SUBJECT:

Presidential Pavilion,

Petitioner,

Centers for Medicare & Medicaid Services.

DECISION

I conclude that Presidential Pavilion (Petitioner or facility) failed to comply substantially with the requirement of participation in Medicare and Medicaid provided at 42 C.F.R. � 483.35(h)(2). Petitioner failed to store, prepare, distribute, and serve food under sanitary conditions. I conclude also that the amount of the per instance civil money penalty, $10,000, is unreasonable; $2,000 is a reasonable amount of civil money penalty.

I. Background

Pursuant to the Centers for Medicare & Medicaid Services' (CMS's) authority to enforce compliance with the participation requirements for Medicare and Medicaid, the Illinois Department of Public Health (state agency or surveyors) conducted an abbreviated survey of the facility, in response to a compliant. The survey concluded on April 29, 2003. In a letter to the facility dated May 15, 2003, CMS notified the facility of CMS's determination that the facility failed to substantially comply with a program requirement. CMS informed the facility that, based on the surveying agency's recommendations, it had determined to impose a per instance civil money penalty of $10,000. CMS's letter informed the facility that the alleged deficiency found at the April 29, 2003 survey was assessed at the immediate jeopardy severity level.

Petitioner requested review of CMS's findings and remedies by submitting a request for hearing dated July 3, 2003. I established a briefing schedule at the parties' request, as indicated in CMS's notice of issues for summary judgement. In that notice, CMS indicated that the parties had agreed to submit motions and briefs for summary disposition of this case. I received the parties' Joint Statement Waiving Oral Hearing on June 2, 2004. The parties' statement clarified that the parties wished for me to decide this matter based on the parties' written submissions without an in-person hearing. I received CMS's motion for summary judgement and accompanying brief (CMS's brief) on January 29, 2004. I received Petitioner's brief and motion for summary disposition (Petitioner's brief) on February 6, 2004. On March 2, 2004, I received CMS's reply brief (CMS's reply). I received Petitioner's response to CMS's brief (Petitioner's response) on March 4, 2004. Petitioner submitted also 16 proposed exhibits (P. Exs.), and CMS submitted 21 proposed exhibits (CMS Exs.). I admit P. Exs. 1-16 and CMS Exs. 1-21 into the record.

II. Issues and Law

A. Issues

The issues are whether there is a basis for CMS to assess a civil money penalty against Petitioner, and, if so, whether the amount of the civil money penalty is reasonable.

B. Law

Title XVIII (Medicare) and Title XIX (Medicaid) of the Social Security Act (Act) (42 U.S.C. �� 301-1397jj) set forth requirements for long-term care facilities, both skilled nursing facilities and nursing facilities, participating in the Medicare and Medicaid programs, and authorize the Secretary of Health and Human Services (Secretary) to promulgate regulations implementing the statutory provisions. Act, sections 1819, 1919. The Secretary's regulations governing skilled nursing facility participation in the Medicare program and nursing facility participation in the Medicaid program are found at 42 C.F.R. Part 483.

If CMS finds a facility is not in substantial compliance with program requirements, CMS has the authority to impose one or more of the enforcement remedies listed in 42 C.F.R. � 488.406, which include imposing civil money penalties. See Act, section 1819(h). CMS is authorized to assess civil money penalties when a facility is not in compliance with one or more participation requirements. 42 C.F.R. � 488.430(a). The civil money penalties range from $50 to $3,000 per day for deficiencies that do not constitute immediate jeopardy, but either cause actual harm, or cause no actual harm, but have the potential for causing more than minimal harm. The civil money penalties range from $3,050 to $10,000 per day for deficiencies which constitute immediate jeopardy. 42 C.F.R. � 488.438(a)(1)(i) and (ii). Or, CMS may impose a per instance civil money penalty, regardless of whether immediate jeopardy is present or not, in the range of $1,000 to $10,000. 42 C.F.R. � 488.438(a)(2).

The purpose of the authorized remedies is to "ensure prompt compliance with program requirements." 42 C.F.R. � 488.402(a). The remedies are applied in light of the scope and severity of the noncompliance found during a survey. In setting the amount of the civil money penalties, CMS considers: (1) the facility's history of noncompliance; (2) the facility's financial condition; (3) the factors specified in 42 C.F.R. � 488.404; and (4) the facility's degree of culpability, which includes neglect, indifference, or disregard for resident care, comfort, or safety. The absence of culpability is not a mitigating factor. 42 C.F.R. � 488.438(f). The factors found at 42 C.F.R. � 488.404 include: (1) the scope and severity of the deficiency; (2) the relationship of the deficiency to other deficiencies resulting in noncompliance; and (3) the facility's prior history of noncompliance in general, specifically with reference to the cited deficiencies.

When CMS imposes an enforcement remedy on a skilled nursing facility or nursing facility, the facility has a right to appeal the "certification of noncompliance leading to an enforcement remedy." 42 C.F.R. � 488.408(g)(1); see also 42 C.F.R. �� 488.330(e) and 498.3. However, a facility may not appeal the choice of remedies by CMS or the factors CMS considered when choosing remedies. 42 C.F.R. � 488.408(g)(2). A facility may only challenge the scope and severity level of noncompliance found by CMS if a successful challenge would affect the amount of the civil money penalty CMS could collect or affect the facility's nurse's aide training program. 42 C.F.R. � 498.3(b)(14).

CMS has the initial burden of coming forward with evidence on any disputed facts showing that the provider was not in substantial compliance with Medicare participation requirements. However, the provider bears the ultimate burden of persuasion that it was in substantial compliance with those requirements. See South Valley Health Care Center, DAB No. 1691 (1999), aff'd, South Valley Health Care Center v. HCFA, 223 F.3d 1221 (10^th Cir. 2000); see, also, Batavia Nursing and Convalescent Center, DAB No. 1904 (2004).

III. Findings and Analysis

A. Petitioner failed to comply substantially with the requirement at 42 C.F.R. � 483.35(h)(2). This deficiency provides the basis for CMS to impose a civil money penalty.

CMS alleges that Petitioner failed to comply substantially with the requirement that food be stored, prepared, distributed, and served under sanitary conditions, as provided at 42 C.F.R. � 483.35(h)(2). I conclude that CMS presented a prima facie case that Petitioner failed to comply substantially with the requirment; and, I conclude also that Petitioner failed to rebut CMS's prima facie case by a preponderance of the evidence.

The parties agree that on the morning of April 23, 2003, drains in the floor of the facility's kitchen became clogged and water backed-up onto the kitchen floor. In the briefs, both parties noted the facility's Policy For Kitchen Closure:

It is the policy of this facility that if sewage water backs up into the kitchen the facility will close the entire kitchen area down.

The kitchen will not reopen until all sanitation requirements are met.

Until the kitchen can reopen, food will be obtained from an outside food source.

P. Ex. 12.

The state agency received a complaint concerning this incident which prompted a survey to commence on the same day. CMS Exs. 4, 5.

CMS asserts that surveyor Rose Hanley arrived at the facility at approximately 2:15 PM and began interviewing employees. CMS Ex. 2. Ms. Hanley reported that a dietary aide (identified in the record as 'E4') told her that at 5:00 AM there were 1� inches of water on the kitchen floor, including in the stove area, and, E4 related to Ms. Hanley, that the water was sooty and smelled like sewer water. CMS Ex. 2, at 2-3; CMS Ex. 11. Ms. Hanley indicated also that the facility's Food Service Supervisor, 'E3,' told her that at 9:00 AM the water in the kitchen was deep enough to wet the bottom of her pants. ⁽¹⁾ CMS Ex. 2, at 2; CMS Ex. 12. E3 reported to Ms. Hanley also that water covered the floor in the cooking area, the dishroom, the hallway next to the dishroom, the breakdown area next to the dishroom, and, E3 reported, the water was backing-up from four drains in the floor of the kitchen area. CMS Ex. 2; CMS Ex. 12. Another dietary aide, 'E7,' indicated to Ms. Hanley that water was ankle-deep during lunch preparations. CMS Ex. 2, at 3. A dietary tech, 'E6,' told Ms. Hanley that water was ankle-deep in the cooking area of the kitchen at 10:30 AM. CMS Ex. 2, at 3. Ms. Hanley reported also that, at 2:30 PM, she observed staff mopping the cooking area of the kitchen and the adjacent hallway, and there were 1/2 to 3/4 inches of water on floor of the dishroom. CMS Ex. 2, at 3.

Ms. Hanley's report indicates that the facility called a plumber who arrived at 10:00 AM and rodded out the clogged drains by 11:00 AM. CMS Ex. 2, at 1, 3. And, Ms. Hanley reported, the facility prepared breakfast for residents in the kitchen while the drainage water was present on the floor; and, breakfast was served to residents on regular dishware that had been cleaned the night before. CMS Ex. 2, at 3. Ms. Hanley reported that the facility served lunch to residents on paper and plastic dishware because the dishwasher could not be used due to the drainage water. CMS Ex. 2, at 3. Ms. Hanley reports observing staff cooking and serving dinner to residents on regular dishware. CMS Ex. 2, at 4-5. Ms. Hanley indicates that she queried E3 about the dishware, and E3 said that the facility ran out of paper and plastic plates and cups after lunch, but that the dishes used for dinner service were sanitized in the dishwasher at 1:00 PM. CMS Ex. 2, at 4-5. Ms. Hanley reports that at approximately 5:05 PM staff washed the kitchen walls next to where a steam table was being filled for the evening meal service. CMS Ex. 2, at 4. Ms. Hanley noted that dinner service started at about 5:17 PM. CMS Ex. 2, at 4-5. At approximately 8:00 PM, Ms. Hanley indicated, the kitchen equipment and floor were cleaned and sanitized by a steam cleaning company- this was done after Ms. Hanley notified the director of nursing, 'E2,' that Ms. Hanley had determined there was a deficiency at the immediate jeopardy severity level. CMS Ex. 2, at 5-6; CMS Ex. 7.

Ms. Hanley related that E3 (the food service supervisor) believed that she did not have the authority to suspend food service and did not have access to a food suspension policy. CMS Ex. 2, at 2. E2 (the director of nurses) purportedly told Ms. Hanley that the facility should have suspended food service due to the flooding, but E3 (the food service supervisor) could not provide Ms. Hanley with the facility's written policy, because the policies were in the administrator's office which was locked and could not be accessed until the following day. CMS Ex. 2, at 3. Ms. Hanley reported that, subsequently, the administrator confirmed that food service should be halted and the kitchen closed if water was found to be backing-up from the floor drains. CMS Ex. 2, at 5.

Petitioner asserts that the facility took appropriate precautions to deal with the flooding, and Petitioner asserts that the facility's policy concerning food service and flooding was not violated. Specifically, Petitioner asserts that the maintenance supervisor was notified of the flooding between 7:00 AM and 8:00 AM. Petitioner's brief at 2. Petitioner asserts also that, at its highest, the water in the kitchen was no more than 1 1/2 inches. Petitioner's brief at 2, citing P. Ex. 4.

Petitioner argues that "[d]ietary staff took all necessary and appropriate precautions throughout that day in the preparation of food, service of meals, and cleaning dishes and utensils." Petitioner's brief at 2, citing P. Ex. 4. For instance, Petitioner argues, staff did not touch the water except to walk through it. Petitioner's brief at 2, citing P. Ex. 4. And, Petitioner indicates, the facility's infection log shows that no new infections were reported after the kitchen flood. Petitioner's brief at 2, citing P. Ex 8.

Petitioner argues that "[t]he fact that there was standing water on the floor in the food preparation and cleaning areas does not mean that the condition was unsanitary." Petitioner's brief at 4. To support that there was no unsanitary condition present at the facility, Petitioner argues that CMS has not alleged there was contact with the water on the floor with food or food preparation areas or with serving utensils. Petitioner's brief at 4. Petitioner argues that CMS has alleged no facts that any staff members contaminated food or utensils. Petitioner's brief at 4.

Petitioner cites a letter it solicited from Dr. Bernard Turnock to support the contention that the flooding did not create a serious health risk. See P. Ex. 10. Dr. Turnock reviewed the facts of the incident as provided by Petitioner and opined that there was no serious health risk. P. Ex. 10. Based on Dr. Turnock's opinion, Petitioner concluded "[t]hus, there was no situation that was likely to cause, serious injury, harm, impairment, or death to a resident." Petitioner's brief at 5.

Petitioner asserts that closing the facility's kitchen in response to the flood would have presented greater risks to residents because of the residents' needs for therapeutic diets - Petitioner indicates that 205 of the 328 residents received therapeutic diets. See Petitioner's response at 2, citing P. Ex. 13. Petitioner asserts that "[f]ood preparation and services continued in a timely, uninterrupted fashion." Petitioner's response at 1.

Petitioner argues also that the water that flooded the kitchen floor was not "sewage," and, therefore, Petitioner's policy did not require that the kitchen be closed. Petitioner's response brief at 1-2. Petitioner thus asserts a distinction between 'sewage water' and water backing up from the facility's "internal drains." Petitioner's response at 1-3. Petitioner argues that a back up of "sewage water" would necessitate closing the kitchen, but water backing up from the facility's internal drains, however, would not. Id.

Petitioner argues that CMS failed to present a prima facie case, but Petitioner argues, in the alternative, CMS's prima facie case notwithstanding, the facility "followed its protocol," because it drained the water, cleaned the kitchen and prepared and served meals under sanitary conditions. Petitioner's response at 4.

Petitioner argued also that the immediate jeopardy level of severity at which CMS cited the remedy constitutes an abuse of discretion by CMS because recent surveys under similar circumstances have resulted in milder determinations. Petitioner's response brief at 4-5.

I find Petitioner's arguments unpersuasive. Petitioner's assertion that no contamination occurred does not demonstrate, regardless of the veracity of the proposition, that the facility complied substantially with the program requirement. The essence of the deficiency alleged by CMS is whether there existed an unsanitary condition, not whether food or residents were in fact contaminated. To make its prima facie case of the deficiency, CMS is not required to show that food or equipment came into contact with the water on the facility's floor. I note that Petitioner's attack of CMS's case as insufficient in this regard highlights the assumption underlying the deficiency: contact with the water on the floor would be unsanitary; the existence of the facility's policy concerning kitchen closure buttresses this point.

I find unpersuasive also the opinions of Dr. Turnock. Dr. Turnock opined that "immediate jeopardy would only have existed if food products had been contaminated by the floor water and there is no evidence of this in the inspection report." P. Ex. 10, at 2. CMS seized on this passage in the doctor's letter and complains that it is inappropriate to consider Dr. Turnock's legal conclusions. I agree that Dr. Trunock is not competent to determine what is or is not 'immediate jeopardy,' as this is a term of art in the regulatory scheme controlling the instant matter. Nonetheless, the essence of Dr. Turnock's opinion is that the risk to residents from illness is caused by contamination from the dirty water. Dr. Turnock asserts that this risk can be "effectively controlled by simple sanitation and hygiene practices," i.e., measures to prevent the floor water from finding its way into the food. P. Ex. 10, at 1. Thus, in explaining how the risk of contamination can be minimized, Dr. Turnock's letter betrays that there is a condition not usually present in the kitchen, water on the floor, which the doctor apparently presumes to contain contaminants, and which must be guarded against. I am persuaded that this describes an unsanitary condition.

Moreover, Dr. Turncock tellingly offers the facility the following advice intended to address the specific circumstances of this case:

Clean . . . walls, hard-surfaced floors, and other surfaces with soap and water and disinfect . . . with a solution of 1 cup bleach to five gallons of water with particular care to thoroughly disinfect surfaces that may come in contact with food, such as countertops, pantry shelves, refrigerators, etc.

P. Ex. 10, at 1-2. Dr. Turnock's letter commends these practices, among others, for heavily contaminated water "as well as for less contaminated forms of water back-up." P. Ex. 10, at 2 . Although, Dr. Turnock did not mention the facility's closure policy in his letter, nor call for the facility to close the kitchen while implementing his advice, I am impressed that Dr. Turnock's advice is consistent with the facility's policy to close the kitchen and clean it before resuming food service.

I find Petitioner's assertion that the facility made the best choice between closing the kitchen or continuing meal preparation and service for residents on therapeutic diets also unpersuasive. First, that many of the residents needed therapeutic diets underscores also that these are people whose health status makes them vulnerable nutritionally, as Petitioner emphasized, but also to the risks stemming from food contamination. Secondly, Petitioner's assertion concerning the facility's food service dilemma is unsupported. There is no evidence that establishes that therapeutic diet requirements could not be met if the kitchen were closed for a period long enough to sanitize it. Furthermore, I note that the evidence Petitioner does provide to support this point, P. Ex. 13, does not demonstrate that 205 residents were on a therapeutic diet, nor is it instructive concerning what risk might be entailed in temporarily obtaining meals for residents from an alternative source. The document is, in fact, merely a monthly census report containing no diet information.

Petitioner's argument concerning the distinction between sewage water and waste waster contained internally in the facility's plumbing fails also to persuade me that the facility substantially complied with the requirement. Regardless of whether there is a bona fide technical difference between sewage water and water that backs up from a building's internal drains, I am not convinced that the distinction is relevant. First, both types would constitute a risk to residents from contamination of food or equipment. Second, concerning whether the facility failed to implement its own policy, assuming the policy required the facility to close its kitchen only in the presence of sewage water as opposed to internal drain water, the evidence demonstrates that the prudent course of action was for the staff to assume the water on the kitchen floor was sewage water. There was no way for the staff to have known whether the water on the floor was sewage water or internal drain water until after the source of the clog was determined. I conclude, therefore, that Petitioner's contention that there is a relevant and meaningful distinction between sewage water and internal drainage water is unavailing to prove food was stored and served under sanitary conditions.

Petitioner argued also that there was no deficiency at the facility because the facility fixed the drains, cleaned the kitchen, and prepared and served meals under sanitary conditions. As I have discussed, I find that the conditions in the kitchen were not sanitary, and the steps staff took to avoid contamination, while commendable, were insufficient under the circumstances. Before any food preparation and service proceeded, the kitchen should have been restored to a sanitary condition.

Finally, Petitioner's argument that the deficiency has been cited at a severity level that is out of proportion to deficiency findings in other instances under similar circumstances is unavailing. Petitioner has presented no cite to any legal rule, principle or authority to support the contention. My review of the instant matter is de novo. I conclude, therefore, that the examples of other deficiency findings are irrelevant to the instant matter.

B. The amount of the civil money penalty, $10,000, is unreasonable; $2,000 is a reasonable civil money penalty.

1. CMS's determination that the deficiency constituted immediate jeopardy is beyond the scope of my review.

Petitioner argues that there was no "crisis" at the facility on April 24, 2003 that presented the likelihood of serious injury, harm, impairment or death to residents, because facility staff were aware of the water on the floor of the food preparation area and took the necessary precautions. Petitioner's response at 4.

CMS argues that the likelihood of serious harm in this case "stemmed from the interplay of an unsanitary condition in the food preparation area and the vulnerable health of the facility's residents." CMS's reply at 2.

In this case CMS seeks to impose a per instance civil money penalty. Pursuant to 42 C.F.R. � 488.438(a)(2), CMS may impose a per instance penalty in the range of $1,000 to $10,000. There is no distinction in the regulation between the range of per instance civil money penalty available to CMS for immediate jeopardy deficiencies and those deficiencies that are determined to be less severe than immediate jeopardy. The regulations limit my review of the scope and severity determination to cases when a successful challenge would affect the range of civil money penalties applicable to the deficiency. Thus, in this case, it is beyond the scope of my review to decide whether the immediate jeopardy level assessment was appropriate or not. Nonetheless, if CMS's determination of immediate jeopardy were before me, my review would be limited to whether CMS's determination was clearly erroneous, because the regulations provide that CMS's severity determination must be upheld unless it is clearly erroneous. 42 C.F.R. � 498.60(c)(2). Were I to be deciding this issue, I would find no basis in the record to conclude that CMS's determination was clearly erroneous. That there was a risk to residents from potential contamination of food or food preparation and service related items, caused by the unsanitary condition, is a reasonable conclusion based on the evidence. That the facility continued to prepare and serve meals despite the unsanitary condition is a reasonable basis for CMS to have concluded there existed the likelihood of serious harm to residents. Accordingly, I would have upheld CMS's determination.

2. A per instance civil money penalty of $10,000 is unreasonable; $2,000 is reasonable.

I find that Petitioner insufficiently comprehended the potential consequences and risks created by the kitchen flood; however, $10,000, the maximum amount of per instance civil money penalty is not reasonable under the circumstances. Where penalties fall within the range of penalties depends on factors which may include: a facility's history of noncompliance; its financial condition; its culpability; the seriousness of a deficiency or deficiencies; and, the relationship of one deficiency to another. 42 C.F.R. � 488.438(f); 42 C.F.R. � 488.404(b), (c) (incorporated by reference into 42 C.F.R. � 488.438(f)(3). Neither party presented evidence or argument concerning the factors. I note that Petitioner objected generally to the "excessive amount" of civil money penalty in its request for a hearing. CMS provided no indication why the the highest amount was assessed other than to assert generally that, based on the deficiency, the penalty should be upheld.

The deficiency was serious; however, I note that concerning Petitioner's culpability, it should be acknowledged that the facility took several steps immediately to remedy the unsanitary condition, including arranging for maintenance to unclog the drain, and by providing some of the meal service on disposable dishware. These measures were insufficient, but they exhibit that this was not a case where the facility neglected residents or showed indifference or disregard for resident care, comfort, or safety. Moreover, the remedial purpose of the penalty - a return to a sanitary condition - was achieved on the same day of the incident. Accordingly, I conclude that $2,000 is a reasonable amount to achieve the remedial purpose of bringing Petitioner into compliance with the regulation.

IV. Conclusion

I conclude that Petitioner failed to comply substantially with the requirement of participation provided at 42 C.F.R. � 483.35(h)(2). Petitioner failed to store, prepare, distribute, and serve food under sanitary conditions. I conclude also that the amount of the per instance civil money penalty, $10,000 is unreasonable; $2,000 is a reasonable amount of civil money penalty.

Alfonso J. Montano

Administrative Law Judge

1. Petitioner urges me to disregard putatively damaging statements reported to have been made by E3 (the food service supervisor), because she (E3) was terminated for cause by the facility and had filed a grievance against the facility related to her termination. Petitioner's brief at 3. I find, however, that with or without my considering E3's statements, my findings and conclusions remain the same.