Cadia Healthcare – Hagerstown, DAB CR6061 (2022)

DECISION

The Centers for Medicare & Medicaid Services (CMS) determined that Cadia Healthcare – Hagerstown (Petitioner or facility), a skilled nursing facility (SNF) participating in the Medicare program, was not in substantial compliance with multiple Medicare participation requirements and that one of its deficiencies posed immediate jeopardy to resident health and safety.  CMS imposed enforcement remedies on Petitioner.  Later, a revisit survey at the facility showed that Petitioner remained out of substantial compliance.  As a result, CMS continued to impose enforcement remedies.  Petitioner eventually returned to compliance and CMS terminated the enforcement remedies.

Although Petitioner concedes that it was not in substantial compliance at the time of original survey and that one of the deficiencies immediately jeopardized the health and safety of residents, Petitioner requested a hearing to dispute the duration of Petitioner’s noncompliance.  Petitioner argues that it returned to substantial compliance by August 13, 2020, and not on December 16, 2020, as CMS found.  As a result, Petitioner asserts that the per day civil money penalty (CMP) should have ended by August 13, 2020, and that the discretionary denial of payment for new admissions (DDPNA) should never have taken effect.

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As explained below, I conclude that Petitioner did not establish an earlier return to substantial compliance date.  Therefore, there was a basis for the per-day CMP to accrue through December 15, 2020, and to impose the DDPNA.  I also conclude that CMS’s imposition of a $225 per-day CMP for non-immediate-jeopardy noncompliance is appropriate under the relevant statutory and regulatory factors.  I do not disturb the $12,920 per-day CMP imposed based on the facility’s immediate-jeopardy noncompliance because that issue is not before me.

I.  Legal Framework

The Medicare program “provides basic protection against the costs of . . . related post-hospital . . . care” for individuals over the age of 65 who are eligible for Social Security retirement benefits and for individuals under 65 who meet other criteria.  42 U.S.C. § 1395c.  Post-hospital care includes extended care services provided at a skilled nursing facility (SNF).  42 U.S.C. §§ 1395f(a)(2)(B), 1395x(h)-(i).

For Medicare program purposes, an SNF is an institution that is primarily engaged in providing skilled nursing care and/or rehabilitation services for its residents but is not primarily engaged in the care and treatment of mental diseases.  42 U.S.C. §§ 1395x(j), 1395i-3(a)(1).  Because an SNF is a “provider of services” in the Medicare program, each SNF that participates in the program must file a provider agreement with the Secretary of Health and Human Services (Secretary).  42 U.S.C. §§ 1395cc(a), 1395x(u).  Further, a participating SNF must meet a variety of ongoing requirements related to how it provides services, maintains the rights of its residents, and administers its facility.  42 U.S.C. § 1395i-3(a)(3), (b)-(d); 42 C.F.R. pt. 483, subpt. B.1

When an SNF fails to meet a statutory or regulatory participation requirement, then the SNF has a “deficiency.”  42 C.F.R. § 488.301; see 42 U.S.C. § 1395i-3(h)(1), (2)(A).  “Noncompliance” means “any deficiency that causes a facility to not be in substantial compliance.”  42 C.F.R. § 488.301; see also 42 U.S.C. § 1395i-3(h)(3).  To maintain “substantial compliance,” an SNF’s deficiencies may “pose no greater risk to resident health or safety than the potential for causing minimal harm.”  42 C.F.R. § 488.301.

Broadly, noncompliance that subjects an SNF to enforcement remedies is divided into two levels.  One level comprises deficiencies that immediately jeopardize the health or safety of residents and the other level is composed of deficiencies that do not.  42 U.S.C. § 1395i-3(h)(1).  “Immediate jeopardy” exists when “the provider’s noncompliance with one or more requirements of participation has caused, or is likely to cause, serious injury, harm, impairment, or death to a resident.”  42 C.F.R. § 488.301.

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The Secretary contracts with state agencies to conduct surveys to determine whether SNFs are in substantial compliance.  42 U.S.C. §§ 1395aa(a), 1395i-3(g); 42 C.F.R. § 488.10.  These surveys can be unannounced surveys that occur at least once every 15 months or can be in response to a complaint.  42 U.S.C. § 1395i-3(g).  When the results of a survey show that an SNF is not in substantial compliance with program participation requirements, the Secretary may impose enforcement remedies on the SNF.  42 U.S.C. § 1395i-3(h)(2); 42 C.F.R. § 488.406.  When CMS selects an enforcement remedy to impose on an SNF, it determines the scope (i.e., the number of residents affected or potentially affected) and severity (i.e., the degree of harm or potential harm) for each deficiency.  See 42 C.F.R. § 488.404(a)-(b); see also 42 U.S.C. § 1395i‑3(h)(2)(B)(ii)(III)(bb).

One such remedy is a CMP.  42 U.S.C. § 1395i-3(h)(2)(B)(ii).  CMS may impose a per-instance CMP for each instance of the SNF’s noncompliance or a per-day CMP for the number of days an SNF is not in substantial compliance.  42 U.S.C. § 1395i‑3(h)(2)(A), (h)(2)(B)(ii)(I); 42 C.F.R. § 488.430(a).  For CMPs assessed on or after January 17, 2020, and for deficiencies that occurred on or after November 2, 2015, the CMP amounts may range as follows:  $2,233 to $22,320 for per-instance CMPs; $112 to $6,695 per day for less serious noncompliance; or $6,808 to $22,320 per day for noncompliance that poses immediate jeopardy to the health and safety of residents.  45 C.F.R. § 102.3 (2020); 85 Fed. Reg. 2869, 2880 (Jan. 17, 2020); see 42 C.F.R. § 488.438(a)(1) (providing original CMP amounts before statutory inflation adjustments).

If CMS imposes a CMP based on a finding of noncompliance, then the SNF may request a hearing before an administrative law judge (ALJ) to challenge CMS’s initial determination of noncompliance that led to the imposition of an enforcement remedy and/or the level of noncompliance (if a successful challenge to the level would affect the range of CMP amounts imposed on the SNF).  42 U.S.C. §§ 1320a-7a(c)(2), 1395i‑3(h)(2)(B)(ii); 42 C.F.R. §§ 488.330(e)(3)(ii), 488.408(g)(1), 488.434(a)(2)(viii), 498.3(b)(13)-(14), (d)(10); see also 5 U.S.C. §§ 554, 556.  However, CMS’s choice of remedies is not reviewable.  42 C.F.R. §§ 488.438(e)(2), 488.408(g)(2), 498.3(b)(13).

If an SNF challenges the existence of a deficiency, CMS must make a prima facie case that the SNF failed to substantially comply with federal participation requirements and, if such a showing is made, the SNF must then prove substantial compliance by a preponderance of the evidence.  Hillman Rehab. Ctr., DAB No. 1611 at 8 (1997); see Batavia Nursing & Convalescent Inn, DAB No. 1911 (2004); Batavia Nursing & Convalescent Ctr., DAB No. 1904 (2004), aff’d, Batavia Nursing & Convalescent Ctr. v. Thompson, 129 F. App’x 181 (6th Cir. 2005); Emerald Oaks, DAB No. 1800 (2001).  If an SNF challenges CMS’s determination as to the level of noncompliance, CMS’s determination must be upheld unless it is clearly erroneous.  42 C.F.R. § 498.60(c)(2).

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If an ALJ concludes that there was a basis for imposing a CMP on an SNF, then the SNF may dispute the amount of the CMP.  The ALJ’s review of the CMP amount is limited to considering the statutory and regulatory factors for setting a CMP amount.  42 C.F.R. § 488.438(e)(3); see 42 U.S.C. §§ 1320a-7a(d), 1395i-3(h)(2)(B)(ii)(I); 42 C.F.R. § 488.438(f).  The ALJ may not reduce a CMP to zero.  42 C.F.R. § 488.438(e)(1).

Either the SNF or CMS may request Departmental Appeals Board (DAB) review of an ALJ’s decision.  42 C.F.R. § 498.80.

II.  Background and Procedural History

My October 7, 2021 Order (Oct. 7 Order) provides a detailed summary of the extensive background and procedural history of this case.  See Oct. 7 Order at 1-5.  Most pertinent for this decision, the Maryland Department of Health, Office of Health Care Quality (state agency) conducted a COVID-19 Focused Emergency Preparedness Survey at Petitioner’s facility on June 12-19, 22-23, 2022, which resulted in an extended survey on July 23, 2020.  CMS Ex. 1 at 1-2.  The state agency drafted a Statement of Deficiencies (SOD) based on the survey’s results.  CMS Ex. 1.2   On August 5, 2020, the state agency issued an initial determination and the SOD to Petitioner.  CMS Exs. 1, 4.  The initial determination stated that CMS had authorized the imposition of a DDPNA if Petitioner did not return to substantial compliance by August 20, 2020.  CMS Ex. 4 at 2.

The facility submitted a plan of correction on August 7, 2020, indicating that it would correct the cited deficiencies by August 13, 2020.  CMS Ex. 8.

Based on CMS’s review of the SOD, CMS decided to delete one of the deficiencies noted by the state agency.  CMS Ex. 5.  Based on the other deficiencies in the SOD, CMS issued an initial determination on September 4, 2020.  CMS Ex. 6.  Of importance to this decision, CMS agreed with the state agency that Petitioner was not in substantial compliance with the following requirements:

• 42 C.F.R. §§ 483.20(f)(5), 483.70(i)(1)-(5), Tag F-842 (Resident Records) (S/S E).
• 42 C.F.R. § 483.80(a)(1), (2), (4), (e), (f), Tag F-880 (Infection Prevention and Control) (S/S K).

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CMS Ex. 6 at 1-2.3   The facility’s noncompliance with the infection prevention and control requirements was cited at an immediate jeopardy level of harm and then, after those conditions were abated, the facility remained out of substantial compliance at a scope and severity level of “E” (i.e., a pattern of conduct that poses the potential for more than minimal harm but has not caused actual harm).  CMS Ex. 1 at 12, 15; CMS Ex. 12 at 1.  CMS’s initial determination indicated that CMS was imposing a CMP on Petitioner.  CMS Ex. 6 at 2.

The state agency returned to the facility and conducted a revisit survey from September 15-17, 2020, and found that the facility had failed to return to substantial compliance with the requirements specified above (i.e., Tags F-842 and F-880) and was no longer in substantial compliance with the following requirements:

• 42 C.F.R. § 483.15(c)(3)-(6), (c)(8), Tag F-623 (notice requirements before transfer/discharge) (S/S D).
• 42 C.F.R. § 483.15(d)(1)-(2), Tag-F-625 (notice of bed hold policy) (S/S D).
• 42 C.F.R. § 483.35, Tag F-684 (quality of care) (S/S D).
• 42 C.F.R. § 483.80, Tag F-882 (infection preventionist qualifications/role) (S/S D).

CMS Ex. 17.4

On January 13, 2021, the state agency conducted a second revisit survey that concluded Petitioner returned to substantial compliance on December 16, 2020.  CMS Ex. 34 at 1.  CMS issued a January 19, 2021 notice indicating that:  1) a DDPNA was in effect from August 20, 2020, through December 15, 2020; 2) a $12,920 per-day CMP was in effect for 11 days from June 12, 2020 through June 22, 2020; and a $225 per-day CMP was in effect for 176 days from June 23, 2020 through December 15, 2020.  CMS Ex. 34 at 1.

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Petitioner timely requested a hearing (Hearing Req.) before an ALJ.  The Civil Remedies Division acknowledged receipt of the hearing request and issued my Standing Prehearing Order, which established deadlines and procedures for prehearing submissions.

CMS initially filed a partial motion for summary judgment, and Petitioner filed a reply and cross-motion for summary judgment (P. Reply).  I denied both motions in my October 7, 2021 Order and considered CMS’s motion as an effort to clarify the issues in this case.  Notably, Petitioner disputed CMS’s classification of the surveys, arguing that the original COVID-19 focused survey took place from June 12-19, 2020, the extended survey from June 22-23, 2020, and the revisit survey on July 23, 2020, where, Petitioner argued, the surveyors found that the facility had returned to substantial compliance.  P. Reply at 5-6.  As explained in my October 7 Order, however, I agreed with CMS’s classifications and found that the July 23, 2020 survey was not a revisit survey that found a return to substantial compliance, but simply a “late” extended survey that found no additional concerns beyond the deficiencies found during the original survey dates.  Oct. 7 Order at 10-12.  I also found that Petitioner did not have a remedy in this proceeding for the state agency’s delay in conducting the extended survey.  Oct. 7 Order at 10.  Finally, I set dates by which the parties would submit their prehearing exchanges.  Oct. 7 Order at 13.

On November 19, 2021, CMS filed a prehearing brief (CMS Br.) along with 39 proposed exhibits.  Three of CMS’s exhibits were written direct testimony from witnesses (CMS Exs. 37-39).  On December 19, 2021, Petitioner submitted a prehearing brief (P. Br.) along with nine proposed exhibits (P. Exs. 1-9).  Petitioner did not submit any written direct testimony.  Petitioner requested to cross-examine one of CMS’s witnesses.

On January 6, 2022, I scheduled a hearing for March 5, 2022, for the cross-examination of CMS’s witness.  In my Notice of Hearing, I admitted all proposed exhibits into the record, although I only provisionally admitted the written direct testimony for CMS’s witness who was to be cross-examined.  I explained that her testimony would be fully admitted into the record once the witness was either cross-examined or Petitioner withdrew its cross-examination request.  Petitioner withdrew its request to cross-examine, and I canceled the hearing.  I therefore issue this decision based on the written record.  Standing Prehearing Order ¶ 13; Civil Remedies Division Procedures § 19(b), (d).

III.  Issues

My October 7, 2021 Order and Notice of Hearing clarified the issues under review.  Oct. 7 Order at 11-12; Notice of Hearing at 2.  Relevant here, Petitioner’s appeal is limited to the date of its return to substantial compliance, which includes a dispute of the noncompliance found during the September 2020 revisit survey.  Hearing Req. at 1 (stating that Petitioner “objects to the DDPNA going into effect as it achieved substantial

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compliance prior to the effective date” and “objects to the CMP, to the extent that CMPs continue to accrue beyond the actual date of substantial compliance.”).

In its cross-motion for summary judgment, Petitioner appeared to challenge the duration of the immediate-jeopardy period and so, in my October 7, 2021 Order, I gave Petitioner an opportunity to raise this as a new issue with an explanation as to why it had not raised it in the hearing request.  Oct. 7 Order at 12; see 42 C.F.R. 498.56(a).  Petitioner subsequently confirmed that it was not seeking to appeal the immediate-jeopardy CMP.  P. Br. at 4 (“There was an additional CMP for the days of Immediate Jeopardy which is not under appeal.”).  Accordingly, CMS’s immediate-jeopardy determination and the $12,920 per day CMP imposed from June 12, 2020 through June 22, 2020, are not before me and is binding on Petitioner.  42 C.F.R. § 498.20.

The issues remaining in this case are:

1. Whether Petitioner returned to substantial compliance before December 16, 2020, including whether Petitioner was in substantial compliance with Medicare requirements at the time of the September 2020 revisit survey; and
2. Whether the amount of the $225 per-day CMP imposed is appropriate under the factors in 42 U.S.C. § 1320a-7a(d) and 42 C.F.R. § 488.438(f).

IV.  Findings of Fact, Conclusions of Law, and Analysis

1.  Petitioner does not dispute the noncompliance found during the original state agency survey that ended on July 23, 2022, which included noncompliance with the requirement at 42 C.F.R. § 483.70(i)(1) based on a failure to maintain complete and accurate resident medical records.

Petitioner did not dispute the deficiencies found during the survey that ended on July 23, 2020.  One such deficiency involved 42 C.F.R. § 483.70(i)(1).  The SOD provided the following as the factual bases for that deficiency:

• On May 18, 2020, Resident 7 fell.  The resident’s medical record did not have a skilled-level assessment of Resident 7.  Resident 7 was sent to the hospital.  The facility’s director of nursing stated that the facility does not complete assessments after residents leave the facility.  “With no documented skilled-level assessment and no documented concurrent review, when Resident #7 returned from the hospital, s/he suffered a second fall [on May 19, 2020] with serious injury.  In the same pattern no skilled-level assessment was documented after the second fall.  The facility then inaccurately coded only one of the 2 falls with major injury into the 5/27/20 MDS discharge assessment.”  CMS Ex. 1 at 10-11.

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• The facility failed to document a skilled-level assessment after Resident 8 fell on June 8, 2020.  CMS Ex. 1 at 11.
• The facility failed to document a skilled-level assessment after Resident 9 fell on June 8, 2020.  CMS Ex. 1 at 11.
• Following a June 19, 2020 incident between Residents 25 and 26, the facility commenced one-on-one observation of Resident 25 until discharged to a hospital on June 20, 2020.  When Resident 25 returned to the facility on June 20, 2020, the facility placed Resident 25 on hourly checks.  Resident 25’s medical record neither revealed documentation that the one-on-one observation had been completed nor that hourly checks had been completed on June 23, 2020, from midnight through 6 a.m. and at 11 p.m.  CMS Ex 1 at 12.

2.  On September 15, 2020, during the state agency revisit survey, a nurse surveyor reviewed Resident 15’s medical records and learned that, on August 28, 2020, Resident 15 vomited two times and was transported by the Emergency Medical Service (EMS) to a hospital.  Resident 15’s medical records did not have any documentation as to why Resident 15 was transferred to the hospital.  The state agency surveyor mentioned this lack of documentation to the facility’s director of nursing.  On September 16, 2020, the state agency surveyor again reviewed Resident 15’s medical records and saw a physician assessment/progress note dated September 15, 2020, that purported to provide the reasons for the August 28, 2020 transfer of Resident 15.

The state agency conducted a revisit survey at Petitioner’s facility from September 15 through 17, 2020.  The revisit survey found that one of the facility’s residents, Resident 15, was transferred to a hospital on August 28, 2020, and that staff failed to document the reason for the transfer at that time.  CMS Ex. 2 at 12-13.  As discussed below, the record supports this factual allegation in the SOD issued by the state agency following the survey.

Resident 15 was originally admitted as a resident at the facility on January 7, 2016, with a principal diagnosis of chronic obstructive pulmonary disease; however, Resident 15 had other diagnoses on admission and later while residing at the facility.  CMS Ex. 21 at 79-80.  By August 26, 2020, a progress note indicated that Resident 15 had previously lost a significant amount of weight but had been stable that month.  It also stated that Resident 15 had a history of increased blood urea nitrogen (BUN) levels and that Resident 15 was to be assessed for end stage renal failure (ESRF).  CMS Ex. 21 at 95, 112.

An August 26, 2020 Physician Assessment (Progress Note) indicates Resident 15 was evaluated to determine if she needed to go to the hospital based on a BUN of 201 with mild hypernatremia and chronic kidney disease (CKD).  CMS Ex. 21 at 81.  The

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physician also noted that Resident 15’s creatinine levels were stable, there was no reported diarrhea, her feeding tube water flush had been increased, and her vital signs were stable.  CMS Ex. 21 at 81.  The physician indicated that Resident 15 had acute kidney injury (AKI) with CKD and that saline would be given intravenously at 100 cc/hour or water flushes would be increased by one liter every day.  CMS Ex. 21 at 84.  The physician stated that Resident 15 may need to be sent to the hospital if her vitals are unstable.  CMS Ex. 21 at 84.

An August 28, 2020 nursing note simply indicates:  “Patient left via EMS transport en route to hospital.  While EMS was preparing patient for transport, patient vomited x 2, moderate amount of stomach acid and recently administered medications.”  CMS Ex. 21 at 89.  Other notes on that date show Resident 15 had no symptoms of coronavirus, had appropriate temperatures in the 97 degree range, had a sufficient blood oxygen saturation rate varying between 93% and 96%, and had been seen by a physician concerning a pressure ulcer.  CMS Ex. 21 at 89-90.

Resident 15 was readmitted to the facility on September 8, 2020.5   CMS Ex. 21 at 79.

While conducting a revisit survey at the facility on September 15, 2020, Margaret Crosby, R.N., reviewed Resident 15’s medical records at noon on September 15, 2020.  CMS Ex. 37 ¶ 17.  Ms. Crosby testified that “[f]urther review of the medical record [for Resident 15] revealed that there were no nursing, nurse practitioner or physician notes to indicate why the resident was being sent to the hospital.”  CMS Ex. 37 ¶ 17.  At 3:30 p.m. on September 15, 2020, Ms. Crosby notified Petitioner’s director of nursing that she was unable to locate clinical records explaining the reason for Resident 15’s transfer.  CMS Ex. 37 ¶ 18.

On September 16, 2020, Nurse Crosby reviewed Resident 15’s medical records again, but this time she saw a new entry by Resident 15’s physician on September 15, 2020, with an effective date of August 28, 2020.  CMS Ex. 37 ¶ 19; CMS Ex. 21 at 85-88.  The document is a Physician Assessment (Progress Note) that states Resident 15 had been transferred mainly due to CKD:

ARF/AKI CKD [acute renal failure/acute kidney injury chronic kidney disease] sacral decubitus OSA [obstructive sleep apnea] chronic respiratory failure[.]  Patient has not improved with conservative care she has acute renal failure and rising creatinine, was sent to hospital for further care still

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has a full code status this note was done on 09/15/20 and had evaluated her on the day of the transfer to hospital.

CMS Ex. 21 at 88.  The physician did not state that Resident 15’s vital signs were the cause of the transfer to the hospital.

3.  When Petitioner transferred Resident 15 to the hospital on August 28, 2020, the facility did not provide Resident 15 or Resident 15’s representative with notice of the applicable bed-hold policy.

In the SOD issued after the revisit survey, the state agency alleged that, “[b]ased on a medical record review and interview . . . the facility failed to provide the bed hold policy to residents when transferred.”  CMS Ex. 2 at 6.  As stated earlier, the record shows Petitioner transferred Resident 15 to a hospital on August 28, 2020.  CMS Ex. 21 at 89.  Resident 15’s Admission Record provides the name and contact information for her “responsible party,” who is her sister.  CMS Ex. 21 at 79; see CMS Ex. 37 ¶ 47.

Despite reviewing Resident 15’s medical record on both September 15 and 16, 2020, Ms. Crosby testified that she found “no documentation of the bed-hold policy that was provided to Resident #15 and her representative” when the resident was transferred to the hospital.”  CMS Ex. 37 ¶ 47; see CMS Ex. 2 at 6-7.  Ms. Crosby testified that she informed the facility administrator and director of nursing; however, they only stated they would investigate.  CMS Ex. 37 ¶ 48.  Petitioner’s staff did not provide documentation to Ms. Crosby showing that the written bed-hold policy notice was provided to Resident 15 or her representative.  CMS Ex. 37 ¶ 51.

4.  The facility was not in substantial compliance with 42 C.F.R. § 483.70(i)(1), (5) because Petitioner failed to maintain complete and accurately documented medical records for Resident 15 at the time of the revisit survey.

The Social Security Act (Act) requires SNFs to maintain clinical records on all residents.  42 U.S.C. § 1395i-3(b)(6)(C).  The Act also requires SNFs to be administered in a manner that allows each resident to attain or maintain the highest practicable physical, mental, and psychosocial wellbeing.  42 U.S.C. § 1395i-3(d)(1)(A).

The Act provides the Secretary with the authority to establish criteria for assessing SNF compliance with the requirement that they be administered properly in relation to, among other things, maintaining clinical records.  42 U.S.C. § 1395i-3(f)(5).  The Secretary promulgated regulations for this purpose, which require SNFs to do the following:

(1) In accordance with accepted professional standards and practices, the facility must maintain medical records on each resident that are -

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(i) Complete;
(ii) Accurately documented;
(iii) Readily accessible; and
(iv) Systematically organized.

42 C.F.R. § 483.70(i)(1).

Relevant to the current case, those regulations state that the medical records for each resident must contain “[a] record of the resident’s assessments” and “[p]hysician’s, nurse’s, and other licensed professional’s progress notes.”  42 C.F.R. § 483.70(i)(5)(ii), (v).

CMS argues that Petitioner’s failure to have the physician assessment/progress note showing the medical reasons for Resident 15’s transfer to the hospital shows that Petitioner’s medical records were incomplete for Resident 15.  Further, the entry of the physician’s assessment/progress note concerning Resident 15 was untimely.  CMS Br. at 12.  CMS asserts that Petitioner’s conduct created the potential for more than minimal harm because a failure to document the reasons for the transfer could potentially impair the coordination of care provided to Resident 15 by other health care providers.  Further, after Resident 15 returned to the facility, only Resident 15’s physician knew why Resident 15 required hospitalization.  CMS Br. at 13.

Petitioner does not dispute that the physician assessment/progress note documenting the reason for the hospital transfer was late but maintains that the deficiency was simply a “technical” or “administrative” one, which “has the potential for causing no more than a minor negative impact on the resident.”  P. Br. at 5.  Petitioner argues that there is no evidence that the incident was anything more than an isolated one that did not impact the care of the resident and that CMS is “not supposed to jump to hypotheticals and whether something could have created harm, when it, in fact, did not.”  P. Br. at 5-6.  Petitioner cites 42 C.F.R. § 488.26(c)(2) for the proposition that CMS is to determine compliance based primarily on patient outcomes.  P. Br. at 6.  Petitioner argues that CMS’s expert witness testimony as to what might have happened due to Petitioner’s failure to properly document the reasons for the transfer is not appropriate evidence because the record shows nothing negative actually happened to Petitioner as a result of Petitioner’s actions.  P. Br. at 6.

The record in this case supports CMS’s contention that Petitioner failed to comply with 42 C.F.R. § 483.70(i)(1) and (5), and Petitioner failed to rebut CMS’s evidence.

Ms. Crosby, testifying as an expert, stated that a hospital transfer is a “clinically significant” event that should be documented in the medical record at the time of the transfer.  CMS Ex. 37 ¶ 21.  She said that the physician’s later documentation was untimely and only entered into the medical record because Ms. Crosby informed the

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facility of the lack of documentation.  CMS Ex. 37 ¶ 21.  Ms. Crosby testified that Petitioner’s actions created the potential for more than minimal harm because the receiving hospital could have been prevented from receiving necessary information about Resident 15 and her needs.  CMS Ex. 37 ¶ 22.  She also testified that, as a general matter, failing to adequately document the rationale for hospitalization can result in a “breakdown in communication” and “impede the coordination of care” with the receiving hospital and other facility staff.  CMS Ex. 37 ¶ 22.  Further, she stated that Resident 15 returned to the facility after hospitalization and, except for facility staff who were directly involved in the transfer on August 28, 2022, other staff “had no way of knowing about the significant clinical occurrence of the resident being transferred to the hospital . . . or the basis for that transfer for several weeks after the significant events occurred.”  CMS Ex. 37 ¶ 22.

I give Ms. Croby’s opinion significant weight based on her knowledge and experience.  CMS Ex. 28; CMS Ex. 37 ¶¶ 1-7.  Further, Petitioner did not provide any evidence to contradict her testimony or cross-examine her.

Ms. Crosby’s testimony is also consistent with the statute governing SNFs.  SNFs are to perform resident assessments “promptly after a significant change in the resident’s physical or mental condition.”  42 U.S.C. § 1395i-3(b)(3)(C)(i)(II).  The result of an assessment is to be used for revising a resident’s plan of care.  42 U.S.C. § 1395i-3(b)(3)(D).  I take from these provisions that assessments, like the one Resident 15’s physician allegedly did on August 28, 2020, is important information that needs to be considered when updating a care plan.  The hospital would have needed this information so that it could assist in their evaluation and decision as to how Resident 15 should be treated.  Indeed, before an SNF transfers or discharges a resident, it must record the reasons for the transfer or discharge.  42 U.S.C. § 1395i-3(c)(2)(B)(i)(II).  Documenting the reason for a transfer or discharge in the resident’s clinical record is specifically required when the transfer or discharge is necessary to meet the resident’s welfare and the resident’s welfare cannot be met by the facility.  42 U.S.C. § 1395i-3(c)(2)(A)(i).  This information must be included in the resident’s medical record and communicated to the receiving health care institution.  42 C.F.R. § 483.15(c)(2).  According to the physician assessment/progress note concerning Resident 15’s August 28, 2020 transfer, the facility could no longer meet Resident 15’s medical needs and transfer to the hospital was necessary.  CMS Ex. 21 at 88.  Therefore, while the SOD found a deficiency concerning Resident 15’s medical records, other Medicare requirements cited above assist in understanding why Petitioner’s deficient conduct was potentially harmful.

Even though Petitioner conceded that it failed to properly document the reasons why Petitioner was sent to the hospital, Petitioner downplayed the potential ramifications of this conduct by asserting that Resident 15 was not, in fact, harmed and that Ms. Crosby is just theorizing about potential problems that could have occurred.  However, CMS never asserted that Resident 15 was actually harmed.  All that CMS need show is “the potential

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for causing more than minimal harm.”  42 C.F.R. § 488.301 (definition of Substantial compliance).

I am persuaded that Ms. Crosby’s unrebutted testimony that Petitioner’s failure to properly document the basis for sending Resident 15 to the hospital had the potential to cause coordination of care problems by restricting the receiving hospital’s ability to receive necessary information about Resident 15 and her needs.  Further, I accept her testimony that after the resident returned to the facility, other facility staff members might have been similarly restricted from the same information.  Therefore, I conclude that the facility’s late documentation had the potential for more than minimal harm and constitutes noncompliance with 42 C.F.R. § 483.70(i)(1) and (5). 

5.  The facility was not in substantial compliance with 42 C.F.R. § 483.15(d)(2) at the time of the revisit survey based on its failure to provide Resident 15 and her representative notice of the facility’s bed-hold policy.

The Secretary’s regulations require a facility to provide notice of the facility’s bed-hold policy to a resident and a resident’s representative upon transfer to a hospital.

(d) Notice of bed-hold policy and return -
(1) Notice before transfer.  Before a nursing facility transfers a resident to a hospital or the resident goes on therapeutic leave, the nursing facility must provide written information to the resident or resident representative that specifies -
(i) The duration of the state bed-hold policy, if any, during which the resident is permitted to return and resume residence in the nursing facility;
(ii) The reserve bed payment policy in the state plan, under § 447.40 of this chapter, if any;
(iii) The nursing facility's policies regarding bed-hold periods, which must be consistent with paragraph (e)(1) of this section, permitting a resident to return; and
(iv) The information specified in paragraph (e)(1) of this section.
(2) Bed-hold notice upon transfer.  At the time of transfer of a resident for hospitalization or therapeutic leave, a nursing facility must provide to the resident and the resident representative written notice which specifies the duration of the bed-hold policy described in paragraph (d)(1) of this section.

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42 C.F.R. § 483.15(d) (emphasis added); see also CMS Ex. 35 at 2-3; State Operations Manual, CMS Pub. 100-07, Appendix PP – Guidance to Surveyors for Long Term Care Facilities (SOM Appendix PP) at 170 (Rev. 173, eff. Nov. 22, 2017).

As indicated above, Petitioner transferred Resident 15 to a hospital on August 28, 2020.  CMS Ex. 21 at 88-89.  However, Resident 15’s records contained no documentation showing that the bed-hold notice had been provided to Petitioner and her representative.

Petitioner does not assert that it provided the requisite bed-hold policies to Resident 15 or her sister, but it contends instead that any failure to do so was “inadvertent” and did not “impact” the resident, who had already returned to the facility by the time of the survey.  P. Br. at 13.

Petitioner’s main argument overlooks the potential for more than minimal harm at the time of the hospital transfer, when the resident and her sister were left without information about whether the resident could eventually return to the facility.  Ms. Crosby testified that, for nursing home residents, “the skilled nursing facility is their home” and the facility’s noncompliance “depriv[ed]” the resident and her representative of the opportunity to ensure that the resident “could return to [her] home.”  CMS Ex. 37 ¶ 53.  I credit Ms. Crosby’s testimony, which Petitioner did not contradict or cross-examine.  The confusion or even uncertainty surrounding the resident’s living arrangements post-hospitalization had the potential to be distressing for the resident.  Therefore, I conclude that the facility’s failure to provide the bed-hold policy at the time of the hospital transfer as required had the potential to cause more than minimal harm and constitutes substantial noncompliance with 42 C.F.R. § 483.15(d)(2).

6.  The regulation at 42 C.F.R. § 488.454(e) provides for the termination of enforcement remedies at a date earlier than a revisit survey if the facility can supply acceptable documentation that it was in substantial compliance and was capable of remaining in substantial compliance on a date preceding a revisit survey.  Because the facility was out of substantial compliance with 42 C.F.R. §§ 483.15(d)(2) and 483.70(i)(1) on August 28, 2020, which was more than two weeks before the revisit survey (and less than two weeks after completing its plan of correction), Petitioner failed to demonstrate that it was in or could maintain substantial compliance.

Petitioner disputes CMS’s finding that it continued to be noncompliant with the resident records requirement at 42 C.F.R. § 483.70(i)(1) based on a revisit survey in September 2020 because Petitioner had implemented a plan of correction, corrected the previously cited deficiencies, and returned to substantial compliance by August 13, 2020.  P. Br. at 2, 6.  Petitioner observes that CMS cited a DAB decision in which it found that “a facility’s noncompliance is deemed to be corrected or removed only when the incidents of noncompliance have ceased and the facility has implemented appropriate measures to

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ensure that similar incidents will not recur.”  P. Br. at 2 (citing Life Care Ctr. of Elizabethton, DAB No. 2367 at 16 (2011)).  However, Petitioner asserts that it returned to substantial compliance when it implemented its plan of correction and that no “similar incidents” recurred; therefore, Petitioner had returned to substantial compliance despite the revisit survey.  P. Br. at 2.

For the reasons stated below, I disagree that Petitioner is eligible for relief from the imposed enforcement remedies based on implementing its plan of correction by August 13, 2020.  Because Petitioner was noncompliant with 42 C.F.R. § 483.70(i)(1) and 42 C.F.R. § 483.15(d)(2) on August 28, 2020, Petitioner is unable to demonstrate that it returned to substantial compliance or could maintain substantial compliance prior to the revisit survey.

Once a facility has been found to be out of substantial compliance, it remains so until it affirmatively demonstrates that it has achieved substantial compliance once again.  Ridgecrest Healthcare Ctr., DAB No. 2493 at 2-3 (2013); Taos Living Ctr., DAB No. 2293 at 20 (2009); Premier Living & Rehab. Ctr., DAB No. 2146 at 3 (2008); Lake City Extended Care, DAB No. 1658 at 12-15 (1998).  The burden is on the SNF to prove that it is back in compliance, not on CMS to prove that deficiencies continued to exist.  Asbury Care Ctr. at Johnson City, DAB No. 1815 at 19-20 (2002).

Although the DAB indicated generally that it is appropriate to look at whether a facility has implemented its plan of correction to determine when the facility has returned to substantial compliance, Petitioner did not cite any DAB decisions that specifically address whether the date a plan of correction is implemented is definitively the date that a facility has returned to substantial compliance.  As explained below, even assuming the facility completed its plan of correction in this case, I disagree that the facility demonstrated that it could maintain substantial compliance in light of the noncompliance found during the revisit survey.

No evidence before me shows that the state agency surveyors or CMS certified the facility’s return to substantial compliance before the revisit survey.  The facility’s plan of correction was accepted by the surveyors, as Petitioner points out, but the mere acceptance of a plan, even with an alleged date of compliance, does not end the analysis.  P. Br. 2, 6.  Instead, the regulations provide that CMS or the surveyors must verify the date that a facility achieves substantial compliance to determine when remedies terminate.

If the facility can supply documentation acceptable to CMS or the State survey agency that it was in substantial compliance and was capable of remaining in substantial compliance, if necessary, on a date preceding that of the revisit, the remedies terminate on the date that CMS or the State can verify as the

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date that substantial compliance was achieved and the facility demonstrated that it could maintain substantial compliance, if necessary.

42 C.F.R. § 488.454(e) (emphasis added); see also Ridgecrest Healthcare Ctr., DAB No. 2493 at 15 (2013) (“As the Board has recognized, a [plan of correction] indicating a specific date of implementation is not sufficient evidence by itself to establish that the measures in the [plan of correction] had been satisfactorily implemented.”); Oceanside Nursing & Rehab. Ctr., DAB No. 2382 at 20 (2011) (“Even if a [plan of correction] is accepted, the facility is not regarded as in substantial compliance until CMS determines, ‘usually through a revisit survey,’ that the deficiency no longer exists.”).

I believe that Petitioner’s interpretation of § 488.454(e), that a facility may be found to have returned to substantial compliance before a revisit even if the revisit finds the facility out of substantial compliance again, is inconsistent with other regulations, comments made during rulemaking, and CMS guidance.  Those sources support the view that noncompliance found as of the revisit survey means that the facility’s continuing noncompliance must extend through the revisit.  This interpretation is consistent with § 488.454(e) because noncompliance found as of the revisit means that the facility failed to demonstrate that it could maintain substantial compliance.

To start, the regulatory definition of a revisit survey makes clear that the survey involves evaluating the facility’s correction of previously cited deficiencies and its substantial compliance with applicable Medicare requirements:

Revisit survey means a survey performed with respect to a provider or supplier cited for deficiencies during an initial certification, recertification, or substantiated complaint survey and that is designed to evaluate the extent to which previously-cited deficiencies have been corrected and the provider or supplier is in substantial compliance with applicable conditions of participation, requirements, or conditions for coverage.  Revisit surveys include both offsite and onsite review.

42 C.F.R. § 488.30(a) (emphasis added).6   Thus, surveyors evaluate more than simply whether the facility completed its plan of correction at the time of the revisit, and Petitioner’s emphasis on the completion of its plan is misplaced in this case.

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I also read the regulatory definition of a revisit survey to mean that surveyors evaluate “the extent to which” the facility is in substantial compliance with all applicable Medicare requirements at the time of the revisit and so new noncompliance found as of the revisit could support a facility’s continuing noncompliance.  Indeed, this understanding of a facility’s revisit noncompliance is consistent with comments CMS has made during rulemaking.  In the preamble to the revisions to the CMP regulations, CMS expressly recognized that “civil money penalty liability has continued in many cases even where the originally identified deficiencies have been corrected, but new ones have arisen . . . because providers must establish substantial compliance with all requirements to avoid civil money penalty liability, not just compliance with the deficiencies that triggered the decision to impose the penalty in the first place.”  64 Fed. Reg. 13,354, 13,355 (Mar. 18, 1999) (emphasis added) (discussing the difficulties of determining the ending date for noncompliance); see also 42 U.S.C. § 1395i-3(h)(3) (a denial of payment for new admissions “shall terminate when the Secretary finds that the facility is in substantial compliance with all the requirements of subsections (b), (c), and (d).”) (emphasis added).  Therefore, merely returning to compliance with the specific requirements that were found deficient during a survey is not necessarily sufficient to show that an SNF has returned to substantial compliance.

Despite this, Petitioner argues that the failure to document the reasons for Resident 15’s hospital transfer constituted a “new” deficiency, which “cannot be used to show a continuation of the earlier narrative” from the original survey, which found that the facility had failed to document post-fall assessments or reviews of three residents (Residents 7, 8, and 9) and failed to document the supervision of another (Resident 25).  P. Br. at 6; CMS Ex. 1 at 12.

Even if Petitioner’s arguments were legally correct, they are factually incorrect.  Petitioner’s original deficiency related to 42 C.F.R. § 483.70(i)(1) included a failure to document a skilled-level assessment for Resident 7 before he was sent to the hospital after a fall.  The SOD went so far as to imply that the failure to document the assessment contributed to a second fall upon return from the hospital.  CMS Ex. 1 at 10-11.  This is nearly the same scenario that occurred regarding Resident 15.  The physician did not complete the physician assessment/progress note until a week after Resident 15 returned from the hospital, and then only because the surveyor noticed that the physician never documented the reasons for sending Resident 15 to the hospital.  Further, the original deficiency also included two instances (Residents 8 and 9) where Petitioner failed to document skilled-level assessments of residents who had fallen.  CMS Ex. 1 at 11.  Both the original and revisit survey show that Petitioner was deficient in documenting assessments made of residents.

In addition, Petitioner’s legal argument is incorrect.  Medicare guidelines addressing the SNF survey and enforcement process reject Petitioner’s line of reasoning that the revisit survey only found a new, rather than continuing, deficiency.  In the section titled,

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“Revisit Identifies New Noncompliance and Same Data Tag is Selected,” the guidelines state:

If the same data tag is selected to identify noncompliance, the State (or regional office) could choose to utilize either the per instance or per day civil money penalty as an enforcement remedy.  It would not matter whether the same data tag was selected to identify the new noncompliance.  The issue is whether noncompliance is present and whether the deficient practice rises to a level that will support selecting a civil money penalty as an enforcement remedy.

SOM-Chapter 7, § 7522.1, at 124-25 (Rev. 185, eff. Nov. 16, 2018) (also providing as an example noncompliance identified at Tag 323 at an original survey, and then, during the revisit, “a different problem dealing with the elopement of three residents was cited at Tag 323.”).  The authorization of CMPs, including per-day CMPs, based on a revisit survey identifying “new” noncompliance with the “same data tag” supports the view that the facility’s continuing noncompliance extends through the revisit.  Petitioner’s complaint that the revisit survey identified “new” noncompliance is therefore unavailing.

Because the facility here was not in substantial compliance with the resident records requirement and the bed-hold policy notice at the time of the revisit survey, it failed to show that it was in substantial compliance and capable of remaining in substantial compliance “on a date preceding that of the revisit.”7   42 C.F.R. § 488.454(e).  The facility’s continuing noncompliance extends through the revisit, which means that there was a basis for imposing the DDPNA effective August 20, 2020, and for the accrual of daily CMPs to continue.  Because Petitioner has not argued it, there is also no basis to find that the facility returned to substantial compliance at any point between the revisit and December 16, 2020, the date CMS determined the facility returned to substantial compliance.  See, e.g., Owensboro Place & Rehab. Ctr., DAB No. 2397 at 12 (2011) (“[T]he facility bears the burden of showing that it returned to substantial compliance on a date earlier than that determined by CMS . . . .”); CMS Ex. 6 at 1.

7.  The $225 per-day CMP from June 23, 2020, through December 15, 2020, is appropriate under the relevant statutory and regulatory factors for setting the amount of a CMP.

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CMS imposed a $225 per day CMP from June 23 through December 15, 2020, for a subtotal CMP of $39,600.  CMS Ex. 34 at 1.  Although a $12,920 per-day CMP was also imposed from June 12 through 22, 2020, Petitioner did not challenge that CMP and I therefore do not consider that issue.  CMS Ex. 34 at 1.

When determining whether the amount of a CMP is appropriate, I apply the factors listed in 42 C.F.R. § 488.438(f):  1) the facility’s history of noncompliance; 2) the facility’s financial condition; 3) the factors specified in 42 C.F.R. § 488.404; and 4) the facility’s degree of culpability, which includes neglect, indifference, or disregard for resident care, comfort, or safety.  See 42 U.S.C. §§ 1320a-7a(d)(2), 1395i-3(h)(2)(B)(ii)(I); 42 C.F.R. § 488.438(e)(3).  The absence of culpability is not a mitigating factor.  42 C.F.R. § 488.438(f).  The factors listed in 42 C.F.R. § 488.404 include:  1) the scope and severity of the deficiency; 2) the relationship of the deficiency to other deficiencies resulting in noncompliance; and 3) the facility’s prior history of noncompliance in general and specifically with reference to the cited deficiencies.  See 42 U.S.C. §§ 1320a-7a(d)(1), (3), 1395i-3(h)(2)(B)(ii)(I).

The regulations leave the decision regarding the choice of remedy to CMS, and the amount of the remedy to CMS and the ALJ, requiring only that the regulatory factors at sections 488.438(f) and 488.404 be considered when determining the amount of a CMP within a particular range.  42 C.F.R. §§ 488.408, 488.408(g)(2); 498.3(d)(11); see also 42 C.F.R. § 488.438(e)(2) and (3); Alexandria Place, DAB No. 2245 at 27 (2009); Kenton Healthcare, LLC, DAB No. 2186 at 28-29 (2008).  However, unless a facility contends that a particular regulatory factor does not support the CMP amount, an ALJ must sustain it.  Coquina Ctr., DAB No. 1860 (2002).

Other than arguing that the duration of the per-day CMP should be limited to August 13, 2020, the date it implemented its plan of correction, Petitioner does not argue that the $225 per day CMP amount is unreasonable based on the regulatory factors.  Coquina Ctr., DAB No. 1860 (2002).  For completeness, I briefly discuss the factors below.

Scope and Severity of Deficiencies and Relationship Between Deficiencies:  The deficiencies addressed above involve the potential for more than minimal harm and support the CMP amount imposed.  As noted, the failure to maintain complete and accurate resident records can impede coordination of care among facility staff and with providers outside of the facility.  And the facility’s failure to provide the requisite bed-hold information had the potential to cause distress while the resident or her representative were left uncertain about the resident’s post-hospitalization living arrangements.

Culpability:  Petitioner’s culpability with respect to its failure to maintain complete and accurate resident records also supports the CMP amount imposed.  Petitioner does not attempt to explain why it failed to follow professional standards for documenting resident

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care and, as explained above, staff failed to document care on multiple occasions, for multiple residents, and over a stretch of time that included a revisit survey.  The facility’s original plan of correction was too narrowly drawn and inadequate to ensure the facility’s substantial compliance.

Facility’s History of Non-Compliance:  CMS did not submit evidence of Petitioner’s history of noncompliance.

Financial Condition of the Facility:  Petitioner does not assert that its financial condition justifies a reduction in the CMP amount.  Therefore, this is not a factor requiring consideration.

CMP Amount:  A per-day CMP of $225 is quite low and near the $112 per-day minimum amount for non-immediate-jeopardy deficiencies and is entirely appropriate based on the factors considered above.  85 Fed. Reg. at 2880.

Conclusion

I conclude that Petitioner remained out of substantial compliance through December 15, 2020, which means that there was a basis for the $225 per-day CMP to accrue through December 15, 2020, and to impose the DDPNA from August 20, 2020, through December 15, 2020.  I also conclude that CMS’s imposition of the $225 per-day CMP for non-immediate-jeopardy noncompliance is appropriate under the relevant statutory and regulatory factors.  I do not disturb CMS’s imposition of the $12,920 per-day CMP for 11 days from June 12, 2020 through June 22, 2020.

1.  All citations to the Code of Federal Regulations are to the version in effect at the time of the survey unless otherwise indicated.
• back to note 1
2.  My October 7, 2021 Order clarified the chronology involving various SODs related to this case.  Oct. 7 Order at 2 n.1.
• back to note 2
3.  CMS agreed with the state agency that the facility was also out of substantial compliance with the requirements at 42 C.F.R. § 483.10(g)(14)(i)-(iv), (15) (Tag F-580) (Notification of Changes) (S/S D) and 42 C.F.R. § 483.35(a)(3), (4) (Tag F-726) (Competent Nursing Staff) (S/S E).  CMS Ex. 1 at 3-8; CMS Ex. 6 at 1-2.  CMS disagreed with the SOD and deleted the finding of noncompliance with 42 C.F.R. § 483.25(d) (Tag F-689) (Accidents).  CMS Ex. 5; see CMS Ex. 10 at 5-8.
• back to note 3
4.  The revisit survey also found that Petitioner had returned to substantial compliance as of August 13, 2020, with respect to the other requirements listed in the original SOD (i.e., Tags F-580 and F-726).  CMS Ex. 17.
• back to note 4
5.  Petitioner’s Exhibit List indicates that Petitioner Exhibit 4 is a document from Resident 15’s medical records.  However, the name of the resident listed on that exhibit is Resident 34.  See CMS Ex. 13.
• back to note 5
6.  In this case, the state agency had to perform a revisit survey because the original survey found an immediate jeopardy level deficiency.  State Operations Manual, CMS Pub. 100-07, Chapter 7, Survey and Enforcement Process for Skilled Nursing Facilities and Nursing Facilities (SOM-Chapter 7), § 7317.2, at 82-83 (Rev. 63, eff. Sept. 10, 2010).
• back to note 6
7.  Having upheld two of the six deficiencies found during the revisit survey, I do not need to discuss the other deficiencies found during the revisit survey because these are sufficient to show that Petitioner remained out of compliance.  Further, as also discussed below, these deficiencies are sufficient to support the per-day CMP that CMS imposed.
• back to note 7