Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Appellate Division
SUBJECT: Texas Department of Human Services
Docket No. 90-144
Decision No. 1203
DATE: November 5, 1990
DECISION
The Texas Department of Human Services (Texas) appealed a determination
by
the Health Care Financing Administration (HCFA) disallowing $86,043
in
federal funds claimed by Texas under the Medicaid program of the
Social
Security Act (Act) for the quarter ending September 30, 1989.
HCFA based the
disallowance on its finding that during this quarter
Texas did not have an
effective program of control over the utilization
of institutional long-term
care services for patients receiving medical
assistance, as required by
section 1903(g)(1) of the Act. HCFA found
that Texas failed to review
several patients at Kirkwood Manor and
Memorial Medical Nursing Center during
the annual reviews at those
facilities, and that the reviews were therefore
not satisfactory. Based
on documentation presented by Texas, HCFA later
changed its findings
with respect to various patients and reduced the
disallowance to
$72,123.59. Texas also conceded that one patient at
Memorial Medical
Nursing Center should have been reviewed. The sole
remaining issue
concerns whether two patients receiving intermediate care
facility (ICF)
services at Kirkwood Manor, patient I.H. and patient M.P.,
should have
been reviewed. 1/
Texas argued that it was not required to include either patient at
issue
in the review. However, as discussed below, the record
establishes that
patient I.H. was reasonably identifiable as a Medicaid
recipient prior
to the review. Accordingly, we sustain the disallowance
in the amount
of $72,123.59 on the ground that this patient should have been
included
in the review. We do not decide whether patient M.P., with
respect to
whom the documentation is inconclusive, was reasonably
identifiable as a
Medicaid recipient, since the amount of the penalty is the
same
regardless of the number of unreviewed patients receiving the same
type
of services in the same facility. 2/
Statutory and regulatory framework
Section 1903(g)(1) of the Act requires the state agency responsible
for
the administration of a state's Medicaid plan to submit a
written
quarterly showing demonstrating that --
[it] has an effective program of medical review of
the care of
patients in . . . intermediate care
facilities pursuant to
paragraphs . . . (31) of
section 1902(a) whereby the professional
management
of each case is reviewed and evaluated at least
annually
by independent professional review
teams.
A state's quarterly showing under section 1903(g)(1) must
be
"satisfactory" or federal funds paid to the state for expenditures
for
long-stay services will be decreased according to the formula set out
in
section 1903(g)(5).
Section 1903(a)(31)(B) requires in pertinent part that a state
plan
provide --
with 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 . . . including with
respect
to each such person (i) the adequacy of the
services available . .
. .
Regulations implementing the statutory utilization control
requirements
are found at 42 C.F.R. Part 456 (1984).
Background
The annual review of patients at Kirkwood Manor which was conducted
from
July 11 through 13, 1989 did not include patient I.H. The
State
surveyor 3/ determined which patients in this facility required
review
using the following procedure. The surveyor first obtained from
the
Texas Department of Human Services a computer- generated billing
list
for the facility, current as of June 15, 1989. The list included
I.H.,
but indicated that no level of care determination had been made for
her.
Texas Ex. 6. Upon arriving at Kirkwood Manor, the surveyor
obtained a
list of Medicaid recipients from the facility which the surveyor
then
compared with the State agency's list, adding (or deleting) the names
of
recipients to the State agency's list as required. Texas asserted
that
the facility's list identified I.H. as a private patient; however,
as
discussed later, the evidence provided in support of this
assertion
(Texas Ex. 4) is not credible. The surveyor then
reviewed the amended
list with facility staff. No further information
was provided by the
facility at that time. While the surveyor noted
during the review that
I.H. was present in the facility, she was not reviewed
since she had not
been identified by the surveyor as a Medicaid recipient.
Texas took the
position that, because I.H. did not appear on the amended
list, she was
not required to be included in the review.
In a series of decisions, the Board has held that a state may not be
held
responsible for reviewing a Medicaid recipient when notice of the
patient's
status was not reasonably available to the review team at the
beginning of
its review. However, a state cannot simply rely on the
fact that a
patient's name does not appear on a list of Medicaid
recipients prepared by
the review team regardless of whether the list
was current or whether the
system used by the state to identify Medicaid
recipients was operated
efficiently. See Missouri Dept. of Social
Services, DAB No. 801 (1986);
Pennsylvania Dept. of Public Welfare, DAB
No. 840 (1987).
Analysis
Applying the standards articulated above, we determine that patient
I.H.
was reasonably identifiable as a Medicaid recipient. There is
no
question that I.H. was a current Medicaid recipient at the time of
the
review. This is established by the State agency's payment register,
a
computer compilation of Medicaid payments made to Kirkwood Manor
from
June 1989 through November 1989 which includes, for each
recipient
named, the period--by month--for which payments were made, the cost
per
day, the amount paid, the number of days, and the date of payment.
In
particular, the register shows that payments were made to Kirkwood
Manor
on July 5, 1989 and again on August 1, 1989 for Medicaid
services
provided to I.H. during the months of June and July 1989,
respectively.
HCFA Ex. D. Clearly, the payments for I.H. reflected in
the payment
register would not have been issued if I.H. had not been
determined
eligible for Medicaid by July 5, six days before the review began.
(It
is likely that the eligibility determination was made earlier than
July
5 since some time would appear to be required for processing the
payment
before it was issued.) Thus, it is self-evident that I.H.'s
status as a
Medicaid recipient was ascertainable long enough before the
review began
that she should have been identified by the review team as a
Medicaid
recipient.
Texas did not challenge the accuracy of the payment register, but
argued
that the surveyor did not have access to it since the register was
dated
December 1, 1989. However, this does not mean I.H. was not
reasonably
identifiable as a Medicaid recipient until that date: the
payment
register is simply evidence that I.H.'s status as a Medicaid
recipient
was determined sufficiently in advance of the review so that the
review
team could have reasonably have identified her as a Medicaid
recipient.
Texas argued further that it was entitled to rely on the State agency
list
in view of the provision in the Medical Assistance Manual, cited in
Idaho
Dept. of Health and Welfare, DAB No. 747 (1986), which states that
the review
team may obtain "[a] current list of patients for whom
payments are being
made to a particular facility . . . from the unit in
the state
responsible for accounting for such payments." Texas also
indicated
that the Board had approved its system for identifying
individuals subject to
review in two prior decisions, Texas Dept. of
Human Services, DAB No. 830
(1987) and DAB No. 1081 (1989).
Texas' reliance on the Medical Assistance Manual provision is
misplaced.
The Board used that provision in DAB No. 747 to support its
conclusion
that Idaho was not required to review a patient who was
determined
eligible for Medicaid only two days before the review and who was
not
included on the state's computer-generated list of patients for
whom
Medicaid payments were being made. In that situation, the Board
found
that the list was "reasonably current" and that the state was
entitled
to rely on it. Reliance on the list was justified there
because the
patient's status as a Medicaid recipient could not be
reasonably
ascertained through other means. Here, in contrast, the
record
establishes that I.H. had Medicaid recipient status sufficiently
prior
to the review that she ought to have been identified as subject to
the
review. Moreover, unlike the situation in DAB No. 747, I.H.'s
name did
appear on the June 15, 1989 billing list for the facility.
Although the
list indicated that no level of care determination had been made
for her
as of that date, the review team was nevertheless placed on notice
that
some follow-up was required to ascertain whether a final
eligibility
determination had been made.
Texas also cited in support of its position the Board's statement in
DAB
No. 747 that --
Agency guidance implies that a State is entitled to
a reasonable
lead time to prepare its list of
eligibles and to make other
preparations for the
review based on that list.
Texas brief, fifth unnumbered page, quoting DAB No. 747 at pp. 7 and 8.
As
just noted, however, the Board found in that case that it was
unreasonable to
expect the review team to find out about an eligibility
determination made
only two days before the review. Here, Texas failed
to establish that it
lacked "reasonable lead time" to identify I.H. as a
Medicaid recipient.
Indeed, Texas did not even establish the date the
eligibility determination
was made. In addition, since Texas was
willing to add patients to its
list based on last-minute information
provided by the facility, Texas can
hardly argue that preparations for
the review would have been disrupted by
the late addition, based on its
own records, of one patient to the list.
Furthermore, Texas' reading of the prior Texas decisions, DAB Nos. 830
and
1081, is clearly incorrect. While the Board stated in DAB No. 1081
that
there was nothing "to indicate that the Texas system of identifying
patients
for review was inherently flawed," this statement was made in
the context of
a finding that there was nothing more that Texas could
reasonably have done
to identify the patient in question, who was
transferred to the facility only
two days before the review. Similarly,
the Board's statement in DAB No.
830 that there was "no evidence in the
record that [Texas'] system for
verifying who should be included in the
review was deficient" was made in the
context of a finding that the
review team "had no reasonable way" of
identifying as a Medicaid
recipient an individual who was transferred from a
decertified facility
to the facility in question where the decertified
facility did not give
notice of the transfer to the state agency as
required. Thus, the fact
that Texas in these cases identified all
individuals who could
reasonably be identified as Medicaid recipients does
not excuse Texas'
failure here to review an individual whose status as a
Medicaid
recipient could reasonably have been ascertained.
Texas also took the position that it was justified in relying on
the
information provided by Kirkwood Manor showing that I.H. was a
private
pay patient. However, a notation on the document in question
indicates
that the information regarding whether the patients in the facility
were
private pay patients or whether the facility instead billed Medicaid
for
intermediate or skilled facility care provided to them was filled in
on
December 15, 1989, after the review in question. Texas Ex.
4
(handwritten note at bottom of page). There is no evidence that
the
facility provided any such information to the reviewers prior to
the
review. Furthermore, even if the facility had advised the
reviewers
that I.H. was not eligible for Medicaid, this would not relieve
Texas of
the obligation to review I.H. since she was clearly a Medicaid
recipient
present in the facility at the time of the review.
Accordingly, we conclude that patient I.H. was reasonably identifiable
as
a Medicaid recipient before the review began. We were unable
to
determine based on the record before us, however, whether M.P.,
the
second patient at issue, was reasonably identifiable as a
Medicaid
recipient. 4/ Nevertheless, we did not request additional
information
from the parties since the disallowance can be upheld in full
based
solely on our determination regarding I.H. This is so because
the
penalty calculated pursuant to section 1903(g)(5) is based on the
number
of patients in unreviewed facilities at each level of care rather
than
on the number of unreviewed patients. I.H. and M.P. were patients
at
the same facility and both received ICF services. Thus, we would
uphold
the disallowance for this facility even if we were to determine
that
M.P. need not have been reviewed.
Conclusion
For the reasons discussed above, we conclude that patient I.H. in
Kirkwood
Manor was reasonably identifiable as a Medicaid recipient prior
to the
review, and that the review team was therefore required to
include her in the
review. Accordingly, we sustain the disallowance in
the amount of
$72,123.59.
Donald F. Garrett
Norval D. (John) Settle
Cecilia Sparks Ford Presiding Board Member
1. The patients are identified by their initials to protect
their
privacy.
2. The State did not argue that either of the two statutory
exceptions
to the annual review requirement (at section 1903(g)(4)(B) of the
Act)
applied here.
3. Although Texas referred only to a single "surveyor," there is
no
dispute in this case concerning whether the facility was reviewed by
a
qualified review team as required by section 1902(a)(26)(B) of the Act.
4. The threshold issue with respect to M.P. is whether she
was
determined eligible for Medicaid before the review of Kirkwood
Manor
began. Texas took the position that no determination had been
made
before that date that M.P. met all Medicaid eligibility
requirements,
citing a "Payment Status and Payment Plan Notice" dated August
12, 1989
which was sent to the facility by the State agency and provides for
a
"Payment Start Date" of July 21, 1989 based on M.P.'s admission to
the
facility on April 21, 1989. Texas Ex. 3. HCFA took the
position that
M.P. had been determined eligible for Medicaid when the review
began,
citing level of care determinations for M.P. which were made by
the
State agency effective May 5 and June 23, 1989. HCFA Ex. A and
B.
We were unable to determine what these documents in fact show. It
is
unclear from Texas Exhibit 3 whether the "Payment Start Date" is
the
first date for which M.P. was eligible for Medicaid payments or the
date
on which payments were first issued, or, if the former, whether
an
eligibility determination had been made as of that date. In addition,
it
is unclear from HCFA Exhibits A and B whether M.P. was
considered
eligible for Medicaid as of the effective date of either level of
care
determination or why there were two such
determinations.