SUBJECT:

Mercy Health Care & Rehabilitation Center,

Petitioner,

Centers for Medicare & Medicaid Services

DECISION

Mercy Health Care & Rehabilitation Center (Petitioner or facility), is a long term care facility certified to participate in the Medicare program as a provider of services. Petitioner challenges the Centers for Medicare & Medicaid Services' (CMS's) October 5, 2000 determination that it was not in substantial compliance with Medicare requirements and that its noncompliance posed immediate jeopardy to resident health and safety. Petitioner also challenges as excessive the imposition of a $10,000 per instance civil money penalty (CMP).

For the reasons set forth below, I conclude that the facility was not in substantial compliance with program participation requirements, and that the CMP imposed - $10,000 per instance - was reasonable.

I. Background

On August 24, 2000, a woman contacted the Illinois Department of Public Health (State agency) to complain of improper nursing care at the facility. She said that her aunt, a facility resident, developed a large hole in her right breast, which was eventually diagnosed as breast cancer. According to the complainant, the symptom must have been obvious for some time, but the facility had made no efforts to diagnose or treat it. CMS Exhibit (CMS Ex.) 4, Attachment (Attach.) A.

Responding to the complaint, the State agency conducted a complaint investigation survey on September 13, 2000, and determined that the facility was not in substantial compliance with the requirements set forth in 42 C.F.R. � 483.25 (Quality of Care), concluding that Resident 1 had not received care and services to attain or maintain the highest practicable physical, mental, and psychosocial well-being; specifically, staff failed to follow up in a timely manner on a change in condition - an open, draining wound in the upper right breast - resulting in her condition deteriorating, and eventually leading to a right mastectomy in August 2000. CMS Ex. 4, Attach. B. CMS agreed, and, by letter dated October 5, 2000, advised Petitioner that it considered the deficiency an isolated deficiency that constituted immediate jeopardy, requiring significant corrections, and constituted "substandard quality of care." CMS also determined that the immediate jeopardy ended on September 13, 2000. The letter reminded Petitioner of remedies set forth in the State agency's September 15, 2000 notice: directed inservice training and mandatory denial of payment for new admissions effective December 13, 2000. In addition, the letter notified Petitioner of additional remedies: the imposition of a per instance CMP of $10,000 for noncompliance at the immediate jeopardy level, and termination of its provider agreement effective March 13, 2001, if the facility did not achieve substantial compliance prior to that date. Finally, the facility was prohibited from offering or conducting a nurse aide training and/or competency evaluation program for two years from September 13, 2000. CMS Ex. 1; Petitioner's Exhibit (P. Ex.) C.

On October 10, 2000, the State agency revisited the facility and found substantial compliance. In a letter dated October 26, 2000, CMS advised Petitioner that it would, therefore, not pursue mandatory denial of payment for new admissions nor termination. However, the $10,000 per instance CMP remained in effect. CMS Ex. 2.

Petitioner timely requested a hearing. CMS Ex. 3.

CMS has filed a motion for summary judgment. Petitioner opposes, arguing that material facts are in dispute. In the alternative, Petitioner contends that the CMP is unreasonable and should be reduced to $3,500.

CMS submitted 11 proposed exhibits, CMS Ex. 1 - CMS Ex. 11, with its motion for summary judgment. CMS also submitted Attachments A - F with CMS Ex. 4. Petitioner submitted 10 proposed exhibits, P. Ex. A - P. Ex. J, with its brief in opposition. CMS submitted five additional proposed exhibits, CMS Ex. 12 - CMS Ex. 16, with its reply brief. I have admitted all exhibits and attachments for purposes of this decision.

II. Issues

I first consider whether summary judgment is appropriate.

On the merits, this case presents a narrow question: whether the facility was in substantial compliance with program participation requirements, specifically, 42 C.F.R. � 483.25. Did its failure, over a five-month period, to report to her physician or otherwise follow up on observed changes in Resident 1's right breast constitute a failure to provide the necessary care and services to allow her to attain or maintain the highest practicable physical, mental, and psychosocial well-being?

If the facility did not meet program requirements, is the amount of the CMP - $10,000 - reasonable?

III. Statutory and Regulatory Background

The Social Security Act (Act) sets forth requirements for nursing facility participation in the Medicare and Medicaid programs, and authorizes the Secretary of Health and Human Services to promulgate regulations implementing the statutory provisions. Act, sections 1819 and 1919. The Secretary's regulations governing nursing facility participation in the Medicare program are found at 42 C.F.R. Part 483.

To participate in the Medicare program, a nursing facility must maintain substantial compliance with program requirements. To be in substantial compliance, a facility's deficiencies may pose no greater risk to resident health or safety than "the potential for causing minimal harm." 42 C.F.R. � 488.301. A facility's noncompliance constitutes immediate jeopardy if it has caused or is likely to cause "serious injury, harm, impairment, or death to a resident." Id. Immediate jeopardy can exist regardless of the scope and severity of the deficiency, so long as the deficiency involves a potential for more than minimal harm. Lake City Extended Care Center, DAB No. 1658, at 17 (1998).

Under the statute and the "quality of care" regulation, each resident must receive, and the facility must provide, the necessary care and services to allow a resident to attain or maintain the highest practicable physical, mental, and psychosocial well-being, in accordance with the resident's comprehensive assessment and plan of care. Act, section 1819(b); 42 C.F.R. � 483.25.

A facility's noncompliance constitutes substandard quality of care if there are one or more deficiencies related to participation requirements under 42 C.F.R. � 483.13 (Resident behavior and facility practices); 42 C.F.R. � 483.15 (Quality of Life); or 42 C.F.R. � 483.25 (Quality of Care), "which constitute either immediate jeopardy to resident health or safety; a pattern of or widespread actual harm that is not immediate jeopardy; or a widespread potential for more than minimal harm, but less than immediate jeopardy, with no actual harm." 42 C.F.R. � 488.301.

If 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 a CMP. See Act, section 1819(h). CMS may impose a CMP for the number of days that the facility is not in substantial compliance with one or more program requirements or for each instance that a facility is not in substantial compliance. 42 C.F.R. � 488.430(a). When penalties are imposed for an instance of noncompliance, the penalties will be in the range of $1,000 to $10,000 per instance. 42 C.F.R. � 488.438.

In setting the amount of the CMP, 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 section 488.404 factors 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 and specifically with reference to the cited deficiencies.

Sections 1819(b)(4)(C)(ii)(II) and 1919(b)(4)(C)(ii) of the Act prohibit approval of nurse aide training and competency evaluation programs by a facility that has been subject to an extended or partially extended survey as a result of a finding of substandard quality of care, has been assessed a total CMP of not less than $5,000, or has been subject to a denial of payment, the appointment of a temporary manager, or termination.

IV. Discussion

The following critical facts are not in dispute:

At the time of the survey, Resident 1 was 78 years old. She had been admitted to the facility in September 1998 with a history of melanoma, and diagnoses of senile dementia and cataracts. CMS Ex. 4, Attach. E, at 1; CMS Ex. 4, Attach. B, at 2. Staff described her as "private" and "shy," often refusing to allow staff to shower her or to examine her. CMS Ex. 4, Attach. B, at 2; P. Ex. B, at 2.

The facility contracted with an agency called Gencare to provide nurse aides who assisted the facility residents with bathing, showering, and other functions. One of those Gencare employees, a certified nurse assistant (CNA) named Weltha White, told surveyor Bonet-Rich that in March 2000, while assisting Resident 1 with a shower, she observed a "palpable bluish-purple nodule" on the resident's right breast. CMS Ex. 4, at 2. She reported the finding to the charge nurse, Tara Hill. In June 2000, she noticed an open, draining wound in the same spot of Resident 1's right breast, and again, she reported her observation to the charge nurse. CMS Ex. 4, at 2 - 3. Resident 1's treatment records mention nothing about these observations, and the charge nurse took no action. CMS Ex. 4, Attach. E, at 6.

On August 10, 2000, the shower team staff again observed a 2x3 cm open and draining wound on the upper aspect of Resident 1's right breast. Staff notified the nursing supervisor, and Dr. Serushan, the attending physician. Dr. Serushan said that he "[would] examine her on his next visit to the facility." CMS Ex. 4, Attach. E, at 6. His "next visit" apparently occurred several days later, as the clinical record shows that he examined Resident 1 on August 14, 2000, at 8:30 p.m. CMS Ex. 4, Attach E, at 6. ⁽¹⁾

Physician progress notes describe "open wound - right breast [with] drainage[.] She has a "large deep mass[,] also has disfiguration of right breast[,] most likely Ca of breast[.] Will consider treatment and poss radiation." CMS Ex. 4, Attach. E, at 15; P. Ex. E, at 4. On August 14, 2000, the physician ordered Keflex. On August 16, 2000, the physician ordered cleansing of the right breast with normal saline solution and the application of a dry protective dressing. CMS Ex. 4, Attach E, at 21, 23 ; CMS Ex. 4, Attach. B, at 3. A surgeon examined Resident 1 on August 21; she underwent a breast biopsy and bone scan on August 22, 2000; and was diagnosed with a right breast mass. CMS Ex. 4, Attach. E, at 18 - 20; CMS Ex. 4, Attach. D, at 4; P. Ex. E, at 4. On August 29, 2000, she underwent a right simple mastectomy. CMS Ex. 4, Attach. B, at 4; CMS Ex. 4, Attach. D, at 4.

Responding to written questions posed by Surveyor Bonet-Rich, Dr. Shahmir Sardar, the surgeon who performed the mastectomy, stated that "[t]he stage at which the cancer was discovered has no bearing on eventual outcome." CMS Ex. 4, Attach. D, at 4.

On September 5, 2000, the facility terminated the charge nurse's employment for "lack of resident assessment, reporting and follow-up for Resident 1's change of condition in order to provide necessary quality care and treatment." CMS Ex. 4, Attach B, at 4; CMS Ex. 4, Attach. C, at 5; CMS Ex. 4, Attach. F. The facility's disciplinary notice specifies:

During a state investigation of a complaint of neglect, it was brought to our attention that a [resident] under your care had indeed been neglected. Further investigation on our part led us to find several staff members who had over a period of five months told you numerous times of a [sic] area warranting nursing assessment & follow-up. Your failure to follow through on this concern in a timely manner jeopardized the health & well-being of the resident.

CMS Ex. 4, Attach. F.

I first consider the appropriateness of summary judgment.

A. Summary judgment is appropriate here because Petitioner has not established any dispute over genuine issues of material fact. ⁽²⁾

"Summary judgment is intended to pierce the pleadings, and assess the parties' proof in order to determine if there is a genuine need for trial." Crestview Parke Care Center, DAB No. 1836, at 7 (2002), citing Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). In Crestview, the Departmental Appeals Board (Board) discussed in some detail the appropriate criteria for awarding summary judgment. Summary disposition is appropriate where the parties raise no genuine issue of material fact. To defeat a motion for summary judgment, the non-moving party must provide evidence of specific facts and must show that the fact in contention is material, that is, a fact that might affect the outcome of the suit.

[I]n order to demonstrate a genuine issue, the opposing party must do more than show that there is "some metaphysical doubt as to the material facts . . . . Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no 'genuine issue for trial.'"

Crestview, at 7, quoting Matsushita, at 587.

Petitioner contends that genuine issues of material fact are in dispute here, citing first, "whether Mercy was in substantial compliance with the participation requirements under 42 C.F.R. � 483.25." Petitioner's Brief (P. Brief) at 8. However, whether the undisputed facts amount to substantial noncompliance constitutes a conclusion of law, not an allegation of fact. See Crestview Parke Care Center, DAB CR867, at 9, aff'd DAB No. 1836, at 8. ("Conclusions and legal arguments do not establish material facts in dispute.")

Next, Petitioner argues that the "conflicting" statements from Drs. Sardar and Serushan, on the one hand, and Dr. Haywood, the Medical Director for CMS, Region V (Chicago) (CMS Ex. 11), on the other, create "a genuine issue of material fact as to whether [Resident 1] was harmed by the alleged delay in reporting a change of condition." P. Brief at 9. However, CMS accepts, for summary judgment purposes, that Resident 1 was not harmed by the delay, and notes, accurately, that a showing of actual harm is not required to sustain the deficiency finding. ⁽³⁾ To be in substantial compliance, a facility's deficiencies may pose no greater risk to a resident's health and safety than "the potential for causing minimal harm." 42 C.F.R. � 488.301. Southridge Nursing and Rehabilitation Center, DAB No. 1778 (2001).

Petitioner comes closer to identifying a genuine issue of material fact when it suggests that an issue remains "as to whether the alleged failure to notify [Resident 1's] physician of the change in her breast had a potential for causing more than minimal harm." P. Brief at 8 n.1. The problem with this assertion is that Petitioner presents no evidence to support it. For purposes of summary judgment, I accept as true the statement from Dr. Serushan that Resident 1's treatment "would not have been any different had she been diagnosed even six or twelve months earlier," (P. Ex. G; CMS Ex. 5) and Dr. Sardar's assertion that "[t]he stage at which the cancer was discovered has no bearing on eventual outcome." CMS Ex. 4, Attach. D, at 4. ⁽⁴⁾ I find, however, that Drs. Serushan and Sardar confine their opinions to the "eventual outcome" resulting from the delay in Resident 1's case: that Resident 1's treatment would not have been different had her symptoms been reported and investigated earlier. Neither physician has suggested that a prolonged delay in reporting a symptom of breast cancer does not have the potential for causing more than minimal harm. I recognize that Dr. Sardar's somewhat ungrammatical mixing of tenses ("the stage at which the cancer was discovered has no bearing") (emphasis added) could create some confusion, but the statement was made in response to a direct question from Surveyor Bonet-Rich as to the treatment provided Resident 1:

How would the resident's treatment have been different had early detection, March 2000, when a dime-sized palpable bruised area was reported by the bath aide to the charge nurse, versus an open draining wound was reported by the bath aide to the charge nurse August 10, 2000? (5 month "window")

CMS Ex. 4, Attach. D, at 4. Thus, in context, his statement could only reasonably be interpreted as addressing what actually happened in Resident 1's case. ⁽⁵⁾

Petitioner also submits an affidavit from the facility administrator, Janice Podwika. Administrator Podwika asserts that Resident 1 "received the highest quality care," a conclusion, not an assertion of fact. She also states that Resident 1 "never complained of a medical problem, nor sought any assistance regarding her breast, even though she was fully capable of doing so at that time." P. Ex. D. Petitioner understandably does not argue from this that the resident was somehow at fault for the delay in reporting, nor that the resident's failure to complain relieves the facility of its responsibility. I consider immaterial whether the resident complained or sought assistance.

Having determined that Petitioner has not raised a genuine issue of material fact, I now address the merits of this case, based on the uncontroverted facts.

B. The facility failure, over a five-month period, to report to her physician or otherwise follow up on observed changes in Resident 1's right breast constitutes a failure to provide the necessary care and services to allow her to attain or maintain the highest practicable physical, mental, and psychosocial well-being. The facility was therefore not in substantial compliance with program participation requirements, specifically 42 C.F.R. � 483.25 (Quality of Care)

I next consider whether the facility failure, over a five-month period, to report to her physician or otherwise follow up on observed changes in Resident 1's right breast constitutes a failure to provide the necessary care and services to allow her to attain or maintain the highest practicable physical, mental, and psychosocial well-being. Petitioner concedes that in March and June 2000, a member of the facility's shower team noticed changes in Resident 1's right breast, and reported those changes to the charge nurse, but the charge nurse failed to follow up. P. Brief at 3. Petitioner also concedes that on August 10, 2000, the shower team reported an open draining wound on Resident 1's right breast. The facility reported this to her physician. She was diagnosed with breast cancer and underwent a mastectomy. P. Brief at 3. The state at which the cancer was finally discovered did not affect her treatment or the outcome, according to her physicians.

In an unchallenged declaration, Surveyor Bonet-Rich, a registered nurse, states that the nursing standard of care mandates the reporting of a significant change in a resident's condition to the resident's physician, and the failure to report timely a clinical condition indicative of breast cancer poses risk of serious harm or death to the resident. CMS Ex. 4, at 4 - 5. In his declaration, Dr. Trent Haywood, a Board-Certified internist and Medical Director for CMS, Region V (Chicago), corroborates the Bonet-Rich opinion that, in the circumstances presented here, professional standards of nursing care mandate the assessment and reporting to a physician the condition of Resident 1's breast observed by CNA White in March and June 2000. CMS Ex. 11. Dr. Haywood characterizes as "common nursing knowledge" that a discolored nodule, palpable to the touch, as observed and reported by CNA White in March 2000, indicates potential breast cancer, among other possible medical conditions.

Similarly, it is common nursing knowledge that the clinical condition of [Resident 1's] breast which had progressed to open draining wound in the same location as the previously noted nodule that was observed by the CNA and reported to the charge nurse in June 2000 is also a significant condition that warrants immediate nursing intervention and report to a physician.

CMS Ex. 11, at 3. Nothing in the statements from Drs. Sardar and Serushan nor any other evidence contradicts these medical opinions.

Dr. Haywood further opines that "a five month delay in the diagnosis and treatment of breast cancer presents a significant risk of metastasis of the malignant cells infiltrating to the lymph nodes," that "such a metastasis is likely to occur during a five month delay in the diagnosis and treatment of the cancer depending on the histology of the breast tissue," and that "[s]uch metastasis of the malignant cells to the lymph nodes or any area outside of the breast itself represents not only serious harm to the individual, but also is likely to negatively affect an individual's prognosis for overall survival or a disease-free survival state within the next five (5) years." CMS Ex. 11, at 3 - 4. He concludes that because of the risk of metastasis, the nursing staff failure to assess and report to the resident's physician the significant change of condition in the resident's breast between March and August 10, 2000, posed a likelihood of serious harm to the resident, regardless "of whether or not metastasis or infiltration of the malignant cells outside of the resident's breast actually occurred." CMS Ex. 11, at 4. Again, Petitioner presents no evidence or medical opinion challenging Dr. Haywood's conclusions. In fact, the facility's articulated rationale for terminating the employment of Charge Nurse Hill is wholly consistent with the opinions expressed by Surveyor Bonet-Rich and Dr. Haywood:

a [resident] under your care had indeed been neglected . . . . several staff members . . . over a period of five months told you numerous times of a [sic] area warranting nursing assessment & follow-up. Your failure to follow through on this concern in a timely manner jeopardized the health & well-being of this resident.

CMS Ex. 4, Attach. F. I accept these opinions and find that the facility was not in substantial compliance with the quality of care requirements set forth in 42 C.F.R. � 483.25. Its failure to assess and report the change in Resident 1's condition constitutes a failure to provide care and services necessary to allow her to attain or maintain the highest practicable physical, mental, and psychosocial well-being. I consider substandard the quality of care provided, and conclude that the facility performance presented a greater risk to resident health and safety than the potential for causing minimal harm.

C. The amount of CMP imposed against Petitioner, $10,000, is reasonable.

Having found a basis for imposing a CMP, I now consider whether that amount is reasonable, applying the factors listed in 42 C.F.R. � 488.438(f). Emerald Oaks, DAB No. 1800, at 10 (2001); CarePlex of Silver Spring, DAB No. 1683, at 16 - 17 (1999); Capitol Hill Community Rehabilitation and Specialty Care Center, DAB No. 1629 (1997).

CMS is not required to offer evidence as to the � 488.438(f) factors as part of its prima facie case. The facility must timely raise its claim that a particular factor makes a CMP unreasonable before any question arises as to CMS's responsibility for producing evidence as to that factor. Community Nursing Home, DAB No. 1807, at 22 (2002). Petitioner here argues that three of the � 488.438(f) factors justify a lower CMP: 1) the facility's financial condition; ⁽⁶⁾ 2) its history of noncompliance; and 3) the seriousness of the deficiency.

Relying on the Podwika affidavit, unsupported by any documentation, Petitioner claims that its financial condition does not justify a $10,000 CMP, because, for the fiscal year ending June 30, 2001, it "operated at a loss of approximately $500,000." P. Ex. D. CMS, on the other hand, submitted the facility's Medicaid cost report for the period ending June 30, 1999, showing a total adjusted net loss of $30,436 for that fiscal year. CMS Ex. 16, at 1. Based on the report, CMS also points to the facility's total revenues ($7,700,142), and available cash assets ($1,010,864), notes that the facility is wholly owned by Mercy Hospital & Medical Center, a potential source of funding, and characterizes the $10,000 CMP as "de minimis." CMS Reply Brief at 18; CMS Ex. 16, at 9, 12.

Accepting the Podwika claim as to the amount of its operating loss for one year does not render unreasonable a $10,000 CMP. Even severe financial losses are not sufficient to establish a provider's inability to pay. Wellington Specialty Care & Rehabilitation Center, DAB CR548 (1998). In a careful analysis, Judge Kessel recently observed that a facility's profits or losses may rise and fall over short periods of time depending on a host of other factors, but those short-term profits and/or losses may not accurately describe the facility's overall financial health. Profits and losses must be considered in the context of other factors, including the facility's financial reserves, its credit-worthiness, and other long-term indicia of its survivability. Ridge Terrace, DAB CR938, at 4 - 5 (2002).

Moreover, here, Petitioner does not even suggest that it is unable to pay the $10,000 CMP, only that its payment "will have an impact on the facility." P. Brief at 13. This is hardly a basis for lowering the amount. The CMP is supposed to "have an impact on the facility," and should be at a level "reasonably related to an effort to produce corrective action." CarePlex, at 8.

With respect to compliance history, the parties present somewhat conflicting accounts. According to the Podwika affidavit, the facility has received only one citation for noncompliance with State or federal regulations: 1999 deficiencies, arising from the elopement of a resident during the installation of a new security system. P. Ex. D. CMS responds by pointing out that the 1999 incident presented immediate jeopardy and resulted in a $ 3,050 CMP (with the facility availing itself of the 35% reduction under 42 C.F.R. � 488.436 and paying $1,982.50). CMS also provides documentation showing the imposition of a $7,000 CMP for noncompliance that resulted in actual harm from April 6, 2000 through May 10, 2000, and additional penalties imposed in 1997 and 1995 - 1996. CMS Ex. 15.

Petitioner made no effort to reply to CMS's assertions, so I am not able to determine whether the facts asserted by CMS are in dispute. Certainly these types of assertions are easily verifiable based on the documentary record. However, even accepting Podwika's claim of only one incident of noncompliance establishes that the facility has a less-than-perfect compliance history.

Finally, financial condition and compliance history are not the only factors to be considered in setting the CMP. The seriousness of the deficiency and the facility's culpability must be considered. Petitioner characterizes its deficiency as "a relatively low level of seriousness." P. Brief at 12. Citing Judge Kessel's opinion in Sonogee Rehabilitation and Living Center, DAB CR754 (2001), Petitioner notes that Sonogee also involved a deficiency cited at the J level, and suggests that because Judge Kessel there lowered the CMP to the minimum, I should do the same here. Sonogee involved a deficiency arising out of the elopement of a facility resident. I find it difficult to assess the relative seriousness of these deficiencies, although I note that elopements can be difficult to control, the facility having to balance individual freedom with safety issues.

Sonogee was "not a case in which Petitioner willfully disregarded the needs of Resident 11 . . . . Petitioner was both aware of the resident's needs and took measures to address those needs. Those measures were inadequate. But, it cannot be said that Petitioner was indifferent or callous." Sonogee, at 12. In contrast here, the facility's obligation was obvious and not difficult: to report an observed condition that staff knew (or should have known) was serious. Its failure to act was callous and indifferent to the needs of a vulnerable resident.

Moreover, accepting Petitioner's claim that its situation is comparable to Sonogee would not benefit Petitioner. In Sonogee, Judge Kessel lowered the penalty to $3,050 per day for 5 days, for a total penalty of $15,250, more than 50% higher than the penalty imposed here for a J level deficiency. ⁽⁷⁾

Because the deficiency was serious, and the facility culpable, I am not able to find unreasonable the imposition of a $10,000 CMP.

V. Conclusion

For the reasons discussed above, I uphold CMS's determination that the facility was not in substantial compliance with program participation requirements for Quality of Care. The care provided was substandard, and the facility's performance presented a greater risk to resident health and safety than the potential for causing minimal harm. The amount of the civil money penalty imposed - $10,000 - is reasonable.

Carolyn Cozad Hughes

Administrative Law Judge

1. According to treatment notes, Dr. Serushan "visited" Resident 1 on March 19, 2000, and she was "seen" by him on April 22, 2000. CMS Ex. 4, Attach. E, at 6. However, his progress notes for those visits make no reference to the breast lesion, and no evidence suggests that he was then aware of it. CMS Ex. 4, Attach. E, at 13. Whether he has any culpability in this debacle is not an issue before me as CMS did not cite a deficiency under physician services.

2. 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 or lettered heading and explain each finding in detail.

3. I note that Dr. Haywood's opinion incorporated the statements from Drs. Serushan and Sadar. CMS Ex. 11.

4. The proposition that removal of an orange-sized lesion as opposed to removal of a dime-sized lesion poses no additional risk might be met with some skepticism, and, certainly, if this issue were material to this case's resolution, these physicians could be called upon to explain more precisely their conclusions. However, because I rule, as a matter of law, that CMS need not demonstrate actual harm, that question need not be resolved here.

5. Nor do I believe that any reputable physician would deny that lengthy delay in reporting an evident symptom of breast cancer presents at least the potential for more than minimal harm.

6. A question arises as to whether this issue has been preserved, inasmuch as Petitioner did not raise its financial condition as an issue in its hearing request. See Community Nursing Home, DAB No. 1807, at 22 et seq.; Emerald Oaks, DAB No. 1800; Crestview, DAB No. 1836, at 24 et seq. (Petitioner's general challenge to the amount of the CMP is insufficient to preserve the issue.) I am concerned that by allowing a party to raise an issue not mentioned in the hearing request, without requiring it to meet the requirements for amending, we move ever closer to stripping 42 C.F.R. � 498.40(b) of any meaning ("The request for hearing must 1) [i]dentify the specific issues, and the findings of fact and conclusions of law with which the affected party disagrees; and 2) [s]pecify the basis for contending that the findings and conclusions are incorrect.")

Nevertheless, since 1) even considering Petitioner's assertions as to its financial condition, I find the CMP reasonable; 2) CMS has not complained that the issue was not preserved; and 3) the parties have not addressed the matter, I decline to reach the thorny issue here.

7. I do not consider significant that $10,000 represents the maximum for a per instance CMP. CMS might have been justified in imposing a per day penalty from as early as March 2000, when the CNA noted and reported the change in Resident 1's condition. So, although CMS imposed the maximum per instance CMP, the result was not nearly as harsh as it might have been had CMS imposed the minimum per day CMP, beginning in March 2000. See Lake City Extended Care Center, DAB No. 1658, at 14 - 15 (1998). Because immediate jeopardy existed, the minimum penalty could have been $3,050 per day for approximately 150 days, a substantial sum, plus at least $50 per day after the immediate jeopardy was removed but substantial noncompliance remained.