<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0203</schemaVersion>

    <documentType>3</documentType>

    <periodOfReport>2010-11-15</periodOfReport>

    <noSecuritiesOwned>0</noSecuritiesOwned>

    <issuer>
        <issuerCik>0000904978</issuerCik>
        <issuerName>SUN HEALTHCARE GROUP INC</issuerName>
        <issuerTradingSymbol>SUNHD</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001249291</rptOwnerCik>
            <rptOwnerName>BEMENT CHRISTIAN K</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>1776 STONE CANYON RD.</rptOwnerStreet1>
            <rptOwnerStreet2></rptOwnerStreet2>
            <rptOwnerCity>LOS ANGELES</rptOwnerCity>
            <rptOwnerState>CA</rptOwnerState>
            <rptOwnerZipCode>90077</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>1</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeHolding>
            <securityTitle>
                <value>Common Stock</value>
            </securityTitle>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>26721</value>
                    <footnoteId id="F1"/>
                    <footnoteId id="F2"/>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeHolding>
    </nonDerivativeTable>

    <derivativeTable>
        <derivativeHolding>
            <securityTitle>
                <value>Employee Stock Option (Right to Buy)</value>
            </securityTitle>
            <conversionOrExercisePrice>
                <value>14.89</value>
            </conversionOrExercisePrice>
            <exerciseDate>
                <footnoteId id="F3"/>
            </exerciseDate>
            <expirationDate>
                <value>2014-03-14</value>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Common Stock</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>6688</value>
                    <footnoteId id="F1"/>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </derivativeHolding>
    </derivativeTable>

    <footnotes>
        <footnote id="F1">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. (&quot;Old Sun&quot;), following a 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 &quot;Separation&quot;).  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.</footnote>
        <footnote id="F2">Includes 5,198 unvested restricted stock units that have not yet been paid in shares of the Issuer's Common Stock and 10,535 shares of restricted stock units that have vested but the payment of which has been deferred.</footnote>
        <footnote id="F3">The option became exercisable at the rate of 25% on each of March 15, 2008, 2009 and 2010, and becomes exercisable as the the remaining 25% on March 15, 2011</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>Michael T. Berg, Attorney in Fact</signatureName>
        <signatureDate>2010-11-22</signatureDate>
    </ownerSignature>
</ownershipDocument>
