- Initial Statement of Beneficial Ownership (3)

FORM 3	UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 INITIAL STATEMENT OF BENEFICIAL OWNERSHIP OF SECURITIES	OMB APPROVAL OMB Number: 3235-0104 Expires: February 28, 2011 Estimated average burden hours per response... 0.5
	Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

1. Name and Address of Reporting Person * WALTERS MILTON J	2. Date of Event Requiring Statement (MM/DD/YYYY) 11/15/2010	3. Issuer Name and Ticker or Trading Symbol SUN HEALTHCARE GROUP INC [SUNHD]
(Last)        (First)        (Middle) C/O TRI-RIVER CAPITAL, 555 FIFTH AVE. 15TH FLOOR	4. Relationship of Reporting Person(s) to Issuer (Check all applicable) __ X __ Director                            _____ 10% Owner _____ Officer (give title below)          _____ Other (specify below)
(Street) NEW YORK, NY 10017        (City)              (State)              (Zip)	5. If Amendment, Date Original Filed (MM/DD/YYYY)	6. Individual or Joint/Group Filing (Check Applicable Line) _ X _ Form filed by One Reporting Person ___ Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Beneficially Owned
1.Title of Security (Instr. 4)	2. Amount of Securities Beneficially Owned (Instr. 4)	3. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	4. Nature of Indirect Beneficial Ownership (Instr. 5)
Common Stock	22127   (1) (2)	D

Table II - Derivative Securities Beneficially Owned ( e.g. , puts, calls, warrants, options, convertible securities)
1. Title of Derivate Security (Instr. 4)	2. Date Exercisable and Expiration Date (MM/DD/YYYY)		3. Title and Amount of Securities Underlying Derivative Security (Instr. 4)		4. Conversion or Exercise Price of Derivative Security	5. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 5)	6. Nature of Indirect Beneficial Ownership (Instr. 5)
	Date Exercisable	Expiration Date	Title	Amount or Number of Shares
Employee Stock Option (Right to Buy)	(3)	1/21/2011	Common Stock	8302   (1)	$13.56	D
Employee Stock Option (Right to Buy)	(4)	5/18/2011	Common Stock	6102   (1)	$8.26	D
Employee Stock Option (Right to Buy)	(5)	5/18/2012	Common Stock	5550   (1)	$8.5	D
Employee Stock Option (Right to Buy)	(6)	5/30/2013	Common Stock	4925   (1)	$9.89	D
Employee Stock Option (Right to Buy)	(7)	3/14/2014	Common Stock	6688   (1)	$14.89	D

Explanation of Responses:
( 1)	On November 15, 2010, the Issuer, formerly known as SHG Services, Inc., became the successor to the Issuer's former parent company, Sun Healthcare Group, Inc. ("Old Sun"), following the spin-off transaction pursuant to which, on November 15, 2010, Old Sun distributed to each of its stockholders one share of the Issuer's Common Stock for every three shares of Old Sun's common Stock held by such stockholders as of the close of business on November 5, 2010 (the "Separation"). This Report is being filed voluntarily by the Reporting Person solely to report the shares of the Issuer's Common Stock beneficially owned by the Reporting Person following the Separation.
( 2)	Includes 5,198 unvested restricted stock units that have not yet been paid in shares of the Issuer's Common Stock and 14,308 shares of restricted stock units that have vested but the payment of which has been deferred.
( 3)	The option became exercisable at the rate of 25% on each of January 22, 2005, 2006, 2007 and 2008.
( 4)	The option became exercisable at the rate of 25% on each of May 19, 2005, 2006, 2007 and 2008.
( 5)	The option became exercisable at the rate of 25% on each of May 19, 2006, 2007, 2008 and 2009.
( 6)	The option became exercisable at the rate of 25% on each of March 31, 2007, 2008, 2009 and 2010.
( 7)	The option became exercisable at the rate of 25% on each of March 15, 2008, 2009 and 2010, and becomes exercisable as to the remaining 25% on March 15, 2011.

Reporting Owners
Reporting Owner Name / Address	Relationships
	Director	10% Owner	Officer	Other
WALTERS MILTON J C/O TRI-RIVER CAPITAL 555 FIFTH AVE. 15TH FLOOR NEW YORK, NY 10017	X

Signatures
Michael T. Berg, Attorney in Fact		11/22/2010
** Signature of Reporting Person		Date

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
*	If the form is filed by more than one reporting person, see Instruction 5(b)(v).
**	Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
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