SUBJECT:

Montana Developmental Center,

Petitioner,

Centers for Medicare & Medicaid Services.

I dismiss the hearing request of Petitioner, Montana Developmental Center. By letter dated March 25, 2003, the Centers for Medicare & Medicaid Services (CMS) notified Montana Developmental Center (Petitioner), an "intermediate care facility for the mentally retarded" (ICF/MR) of CMS' finding of Petitioner's noncompliance with the requirements of Section 1905(d) of the Social Security Act and the conditions of participation for ICFs/MR. The notice further advised that, if Petitioner had not corrected the situation by June 23, 2003, CMS would terminate Petitioner's participation in the Medicaid program. Petitioner timely requested a hearing on May 20, 2003. On July 22, 2003, after CMS conducted a revisit, CMS notified Petitioner that it found the facility was back in compliance with the Federal participation requirements for ICFs/MR and the proposed termination action was rescinded.

I. Background.

CMS filed a Motion to Dismiss Under 42 C.F.R. � 498.70, on October 10, 2003, together with four attachments to support its motion to dismiss: CMS Exhibits (Exs.) 1 - 4. Thereafter, on November 21, 2003, Petitioner filed a brief in opposition to the dismissal along with eight attachments: Petitioner Exhibits (P. Exs.) 1 - 8.

Because Petitioner raised a number of questions in its brief about the right to appeal "decertifications" for Medicare payments for individual residents, I held oral argument on the issues on April 21, 2005.

The following facts were made clear as a result of that oral argument and are not in dispute.

1. Petitioner is a certified ICF/MR located in Boulder, Montana. It is administrated by the Montana Department of Public Health & Human Services.

2. Certification allows Petitioner to be paid by Medicaid for services delivered at the facility.

3. CMS conducted a certification survey of Petitioner's facility and informed Petitioner on January 29, 2003, that conditions within the facility constituted immediate jeopardy to the health and safety of its clients. CMS Ex. 1.

4. After an interim visit and another revisit on June 13, 2003, CMS notified Petitioner that it found the facility back in compliance with Federal participation requirements for ICFs/MR and the termination action scheduled to become effective June 23, 2003, was rescinded.

5. The deficiency upon which Petitioner focused its concern in this case was the deficiency described by CMS as Tag 198. Petitioner's interpretation of this deficiency is that CMS concluded during its last resurvey on June 13, 2003, that 19 of Petitioner's residents out of 75 total residents did not need and were not receiving active treatment services. See 42 C.F.R. � 483.440 (b)(1). Petitioner deemed this a "decertification" of the individual residents so identified.

6. CMS moved to dismiss this action because it had rescinded its proposed remedies. Petitioner objected and expressed its concern that it may no longer receive Medicaid payments for the 19 residents at issue. CMS asserted during the oral argument that Medicaid payments had not been stopped for the 19 residents and Petitioner confirmed that no action has been taken as a result of Tag 198 with respect to these residents.

7. Petitioner, also as part of its appeal herein, sought clarification of the active treatment requirement as established by 42 C.F.R. � 483.440(b)(1) and presented voluminous information with which it hoped to show that the residents needed and were receiving active treatment; i.e., the residents were appropriately placed at the facility.

Petitioner asked that I make a decision with respect to the 19 residents and to clarify the requirements of the regulation at issue even though CMS had imposed no remedies or taken no other action as a result of the alleged deficiency.

II. Applicable Law and Regulations.

The hearing rights of an ICF/MR are established by federal regulations at 42 C.F.R. Part 498. A provider dissatisfied with CMS's initial determination is entitled to further review, but administrative actions that are not initial determinations are not subject to appeal. 42 C.F.R. � 498.3(d). The regulations specify which actions are "initial determinations" and set forth examples of actions that are not. A finding of noncompliance that results in the imposition of a remedy specified in 42 C.F.R. � 488.406 is an initial determination for which a facility may request an administrative law judge (ALJ) hearing. 42 C.F.R. � 498.3(b)(13). Unless the finding of noncompliance results in the imposition of a specified remedy, however, the finding is not an initial determination. 42 C.F.R. � 498.3(d)(10)(ii).

III. Issues, findings of fact and conclusions of law.

A. Issues

The issues in this case are:

1. Whether Petitioner has a right to a hearing; and,

2. If not, whether I must dismiss Petitioner's hearing request.

B. Findings of fact and conclusions of law

I make findings of fact and conclusions of law (Findings) to support my decision in this case. I set forth each Finding below as a separate numbered heading. I discuss each Finding in detail.

1. Petitioner has no right to a hearing.

A facility does not have a right to a hearing to challenge every action by CMS with which it disagrees. Only certain actions create hearing rights. In general, a participating facility will have a right to a hearing if CMS makes an initial determination to impose a remedy against that facility. 42 C.F.R. � 498.3(b)(13). The possible remedies that CMS might impose against a facility are specified at 42 C.F.R. � 488.406(a). No right to a hearing exists pursuant to 42 C.F.R. � 498.3(b)(13), unless CMS determines to impose - and actually imposes - one of the specified remedies. The Lutheran Home - Caledonia, DAB CR674 (2000), aff'd, DAB No. 1753 (2000); Schowalter Villa, DAB CR568 (1999), aff'd, DAB No. 1688 (1999); Arcadia Acres, Inc., DAB CR424 (1996), aff'd, DAB No. 1607 (1997). Indeed, the Secretary of Health and Human Services (Secretary) specifically rejected a proposal to grant hearing rights for deficiency findings that were made without the imposition of remedies. 59 Fed. Reg. 56,116, 56,158 (1994).

It is the remedy, and not the citation of a deficiency, that generates the right to a hearing. Eaglecare, Inc., d/b/a Beech Grove Meadows, DAB CR923 (2002); Schowalter Villa, DAB No. 1688 (1999); Arcadia Acres, Inc., DAB No. 1607 (1997). See also The Lutheran Home-Caledonia, DAB No. 1753 (2000); Walker Methodist Health Center, DAB CR869 (2002); Charlesgate Nursing Center, DAB CR868 (2002); D.C. Association for Retarded Citizens, DAB CR776 (2001); Alpine Inn Care, Inc., DAB CR728 (2000); Woodland Care Center, DAB CR659 (2000); and Fort Tryon Nursing Home, DAB CR425 (1996).

In each of these cases, the failure or inability of the petitioner to demonstrate that the appealed survey findings and deficiency determinations had resulted in a remedy actually in effect was fatal to its appeal. In each of these cases, the appeal was dismissed. The appellate panels of the Departmental Appeals Board and the administrative law judges who decided these cases have uniformly adhered to the doctrine that a citation of deficiency which does not result in the imposition of a remedy, or which results in the imposition of a remedy later rescinded or reduced to zero, does not create the right to appeal.

Furthermore, in the absence of an imposed enforcement remedy against Petitioner, there is no further remedial action for me to take; clearly there are no issues for me to review or to decide. I have no authority to make a declarative statement on the proper interpretation of a regulatory provision; i.e., 42 C.F.R. � 483.440 (b)(1), outside the context of determining the appropriateness of an imposed remedy.

2. I must dismiss Petitioner's hearing request because Petitioner has no right to a hearing.

Petitioner does not have a right to a hearing. The undisputed facts establish that while CMS initially determined that Petitioner was deficient and imposed proposed termination upon Petitioner, CMS later rescinded all enforcement remedies imposed against Petitioner. Therefore, Petitioner no longer suffers any injury for which relief can be granted and has no right to an appeal.

Since CMS rescinded all remedies against Petitioner, I must dismiss Petitioner's hearing request in this case because it has no right to a hearing. 42 C.F.R. � 498.70(b).

IV. Conclusion.

I conclude that Petitioner is not entitled to a hearing. I therefore grant CMS's motion to dismiss and order this case dismissed.

Anne E. Blair

Administrative Law Judge