DEPARTMENTAL APPEALS BOARD
Department of Health and Human Services
SUBJECT: Texas Department of DATE: August 3, 1989 Human
Services Docket No. 88-251 Decision No. 1081
DECISION
The Texas Department of Human Services (Texas/State) appealed a
determination by the Health Care Financing Administration (HCFA/Agency)
disallowing $19,637.94 in federal funds claimed by the State under Title
XIX (Medicaid) of the Social Security Act (Act) for the calendar quarter
ending March 31, 1988. The disallowance was taken pursuant to section
1903(g)(1) of the Act, which provides for the reduction of a state's
federal medical assistance percentage of amounts claimed for a calendar
quarter unless the state shows that during the quarter it had "an
effective program of medical review of the care of patients . . .
pursuant to paragraphs (26) and (31) of section 1902(a) whereby the
professional management of each case is reviewed and evaluated at least
annually by independent professional review teams."
Specifically, HCFA found that Texas failed to conduct a satisfactory
annual medical review at the Will-O-Bell Nursing Home (Will-O-Bell), an
intermediate care facility. HCFA alleged that the review of Will-O-Bell
was deficient because the State did not review one Medicaid recipient
residing in the facility during the annual review.
Based on the following analysis, we find that the State was not required
to review this patient, and we, therefore, reverse the disallowance.
Statutory Authority
Section 1902(a)(31)(B) requires in pertinent part that a state plan
provide:
[W]ith respect to each . . . intermediate care facility within
the State, for periodic onsite inspections of the care being
provided to each person receiving medical assistance, by one or
more independent professional review teams . . . .
The regulations implementing this provision and section 1903(g)(1) are
found at 42 C.F.R. Part 456. In particular, section 456.652 provides
that:
(a) [i]n order to avoid a reduction in FFP, the Medicaid agency
must make a satisfactory showing to the Administrator, in each
quarter, that it has met the following requirements for each
recipient:
* * * *
(4) A regular program of reviews, including medical
evaluations, and annual on-site reviews of the care of each
recipient . . . .
(b) Annual on-site review requirements.
(1) An agency meets the quarterly on-site review requirements
of paragraph (a)(4) of this section for a quarter if it
completes on-site reviews of each recipient in every facility in
the State, . . . by the end of the quarter in which a review is
required under paragraph (b)(2) of this section.
(2) An on-site review is required in a facility by the end of a
quarter if the facility entered the Medicaid program during the
same calendar quarter 1 year earlier or has not been reviewed
since the same calendar quarter 1 year earlier . . . .
Analysis
The central facts in this case are undisputed. The patient at issue was
discharged from a nursing home to a hospital on January 1, 1988,
discharged from the hospital and admitted to another nursing home on
January 27, 1988, and then admitted to Will-O-Bell on February 2, 1988.
The State performed a review of Will-O-Bell on February 4 and 5, 1988.
Since the patient was in the facility on those dates, the State had to
review her if it could reasonably identify her as a Medicaid recipient.
The Board has found that a state bears the ultimate responsibility for
identifying patients subject to the annual review requirement.
Washington State Dept. of Social and Health Services, DAB No. 940
(1987). However, the Board has also stated:
[A] state may only be held responsible for reviewing those
patients that the state could reasonably be expected to identify
as Medicaid recipients. See Idaho Department of Health and
Welfare, DAB No. 747 (1986) . . . .
Texas Dept. of Human Services, DAB No.830
(l987), at p.4.
See also Oregon Dept. of Human Resources, DAB No. 895 (1987).
Nevertheless, since the State bears the ultimate responsibility for
identifying patients requiring review, the State can not rely solely on
facility lists without taking "reasonable efforts to insure their
completeness." Washington, supra, at p.6.
The only issue before us is whether in this particular case the State
could reasonably have been expected to identify this patient as
requiring review. We turn therefore to consideration of the particular
facts of this case.
The patient came into the facility on February 2. The review began on
February 4, but the patient transaction notice did not reach the State's
Long Term Care Unit (LTCU) until February 8. This was certainly not an
unreasonable time, taking into account the size of the State of Texas
and its over 1000 facilities. The significant fact is that even if the
discharging facility sent out its patient transaction notice immediately
on February 2, the notice would not be expected to reach the LTCU before
the reviewers left to begin their review of Will-O-Bell on February 4.
The remaining question is whether this patient was reasonably
identifiable to the review team even though the State's official records
did not reflect her status as a recipient present during this review.
The record includes an affidavit by a member of the survey team, which
states that she presented the facility administrator with the State's
list of Medicaid recipients and inquired about transfers and new
admissions, but was not informed of the presence of the unreviewed
patient at the facility. She also stated that she had no knowledge of
the presence of this patient at the facility until the State received
the patient transaction notice on February 8. State's Exhibit B.
The State also submitted an affidavit by the facility administrator,
which corroborated the affidavit by the survey team member. The
administrator stated that the surveyors asked about transfer patients,
but the administrator did not tell the surveyors about the presence of
the particular patient at the facility. State's Exhibit C.
The affidavit by the facility administrator does not give any reason why
she did not tell the survey team about the patient in question. The
State's brief has a statement that the administrator thought the patient
would be applying for a new level of care, i.e., that the patient was
not presently a Medicaid recipient. State's brief, unnumbered fourth
page.
The significant fact is that the State team did all it could reasonably
be expected to do. It brought its lists and asked the administrator if
there were any additions to it. The administrator did not mention the
new patient. All the survey team could reasonably be expected to do was
inquire about new patients; the survey team reasonably assumed that the
administrator was giving it correct information.
There is nothing here to indicate that the Texas system of identifying
patients for review was inherently flawed. In fact, in DAB No. 830
(supra), we described the procedure and found no fault with it:
Texas indicated that inspection teams compile their initial
patient review list approximately 30 days prior to a review.
The lists themselves are drawn from computer-generated facility
billing lists provided to the facilities on a monthly basis.
The review teams update their lists upon arriving at the
facility . . . .
DAB No. 830, at p. 5.
Although the State did not here describe its procedure in detail, it
appears that the same system referred to in DAB No. 830 was the one used
in this particular instance. The facts in DAB No. 830 were different
from those here. In that case there were a number of patients
transferred from a decertified facility. The delay by the transferring
facility in reporting the transfer of the particular patient resulted in
a patient being in that particular facility 11 days prior to the start
of the review; the LTCU did not receive the transaction notice until 3
days after the start of the review, or 14 days after the transfer.
In DAB No. 830 we had to consider whether the time lag was a reasonable
one, where the patient was transferred 11 days before the start of the
review. Here the patient was transferred only two days before the start
of the review. Under the best possible circumstances, a transaction
notice could not have reached the LTCU before it began its review.
Language used by us in DAB No. 830 certainly applies here, even though
the particular facts differ:
Here the State attempted to update its patient list just prior
to the review, but this patient apparently was not added to the
list by the facility's staff . . . As a result, the State was
not notified that this patient had been transferred . . . prior
to the beginning of the review . . . The State took reasonable
efforts in preparing and updating its list . . . . (p. 5)
HCFA submitted an affidavit from a Medicaid Program Specialist in which
he discussed the Texas review procedure, with which he stated he was
familiar. He stated that even if the State Medicaid agency did not
receive the transfer notice until after the review, the admitting
facility would have access to information that the transferred patient
was a Medicaid recipient by reviewing the medical records that
accompanied the patient. Agency's Silvernail Affidavit.
That was not the problem in this case, however. The affidavit by the
facility administrator leaves open whether she knew the particular
patient was in the facility and was a Medicaid recipient. The point is
that even if she knew this, she did not tell the surveyors, when the
review team attempted to update its list by asking the administrator
about transferred patients. The review team took reasonable efforts to
insure the completeness of its list.
Conclusion
Based on the foregoing analysis, we reverse the disallowance in full.
________________________________
Cecilia Sparks Ford
________________________________
Norval D. (John) Settle
________________________________
Alexander G. Teitz
Presiding Board