with all applicable rules and statutes. 6. Joseph Kraus (“KRAUS”) acquired an ownership interest in the subject assisted living facility on or about June 21, 2004 when he bought 60% of the shares of stock in the Now 23 2005 13:54 NOW-23-2885 13:55 AHCA LEGAL DEPARTMENT P.@3/89 corporation, Kraus, as President of sun Village Homes, Inc., also executed a mortgage on June 21, 2004 for the amount of SIX HUNDRED THIRTY-FIVE THOUSAND AND NO/100 ($635,000.00). After acquiring the facility, Kraus hired Natalia Duwin to serve as the administrator for the facility and Kraus signed all the checks relating to the operation and management of the facility. Kraus became the registered agent for the corporation on June 21, 2004, 7. That on or about July 6, 2005, KRAUS filed documents with the Secretary of State, Division of Corporations, showing that he wae the President and registered agent of Sun Village Homes, Inc. 8. KRAUS has been employed by the Agency since on or about August of 1998. This is the same regulatory agency that regulates assisted living facilities such as Sun Village Homes, Inc., the facility owned by KRAUS. 8, That since on or about 2000, KRAUS worked as a surveyor in the Assisted Living Facilities Unit in the Miami Field Office which covers Dade and Monroe counties. Sometime in 2000, Kraus was promoted to supervisor of the Assisted Living Facilities Unit and served in that position for about one year. Afterwards, he left the position as supervisor and continued fo work in the Assisted Living Facilities Unit as a surveyor and a mentor to the other surveyors. As part of his duties as an AHCA surveyor, 3 Now 23 2005 13:54 NOW-23-2885 13:55 AHCA LEGAL DEPARTMENT P.@4/89 KRAUS surveyed and inspected the assisted living facilities in Dade and Monroe Counties, and determined whether the facilities were in compliance with Florida Statutes and Rules, As an AHCA surveyor, KRAUS had access to ASPEN. ASPEN is an internal program which can be accessed only by AHCA employees and which has all of the findings of all of the surveys conducted by AHCA surveyors, including the findings of all complaint investigations. As an AHCA surveyor, KRAUS also had access to the dates when the surveys of assisted living facilities would take place. These dates are not made public and the visits are conducted in an unannounced manner. KRAUS also had access to all of AHCA’s files. Additionally, KRAUS also had access to all complaint investigations and to the identity of any complainant who called in a complaint on the AHCA Abuse Hotline. The identity of a complainant is confidential and is not disclosed to the public. 10. As an AHCA employee, KRAUS was prohibited from being involved in a business entity which’ was regulated by AHCA since it would create a conflict between his private interests and the performance of his duties pursuant to Sec. 112.313 (7(a), which states in pertinent part: No public officer or employee of an agency shall have er hold any employment or contractual relationship with any business entity or any agency which is subject to the Now 23 2005 13:54 P.@5/89 NOW-23-2885 13:55 AHCA LEGAL DEPARTMENT regulation of, or is doing business with an agency of which he or she ig an officer or employee...nor shall an officer or employee of an agency have or held any employment or contractual relationship that will create a continuing or frequently recurring conflict between his or her private interests and the performance of his or her public duties or that would impede the full and faithful discharge of his or public duties. 11. Rule 60L-36.003, Florida Administrative Code, provides that “relationships between employees and requlated entities give rige to the potential for conflict of interest” and requires an agency employee to notify the agency in writing within five days if he/she obtains a financial interest in a regulated entity. KRAUS failed to notify the Agency that he acquired an ownership interest in the subject assisted living facility within five days of the date of his acquisition (June 21, 2004), 12. Sun Village Homes, Ine. submitted an Assisted Living Facilities License Application to the Agency on or about July 28, 2005 for a renewal license. The application was received by the assisted living facilities licensing Unit in Tallahassee on August 2, 2005. In the application, Sun Village Homes, Inc. did not disclose the name of the Majority shareholder of the Corporation who owned 60% of the Gerporation in the subject license application (see pages 7 and 9 of the application). That individual was KRAUS. The name “Joseph Kraus” does not appear on $ Now 23 2005 13:54 ra NOW-23-20N5 13:56 AHA LEGAL DEPARTMENT P2629 the application. 13. Sun Village Homes, Inc. wags required to disclose the name, address, date of birth and social security number of each of its directors in its renewal license application (see page 5 of the application). The name “Joseph Kraus” does not appear on the application. Three different Places in the application require the disclosure of the name of the corporate President and the name of all persons Owning at least 5% interest in the corporation, The name disclosed in the application was “Joseph Michael”, The name Michael is Kraus’ middle name. The middle namé was used instead of the last name “Kraus”. 14. On or about August 3, 2005, the ALF Unit in Tallahassee discovered that the “Joseph Michael” on the renewal application wag used to hide the identity of “Joseph Michael Kraus”, an AHCA surveyor working in Miami-Dade County. 15. On August 5, 2005, a Notice of Intent to Deny the renewal application was sent to sun Village Homes, Ine. On that same day, KRAUS was informed by his supervisor, Rachel Sigel, that he was being transferred from the ALF Unit to the HHA division. It was only after Joseph Kraus realized that his supervisors at AHCA had found out that he owned the subject ALF that he disclosed his ownership interest in the subject facility to his supervisors. 16. Joseph Kraus was terminated from hig employment at AHCA 6 Now 23 2005 13:55 NOW-23-2885 13°56 AHCA LEGAL DEPARTMENT Par /ao effective on September 29, 2005. COUNT I SUN VILLAGE HOMES, INC. FAILED TO DISCLOSE THE NAMES OF THE CORPORATE OFFICERS AND THOSE INDIVIDUALS HAVING AT LEAST A 5 PERCENT OWNERSHIP INTEREST IN THE CORPORATION AND THUS OMITTED A MATERIAL FACT ON THE LICENSE APPLICATION. SECTION 400.417(2), FLORIDA STATUTES SECTION 400.411 (1) & (3) (a), FLORIDA STATUTES SECTION 400.414(1) (j) & (n), FLORIDA STATUTES 17, AHCA re-alleges and incorporates paragraphs (1) through (15) as if fully set forth herein. 18. Sun Village Homes, Inc. omitted a material fact in its renewal application by failing to diselose the name of Joseph, Kraus, who owned 60% of the corporation and was the President of the corporation at the time the application was submitted to the Agency, and therefore violated Sections 400.411(1)&(3) (a) ,and 400.417(2), Florida Statutes (2004). The omission of a material fact on the subject application warrants denial of the license pursuant to Section 400.414 (1) (j)&(n), Plorida Statute (2004), CLAIM FOR RELIEF WHEREFORE, the Agency requests the Court to order the following relief: 1. Enter a judgment in favor of the Agency for Health Care Administration against Sun Village Homes, Inc. on Count I, Now 23 2005 13:55 NOU-23-2885 13:56 AHCA LEGAL DEPARTMENT P8889 2. Deny the license of Sun Village Homes, Inc. 3. Assess costs related to the investigation and Prosecution of this matter, if the Court finds costs applicable. 4. Grant such other relief as this Court deems ig just Lourdes A. Naranjo, Esq. Assistant General Counsel Alba M. Rodriguez, Esq. Chief Facilities Counsel Agency for Health Care Administration 8350 N.W, 52 Terrace - #103 Miami, Florida 33166 305-470-6805 and proper. CERTIFICATE OF SERVICE I HEREBY CERTIFY that the original of the foregoing Motion was faxed to the Honorable Patricia M. Hart, Administrative Law Judge, Division of Administrative Hearings, The Desoto Building, 1230 Apalachee Parkway, Tallahassee, Florida 232399 (850) g21- 6847), and Lawrence Besser, Esquire, Samek and Besser, 999 Brickell Avenue, Suite 700, Miami, Florida 33131 on thisd3 -H. day of November, 2005. @& Lewrnes , Now 23 2005 NOW-23-2085 13:5? AHCA LEGAL DEPARTMENT P.@9/89 Copies furnished to: Field office Manager Agency for Health Care Administration 8355 N. W. 53rd Street Miami, Florida 33166 (Intereffice Mail) Jean Lombardi Finance and Accounting Agency for Health Care Administration 2727 Mahan Drive Tallahassee, Florida 32308 (Intereffice Mail) Assisted Living Facility Unit Program Agency for Health Care Administration 2727 Mahan Drive Tallahassee, Florida 32308 (Interoffice Mail) TOTAL FP.@o

Docket for Case No: 05-003136