SUBJECT:

Concourse Nursing Home,

Petitioner,

Centers for Medicare & Medicaid Services

DECISION

This case presents the narrow question as to whether a revised Statement of Deficiencies, issued following Petitioner's completion of a State Informal Dispute Resolution (IDR) process, constitutes a "reconsidered or revised determination" within the meaning of 42 C.F.R. � 498.5, creating an additional right to hearing and triggering anew the 60-day time limit for filing an appeal. I conclude that the revised Statement of Deficiencies is not a "reconsidered or revised determination"and does not trigger an additional right to hearing. I therefore grant the Centers for Medicare & Medicaid Services' (CMS's) Motion to Dismiss Petitioner's hearing request as untimely.

I base my decision on the Medicare statute, regulations, and reasoning set forth in the Departmental Appeals Board's (Board) appellate panel decisions in Cary Health and Rehabilitation Center, DAB No. 1771 (2001) and Nursing Inn of Menlo Park, DAB No. 1812 (2002).

BACKGROUND

Petitioner is a nursing facility certified to participate in the Medicare and Medicaid programs as a provider of services. In a letter dated July 27, 2001, CMS advised Petitioner that, based on deficiencies found during a March 21, 2001 survey and a July 7, 2001 revisit, it was imposing against the facility a denial of payment for new admissions (DPNA). The letter warned that if substantial compliance was not achieved prior to September 17, 2001, the facility's participation in the Medicare and Medicaid programs would be terminated effective that date. The letter set forth Petitioner's appeal rights and specifically advised that "a written request for a hearing must be filed no later than 60 days from the date of receipt of this letter." (Emphasis added). CMS Ex. A.

Subsequently, in a letter dated August 28, 2001, CMS advised Petitioner that, based on the results of an August 20, 2001 survey, it was lifting the DPNA effective August 20, 2001, and was rescinding the termination. CMS Ex. B.

Petitioner did not request a hearing within 60 days of the July 27th letter. In a letter to the CMS Coordinator of Hearings and Appeals, dated December 4, 2001, Petitioner requested a hearing. CMS Ex. C. In that letter, Petitioner explained that it "took no action in response to [CMS's July 27, 2001 notice] letter" because it instead filed requests for IDR with the State Department of Health, and "if the underlying deficiencies were rescinded[,] the whole issue of denial of payment for new admissions and the scheduled termination would similarly be withdrawn." Id. The State Department of Health's IDR decisions removed two of the cited deficiencies but left intact the balance of the deficiencies cited on the original statement of deficiencies. Petitioner filed its request for a hearing before an administrative law judge (ALJ) on December 4, 2001, following its receipt of the IDR determination.

CMS now moves to dismiss Petitioner's hearing request as untimely, arguing that Petitioner did not file its hearing request within 60 days of receiving CMS's July 27, 2001 notice. ⁽¹⁾ Petitioner, on the other hand, argues that its hearing request is timely because it was filed within 60 days of its receiving the IDR decision. Petitioner characterizes the IDR decision as a "reconsidered or revised determination" within the meaning of 42 C.F.R. � 498.40(a).

DISCUSSION

I make Findings of Fact and Conclusions of Law (Findings) to support my decision in this case. I set forth each Finding as a separately numbered heading, and explain each Finding in detail.

1. Petitioner failed to file its hearing request within 60 days of its receipt of CMS's notice as required by statute and regulation.

Section 1866(h) of the Social Security Act (Act) authorizes administrative review of determinations that a provider fails to comply substantially with the provisions of the regulation "to the same extent as is provided in section 205(b) [of the Act]." Under section 205(b), the Secretary of the United States Department of Health and Human Services (Secretary) must provide reasonable notice and opportunity for a hearing "upon request by [the affected party] who makes a showing in writing that his or her rights may be prejudiced" by the Secretary's decision. The hearing request "must be filed within sixty days" after receipt of the notice of CMS's determination (emphasis added). Act, section 205(b). The 60-day time limit is thus a statutory requirement. See Cary, at 8-9 (an appeal from a determination imposing a DPNA must be filed within 60 days of receipt of the determination).

Similarly, the regulations mandate that the affected party "file its request in writing within 60 days from receipt of the notice . . . unless that period is extended." 42 C.F.R. � 498.40(a). On motion of a party or on his or her own motion, the ALJ may dismiss a hearing request where that request was not timely filed and the time for filing was not extended. 42 C.F.R. � 498.70(c). Under �� 498.40(a)(2) and 498.22(b)(3), receipt is "presumed to be 5 days after the date on the notice unless there is a showing that it was, in fact, received earlier or later."

Here, Petitioner does not dispute its receipt of the July 27, 2001 notice letter, which specifically informed the facility of its appeal rights and advised that the appeal must be filed no later than 60 days after receipt of the notification. Petitioner filed a hearing request on December 4, 2001, well after 60 days had elapsed. The notice language is clear and unconditional and the facility admits that it made a conscious decision to focus its efforts on pursing IDR rather than requesting an ALJ hearing. Under similar circumstances, the Board's appellate panels have upheld dismissal. Nursing Inn of Menlo Park; Cary, at 8-9. Thus, on its face, the hearing request is untimely, and dismissal seems appropriate. I next consider whether Petitioner has presented any compelling reason why I should exercise discretion not to dismiss under 42 C.F.R. � 498.70(c).

2. The revised Statement of Deficiencies issued following completion of the State IDR process does not constitute a "reconsidered or revised determination" within the meaning of 42 C.F.R. � 498.5 and creates no new appeal rights.

After receiving the July 27, 2001 notice letter, Petitioner submitted its Plan of Correction and Request for IDR. On November 26, 2001, the State agency sent Petitioner its IDR determination, which included a revision to the Statement of Deficiencies. Petitioner filed its hearing request eight days later. The crux of Petitioner's argument is that the revised Statement of Deficiencies, issued following IDR, constituted a "reconsidered" or "revised" determination within the meaning of 42 C.F.R. � 480.40(a)(2), which states that the affected party must file its hearing request within 60 days from receipt of the notice of the "initial, reconsidered, or revised determination."

The Board appellate panel has rejected similar arguments, holding that the IDR process is separate from and independent of the initial and reconsidered determinations which give rise to hearing before an ALJ. 42 C.F.R. � 498.40(a) affords "an affected party entitled to hearing under � 498.5" the right to file a request for hearing. Section 498.5 sets out a party's appeal rights, including the right to appeal an initial determination, but the appeal must be filed within 60 days of the party's receipt of the notice of the initial determination. 42 C.F.R.� 498.40(a)(2). Petitioner concedes that the July 27th notice letter was an initial determination. (P. Brief at 8). Subpart B of 42 C.F.R. Part 498 addresses those "Initial, Reconsidered, and Revised Determinations" which give rise to appeal rights. An initial determination is binding unless reconsidered in accordance with 42 C.F.R. � 498.24, reversed or modified by hearing decision in accordance with 42 C.F.R. � 498.78, or revised in accordance with 42 C.F.R. �� 498.32 or 498.100. 42 C.F.R. � 498.20(b). Only certain types of initial determinations, not applicable here, may be reconsidered:

any initial determination that affects a prospective provider or supplier, or a hospital seeking to qualify to claim payment for all emergency hospital services. .

42 C.F.R. � 498.22(a). With respect to "revised determinations," the regulations authorize CMS, on its own initiative, to reopen an initial or reconsidered determination within 12 months of the date of notice of the initial determination. 42 C.F.R. � 498.30. The determination issued following the reopening is then referred to as a "revised determination."

The IDR provisions are completely independent of these provisions. The regulations mandate that a facility be provided the opportunity for informal dispute resolution, at the facility's request, to dispute state survey findings with the State survey agency. 42 C.F.R. � 488.331. The IDR regulations specifically provide that failure to complete IDR cannot delay the effective date of any enforcement action against the facility and that the facility may not delay any enforcement action against it because IDR has not been completed. 42 C.F.R. � 488.331(b). Pointing to these provisions, the appellate panel in Nursing Inn of Menlo Park characterized as "unconvincing" the facility's reliance on its participation in the IDR process as an explanation for its failure to request a hearing timely. Nursing Inn of Menlo Park, at 7-8. Similarly, the panel in Cary ruled that a petitioner is not justified in believing that IDR process somehow tolls the requirement to file a timely federal hearing request. Cary, at 28. That the regulations require states to institute a separate IDR procedure does not turn that procedure into a "reconsidered or revised determination," determinations that are specifically defined elsewhere in the regulations.

3. Petitioner did not show good cause for its untimely appeal.

In the alternative, Petitioner requests an extension of time for filing its appeal, arguing that its misinterpretation of the regulations constitutes good cause. If a hearing request is not filed within 60 days, the affected party may file with the ALJ a written request for an extension of time stating the reasons why the request was not filed timely, and, upon a showing of good cause, the ALJ may extend the time for filing. 42 C.F.R. � 498.40(c). The Board has rejected this argument under similar circumstances.

It is instructive to recall that the party in the role of "claimant" here is not an individual insurance recipient or program beneficiary but a provider that has executed a contract to receive federal funds for services that it provides on condition that it adheres to regulatory conditions of participation. Hence, considerably more justification is present in this situation for holding the provider to some responsibility for being familiar with the rules on survey and enforcement and on the appeal process. Correspondingly, as reflected in the discussion of good cause for late filing, there is considerably less justification for such a party and its counsel to respond to federal notices with inaction.

Cary, at 20 n.7.

Petitioner in Cary argued, among other matters, that it was awaiting final results from its participation in the State's IDR process, which it expected might undo the basis for the penalties imposed. The Board ruled that Petitioner's inaction in filing its appeal was not justified where the agency's notice letter spelled out in detail the facility's appeal rights. The letter informed Petitioner that some appealable action had been taken and it was not reasonably misled into believing that it could appeal the determinations made in the notice letter without filing a timely request for review. Id. at 27.

Similarly, in Nursing Inn of Menlo Park, the Board noted that the "explicit, unambiguous language in the notice renders unpersuasive any argument . . . by Nursing Inn that it was confused by CMS' action. . . ." Id at 9. The appellate panel found no good cause in Petitioner's claim that it mistakenly believed the notice was invalid and that another would be issued after the IDR process. The panel characterized this claim as "mere speculation" on the facility's part "to excuse its dereliction in filing a hearing request." Id. at 10.

I do not see that Petitioner here was any more justified in its "mistaken beliefs," and find no good cause to extend the time for filing.

CONCLUSION

Though explicitly informed of the 60-day deadline for filing a hearing request, Petitioner nevertheless failed to file until at least 125 days after it received CMS's notice letter. I thus do not have before me a timely filed hearing request, and Petitioner has not, pursuant to 42 C.F.R. � 498.40(c), shown good cause for its failure to file timely. I therefore dismiss this appeal pursuant to the authority granted me in 42 C.F.R. � 498.70(c).

Carolyn Cozad Hughes

Administrative Law Judge

1. In the alternative, CMS moves to dismiss for Petitioner's failure to meet the content requirements for hearing requests set forth in 42 C.F.R. � 498.40(b). Petitioner's hearing request did not provide the bases for contending that CMS's findings and conclusions were incorrect. Indeed, in its request, Petitioner notes that the bases for objection "have already been detailed in [its] request for the IDR's." Petitioner did not include those IDR submissions with its hearing request, but offered to provide them "if you don't receive it from the Department of Health." Recent Board appellate panel decisions significantly restrict the ALJ's authority to dismiss even an undeniably inadequate hearing request. The Carlton at the Lake, DAB No.1829 (2002); Alden Nursing Center - Morrow, DAB No. 1825 (2002). In those cases the Board appellate panels directed that - notwithstanding the language of 42 C.F.R. � 498.40(b) - ALJs "exercise discretion" to accept "as adequate to preserve a right to hearing" hearing requests that fail to "identify the specific issues and findings of fact and conclusions of law with which the affected party disagrees," and/or fail to "specify the basis for contending the findings and conclusions are incorrect." Whether, after the rulings in Alden-Morrow and Carlton at the Lake, the ALJ retains any discretion to dismiss a facially inadequate hearing request is, thankfully, an issue I need not and do not reach in this case.