SUBJECT:

Carmel Care Center,

Petitioner,

Centers for Medicare & Medicaid Services.

DECISION

Carmel Care Center, Petitioner, requested a hearing to challenge the determination by the Centers for Medicare & Medicaid Services (CMS) to impose a civil money penalty (CMP) of $100 against it based on deficiencies cited following a survey completed on October 1, 2002. For the reasons set forth below, I decide that CMS had the authority to impose the CMP because Petitioner was not in substantial compliance with the cited participation requirements.

I. BACKGROUND

Petitioner is a nursing facility located in Carmel, Indiana. CMS determined that Petitioner was not in substantial compliance with Medicare participation requirements based on a survey by the Indiana State Department of Health (State survey agency) which was completed on October 1, 2002. The State survey agency found Petitioner out of substantial compliance with the following participation requirements: 42 C.F.R. � 483.13(c)(1)(ii) (F Tag 225 on the statement of deficiencies); 42 C.F.R. � 483.25 (F Tag 309 on the statement of deficiencies); 42 C.F.R. � 483.25(h)(2) (F Tag 324 on the statement of deficiencies); 42 C.F.R. � 483.25(l)(1) (F Tag 329 on the statement of deficiencies); and 42 C.F.R. � 483.75(k)(2)(ii) (F Tag 511 on the statement of deficiencies). CMS exhibit (Ex.) 5. By letter dated October 28, 2002, CMS informed Petitioner that it would be imposing remedies based on these deficiencies, which remedies would include a per day CMP of $100, denial of payment for new Medicare and Medicaid admissions (DPNA), effective January 1, 2003, and termination of Petitioner's provider agreement if Petitioner did not attain substantial compliance by April 1, 2003. CMS Ex. 1. The State survey agency conducted a revisit of Petitioner's facility on November 21, 2002. The revisit found Petitioner in substantial compliance as of October 2, 2002. By letter dated December 4, 2002, CMS rescinded the potential DPNA and termination remedies and imposed the $100 per day CMP for only one day - October 1, 2002 - for a total CMP of $100. CMS Ex. 3. By letter dated December 23, 2002, Petitioner requested a hearing to appeal "the facility's total fine of $100 in this matter." CMS Ex. 4. The request did not specifically state which deficiencies Petitioner was appealing. By motion dated March 21, 2003, CMS requested that Petitioner provide a more definite statement of the issues consistent with 42 C.F.R. � 498.40(b). Petitioner provided its response on April 22, 2003, indicating that it was contesting F Tags 225 and 324. On July 7, 2003, CMS submitted its "Motion for Summary Affirmance, or, in the Alternative, Partial Summary Affirmance and Partial Dismissal for Cause" (CMS Brief) ⁽¹⁾, accompanied by 18 exhibits (CMS Exs. 1 - 18). Petitioner responded on August 23, 2003 (Petitioner's (P.) Brief). Petitioner's brief was accompanied by 13 attachments (P. Exs 1 - 13). In the absence of objection, I am admitting CMS Exs. 1 - 18 and P. Exs. 1 - 13 into evidence. Petitioner's brief also only contested F Tags 225 and 324.

II. APPLICABLE LAW

Long term care providers, such as Petitioner, participate in the Medicare program by entering into provider agreements with the United States Department of Health and Human Services (HHS). Requirements of participation are imposed by statute and regulation. Social Security Act (Act), sections 1819, 1919; 42 C.F.R. Parts 483, 488, and 489. In order to continue in the Medicare and Medicaid programs, providers must remain in substantial compliance with participation requirements.

The regulations define "substantial compliance" as follows: "Substantial compliance means a level of compliance with the requirements of participation such that any identified deficiencies pose no greater risk to resident health or safety than the potential for causing minimal harm." 42 C.F.R. � 488.301.

The regulations also specify that a CMP that is imposed against a provider will fall into one of two broad ranges of penalties. 42 C.F.R. �� 488.408; 488.438. The lower range of CMPs, from $50 per day to $3,000 per day, is reserved for deficiencies that do not constitute immediate jeopardy, but either cause actual harm to residents, or cause no actual harm, but have the potential for causing more than minimal harm. 42 C.F.R. � 488.438(a)(1)(ii). The upper range of CMPs, from $3,050 per day to $10,000 per day, is reserved for deficiencies that constitute immediate jeopardy to a provider's residents, and, in some circumstances, for repeated deficiencies. 42 C.F.R. �� 488.438(a)(1)(i), (d)(2). When penalties are imposed for an instance of noncompliance, the penalties will be in the range of $1,000 to $10,000 per instance. 42 C.F.R. � 488.438(a)(2). An administrative law judge (ALJ) may not set a penalty at zero or reduce a penalty to zero if the ALJ finds a basis for imposing a CMP exists. 42 C.F.R. � 488.438(e).

The preponderance of the evidence standard is applied to resolve disputed issues of fact, except as provided by 42 C.F.R. � 498.60(c)(2), which states that, in CMP cases, CMS's determination as to the level of noncompliance must be upheld unless it is clearly erroneous. CMS bears the burden of coming forward with evidence sufficient to establish a prima facie case that a provider was not in substantial compliance with the participation requirements at issue. Once CMS has established a prima facie case, the provider has the ultimate burden of persuasion: to prevail, the provider must prove by a preponderance of the evidence that it was in substantial compliance with each participation requirement at issue. See Batavia Nursing and Convalescent Center, DAB No. 1904 (2004); Batavia Nursing and Convalescent Inn, DAB No. 1911 (2004); Hillman Rehabilitation Center, DAB No. 1611 (1997), aff'd, Hillman Rehabilitation Center v. United States, No. 98-3789 (GEB) (D.N.J. May 13, 1999); see South Valley Health Care Center, DAB No. 1691 (1999), aff'd, South Valley Health Care Center v. HCFA, 223 F.3d 1221 (10^th Cir. 2000).

III. SUMMARY JUDGMENT

I am deciding this case on CMS's "Motion for Summary Affirmance or, in the Alternative, Partial Summary Affirmance and Partial Dismissal for Cause." CMS notes that the only deficiency tags that Petitioner has challenged are F Tags 225 and 324. Thus, CMS has moved for summary judgment as to F Tags 225 and 324 and partial dismissal for cause or, in the alternative, summary judgment as to F Tags 309, 329, and 511, and the amount of the CMP.

An ALJ may decide a case on summary judgment, without an evidentiary hearing, if the case presents no genuine issue of material fact. Crestview Parke Care Center v. Thompson, 373 F.3d 743, 750 (6^th Cir. 2004); Livingston Care Center v. Dep't. of Health & Human Services, No. 03-3489, 2004 WL 1922168, at 3 (6^th Cir. Aug. 24, 2004). By interpretive rule, this tribunal has established a summary judgment procedure "akin to the summary judgment standard contained in Federal Rule of Civil Procedure 56." Crestview Parke Care Center, 373 F.3d 743, 750. Under that rule, the moving party may show the absence of a genuine factual dispute by presenting evidence so one-sided that it must prevail as a matter of law, or by showing that the non-moving party has presented no evidence "sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Livingston Care Center, No. 03-3489, 2004 WL 1922168, at 4, citing Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). The nonmoving party must then act affirmatively by tendering evidence of specific facts showing that a dispute exists. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 n.11 (1986). See also Vandalia Park, DAB No. 1939 (2004); Lebanon Nursing and Rehabilitation Center, DAB No. 1918 (2004). A mere scintilla of supporting evidence is not sufficient. "If the evidence is merely colorable or is not significantly probative summary judgment may be granted." Livingston Care Center, No. 03-3489, 2004 WL 1922168, at 4, quoting Anderson v. Liberty Lobby, 477 U.S. 242, at 249-250 (1986). In deciding a summary judgment motion an ALJ may not make credibility determinations or weigh conflicting evidence but must instead view the entire record in the light most favorable to the non-moving party, all reasonable inferences drawn from the evidence in that party's favor. Innsbruck HealthCare Center, DAB No. 1948 (2004); Madison Health Care, Inc., DAB No. 1927 (2004).

In its response to CMS's motion for a more definite statement, Petitioner listed the deficiencies it was contesting - only the deficiencies cited under F Tags 225 and 324. Petitioner did not contest the other F Tags cited in the survey report, F Tags 309, 329, and 511. CMS then filed its motion in the alternative - for summary affirmance or for dismissal for cause on F Tags 309, 329, and 511. Petitioner, in its response to CMS's motion, did not mention, contest, or raise an issue of fact connected with F Tags 309, 329, or 511. Finding that no genuine issue of material fact has been raised by Petitioner with regard to these F Tags, I will address the facts of each deficiency, as set forth uncontested in the survey report (CMS Ex. 5), to determine whether they show that Petitioner was out of compliance with the participation requirement cited and to decide whether the $100 CMP imposed is reasonable. ⁽²⁾ As I find the $100 CMP reasonable based on the deficiencies Petitioner has not contested, I will not be addressing F Tags 225 and 324.

IV. FINDINGS OF FACT AND CONCLUSIONS OF LAW

1. As of the survey ending on October 1, 2002, Petitioner was out of substantial compliance with participation requirements.

A. Petitioner was out of substantial compliance with the participation requirement at F Tag 309.

F Tag 309 reflects a deficiency at 42 C.F.R. � 483.25 (Quality of Care). This regulation provides that each resident must receive, and a facility must provide, the necessary care and services to allow a resident to attain or maintain the resident's highest practicable physical, mental, and psychosocial well-being, in accordance with the resident's comprehensive assessment and plan of care. Here, based on a clinical record review, observations, and interviews, the State surveyors determined that Petitioner failed to ensure that Ted Hose were applied as ordered for a resident and that heel protectors were applied as ordered for two residents. CMS Ex. 5. Petitioner has not contested this deficiency before me, or the material facts upon which it is based. However, Petitioner did refer to this F Tag in an attachment to its brief, P. Ex. 1, a letter dated October 25, 2002, which was sent to the State survey agency. While this exhibit relates to Petitioner's argument that the State survey agency failed to properly administer the IDR process (over which I have no authority), Petitioner did state with regard to F Tag 309 that

The vast majority of residents with pressure-reducing devices were not found to be without them. Observations were limited and demonstrated no adverse outcome. Staff members cannot immediately apply devices at the moment a resident is first transferred to bed. The surveyor did not address the length of time residents were "in bed" with staff members in the room or immediate area. During the entire survey, surveyors were present on the second shift for less than 5% of the survey. Half of this time was spent on meal observation and half was spent on clerical work. Only 1.4% of the survey was spent on the third shift. Thus, more than 94% of observations were conducted on the day shift only. This does not allow for a valid sample of observations since minuscule time segments were considered during minorly varied time periods.

P. Ex. 1, at 1.

Petitioner's assertions, however, do not constitute a dispute about the material facts of the deficiency cited by the State survey agency, as Petitioner does not contest the State surveyors' observations but only argues the conclusions to be drawn from them. Those undisputed (and un-appealed) material facts are set forth below, by resident.

Resident 67: Physician's orders indicated that this resident was to wear bilateral heel protectors while in bed. State surveyors observed Resident 67 in bed not wearing heel protectors on several occasions, specifically on September 23, 2002, at 2:41 p.m., on September 24, 2002, at 10:15 a.m. and 3:22 p.m., and on September 26, 2002, at 9:29 a.m. and 2:50 p.m. On September 27, 2002, at 2:02 p.m., a State surveyor observed Resident 67 in bed and not wearing heel protectors. A licensed practical nurse who was in the room at the time checked the resident's drawers, then located the heel protectors on a shelf in the resident's closet. CMS Ex. 5, at 10 - 11.

Resident 56: A physician's order dated July 29, 2002, indicated that Resident 56 was to wear heel protectors while in bed. A nurse's note of that date indicated that the resident's left heel was red and mushy and that heel protectors were being placed. An August 23, 2002 health care plan indicated that the resident was to wear heel protectors in bed. Observations by the State surveyors on the following dates and times showed Resident 56 in bed without heel protectors on: September 23, 2002, at 2:42 p.m.; September 24, 2002, at 3:23 p.m.; September 25, 2002, at 2:20 p.m.; and September 26, 2002, at 2:50 p.m. On September 27, 2002, at 2:00 p.m., the State surveyor observed the resident in bed without heel protectors. A licensed practical nurse in the room located one heel protector in the resident's closet, but the nurse was not able to locate the other. CMS Ex. 5, at 11 - 12.

Resident 84: Physician's orders indicated Resident 84 was to wear Ted Hose, to be put on at 6:00 a.m. and taken off at 9:00 p.m. State surveyors observed that Resident 84 was not wearing the Ted Hose on September 26, 2002, at 9:30 and 10:00 a.m., and at 1:05 and 2:48 p.m., and on September 27, 2002, at 2:05 p.m. CMS Ex. 5, at 12 - 14.

This section of the regulations requires that the facility must provide the necessary care and services to a resident so that the resident can attain or maintain the resident's highest practicable physical, mental, and psychosocial well-being in accordance with the comprehensive assessment and plan of care. Here, on numerous occasions, residents were observed by State surveyors, in bed, without physician ordered heel protectors or Ted Hose. I find this to constitute substantial noncompliance with this participation requirement.

B. Petitioner was out of substantial compliance with the participation requirement at F Tag 329.

F Tag 329 reflects a deficiency at 42 C.F.R. � 483.25(l)(1) (Quality of Care - Unnecessary Drugs). The regulation provides that each resident's drug regimen must be free from unnecessary drugs. The regulation states that an unnecessary drug is a drug used: in excessive doses; for an excessive duration; without adequate indications for its use; in the presence of adverse consequences which would indicate that the dose should be reduced or discontinued; or any combination of the above reasons. The State survey agency alleged that the requirement was not met here because, based on a clinical record review, interview, and review of the nursing drug handbook 2001, Petitioner failed to ensure that a resident who received an anti-psychotic medication had indications for the use of the medication and had periodic attempts at dosage reduction.

Petitioner has not contested this deficiency before me, or the material facts upon which it is based. However, Petitioner did refer to this F Tag in an attachment to its brief, P. Ex. 1, the October 25, 2002 letter to the State survey agency. Petitioner noted that,

The four observations of resident #47 being observed 'with eyes closed' are meaningless and should be deleted. They say nothing with respect to the time period, sleep state, context, environment or other details. So what? In particular, resident #47 was, 'in bed with eyes closed.'

P. Ex. 1, at 2. I accept for the purpose of this decision that Petitioner is correct. I do not rely on the surveyor's observations to support my finding that Petitioner was out of substantial compliance with this requirement. Petitioner has not disputed the other material facts set forth in the survey report and I rely on them here.

As set forth in the survey report, Resident 47, an individual with diagnoses of Alzheimer's disease, depression, and anxiety, was prescribed (by order dated November 18, 2000) Zyprexa (a medication used to treat psychotic disorders). Resident 47's quarterly minimum data sets, dated June 6, 2002 and September 11, 2002, indicated that Resident 47 was severely cognitively impaired and had periods of lethargy that were not of recent onset. A health care plan dated March 21, 2002, indicated Resident 47 had a problem/need/concern related to psychotropic drug use which indicated the resident received Zyprexa for Alzheimer's disease. The surveyors noted, however, that nurse's notes from December 29, 2001 through September 25, 2002, lacked any documentation regarding abnormal behaviors for Resident 47, and the behavior flow record for September 2002 lacked any monitoring for Resident 47's Zyprexa usage. A consultant pharmacist consultation form dated January 14, 2002, indicated that the pharmacist recommended a reduction in Resident 47's Zyprexa at bedtime and further indicated that if the reduction was contraindicated the contraindication should be documented. The form was faxed to Resident 47's physician on January 23, 2002. Nurse's notes from that date through September 25, 2002, lack any documentation regarding the physician being made aware of the recommendation. CMS Ex. 5, at 27 - 28. Petitioner's policy regarding the use of anti-psychotic drugs indicated that all residents receiving anti-psychotic drugs would receive a gradual dosage reduction unless clinically contraindicated. CMS Ex. 5, at 27 - 30.

Review of Resident 47's behavior flow record for June, July, and August, 2002, indicated that Resident 47 received Ativan for "agitat[ion]" and "anxiety," and in September, 2002, Resident 47 received it for "anxiety." However, the behavior flow record lacked documentation of any episodes of agitation or anxiety. Id.

I find from the above that Petitioner did not document episodes of anxiety or agitation which would require Ativan. Petitioner did not monitor Resident 47's Zyprexa use. Petitioner did not ensure that the consultant pharmacist's recommendation was effectively brought to the attention of the resident's physician. Finally, there was no evidence that

Petitioner attempted to reduce the amount of Resident 47's Zyprexa dosage and no information that a dosage reduction was clinically contraindicated. Thus, I find that Petitioner was not in substantial compliance with this participation requirement.

C. Petitioner was out of substantial compliance with the participation requirement at F Tag 511.

F Tag 511 reflects a deficiency at 42 C.F.R. � 483.75(k)(2)(ii) (Administration - Radiology and other diagnostic services). The regulation provides that a facility must promptly notify an attending physician of the results of radiology or other diagnostic services. Here, based on clinical record review, observation, interview, and a review of the nursing drug handbook 2001, the surveyors found that Petitioner failed to ensure that attending physicians were promptly notified of abnormal laboratory findings for two residents.

Resident 87: A physician's order dated March 24, 2002, indicated Resident 87 received Digoxin daily (a medicine used to treat heart failure). A physician's order dated May 3, 2002, indicated that Resident 87 was to have a Digoxin level and electrolyte level drawn. A laboratory report dated May 4, 2002, indicated that Resident 87's Digoxin level was low. The laboratory report contained an unsigned handwritten note indicating that the report was FAXed to the physician on May 6, 2002. However, nurse's notes lack any documentation of the physician receiving the FAX sent on May 6. A nurse's entry dated June 14, 2002, indicates that the physician's office was contacted again regarding the May 4, 2002 laboratory test. A nurse's note dated June 14, 2002, but later in the day, indicates that the physician's office returned the call and gave new orders, increasing Resident 87's Digoxin. Thus, 41 days elapsed from the date the Digoxin level was drawn to the time the physician was contacted about it. CMS Ex. 5, at 31 - 33.

Resident 37: On June 12, 2002, a physician's order indicated Resident 37 was to have a complete blood count (CBC) and basic metabolic profile (BMP). A laboratory report on June 12, 2002, indicated abnormal laboratory values. A notation at the bottom of the laboratory report indicated that stat results were called to a facility employee. However, nurse's notes from June 12 through July 1, 2002 lack documentation of physician notification of the abnormal laboratory report. CMS Ex. 5, at 34.

A physician's order dated August 27, 2002, indicated Resident 37 was to have a Dilantin level drawn every six months due to a history of seizure activity. A laboratory report dated August 29, 2002, indicated that the resident's Dilantin level was low. The laboratory report indicated that the result was reported to the resident's physician. However, a nurse's note dated August 29, 2002, indicated that the laboratory results were reported to the physician via the patient's folder. Nurse's notes from August 29, 2002 through September 15, 2002, lacked documentation that the physician saw the laboratory report in the folder or that the physician was informed in any other manner regarding the abnormal Dilantin level. CMS Ex. 5, at 34 - 36.

This section of the regulations requires that a facility ensure that attending physicians are promptly notified of abnormal laboratory findings. The examples above show that Petitioner did not promptly notify these residents' physicians about the abnormal laboratory findings and that Petitioner was thus not in substantial compliance with the regulation.

2. The CMP imposed is reasonable.

Petitioner's hearing request stated only that it was "appealing the facility's total fine of $100 in this matter." Petitioner did not refer to the reasonableness of the amount of the CMP in either its response to CMS's motion for a more definite statement or in its brief.

If a facility has been found out of substantial compliance with a participation requirement at a non-immediate jeopardy level, CMS has the authority to impose one or more of the enforcement remedies listed at 42 C.F.R. � 488.406. For substantial noncompliance such as I find here (which does not constitute immediate jeopardy), 42 C.F.R. � 488.408(c) provides, among other things, for the remedy of a CMP of from $50 to $3,050 per day.

The factors the regulations allow me to consider in determining the reasonableness of the amount of the penalty include: a facility's history of noncompliance, including repeated deficiencies; a facility's financial condition; a facility's degree of culpability; and other factors found at 42 C.F.R. � 488.404, which include a determination of the seriousness of the deficiency, the relationship of one deficiency to other deficiencies, and a facility's prior history. 42 C.F.R. � 488.438(f).

As I have found Petitioner to be out of substantial compliance with participation requirements, I must find a CMP of at least $50 per day to be reasonable. The $100 CMP imposed upon Petitioner by CMS is at the very low end of possible per day CMPs. CMS cited Petitioner for serious deficiencies which could affect the health or safety of Petitioner's residents. Petitioner did not assert that it was unable to pay the CMP or advance any explanation for why the amount of the CMP was unreasonable. Accordingly, I find the $100 per day CMP imposed, totaling $100, to be reasonable.

Anne E. Blair

Administrative Law Judge

1. I construe CMS's motion for summary affirmance as a motion for summary judgment.

2. I note here Petitioner's assertions in its brief that the State survey agency did not respond to his letters and that informal dispute resolution in its case was unfair because quoted language in the survey report was inaccurate. P. Br. at 1 - 2. I am without authority to censure a State survey agency. Moreover, as my authority is de novo, Petitioner was able to present its arguments in this forum. Finally, Petitioner's assertions went to its arguments regarding F Tags 225 and 324, which I am not discussing here.