Palythoa reproduce by budding from an extension of the foot. It will make a little paly polyp. They can alter shape in response to things in the enviroment or food they capture during the day. They are phototropic so they open and close in response to the light/dark. If one does look like its dying, get it out of your tank. It will get all mucoid-slimmy looking and like its decaying if its dying. Matt is right on, they are hazardous to you and your tank mates. Best to use gloves and definitely do not try to do anything to it in the tank. Manipulate it in a little container and then back into the main tank to avoid toxins in the tank water. Some species of palythoa are lethal at very low doses of the paly toxin. BTW, Zooanthids are related organisms, but, much much less toxic. Use some kind of rubber gloves. Bio-Supply houses sell them in shoe box size, 100 gloves/box. They are disposable. Get powder free ones.