GAB Decision 671
July 10, 1985
Arkansas Department of Human Services;
Ballard, Judith A.; Garrett, Donald F. Teitz, Alexander G.
Docket No. 84-145
DECISION
The Arkansas Department of Human Services (Arkansas) appealed a decision
by the Health Care Financing Administration (HCFA) disallowing
$114,662.63 in federal funds claimed by Arkansas under the Medicaid
program for the fiscal quarter ending September 30, 1983. HCFA based
the disallowance on its determination that, during this period, Arkansas
did not have an effective program of utilization control at 10 skilled
nursing facilities (SNFs). Arkansas challenged the substantive basis of
the disallowance and also asserted that section 2363 of the Deficit
Reduction Act of 1984 (DEFRA), Pub. L. No. 98-369, precluded HCFA's
imposition of this disallowance.
For the reasons set out below, we uphold this disallowance for all but
two facilities. Our decision is based upon briefing and evidence
submitted by the parties. Arkansas specifically waived an evidentiary
hearing in this matter by letter dated May 23, 1985.
Background
I. The Statute and Regulations
Under Title XIX of the Social Security Act, states which have an
approved Medicaid state plan receive federal financial participation in
expenditures for medical services to needy individuals. Services which
qualify as "medical assistance" under section 1905(a) of the Act,
including SNF services, are reimbursed generally at the "Federal medical
assistance percentage" (FMAP) rate. Sections 1903(a)(1); 1905( b).
However, section 1903(g)(1) of the Act, as in effect during the time
period in question here, provided that, with respect to amounts paid for
certain "long-stay services," the FMAP "shall be decreased .
. . unless
the State . . . makes a showing satisfactory to the Secretary that there
is in operation in the State an effective program of control over
utilization of such services . . . ." Section 1903(g)(1) further
provided:
. . . such a showing must include evidence that --
(A) in each case for which payment is made under the State plan, a
physician certifies at the time of (2) admission, or, if later, the time
the individual applies for medical assistance under the State plan (and
the physician, or a physician assistant or nurse practitioner . . .
recertifies, where such services are furnished over a period of time, in
such cases, at least every 60 days, and accompanied by such supporting
material, appropriate to the case involved, as may be provided in
regulations of the Secretary), that such services are or were required
to be given on an inpatient basis because the individual needs or needed
such services; and
(B) in each case, such services were furnished under a plan
established and periodically reviewed and evaluated by a physician;
* * *
The statutory requirements for recertification in SNFs are implemented
by federal regulation which provides:
(b) Recertification. (1) A physician, or physician's assistant or
nurse practitioner . . . must recertify for each . . . recipient that
SNF services are needed.
(2) Recertifications must be made at least every 60 days after
certification. 42 CFR 456.260.
Regulations implementing plan of care requirements provide:
(a) Before admission to a SNF or before authorization for payment,
the attending physician must establish a written plan of care for each
applicant or recipient in a SNF.
* * *
(c) The attending or staff physician and other personnel involved in
the recipient's care must review each plan of care at least every 60
days. 42 CFR 456.280.
II. The Facts and Arguments
HCFA determined that Arkansas failed to operate an effective utilization
control program at any of the 10 SNFs reviewed by federal officials for
the quarter in question. HCFA found in excess of 150 individual
violations at these facilities. HCFA found that recertifications were
not performed in a timely fashion; the date accompanying the
recertifying physician's signature was typed or handwritten in a
different color ink than the signature; recertifications failed to state
the level of care required for the patient; or recertification dates
were altered. HCFA also found plans of care (3) reviewed less
frequently than every 60 days and plans of care not dated by a
physician.
Arkansas challenged the entire disallowance based upon the changes in
the utilization control requirements contained in DEFRA. In short,
other than the medical review requirement of section 1903(g)(1)(D),
which is not relevant here, DEFRA has eliminated all other utilization
control violations as a basis for reductions in Medicaid funding.
Arkansas argued that since the DEFRA amendments took effect prior to the
final administrative determination in this matter, DEFRA precluded
imposition of this disallowance.
With regard to the substantive determinations made by HCFA, Arkansas
asserted that HCFA's findings regarding typewritten recertification
dates or those written in a different colored ink were not supported by
the regulations. Arkansas maintained that all the challenged
recertifications were timely and asserted that HCFA should have produced
evidence in support of its finding that some dates were incorrect.
Arkansas also alleged that HCFA should be estopped from finding
violations for recertification dates appearing in typewritten form or
ink different from the physician's signature, as HCFA had previously
found no violations for this type of dating and that Arkansas had relied
on those previous findings to its detriment here. /1/
Analysis
I. The DEFRA Amendments
Arkansas was one of several states which raised the DEFRA amendments as
a defense to HCFA's finding of utilization control violations in appeals
recently before the Board. The applicability of DEFRA to utilization
control violations in Arkansas and those other states was addressed in
Board Decision No. 655, June 7, 1985. In general, we determined that the
changes in DEFRA applied to showings made by the states after October 1,
1984, with respect to the quarter beginning July 1, 1984 and later
quarters. We concluded that pre-amendment provisions would apply to any
prior quarters even though a final administrative determination may have
taken place after the effective date of the amendments. Additionally,
we found that, in the legislative history of DEFRA, Congress reaffirmed
its intention that utilization (4) control requirements be met and that
nothing in the amendments indicated that Congress thought HCFA had
misinterpreted the previous requirements. Id. at 3-4. Decision No.
655, therefore, disposed of Arkansas' argument relating to DEFRA, and it
is not necessary to address DEFRA's application in any further detail
here.
II. General Arguments
A. Prior Utilization Control Decisions
The Board has had numerous opportunities to address the utilization
control issues raised by this appeal. We will first discuss our past
decisions on these issues and move from there to a review of the
individual facilities in question here.
The Board has long upheld HCFA's interpretation that recertifications at
the SNF level (as well as the ICF level) of care must occur no later
than 60 days from the last prior recertification, or certification. We
have upheld findings that recertifications occurring at a later date,
even if on the 61st day, are invalid. Our analysis of the applicable
statute, regulations, and accompanying legislative history convinced us
that HCFA reasonably determined that it did not have the authority to
overlook "minor" violations of the certification and recertification
requirements and was, therefore, obligated to apply the statutory
reduction for even a single violation at a facility. Additionally, we
have held that, in the face of a disallowance by HCFA, a state is
obliged to demonstrate compliance with utilization control requirements.
See Ohio Department of Public Welfare, Decision No. 191, June 24, 1981;
Georgia Department of Health, Decision No. 207, August 28, 1981;
Virginia Department of Health, Decision No. 208, August 28, 1981; Idaho
Department of Health and Welfare, Decision No. 250, January 28, 1982;
North Carolina Department of Human Resources, Decision No. 273, March
31, 1982; Kansas State Department of Social and Rehabilitation
Services, Decision No. 312, June 21, 1982; Washington Department of
Social and Health Services, Decision No. 487, December 17, 1983;
Georgia Department of Medical Assistance, Decision No. 508, January 31,
1984. /2/
(5) Although we have frequently upheld HCFA's interpretation of the
manner in which utilization control requirements should be applied, we
have not always accepted HCFA's position on what the requirements are.
One of those decisions is relevant to the issue here concerning dates
typed or handwritten in an ink different from the ink used for the
physician's signature. HCFA's policy regarding the make-up of valid
certification and recertifications is contained in Medicaid Action
Transmittal 80-68 (AT-80-68), effective October 1, 1980. In Minnesota
Department of Human Services, Decision No. 615, December 24, 1984, at
pages 5-6, we analyzed AT-80-68 extensively in the context of judging
the validity of typewritten recertification dates and found:
AT-80-68 was promulgated to clarify what constitutes a valid
certification and recertification. The statutory and regulatory
provisions specify who must certify or recertify and when they must do
so, but do not specify how this must be documented. Since the Secretary
must be able to verify that the requirements are met, however, the Board
has held that action transmittal provisions clarifying that a
certification or recertification must be in writing and signed by the
appropriate person were a logical extension of the statutory and
regulatory requirements. Social Service Board of North Dakota, Decision
No. 166, April 30, 1981. We have also said that a requirement for
dating may be viewed as an interpretation of what is a timely and
verifiable certification. Maine Department of Human Services, Decision
No. 516, February 29, 1984. However, we do not think that, where there
is other persuasive evidence of timeliness, HCFA can reasonably apply
AT-80-68 to require a finding of a violation simply because the
physician has not manually dated the certification or recertification
document, particularly where, once a violation is found, a disallowance
must be taken.
Some of the examples of acceptable certifications and
recertifications given in AT-80-68 refer to documents "signed and dated
by a physician," but other examples refer merely to "signed and dated"
orders or notes. In general, AT-80-68 states: "The certification must
be dated at the time it is signed by the physician." at p. 3. Although
the illustrations imply that HCFA expects the date to be entered by the
physician, AT-80-68 does not explicitly state that a violation will be
found if the physician has not dated the (6) certification by hand or
the date does not appear next to the signature. (n3)$F
n3 In Minnesota, supra at 6, n.3, we also noted that use of the
phrase "at the time" does not necessarily imply that the date must
be
entered simultaneously with the signature. HCFA has interpreted the
phrase "at the time of admission" in section 1903(g) to mean on the
date
of admission (AT-75-122), so a state could reasonably conclude that a
certification was satisfactory if it was dated on the day it was
signed.$E
Under the statute and regulations, a state has the burden to show that
the certification or recertification occurred in a timely manner.
Maine, supra. While a handwritten date appearing next to the
physician's signature would be the best evidence of when the physician
signed the certification, AT-80-68 does not clearly provide that this is
the only acceptable evidence of timeliness. The Board has agreed with
HCFA that a certification was not shown to be timely where the date on
which a state relied appeared on the same form as a physician's
signature but appeared to be related to a different entry on the form.
See e.g., Washington, ($Usupra).
We see little practical difference between the circumstances in
Minnesota and those here. HCFA has not alleged that recertification
dates have been altered or that the recertifications were not performed
on the correct dates. Rather, HCFA would have us conclude that dates in
a different ink are, per se, proof of invalid recertification. We think
that such a conclusion is unsupported by the applicable statutes and
regulations. As we noted in Minnesota, the statute and regulation
specify who must recertify and when, but do not specifically require
that the person signing also date his or her signature. Here, the facts
themselves do not adequately support the conclusion that there are
utilization control violations with regard to these recertifications.
Indeed, it would seem likely that if there was an intent to defraud the
Medicaid system at these facilities by falsifying recertification dates,
the differences between the dates and signatures would not be so
obvious.
Thus, we conclude that neither the statute nor the facts as presented
support HCFA's allegations on this point. We are aware of our previous
decisions which hold that the states bear the burden of proving
compliance with the program requirements. We do not think that our
conclusion here conflicts with those decisions since, prior to the
states assuming that burden, HCFA must have a reasonable basis for its
decision to disallow federal funds. Here, we believe (7) that HCFA's
stated position with regard to recertification dates written by someone
other than the physician does not provide a reasonable basis for
challenging recertifications which otherwise appear to be proper.
Accordingly we reverse HCFA's findings on that issue for Morrilton Manor
and Woodland Manor (see discussion on pages 8-9 below).
Additionally, our review of previous utilization control disallowances
has provided ample opportunity to address the plan of care requirements
for SNFs and ICFs. The applicable statute and regulations clearly
require an update of a plan of care for a SNF patient at least every 60
days. The components of a valid plan of care, as well as the act of
updating such a document, have been the topic of numerous Board
decisions. In our past decisions we evaluated the substantive aspects
of plans of care on a case-by-case basis. See, e.g., California
Department of Health Services, Decision No. 326, June 30, 1982; Georgia,
Decision No. 508, supra; Nevada Department of Human Resources, Decision
No. 471, October 31, 1983; and Nevada Department of Human Resources,
Decision No. 611, December 19, 1984. Accordingly, where necessary, we
will examine each plan of care question in our review of the facilities.
B. The Burden of Demonstrating Compliance
Our conclusion that HCFA did not have a sufficient basis to challenge
the recertifications even if dated by someone other than the physician
precludes the need to address Arkansas' contention that HCFA had the
burden to prove that the recertification dates entered in different ink
were false. Arkansas Brief, p. 13. /4/
However, as we noted above, based on a long line of Board cases, states
are responsible for demonstrating compliance with all the program
requirements. In eight of the ten facilities surveyed, HCFA found
violations other than the recertification dating issue discussed above.
On the whole, Arkansas has provided very little evidence to rebut the
other violations alleged by HCFA. Arkansas has not, since receipt of
HCFA's September 6, 1984, submission, giving details of all the alleged
violations, maintained that it did not possess sufficient information to
address any aspect of this case. Thus, we conclude that in spite of
ample opportunity provided by the Board's process, Arkansas failed to
carry its burden of demonstrating compliance with the utilization
control requirements in the remaining eight facilities.
(8) III. The Facilities
1. Little Rock Nursing Center
In addition to citing three patients for having recertification dates in
different ink, HCFA also cited one patient at this facility for a plan
of care violation. HCFA indicated that it could not find the plan of
care from the prior quarter for this patient. HCFA noted that there
were plans of care for the relevant quarter dated July 28, August 26,
and September 29, 1983, and did not challenge the substantive quality of
these documents. The updates from July to August, and August to
September, are clearly within the prescribed 60-day timeframe. Arkansas
did not provide any documentation to show the date of the plan of care
update from the previous quarter for this patient. Such documentation
is necessary as a starting point in determining whether the July 28th
update was within the 60-day timeframe for a plan of care update since,
given the facts, only this update could be invalid. Absent this
documentation, Arkansas has not met the burden of demonstrating
compliance with the utilization requirements. Thus, we must uphold the
determination of a plan of care violation at this facility.
2. Crest Park Inn of Wynne
HCFA cited nine patients for alleged recertification violations at this
facility. Some of the findings were based on the differences in ink
between the physician's signature and date. HCFA also found three
recertifications not showing the level of care at which the patients
were being recertified and one patient for whom there was no evidence of
recertification. Arkansas offered no evidence to refute any of these
other determinations. Accordingly, we uphold the inclusion of this
facility in the disallowance.
3. Southern Nursing Home
HCFA alleged six violations here, all of which involve certain aspects
of patient certifications and recertifications, such as late
recertifications, missing and altered recertification documents, undated
recertifications, and missing certification documents. For example, on
deficiency cited by HCFA involved a patient for whom no evidence of
recertification could be found for the period December 21, 1982 through
September 30, 1983, a total of 274 days. Arkansas did not provide
evidence to challenge HCFA's findings. Absent any evidence to refute
these allegations, we uphold the disallowance for Southern Nursing Home.
4. Pine Bluff
HCFA alleged 17 violations at this facility. The majority of these
findings were based on a failure to indicate a level of care on the
recertification document. Additionally, HCFA (9) found three instances
of recertifications occurring outside the 60-day time frame. Arkansas
failed to provide evidence to refute any of these allegations.
Accordingly, we uphold the disallowance for this facility.
5. Hillsboro Manor
HCFA found 18 alleged violations at this facility. Among the violations
were three for recertifications occurring more than 60 days from the
last prior certification/recertification. Arkansas did not provide a
specific response to these alleged violations; therefore, we uphold
this facility's inclusion in the disallowance.
6. Morrilton Manor
HCFA found 25 alleged violations here, all of which centered on the
recertifying physician's signature and the date of recertification being
in different ink.
The federal surveyors' sole rationale for these violations was based on
the differences in the ink colors used to sign and date the
recertifications. In making its argument, HCFA admitted, however, that
so long as the physician's recertification was dated on the day it was
signed by the physician, the statutory and regulatory standards are
satisfied. Respondent's (HCFA's) Comments, March 11, 1985, p. 2. See
also Note 3, supra.
As we discussed in Part II A, we do not believe that the mere allegation
that the recertifications were dated by someone other than the physician
is a sufficient basis for finding a recertification violation.
Accordingly, we reverse the inclusion of this facility in the
disallowance.
7. Greenhurst, Inc.
HCFA found 23 alleged violations at this facility, the majority based on
the different ink issue. Additionally, HCFA alleged that recertification
dates for two of the patients here had been altered to meet the 60-day
deadline, adding that the "Medical Records Librarian" (presumably
from
the facility) acknowledged the date alterations. See HCFA Exhibit A, p.
8. Arkansas offered no evidence to challenge any of the determinations
made by HCFA relative to this facility. Accordingly, we sustain
inclusion of this facility in the disallowance.
8. Woodland Manor
HCFA alleged one violation here, namely that the physician
recertification signature and date were in different colored inks.
Arkansas provided a copy of the physician's progress notes for the
September - December 1982 quarter and a 1984 (10) statement from the
physician indicating that he occasionally forgot to date progress notes
and that the nurse making the rounds with him filled in the date. See
Arkansas Exhibit 1, pp. 92-93. The physician's progress notes clearly
refer to the final quarter of 1982. This disallowance does not apply to
that quarter, but rather to the third quarter of 1983. Thus, the
evidence provided by Arkansas has no relevance to the assessment of
compliance for the 1983 quarter. However, given our analysis in Part II
A, and the fact that the sole rationale for HCFA's determination here
was the difference in ink colors, we reverse the disallowance for this
facility.
9. Riley's Oak Hills Manor
HCFA cited 25 individuals for a variety of alleged violations including
the different ink issue, the physician's failure to date plans of care,
and the untimely updates of plans of care. Arkansas offered no evidence
regarding any of these violations. We note that we are not aware of any
specific requirement that the physician himself date the plan of care,
so our analysis of this issue would likely be similar to our analysis
above on the need for the physician to date recertifications. However,
we uphold the disallowance for this facility based on the unrebutted
findings of untimely updates of plans of care.
10. City Hospital Geriatrics Center
HCFA alleged 16 recertification violations here consisting of untimely
recertifications, failure to indicate the level of care on a
recertification, and dates and physicians' signatures appearing in
different inks. Arkansas offered no evidence to refute these findings.
Accordingly, we uphold the findings of violations at this facility.
Conclusion
Based on the foregoing analysis we uphold the violations found at Little
Rock Nursing Center, Crest Park Inn of Wynne, Southern Nursing Home,
Pine Bluff, Hillsboro Manor, Greenhurst Inc., Riley's Oak Hills Manor,
and City Hospital Geriatrics Center. We reverse HCFA's findings at
Morrilton(11) Manor and Woodland Manor. HCFA should recalculate the
disallowance accordingly. /1/ Since we find no reasonable basis for
HCFA's position here that recertifications were not valid when
the date accompanying the physician's signature was typed or handwritten
in a different color ink than the signature, we need not address the
State's estoppel argument. /2/ These issues have also been raised in
two appeals by the state of Colorado. See Colorado Department
of Social Services Decision, No. 169, April 30, 1981; and Colorado
Department of Social Services, Decision No. 218, September 30, 1981.
Our rationale disposing of these issues has been upheld by both the
United States District Court and the United States Court of Appeals.
See Colorado Department of Social Services v. Department of Health and
Human Services, 558 F. Supp. 337 (D. Col. 1983); aff'd, No. 83-1395
(10th Cir. May 9, 1984). /4/ Therefore, there is no reason to
consider the adequacy of the physicians' statements and telephone orders
submitted by Arkansas on this issue.
OCTOBER 04, 1985