SUBJECT: Asbury Center at Johnson City,

Petitioner,

Centers for Medicare and Medicaid Services

FINAL DECISION ON REVIEW OF

ADMINISTRATIVE LAW JUDGE DECISION

Asbury Center at Johnson City (Asbury) appealed an August 9, 2001 decision by Administrative Law Judge (ALJ) Carolyn Cozad Hughes sustaining the determinations by the Centers for Medicare and Medicaid Services (CMS) to impose two civil money penalties totaling $365,000 against Asbury.⁽¹⁾ See Asbury Center at Johnson City, DAB CR807 (2001) (ALJ Decision). CMS had imposed the remedies based on two surveys conducted by the Tennessee Department of Health, the state survey agency for Tennessee (state agency), which found Asbury out of substantial compliance with Medicare requirements during the periods June 29 through July 26, 2000, and September 10 through October 9, 2000. The state agency also found that in both instances the deficiencies posed immediate jeopardy to resident health and safety.

The ALJ made three numbered findings of fact and conclusions of law; Asbury has taken exception to all of them. For the reasons discussed below, we conclude that there is substantial evidence in the record to support the ALJ's determination that Asbury was in violation of the program requirements, and that her analyses of applicable law, including her determinations that the CMPs imposed are reasonable in amount, are correct. Accordingly, we sustain the imposition of a CMP in the amount of $365,000.

Standard of Review

Before the ALJ, the sanctioned facility must prove substantial compliance by the preponderance of the evidence, once CMS has established a prima facie case that the facility was not in substantial compliance with relevant statutory or regulatory provisions. See Cross Creek Health Care Center, DAB No. 1665 (1998), applying Hillman Rehabilitation Center, DAB No. 1611 (1997)(Hillman), aff'd, Hillman Rehabilitation Center v. United States, No. 98-3789(GEV), at 25 (D.N.J. May 13, 1999). The ALJ must uphold CMS's determination as to the level of noncompliance unless it is clearly erroneous. 42 C.F.R. � 498.60(c)(2).

Our standard of review on a disputed conclusion of law is whether the ALJ Decision is erroneous. See, e.g., Lake Cook Terrace Nursing Center, DAB No. 1745 (2000). Our standard of review on a disputed finding of fact is whether the ALJ Decision is supported by substantial evidence on the record as a whole. Id. We have repeatedly held that the role of appellate review is not to substitute our evaluation of the evidence for that of the ALJ, but only to determine whether the factual findings made by the ALJ are supported by substantial evidence in the record as a whole. See Lake Cook Terrace Center, DAB No. 1745, at 6 (2000); Beverly Health and Rehabilitation - Spring Hill, DAB No. 1696, at 40 (1999).

The record here includes the record before the ALJ, including a June 29, 2000 Incident Stipulation (stip.) entered into by the parties and Joint Exhibits (J. Ex.) admitted by the ALJ pursuant to stipulation; the transcript of a hearing held at the request of Asbury; and the parties' submissions on appeal.

Applicable Regulations

For purposes of surveys of skilled nursing facilities like Asbury, the regulations define "substantial compliance" as "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. "Immediate jeopardy" is defined as "a situation in which the provider's noncompliance with one or more requirements of participation has caused, or is likely to cause, serious injury, harm, impairment, or death to a resident." Id.

For deficiencies that constitute immediate jeopardy, a CMP in the range of $3,050 - $10,000 per day may be imposed. 42 C.F.R. � 488.438(a)(1)(i) (1999). The factors to be taken into account in setting the amount of a CMP are --

(1) The facility's history of noncompliance, including repeated deficiencies.
(2) The facility's financial condition.
(3) The factors specified in � 488.404.
(4) The facility's degree of culpability.
Culpability for purposes of this paragraph includes, but is not limited to, neglect, indifference, or disregard for resident care, comfort or safety. The absence of culpability is not a mitigating circumstance in reducing the amount of the penalty.

42 C.F.R. � 488.438(f)(Italics in original).

The ALJ Decision sustained deficiency findings relating to the following Medicare program requirements:

Quality of Care.

Each resident must receive and the facility must provide the necessary care and services to attain or maintain the highest practicable physical, mental, and psychosocial well-being, in accordance with the comprehensive assessment and plan of care.

* * *

(h) Accidents. The facility must ensure that-

* * *

(2) Each resident receives adequate supervision and assistance devices to prevent accidents.

42 C.F.R. � 483.25(h)(2) (emphases in original).

Administration.

A facility must be administered in a manner that enables it to use its resources effectively and efficiently to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident.

42 C.F.R. � 483.75 (emphasis in original).

Physical environment.

The facility must be designed, constructed, equipped, and maintained to protect the health and safety of residents, personnel and the public.

* * *

(c) Space and equipment. The facility must-

* * *

(2) Maintain all essential mechanical, electrical, and patient care equipment in safe operating condition.

42 C.F.R. � 483.70(c)(2) (emphases in original).

Factual Background

The ALJ Decision contains a full discussion of the background, which we summarize here. ALJ Decision at 1 - 3.

Asbury is a long-term care facility located in Johnson City, Tennessee. On June 29, 2000, Resident #1 (R1), who was restrained in a wheelchair, fell down a flight of stairs and sustained injuries leading to her death. Stip. at 1, �� 4, 5. On July 6, 2000, the state agency conducted a complaint investigation in response to Asbury's report of the incident, and on July 10, 2000 conducted a partial extended survey. Based on these surveys, the surveyors determined that Asbury was not in substantial compliance with Medicare participation requirements in two areas: Quality of Care, 42 C.F.R. � 483.25(h)(2) (Tag F-324); and Administration, 42 C.F.R. � 483.75 (Tag F-490). J. Exs. 7, 14.

On July 13, 2000, CMS notified Asbury that conditions in the facility constituted immediate jeopardy to resident health and safety, and that CMS was therefore imposing a CMP of $5,000 per day, effective from June 29, 2000, until substantial compliance had been achieved, or the facility's provider agreement was terminated. J. Ex. 11. On July 19, 2000, Asbury submitted a plan of correction (POC) that triggered a follow-up survey by the state agency on July 27, 2000, at which the state agency concluded that Asbury had achieved compliance as of that date. J. Ex. 31, at 3. The total amount of the CMP imposed for this period was $5,000 per day for 28 days, or $140,000.

On September 10, 2000, Resident #2 (R2) fell down a stairwell while restrained in her wheelchair, sustaining injuries including a head laceration that required sutures. Stip. at 2, �� 7-9. Once again, Asbury filed the requisite incident report and the state agency visited the facility, on September 20 and 28, 2000, to investigate. J. Exs. 32, 44, 53, 54. As a result of its surveys, the state agency concluded that Asbury was deficient in three areas: Quality of Care, 42 C.F.R. � 483.25(h)(2) (Tag F-324); Physical Environment, 42 C.F.R. � 483.70(c)(2) (Tag F-456); and Administration, 42 C.F.R. � 483.75 (Tag F-490). J. Exs. 36, 37.

On October 4, 2000, CMS notified Asbury that conditions in the facility constituted immediate jeopardy to resident health and safety, and that CMS was therefore imposing a CMP of $7,500 per day, effective from September 10, 2000, and denial of payment for new admissions effective October 19, 2000. J. Ex. 38. CMS also indicated that it would terminate the facility's provider agreement effective October 21, 2000. Id. However, Asbury submitted a COP alleging substantial compliance, and the state agency revisited and determined that the facility had achieved and maintained compliance. J. Exs. 58-60. Consequently, the pending denial of payment for new admissions and termination actions were canceled. The total amount of the CMP imposed for the period was $7,500 per day for 30 days, or $225,000.

Asbury timely requested hearings to challenge the CMPs and the ALJ consolidated the two hearing requests with the consent of the parties. The ALJ held a hearing in Knoxville, Tennessee at which both parties produced and cross-examined witnesses, and she admitted into evidence exhibits that were submitted jointly as well as individual exhibits provided by Asbury.

The ALJ Decision

The ALJ made three findings of fact and conclusions of law, which she called "Findings:"

1. Petitioner was not in substantial compliance with program participation requirements, specifically 42 C.F.R. � 483.25(h)(2) (Quality of Care), and 42 C.F.R. � 483.75 (Administration), from June 29 through July 26, 2000, and the facility's level of noncompliance posed immediate jeopardy to resident health and safety.

2. The facility was not in substantial compliance with program participation requirements, specifically 42 C.F.R. � 483.25(h)(2) (Quality of Care), 42 C.F.R. � 483.70(c)(2) (Physical Environment), and 42 C.F.R. � 483.75 (Administration), from September 10 through October 9, 2000, and the facility's level of noncompliance posed immediate jeopardy to resident health and safety.

3. The amount of the CMP imposed against Petitioner, $5,000 per day from June 29 through July 26, 2000, and $7,500 per day from September 10 through October 9, 2000, is reasonable.

ALJ Decision at 5, 13, 17.

Asbury took exception to all three Findings. We analyze these exceptions in order below.

Discussion

I. The ALJ applied the correct standard of law in deciding the issues of Asbury's compliance with 42 C.F.R. �� 483.25(h)(2) and 483.75, and there is substantial evidence supporting the ALJ's Finding 1 that Asbury was not in substantial compliance with these program participation requirements.

The ALJ found, without dispute from Asbury, that R1 was a very old woman who had long-term and short-term memory problems and impaired vision, was unaware of her limitations, and lacked safety awareness. ALJ Decision at 6. Asbury's plan of care for R1 provided that when she was out of bed in her wheelchair, staff were to observe her frequently, and place her in a supervised area; when R1 was in the wheelchair, they were to apply a lap cushion as ordered by her physician to prevent her from standing unassisted; and, because the lap cushion is a restraint, they were to check it every 30 minutes and release her from it every 2 hours. Id., citing J. Ex. 26, at 15, 17, 19. R1 spent a considerable amount of time in purposeful wandering in her wheelchair, rolling up and down the hallways and entering open doors. Tr. 146.

On the day in question, Asbury was having its annual picnic and had about 400 visitors. Tr. 28. Because of the event, additional staff were on duty. Tr. 167. R1 was last seen prior to her fall sitting in her wheelchair in front of the nurses' station. At least three staff members were assigned to R1's floor, but neither they nor the Director of Nursing (DON), who passed through just before the accident, saw the south stairwell door standing in an open position. ALJ Decision at 7-10. The first notice that staff had that R1 had entered the door and fallen down one flight of stairs was when a nurse heard a sound and went to investigate. Id. at 10. The ALJ concluded that, since the facility did not rely on a door alarm that was supposed to sound when the door was opened as a detection system, it was of no consequence to her decision whether a door alarm either was not sounding or was inaudible to staff. Id. at n. 2. The ALJ reviewed the evidence before her and concluded that R1 had been unattended for 20 to 35 minutes, and that this lack of supervision did not comport with her plan of care. Id. at 10-11. The ALJ also rejected Asbury's contention that this accident was unforeseeable, given that R1 had wandered for years without incident, because the record showed two incidents of poor outcomes from this practice. Id. at 11. The ALJ therefore concluded that Asbury was not in substantial compliance with 42 C.F.R. �� 483.25(h)(2) and 483.75.

Asbury contended that the ALJ erred in finding it out of substantial compliance with the cited provisions because CMS did not make a prima facie case of noncompliance with respect to either provision; because the ALJ ignored substantial evidence in the record demonstrating that Asbury was in substantial compliance; because the ALJ held Asbury to a standard of strict liability; and because the ALJ added new issues after the record was closed, in violation of 42 C.F.R. � 498.56(a)(3). We address each contention in turn.

A. Prima facie case

Asbury contended that the ALJ erred in concluding that CMS presented a prima facie case of substantial noncompliance with 42 C.F.R. � 483.25(h)(2) (Tag F-324, Quality of Care) because that deficiency finding as stated in the survey report relied solely upon the failure of Asbury's staff to respond to an alarm indicating that the stairwell door was opened at the time of the accident. Asbury argued that since the ALJ specifically held that whether the alarm sounded at the time of the accident was "of no consequence," she should have concluded that there was no prima facie case and dismissed this part of the case. Asbury contended that the ALJ instead "proceeded to create a completely new reason why the facility failed to provide adequate supervision." Asbury Br. at 14. According to Asbury, the ALJ's emphasis on the adequacy of Asbury's supervision of R1 as the decisive issue was an error. Asbury also contended that the ALJ erred in finding that CMS established a prima facie case of substantial noncompliance with 42 C.F.R. � 483.75 (Tag F-490, Administration) because testimony by the state surveyors indicated that their citation of this deficiency was "automatic" with their conclusion that a deficiency at the immediate jeopardy level existed.

The ALJ did not make a specific statement that CMS had made a prima facie case based on the evidence it produced concerning supervision of R1 (she is not required to do so), but we agree with Asbury that she made that issue central to her analysis of Asbury's compliance with the Quality of Care regulation. However, we reject Asbury's contention of error because it is based upon a selective reading of the statement of deficiencies which was the basis for CMS's proposed imposition of a CMP for this time period. Asbury's contention focuses on the following sentence in the statement of deficiencies:

This requirement is not met as evidenced by:

Based on record review and staff interview, it was determined that the facility failed to provide adequate supervision to protect one of ten sampled residents from injury when they did not respond to an alarm indicating that a door leading to stairwell was opened.

J. Ex. 14, at 2. Asbury ignores that the document goes on to state, "The facility placed [R1's] life in jeopardy by not providing adequate supervision, by not providing an alarm system that was loud enough to alert the staff when the door was opened and by not maintaining the door in safe working order." Id. at 3-4. Certainly this gave notice to Asbury that the alarm was but one of three grounds for CMS's determination that Asbury had failed to comply with the cited requirement. Thus, it was not an error for the ALJ to rely on another of those grounds, the failure to provide adequate supervision, in determining whether Asbury was in substantial compliance with the Quality of Care regulation.

The ALJ also did not make an explicit finding that CMS made a prima facie case on the allegation that Asbury failed to comply with the Administration requirement; indeed, as Asbury noted, she termed the administration deficiency finding a derivative finding based on findings of other deficiencies. ALJ Decision at 13. There is no legal error in this determination, because the ALJ did not simply derive her determination that there was an Administration deficiency from the fact that there was a Quality of Care deficiency. Instead, she explicitly linked the factual findings she had already made with the requirements of the particular regulation. Specifically, the ALJ held, "Here, Petitioner's failure to carry out fully the supervisory aspects of Resident #1's care plan establish that Petitioner was deficient in meeting the administration requirement in terms of carrying out the requirement for adequate supervision to prevent accidents, which means using reasonable and practicable means for preventing foreseeable accidents such as Resident #1's. Osceola Nursing & Rehabilitation, DAB CR 775, at 17 (2001)." Id. Thus, the ALJ's determination was legally sound if, as we find below, the factual findings regarding failure to provide adequate supervision were based on substantial evidence in the record.

B. Substantial evidence

With respect to the ALJ's finding that Asbury failed to provide adequate supervision, Asbury contended that the ALJ ignored substantial evidence in the record demonstrating that Asbury was in substantial compliance. Asbury argued that it showed that its staffing was adequate and that there were no known safety hazards to R1 in permitting her to wander around the floor. Asbury maintained that the regulations do not require constant supervision of residents in general and that the ALJ misinterpreted R1's care plan as requiring constant supervision for her in particular. Asbury contended that the reason for R1's accident was an unfortunate combination of unforeseeable circumstances, and that CMS and the ALJ were influenced by "hindsight bias" in concluding that Asbury failed to prevent injury to R1. Asbury also argued that since CMS had admitted that the assessment of an administration deficiency was "automatic" when an immediate jeopardy deficiency was found, there was no evidence that it failed to comply with the specific elements of administration listed in 42 C.F.R. � 483.75. Asbury maintained that there was ample evidence showing that Asbury complied with the administration regulation by, for example, developing quality assessments and care plans, so that the ALJ should have found it to be in substantial compliance.

In reading the ALJ Decision, it is clear that the ALJ reviewed all of the evidence before her, including that identified by Asbury in its appeal before us as "ignored," and reached sound conclusions that were amply supported in the record.⁽²⁾ The principal evidence upon which the ALJ relied in concluding that Asbury did not provide adequate supervision to prevent accidents were R1's care plan and the record of two prior incidents in which a lack of supervision had caused problems. It was undisputed that R1's care plan stated that when she was in a wheelchair staff were to apply a lap cushion to keep her from standing unassisted, and when out of bed in her wheelchair, staff were to observe her frequently, and place her in a supervised area. ALJ Decision at 6, citing J. Ex. 26, at 15, 17, 19. While Asbury contended that the primary concern with R1 was to prevent her from standing unassisted rather than to prevent her from eloping, which she had never tried to do, Asbury did not dispute the ALJ's conclusion that on the day in question R1 was left to wander unsupervised for at least 20 minutes. The ALJ found that this lack of supervision by Asbury's staff simply did not comport with the plan of care formulated for R1 by Asbury's staff. ALJ Decision at 11. Apart from arguing that constant supervision was not possible or desirable--for example, R1 would not need supervision when in her room--Asbury did not show that its actions that day implemented the plan of care requirements to "observe her frequently and place her in a supervised area." The ALJ did not require that R1 have constant supervision, only supervision while wandering. She rejected Asbury's contention that the accident that occurred while R1 was unsupervised was not foreseeable because R1 had wandered for years without incident, because the record before the ALJ contained nursing notes of one incident in which R1's wandering led her to hit other residents with her wheelchair and another incident in which she was found in the hallway lying on her back in her wheelchair. Id. at 11, citing J. Ex. 27, at 1, 5. As indicated, all of the ALJ's conclusions about the level of supervision required by and furnished to R1 are based on substantial evidence in the record and we therefore reject Asbury's assertion to the contrary.

We also reject Asbury's contention that CMS's instructions to surveyors to assess an administrative deficiency when an immediate jeopardy deficiency is found means that CMS has failed to prove the existence of a separate deficiency. As the ALJ noted, the administrative deficiency is a derivative deficiency based on findings of other deficiencies. We agree with the ALJ that, where a facility has been shown to be so out of compliance with program requirements that its residents have been placed in immediate jeopardy, the facility was not administered in a manner that used its resources effectively to attain the highest practicable physical, mental, and psychosocial well-being of each resident. A facility's other efforts to meet this requirement do not overcome the fact that the facility's administration failed to prevent a deficiency of this scope. In determining that Asbury was out of compliance with the administration requirement, the ALJ relied on her finding that Asbury failed to carry out fully the supervisory aspects of R1's care plan. We have found above that there is substantial evidence in the record supporting this finding, and it therefore follows that her conclusion that Asbury was out of compliance with the administration requirement is also supported by substantial evidence.

C. Issues regarding procedures and standards used by the ALJ

Asbury also complained that the ALJ erred by adding new issues after the record was closed, in violation of 42 C.F.R. � 498.56(a)(3).⁽³⁾ We find this complaint to be baseless. The new allegation that Asbury alleged the ALJ added was that Asbury failed to comply with 42 C.F.R. � 483.25(h)(1), which requires the facility to ensure that the resident environment remains as free of accident hazards as is possible. Asbury Br. at 22, citing ALJ Decision at 13 ("Based on all of this, I conclude that the facility did not ensure that the resident was as free of accident hazards as possible, nor that each resident received adequate supervision and assistance devices to prevent accidents, as required by 42 C.F.R. � 483.25(h)(2)."). We disagree that the ALJ was inferring a violation of a different regulation than the one reflected in this sentence and her Finding, the provision cited by CMS as the basis for the CMP. Rather, this choice of words reflected a paraphrasing of her statement of the applicable standard on page 5 of her decision - "In ensuring adequate supervision, the facility is not required to do the impossible or be a guarantor against unforeseeable occurrence, but it 'is required to do everything in its power to prevent accidents.' (emphasis added) 42 C.F.R. � 483.25(h); Koester [Pavilion], DAB No. 1750, at 25-26 [(2000)]; Woodstock Care Center, DAB No. 1726, at 25 (2000)." Her allusion to hazards immediately followed her findings that Asbury's staff leaving the floor unmonitored under the circumstances present that day and allowing R1 to wander without anyone paying attention were dangerous and not within this standard. ALJ Decision at 12. Thus, the ALJ was not improperly adding a new issue.

Finally, Asbury's contention that the ALJ applied a strict liability standard, in violation of DAB precedent, is also without merit. As we indicated in the previous paragraph, the ALJ was well aware of DAB precedent calling for an examination of whether the facility had done all it could to prevent foreseeable accidents. The ALJ found, based on substantial evidence in the record, that the accident was caused by Asbury's failure to provide proper supervision to R1 in accordance with her plan of care, despite two prior incidents that indicated the danger to R1 of allowing her to wander unsupervised. Thus, it is evident that by no means did the ALJ apply a strict liability standard in determining that Asbury was not in substantial compliance with the regulation.

Accordingly, we affirm and adopt Finding 1.

II. The ALJ applied the correct standard of law in concluding that Asbury was not in substantial compliance with 42 C.F.R. �� 483.25(h)(2) (Tag F-324, Quality of Care), 483.70(c)(2) (Tag F-456, Physical Environment), and 483.70 (Tag F-490, Administration), during the period from September 10 through October 9, 2000, and there is substantial evidence in the record supporting her findings.

The ALJ found it undisputed that R2 exhibited exit-seeking behavior from the very beginning of her stay at Asbury, and that the facility properly moved her to a secure floor for her protection. This special floor had a WatchMate security system that consisted of bracelets worn by residents, attached to wrists or ankles, which are designed to set off an alarm if a resident approaches an exit door and to keep an elevator from moving if a resident attempts to board. See J. Ex. 46, at 2. On September 10, 2000, R2 was documented as having been extremely agitated and restless, getting into things and attempting to leave the floor by the elevator. J. Ex. 37, at 1-2; J. Ex. 46, at 32-33. At about 8:35 p.m., two certified nurse assistants (CNAs) assigned to staff the floor left by elevator to remove the linens and garbage, leaving only a licensed practical nurse (LPN) to monitor the floor's 27-30 residents. J. Ex. 46, at 32. After the LPN removed R2 from the vicinity of the elevator, so that the CNAs could depart, she went to a nurses' station to chart. The last time she saw R2, R2 was next to the window near the exit door; the exit door itself was not visible from the nurses' station. Tr. 129; P. Ex. 67. When the LPN heard a loud noise, she investigated and eventually found R2 at the bottom of the stairwell, bleeding from the head and still in her wheelchair, which had capsized. The bracelet was removed from R2 before she was transported to the hospital. On September 10 staff got a positive result from testing R2's bracelet with the hand-held tester but were able to defeat the door alarm system several times. Tr. 184. It is undisputed that the last test had been conducted on September 1, more than one week prior to the September 10 accident. When R2 returned to the facility she was given a new bracelet and the security system company was called in to inspect the entire system. No malfunctioning bracelets or other components were found in this inspection.

The ALJ did not accept Asbury's contention that the failure to follow its own policy for testing the bracelets weekly was not a contributing factor because the manufacturer only suggested monthly checks, noting that there were additional instructions calling for a different test on a weekly basis. She noted that although it was unclear whether the failure of the security system was attributable to inadequate or improper testing, the system was not meant to be fail-safe and could not substitute for the presence of adequate staff. The ALJ rejected Asbury's contention that the LPN was watching R2 closely, and the ALJ agreed with the state surveyor that having all of the CNAs absent from the floor at the same time was not good practice. The ALJ concluded that it was the lack of supervision of a resident who was identified as in need of supervision that was the cause of the accident. She therefore concluded that Asbury was not in substantial compliance with 42 C.F.R. �� 483.25(h) and 483.75. She also concluded that Asbury's failure to check the bracelet on schedule demonstrated that Asbury was not in substantial compliance with 42 C.F.R. � 483.70(c)(2).

Asbury contended that the ALJ erred in finding it out of substantial compliance with the cited provisions because she relied on analyses that were different than the prima facie cases presented by CMS for the Quality of Care and Physical Environment deficiencies and because the prima facie case for the Administration deficiency was Asbury's lack of substantial compliance with the other two provisions; because the ALJ ignored substantial evidence in the record demonstrating that Asbury was in substantial compliance with all three provisions; and because the ALJ held Asbury to a standard of strict liability. We address each contention in turn.

A. Prima facie case

Asbury contended that the ALJ erred in finding that CMS presented a prima facie showing of failure to comply with the quality of care requirement because the statement of deficiencies did not allege a lack of supervision as cause for the accident. According to Asbury, the principal focus of the surveyor was the facility's failure to perform weekly testing of the bracelet according to facility policy. Asbury noted that the POC approved by CMS for these deficiencies and the surveyor who conducted the resurvey both addressed the maintenance and testing of the security system rather than the facility's practice of having its CNAs leave the floor to remove the garbage. Asbury therefore contended that the ALJ's emphasis on the absence of the two CNAs amounted to a rewriting of the statement of deficiencies to justify her conclusions.

Again, Asbury's contentions rely upon a myopic reading of the statement of deficiencies, which was part of the record before the ALJ. The introductory language for the deficiency in question states, "This Requirement is not met as evidenced by: Based on observation, interview, and record review, it was determined that the facility failed to provide adequate supervision to one resident out of nine reviewed to prevent accidents." J. Ex. 45, at 2. Among the findings included in support of this determination were, "The resident's plan of care includes approaches to monitor the resident's activity to assure that personal care needs and safety needs are met." Id. The statement of deficiencies also notes, prior to stating that the two CNAs left the floor, that R2 had been extremely active in exit-seeking. Id. at 2-3. All of these statements gave Asbury notice that CMS was relying on inadequate supervision, as well as the facility's failure to test the bracelet as scheduled, for its prima facie case. In addition, we note that although the statement of deficiencies was amended to delete some information as a result of the informal dispute resolution process, these statements remained in the amended document. Compare J. Exs. 37 and 45.

The state agency's acceptance of a POC that emphasized repairs to the security system does not detract from this conclusion. Nothing in the correspondence from the state agency to Asbury concerning the statement of deficiencies and POC stated that the sole issue to be resolved was the alarm system. Asbury's POC stated that it had reviewed R2's plan of care and found that the supervision and devices recommended were adequate; however, as we discuss below, the ALJ found that Asbury did not provide the degree of supervision called for by this resident's POC given her behavior that evening. In any event, a POC is only a facility's plan for achieving compliance, and fulfilling the terms of a POC does not guarantee that a facility will be found to be in compliance upon a resurvey. Warren N. Barr Pavilion of Illinois Masonic Medical Center, DAB No. 1705 (1999), at 5-8. Consequently, a facility's accepted POC does not provide a basis for reinterpreting an unambiguous statement of deficiencies.

We therefore reject Asbury's assertion that the ALJ rewrote the statement of deficiencies in order to find a prima facie case of substantial noncompliance.

B. Substantial evidence

Asbury contended that, "The ALJ's decision finding violations of F324 [Quality of Care] and F456 [Physical Environment] by failure to maintain the WatchMate System is based [on] a misunderstanding of the operation and testing of the system and is not supported by substantial evidence from the record as a whole." Asbury Br. at 33. Asbury argued that the preferred method of testing the alarm system was to employ a hand-held tester to check the bracelet, which Asbury did on a weekly basis even though the manufacturer suggested monthly checks. Asbury maintained that its failure to perform the scheduled test was not a contributing factor in the accident because tests with the hand-held tester immediately following the accident showed the bracelet to be working. Asbury also argued that the ALJ incorrectly concluded that testing the alarm bracelet by passing the resident through a protected area was the weekly testing method recommended by the manufacturer, and that she ignored testimony that the transmitter was evidently working because R2's bracelet set off the alarm several times before it failed. Asbury also contended that the ALJ's finding that its staff failed to provide R2 with adequate supervision was not supported by the record. Asbury Br. at 36. Finally, Asbury argued, "Surely the unforeseen failure of a single piece of equipment should not be an indictment to an Administration of a facility." Asbury Br. at 42.

The ALJ found as undisputed facts that the audible alarm and door locking mechanism did not activate when R2 was able to open the door and fall down the stairs in her wheelchair despite her wearing her alarm bracelet, that the bracelet battery tested as working when the hand-held tester was tried after the accident, that a test with the hand-held tester scheduled by facility policy for two days prior to the accident had not been conducted, and that the Administrator and the DON found that, while wearing R2's bracelet, they were able to foil the system and enter the stairway several times immediately after the accident. Where the ALJ differs from Asbury is in reading the manufacturer's instructions as indicating that weekly testing of the bracelet with only the hand-held tester was sufficient checking of the alarm system. While not contradicting Asbury that the manufacturer specified monthly rather than weekly checks of this type, the ALJ noted the following language from the instructions:

MAINTENANCE
Testing Transmitter Operation
To test transmitter operation, have the resident pass through a protected area a number of times while wearing a transmitter. A resulting alarm with each pass confirms proper transmitter operation. Perform this test on a weekly basis. Always test transmitters while strapped to a person's wrist or ankle, the location used during normal operation.

ALJ Decision at 15, quoting J. Ex. 54, at 14, and J. Ex. 55, at 4 (emphasis added by ALJ). Asbury did not establish on the record that it had performed such testing, but it argued on appeal to us that the ALJ ignored evidence showing that testing of that sort had been effectively provided on the night in question because the record showed that R2 had repeatedly set off the alarm prior to her accident. However, the ALJ Decision refers only to staff removing R2 from the elevator area, which was subject to a different alarm from the door, because her security bracelet prevented the elevators from leaving the floor. The ALJ did not find, and Asbury did not point to anything in the record showing, that the alarm on the stairway door had been activated by R2 prior to her accident, and testimony by Asbury's staff showed that the alarm failed to sound several times when tested after the accident. Consequently, we conclude that there is substantial evidence in the record supporting the ALJ's conclusion that Asbury's testing methods were insufficient.

Asbury also contended that the record contradicted the ALJ's conclusion that a lack of supervision by the facility contributed to the accident. Asbury argued that the record showed that R2 was in the direct line of sight of a nurse for all but five minutes prior to the accident, and that the ALJ Decision requires that all of the floor's residents be under line of sight supervision at all times. Asbury also criticized the ALJ's citation of the CNAs' absence from the floor as a part of the facility's failure to provided adequate supervision, stating, "It is ludicrous to assume that had the CNA's been on the floor they would also have been watching Resident #2. The effect of the ALJ's conclusion is to provide three on one supervision of Resident #2 without regard to the other residents of the floor." Asbury Br. at 38.

We conclude that the ALJ Decision demonstrates that, contrary to Asbury's assertions, the ALJ did not ignore any evidence in the record concerning the supervision of R2 prior to her accident and the ALJ did not adopt positions setting an impossible standard of supervision. The ALJ found that the weight of the evidence was that the sole staff member on duty on the floor at the time was not, as alleged by Asbury, watching R2 closely. The ALJ reported that the nurse testified that she could see the window near the exit door from the nurses' station, but not the exit door or elevator. Thus, the ALJ was reasonable in concluding that the nurse could not have had R2 in her direct line of sight while R2 managed to wrestle the heavy door open and go through it without the nurse noticing it. ALJ Decision at 16. Moreover, although Asbury alleged in its brief before us that, at the time the CNAs left the floor to remove the trash and linen, the floor was quiet, Asbury did not contradict the account in the statement of deficiencies that R2 had been restless and attempting to elope all night long and even tried to get on the elevator with the departing CNAs. Under these circumstances, the ALJ's conclusion that having both CNAs absent from the patient care unit at the same time for more than fifteen minutes was poor practice is reasonable. Asbury's contentions that the ALJ's decision would require constant line of sight supervision of all residents and/or three on one supervision of R2 without regard to the other residents misconstrues the import of ALJ's conclusions that the level of supervision of R2 at the time of the incident was inadequate to protect R2 from accidents. Rather than setting a standard for supervision of patients in general, the ALJ examined R2's particular circumstances and concluded that the facility failed her.

Asbury also contended that the ALJ's statement that Asbury relied almost exclusively on the WatchMate system is incorrect and not supported by the record. Asbury listed several interventions it provided to R2 that were in place at the time of the accident and that Asbury claimed the ALJ ignored. The ALJ cited the testimony of Asbury's DON, Administrator and the LPN in support of her conclusion that Asbury's staff expected the alarm system to prevent such an accident. Id. at 16, citing Tr. 237, 132. As the testimony cited was from Asbury's most senior staff, as well as the nurse who was in charge at the time of the accident, we find there is substantial evidence to support the ALJ's statement that Asbury relied almost exclusively on its alarm system to prevent elopements by at-risk patients.

Asbury's assertion that the ALJ's determination that it was out of compliance with the administration requirement was not supported by substantial evidence is based upon its assumption that the ALJ based this determination solely upon the failure of the bracelet to set off the alarm. Our preceding discussion of the quality of care deficiency indicates that there was more to this deficiency than the failure of the bracelet. Moreover, as we previously discussed, it is reasonable to infer from the findings of inadequate supervision amounting to a quality of care deficiency at the immediate jeopardy level that the administration of a facility is deficient. Consequently, we conclude that, since there is substantial evidence in the record supporting the ALJ's findings on the quality of care deficiency, there is also such support for her findings on the administration deficiency. Asbury did not contest the ALJ's finding that the facility was out of compliance with the Physical Environment provision due to its failure to check the security bracelet on schedule. See id. at 17.

C. Strict liability

Asbury contended that the ALJ applied a strict liability standard in finding these deficiencies, in violation of DAB precedent. According to Asbury's view of the case, the ALJ found Asbury deficient because it did not "play" with each security bracelet for many hours on a weekly basis to discover possible failures, in spite of Asbury's weekly tests of the bracelets using the manufacturer's preferred method of testing, and because the ALJ concluded that the supervision of R2 was insufficient when for "less than five minutes" R2 was not in line of sight of the nurse. Asbury Br. at 40. Asbury also cited the case of Price Hill Nursing Home, DAB No. 1781 (2001), as contrasting to its own situation, since the facility in that case had notice prior to an elopement that its alarm system was malfunctioning. Asbury maintained that holding it responsible where it lacked such notice also showed that the ALJ was applying a strict liability standard.

As we discussed previously, the ALJ cited to and clearly intended to apply DAB precedent calling for an analysis of whether the facility did everything in its power to prevent accidents. She correctly noted that the quality of care regulation "does not amount to strict liability or require absolute success in an obviously difficult task." ALJ Decision at 5. With respect to her findings on the deficiencies, the ALJ determined that the facility did not follow the manufacturer's recommendations for testing the alarm system, not that the facility failed to conduct absurd tests. Her comments about direct line of sight supervision were in response to Asbury's assertions in its post-hearing brief that R2 was being watched closely and was in the single staff member's "direct line of sight." Id. at 16, citing P. Br. at 17. Thus, rather than imposing a particular requirement for adequate supervision, the ALJ was analyzing Asbury's factual contention about the supervision that was being given to R2 just prior to her accident; she concluded that it was not credible and she did not accept it. Finally, Asbury's citation to Price Hill is unavailing, since there was no manufacturer's requirement for testing the alarm system used by the facility in Price Hill and, in fact, Asbury had admitted that another resident had been able to exit while wearing the WatchMate bracelet.

We therefore conclude that the ALJ did not apply a strict liability test to Asbury in making her findings of substantial noncompliance. Accordingly, we affirm and adopt Finding 2.

III. The ALJ did not err in finding that the CMP imposed against Asbury was reasonable.

Asbury contended that, even if the incidents were properly found to be the result of noncompliance, the Act and the regulations provide authority to impose a per day CMP only for the number of days of noncompliance, and the noncompliance for each incident lasted only one day. In particular, Asbury argued that R1 was the only resident for whom a risk was identified, and that CMS's witness testified that the immediate jeopardy was removed when the stairwell door was repaired on the day of the incident. Consequently, Asbury maintained that there was no evidence of noncompliance at any level that would justify a CMP of $5,000 per day for the period June 29 through July 26, 2000. Asbury also contended that this CMP was not remedial in purpose, since the problem had been remedied by the time the CMP was imposed. As to R2, Asbury contended that the problem causing the incident-the faulty bracelet-was also immediately rectified, and the security alarm company checked the entire system on the day after the accident and found it to be operating properly. As there was no subsequent finding that the facility failed to test the system after the incident, Asbury argued that there was no proof that Asbury failed to implement its POC. Asbury therefore contested both CMPs' amount and duration as unjustified, not remedial, and unreasonable.⁽⁴⁾

Asbury's contentions amount to an allegation that acceptance of its POCs alleging compliance due to repairs conclusively established compliance on the dates of those repairs. These contentions ignore that the ALJ expressly linked her determinations as to the reasonableness of the CMPs imposed to her findings of inadequate supervision. The regulations (42 C.F.R. � 488.454) provide that a facility's return to substantial compliance must usually be established through a resurvey, and in a situation involving inadequate supervision requiring such a resurvey appears wise. See Cross Creek Health Care Center, DAB No. 1665 (1998). Thus, we conclude that the ALJ appropriately set the durations of both CMPs for the period from the date of noncompliance until a resurvey established compliance.

As for Asbury's allegation that the CMPs are unjustified, not remedial, and unreasonable, it is based upon Asbury's position, which we rejected above, that the ALJ applied a strict liability standard in both instances. Asbury has not shown that the ALJ failed to consider the factors listed in the applicable regulation at 42 C.F.R. � 488.438(f) in analyzing whether the CMP amounts proposed by CMS were reasonable. Asbury has not contested the finding of immediate jeopardy for both deficiencies, which establishes a mandatory range of CMPs from $3,050 to $10,000. We agree with the ALJ that, given the seriousness of the deficiencies and the facility's culpability, a CMP of $5,000 per day was reasonable for the first period of noncompliance. See ALJ Decision at 17. In addition, we agree with the ALJ that the imposition of a $7,500 per day CMP was reasonable for the second period of noncompliance in light of the seriousness of the deficiencies, the consequences, and the fact that this was the second such incident within a few months. Id. at 18.

We therefore affirm and adopt Finding 3.

Conclusion

For the reasons discussed above, we sustain the imposition of a CMP of $365,000, representing $5,000 per day for the period beginning on June 29, 2000 and ending on July 26, 2000, and $7,500 per day for the period beginning on September 10, 2000 and ending on October 9, 2000. In doing so, we affirm and adopt all the Findings made by the ALJ.

Donald F. Garrett

Marc R. Hillson

M. Terry Johnson
Presiding Board Member

1. CMS was previously named the Health Care Financing Administration (HCFA). See 66 Fed. Reg. 35,437 (July 5, 2001). We use "CMS" in this decision unless we are quoting from documents that refer to HCFA.

2. Asbury requested in a footnote that we reconsider the ALJ's credibility assessments of all witnesses on the grounds that she did not credit testimony from Asbury's witnesses. CITE We decline this invitation. We generally give deference to the credibility assessments of the factfinder who can observe the demeanor of witnesses and evaluate their testimony firsthand. The ALJ here gave sufficient explanation of her assessments, and we see no reason to engage in a wholesale reconsideration of her conclusions, especially since Asbury presented no specific justification for doing so.

3. Section 498.56 generally permits the addition of new issues provided that timely notice is given to the parties, so we construe Asbury's complaint to mean that it did not receive such notice.

4. We note that the ALJ did not expressly address these contentions, although Asbury raised them before her. Asbury did not take exception to this omission, and we find it to be harmless error. As we discuss in the text, the ALJ's thorough discussion of the bases for her conclusions that the amounts of the CMP were reasonable implicitly rejects Asbury's premise that the deficiencies were only about defective equipment.