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                              Texas General Hospital, DAB CR5692 (2020)
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Texas General Hospital, DAB CR5692 (2020)








  
  
    

  
      
Department of Health and Human Services 
    DEPARTMENTAL APPEALS BOARD
          Civil Remedies Division





Texas General Hospital
	(CCN: 670083),
	Petitioner,
v.
Centers for Medicare & Medicaid Services.
Docket No. C-19-190Decision No. CR5692August 18, 2020

        
              
    

      DECISION
Petitioner, Texas General Hospital, was a hospital that participated in the Medicare program until October 2018.  Effective October 18, 2018, the Centers for Medicare & Medicaid Services (CMS) terminated Petitioner’s Medicare participation agreement, based on a survey completed on August 2, 2018, and an attempted revisit survey on September 14, 2018.
Petitioner appealed, and CMS moved for summary judgment.  Petitioner opposed CMS’s motion.
As explained below, I conclude that CMS is entitled to summary judgment.  I therefore grant CMS’s motion.  The undisputed evidence establishes that, at the time of the revisit survey and prior to the date of its termination, Petitioner no longer met the statutory definition of “hospital” and was not in substantial compliance with Medicare conditions of participation.  CMS was therefore authorized to terminate Petitioner’s Medicare provider agreement.
Page 2
I.  Background and Procedural History
Petitioner was a hospital located in Grand Prairie, Texas, that participated in the Medicare program.  *See, e.g.*, CMS Exhibit (Ex.) 1 at 1.1
  The Texas Health and Human Services Commission (state agency) completed a complaint survey of Petitioner’s facility on August 2, 2018.  CMS Ex. 2.  The survey found that the facility was not in substantial compliance with Medicare participation requirements and that the deficiencies constituted immediate jeopardy to the health and safety of patients.  *Id.* The state agency issued a statement of deficiencies for the survey which identified the deficiencies.  *Id*.  In a notice letter dated August 17, 2018, CMS informed Petitioner that, based on the survey findings, it was not in substantial compliance with the following conditions of participation:
42 C.F.R. § 482.12 Governing Body
	42 C.F.R. § 482.13 Patient Rights
	42 C.F.R. § 482.23 Nursing Services
	42 C.F.R. § 482.26 Radiology Services
	42 C.F.R. § 482.27 Laboratory ServicesCMS Ex. 3 at 1.  CMS advised Petitioner that, unless the immediate jeopardy to patient health and safety was removed, CMS would terminate Petitioner’s Medicare provider agreement on September 9, 2018.  *Id.* CMS advised Petitioner further that “[t]ermination can only be averted by correction of the deficiencies, through submission of acceptable plans of correction (PoC) and subsequent verification of compliance by the [state agency].”  *Id*.  CMS set August 22, 2018, as the due date for the plan of correction and September 1, 2018, as the latest permissible completion date for Petitioner’s corrective action.  *Id.*at 1-2.
By letter dated September 6, 2018, CMS extended the termination date to October 8, 2018.  CMS Ex. 4.
Page 3
On September 14, 2018, two state agency surveyors went to Petitioner’s premises to conduct an unannounced revisit survey to verify whether Petitioner was in compliance with the Medicare conditions of participation.  CMS Ex. 8 at ¶ 3.  The surveyors found Petitioner’s building closed, and its doors locked.  *Id.*The revisit survey thus did not take place.  On September 21, 2018, the surveyors again visited Petitioner’s premises for a final inspection, but the building remained closed.  *Id.*at ¶ 4.
By letter dated October 3, 2018, CMS informed Petitioner that CMS was terminating Petitioner’s Medicare provider agreement, effective October 18, 2018, because Petitioner no longer met program participation requirements.  CMS Ex. 5 at 1.  CMS stated that the state agency had not been able to conduct the September 14, 2018 follow-up survey “to determine compliance with the continuing Condition level deficiencies.”  *Id.* CMS did not provide Petitioner any additional opportunity to correct the cited deficiencies.  *Id.*
On November 29, 2018, Petitioner requested a hearing before an administrative law judge.  Departmental Appeals Board (DAB) Electronic Filing System (E-File) Docket Entry 1‐1a.  The case was assigned to me for hearing and decision.  On December 6, 2018, I issued an Acknowledgment and Pre-hearing Order (Pre-hearing Order) establishing a briefing schedule.
On February 1, 2019, CMS filed a combined motion for summary judgment and memorandum in support (CMS MSJ) along with three proposed exhibits.  On March 6, 2019, CMS filed its pre-hearing brief and eight proposed exhibits (CMS Exs. 1-8).  On March 6, 2019, Petitioner filed an opposition to CMS’s motion for summary judgment (P. Opp.) and three proposed exhibits, which were not labeled.  On March 8, 2019, CMS filed a reply (CMS Reply).  In its reply, CMS pointed out that Petitioner’s opposition was not filed timely and asked that it be stricken.  CMS Reply at 3.  I decline to strike Petitioner’s opposition.  However, I consider CMS’s substantive argument (i.e. that Petitioner failed to raise a genuine dispute as to the material facts) in ruling on the motion for summary judgment.
On April 10, 2019, Petitioner filed its pre-hearing brief (P. Pre-hrg. Br.) and three proposed exhibits (P. Exs. 1-3), which were identical to the exhibits filed with its opposition to CMS’s motion.  Neither party objected to the exhibits offered by the opposing party.  Therefore, in the absence of objection, I admit into the record CMS Exs. 1-8 filed with CMS’s pre-hearing brief and P. Exs. 1-3.  CMS offered the written direct testimony of one witness, Shannon Sisco, Program Manager, Texas Health and Human Services Commission, Hospital Facility Compliance Division.  CMS Ex. 8.  Petitioner did not request to cross-examine CMS’s witness.  In any event, as I explain below, the record shows that there is no genuine dispute as to any material fact.  I therefore find it appropriate to decide this case on summary judgment in lieu of a hearing.
Page 4
II.  Issues
The issues in this case are:
Whether summary judgment is appropriate; and
Whether CMS had a legal basis to terminate Petitioner’s Medicare provider agreement.
III.  Jurisdiction
I have jurisdiction to hear and decide this case.  Social Security Act (Act) § 1866(h)(1) (codified at 42 U.S.C. § 1395cc(h)(1)); 42 C.F.R. §§ 488.24(c); 489.53(e);****498.3(b)(8); 498.5(b); 498.40(a)(1).
IV.  Discussion
**A.  Statutory and Regulatory Background**
A hospital is an institution that, among other requirements, primarily engages in providing to inpatients, by or under the supervision of physicians, (A) diagnostic and therapeutic services for medical diagnosis, treatment, and care of injured, disabled or sick persons, or (B) rehabilitation services for injured, disabled, or sick persons.”  Act § 1861(e) (42 U.S.C. § 1395x(e)).  A hospital may participate in the Medicare program as a provider of services, if it meets the statutory definition and complies with regulatory requirements, called conditions of participation.  *Id.*; *see also id.* § 1866(a)(1) (42 U.S.C. § 1395cc(a)(1));42 C.F.R. Part 482; 42 C.F.R. § 488.3.  If a provider fails to comply substantially with the provisions of section 1861 of the Act or the regulations governing its program participation, CMS, acting on behalf of the Secretary of Health and Human Services (Secretary), may terminate its provider agreement.  Act § 1866(b)(2) (42 U.S.C. § 1395cc(b)(2)); 42 C.F.R. § 489.53(a)(1).
The Secretary contracts with state agencies to conduct periodic surveys to determine whether a hospital meets the conditions of participation.  Act § 1864(a) (42 U.S.C. § 1395aa(a)); 42 C.F.R. §§ 488.10(a)(1), 488.1.  “The State agency will certify that a provider or supplier is not or is no longer in compliance with the conditions of participation . . . where the deficiencies are of such character as to substantially limit the provider’s or supplier’s capacity to furnish adequate care or which adversely affect the health and safety of patients.”  42 C.F.R. § 488.24(b).  “The decision as to whether there is compliance with a particular requirement, condition of participation, or condition for coverage depends upon the manner and degree to which the provider or supplier satisfies the various standards within each condition.”  42 C.F.R. § 488.26(b).  “Immediate
Page 5
jeopardy” is defined as “a situation in which the provider’s or supplier’s non-compliance with one or more Medicare requirements, conditions of participation, conditions of coverage or certification has caused, or is likely to cause, serious injury, harm, impairment, or death to a resident or patient.”  42 C.F.R. § 488.1.  A state agency may conduct a revisit survey “to evaluate the extent to which previously-cited deficiencies have been corrected and the provider or supplier is in substantial compliance with applicable conditions of participation, requirements, or conditions for coverage.”  42 C.F.R. § 488.30(a).
	If CMS terminates a hospital’s provider agreement, the hospital may request a hearing before an administrative law judge to dispute the termination.  Act § 1866(h)(1) (42 U.S.C. § 1395cc(h)(1)); 42 C.F.R. §§ 488.24(c); 498.3(b)(8); 498.5(b); 498.40(a)(1).  In a proceeding before an administrative law judge under 42 C.F.R. part 498, CMS must make a *prima facie* case that a provider failed to comply with a condition of participation, and, if this occurs, the provider has the burden of proving compliance by a preponderance of the evidence.  *Nightingale Home Healthcare, Inc.*, DAB No. 2784 at 11 (2017); *Hillman Rehab. Ctr.*, DAB No. 1611 at 8 (1997), *aff’d, Hillman Rehab. Ctr. v. U.S. Dep’t of Health & Human Servs.*, No. Civ. A. 98-3789 (GEB), 1999 WL 34813783 (D.N.J. May 13, 1999); *see* *Batavia Nursing & Convalescent Inn*, DAB No. 1911 (2004), *aff’d, Batavia Nursing & Convalescent Ctr. v. Thompson*, 143 F. App’x 664 (6th Cir. 2005).
**B.  Findings of Fact, Conclusions of Law, and Analysis**
***1. Summary judgment is appropriate in this case.2***
**a.  Legal Standard**
An administrative law judge may resolve a case, in whole or in part, by summary judgment*.  See, e.g., Lebanon Nursing & Rehab. Ctr*., DAB No. 1918 at 3 (2004).  Summary judgment is appropriate and no hearing is required where either:  there are no genuine disputes of material fact and the only questions that must be decided involve application of law to the undisputed facts; or the moving party prevails as a matter of law even if all factual disputes are resolved in favor of the party against whom the motion is made.  *Mission Hosp. Reg’l Med. Ctr.*, DAB No. 2459 at 5 (2012) (and cases cited therein),*aff’d, Mission Hosp. Reg’l Med. Ctr. v. Burwell*,819 F.3d 1112 (9th Cir. 2016).  In determining whether there are genuine issues of material fact for trial, the reviewer must view the evidence in the light most favorable to the non‐moving party, drawing all reasonable inferences in that party’s favor.  *Id.*The party requesting summary judgment bears the burden of showing that there are no genuine issues of material fact for trial and/or that it is entitled to judgment as a matter of law.  *Id.*Generally, the non‐movant may not defeat an adequately supported summary judgment
Page 6
motion by relying upon the denials in its pleadings or briefs but must furnish evidence of a dispute concerning a material fact, i.e., a fact that would affect the outcome of the case if proven.  *Senior Rehab. & Skilled Nursing Ctr.*, DAB No. 2300 at 3 (2010) (and cases cited therein), *aff’d, Senior Rehab. & Skilled Nursing Ctr. v. Health & Human Servs.*, 405 F. App’x 820 (5th Cir. 2010);*see also Anderson v. Liberty Lobby, Inc.*, 477 U.S. 242, 248 (1986).
In moving for summary judgment, CMS argues that it properly terminated Petitioner’s Medicare participation agreement because Petitioner no longer met the statutory definition of “hospital” and did not substantially comply with the Medicare conditions of participation for hospitals.  CMS MSJ at 3-6.  CMS contends that the undisputed facts that Petitioner was closed and not in operation on September 14, 2018, and September 21, 2018, when state agency surveyors attempted to conduct revisits of Petitioner’s premises, are sufficient to support the termination as a matter of law.  *Id.* Petitioner argues that there are material facts in dispute concerning whether it returned to substantial compliance with the conditions of participation before the state agency attempted the revisit surveys.  P. Opp. at 3.
Applying the criteria for summary judgment to this case, I find that Petitioner’s arguments do not raise a genuine dispute as to any material fact.  The issues in this case must be resolved against Petitioner as a matter of law, and the case can be resolved by applying the law to the undisputed facts.  Accordingly, I grant summary judgment in favor of CMS.
**b.  Undisputed Facts3**
Petitioner was a hospital located in Grand Prairie, Texas, which participated in the Medicare program.  *See, e.g.*, CMS Ex. 2 at 1.  The state agency completed a complaint survey of Petitioner’s facility on August 2, 2018.  *Id.*The survey found that the facility was not in substantial compliance with five Medicare conditions of participation and that the deficiencies constituted immediate jeopardy to the health and safety of patients.  *Id.*at 2.  In a letter dated August 17, 2018, CMS advised Petitioner, inter alia, that it no longer met the requirements for program participation, and that, unless the immediate jeopardy to patient health and safety was removed, CMS would terminate Petitioner’s Medicare provider agreement on September 9, 2018.  CMS Ex. 3 at 1.  By letter dated September 6, 2018, CMS extended the termination date to October 8, 2018.  CMS Ex. 4.
Page 7
On August 7, 2018, the Texas state agency issued an Emergency Order, suspending Petitioner’s license to operate as a hospital.  *See* CMS Ex. 6 at 1.  On September 11, 2018, following a hearing, an administrative law judge with the Texas state agency issued an order upholding the emergency suspension.  *Id.*at 1, 2.  The state administrative law judge ruled that Petitioner’s license would remain suspended until the state agency determined that Petitioner was “once again in compliance with licensing rules and laws.”  *Id.*at 1.
On September 14, 2018, state agency surveyors went to Petitioner’s premises to conduct an unannounced revisit survey to verify whether Petitioner was in compliance with Medicare conditions of participation.  CMS Ex. 8 at ¶ 3.  The surveyors found Petitioner’s building closed, its signage covered, and its doors locked.  *Id.*The surveyors could not gain access to the facility.  *Id.* The revisit survey thus did not take place.
On September 21, 2018, the surveyors again visited Petitioner’s premises to attempt a final inspection, but the building remained closed.  *Id.*at ¶ 4.  One of the surveyors took photographs of Petitioner’s premises during the September 21, 2018 visit.  *Id*.  One photograph depicts a sign affixed to either a glass window or door, on which is printed:  “The Hospital is temporarily closed and is not accepting patients at this time.  For Emergency Assistance please call 9-1-1[.]”  *Id.* at 4.
By letter dated October 3, 2018, CMS informed Petitioner that its Medicare provider agreement would be terminated, effective October 18, 2018, because Petitioner was no longer in compliance with Medicare conditions of participation.  CMS Ex. 5 at 1.  CMS advised that the state agency had not been able to conduct the September 14, 2018 follow-up survey “to determine compliance with the continuing Condition level deficiencies” because Petitioner was closed; therefore, the state agency was unable to verify Petitioner’s compliance.  *Id.* CMS determined also that the cited deficiencies represented immediate jeopardy to patient health and safety.  *Id*.  CMS did not provide Petitioner any additional opportunity to correct the cited deficiencies.
***2.  CMS is entitled to summary judgment because the undisputed evidence establishes that Petitioner had closed and stopped operating as of the date of the revisit survey; it therefore did not meet the statutory definition of “hospital” and did not comply with Medicare conditions of participation.***
CMS argues that it was authorized to terminate Petitioner’s Medicare participation agreement following Petitioner’s closure because Petitioner no longer met the statutory definition of “hospital” and was not in substantial compliance with Medicare conditions of participation.  *See, e.g.*, CMS MSJ at 1.  There is no dispute that, on September 14, 2018, the date of the attempted revisit survey, Petitioner was closed, its doors were locked, and it had stopped providing hospital services.  P. Opp. at 2 (¶ 4).  This is
Page 8
unsurprising given that, effective August 7, 2018, the state agency had issued an emergency order suspending Petitioner’s license to operate as a hospital.  CMS Ex. 6 at 1.  As of September 11, 2018, a state administrative law judge had upheld the emergency suspension, and ordered that Petitioner’s license would remain suspended until the state agency determined that Petitioner was “once again in compliance with licensing rules and laws.”  *Id.* Because Petitioner’s building was closed and the hospital was not providing services, state agency surveyors were unable to conduct a revisit survey to verify whether Petitioner had returned to substantial compliance.  When the surveyors returned on September 21, 2018, for a final inspection, they found that Petitioner’s premises remained closed.
Thus, from on or about August 7, 2018, through at least September 21, 2018,4
 Petitioner’s license to operate a hospital was suspended.  At least as of September 11, 2018, Petitioner had ceased operations, and no longer had any patients or staff.  Accordingly, Petitioner could not comply with either the statutory or regulatory requirements to participate in Medicare as a hospital.  Petitioner did not comply with the statute because Petitioner was not engaged (“primarily” or otherwise) in providing diagnostic and therapeutic services to inpatients, nor was it able to provide 24-hour nursing services.  *See*Act § 1861(e)(1), (5).  Further, Petitioner no longer met state licensing requirements because the state agency had suspended its operating license.  Act § 1861(e)(7); Tex. Health & Safety Code Ann. § 241.021; 25 Tex. Admin. Code § 133.121(12).  These undisputed facts establish that, as of the September 14, 2018 revisit survey, Petitioner no longer met the statutory definition of “hospital.”  This conclusion alone is a sufficient basis to grant summary judgment in favor of CMS because section 1866(b)(2) of the Act authorizes the Secretary to terminate the provider agreement of a facility that fails to meet the statutory definition.  *See Ariz. Surgical Hosp., LLC,*DAB No. 1890 at 4 (2003) (“Given [the petitioner’s] inability to comply with the statutory definition [of hospital], the [administrative law judge] was not required to take additional evidence.”).
Although Petitioner does not deny that its facility was closed at the time of the attempted resurvey, Petitioner nevertheless argues that summary judgment is inappropriate because there are material facts in dispute.  P. Opp. at 3.  Petitioner alleges that it had resolved all the deficiencies prior to the attempted revisit, and its corrective actions were contained in
Page 9
its plan of correction and supporting documents.5
  Citing 42 C.F.R. § 488.454(a)(1), Petitioner argues that its plan of correction and supporting documents constituted “credible written evidence” which CMS could have verified without an on‐site visit.  *Id.*According to Petitioner, had CMS done so, it could have established that Petitioner had returned to substantial compliance and was capable of remaining in compliance, on a date prior to the attempted revisit.  *Id.*; *see also*P. Pre‐hrg. Br. at 3.
Petitioner’s argument that it was in compliance with the hospital conditions of participation prior to the termination of its provider agreement fails to address its inability to comply with the statutory definition of hospital.  Moreover, Petitioner’s plan of correction, absent verification by a survey, does not raise a material factual dispute concerning Petitioner’s return to substantial compliance.  *See Hermina Traeye Mem’l Nursing Home*, DAB No. 1810 at 12 (2002) (“Under the regulations, the mere submission of a [plan of correction] [does] not establish that any cited deficiencies [have] been corrected.”), *aff’d sub nom. Sea Island Comprehensive Healthcare Corp. v. U.S. Dep’t of Health & Human Servs.*, 79 F. App’x 563 (4th Cir. 2003).6
Petitioner’s argument that CMS could have verified Petitioner’s substantial compliance based on “credible written evidence” without the need for a revisit survey overlooks the fact that, while the regulation *permits* CMS to accept written evidence of compliance, it does not *require*CMS to do so.  The regulation on which Petitioner relies, 42 C.F.R. § 488.454(a)(1), provides, in relevant part:
(a) Except as specified in paragraphs (b) and (d) of this section, alternative remedies continue until –
	(1) The facility has achieved substantial compliance, as determined by CMS or the State based upon a revisit or after an examination of credible written evidence that it can verify without an on-site visit; or
*         *        *
Page 10
(e) If the facility can supply documentation acceptable to CMS or the State survey agency that it was in substantial compliance and was capable of remaining in substantial compliance, if necessary, on a date preceding that of the revisit, the remedies terminate on the date that CMS or the State can verify as the date that substantial compliance was achieved and the facility demonstrated that it could maintain substantial compliance, if necessary.
The regulation at 42 C.F.R. § 488.454(a)(1) does not specify under what circumstances verification of substantial compliance may be determined based solely on CMS’s review of “credible written evidence,” without an on-site revisit.  However, the preamble to the final rule adopting section 488.454(a)(1) is instructive:
In order to appropriately respond to each unique situation of noncompliance, [CMS] or the State will evaluate credible written evidence on a case by case basis.  [CMS] and the State have the discretion to determine what constitutes written credible evidence.  For example, a survey may determine that a facility’s furnace is broken constituting a deficiency for violating a Physical Environment requirement by its failure to maintain all essential mechanical, electrical and patient care equipment in safe operating condition (§ 488.70(c)(2)).  In such a case, the facility may buy a new furnace, have it installed, and submit the receipt to the State or [CMS] as written credible evidence of substantial compliance.  If this written credible evidence is accepted by [CMS] or the State, the accrual of the civil money penalty would stop as of the date substantial compliance was achieved.
*        *        *
There are other cases in which documentation cannot confirm the correction of noncompliance, and in these cases an on-site revisit is necessary.  For example, one of the requirements for Infection Control is that personnel must handle, store, process and transport linens so as to prevent the spread of infection as specified in § 483.65.  If a deficiency is cited for a violation of this requirement and a civil money penalty is imposed, submitted written documentation would not confirm the correction of the violation.  An on-site revisit to observe personnel behavior is necessary in this case to confirm that
Page 11
the facility is, in fact, back in substantial compliance with this regulatory provision.
59 Fed. Reg. 56,116, 56,207 (Nov. 10, 1994).
Importantly, the preamble underscores that CMS and the state agency have discretion to determine what constitutes credible written evidence of compliance.  In the present case, it is apparent that CMS and the state agency determined that a revisit was required to confirm whether Petitioner had attained substantial compliance with the conditions of participation for hospitals.  The decision to attempt a revisit survey reflects an implicit finding that Petitioner’s plan of correction alone did not constitute credible written evidence of compliance that could be verified without the need to conduct an on-site revisit.  Given that this is a matter over which CMS and the state may exercise discretion, it is not clear to me that I am authorized to review whether CMS or the state agency properly determined that Petitioner’s written evidence was not sufficiently credible to warrant a finding that Petitioner had returned to substantial compliance.  *See Hermina Traeye*, DAB No. 1810 at 12 (the administrative law judge “properly concluded that he lacked authority to adjudicate the question of whether [CMS] abused its discretion in deciding to reject the [plan of correction].”).  Nevertheless, if the issue were properly before me, I would agree with CMS that Petitioner could not be found to have returned to substantial compliance without a revisit survey.
In interpreting 42 C.F.R. § 488.454, appellate panels of the Departmental Appeals Board (DAB) have held that a facility remains out of substantial compliance until it affirmatively demonstrates that it has returned to substantial compliance.  *Ridgecrest Healthcare Ctr.*, DAB No. 2493 at 2-3 (2013); *Life Care Ctr. of Elizabethton*, DAB No. 2367 at 16-17 (2011); *Premier Living & Rehab. Ctr.*, DAB No. 2146 at 23 (2008); *Lake City Extended Care Ctr.*, DAB No. 1658 at 12-15 (1998).  The facility must show that the incidents of noncompliance have ceased *and*that it has implemented appropriate measures to ensure that similar incidents will not recur.  *Libertywood Nursing Ctr.*, DAB No. 2433 at 15 (2011) (citing *Life Care Ctr. of Elizabethton*, DAB No. 2367 at 16), *aff’d, Libertywood Nursing Ctr. v. Sebelius*, 512 F. App’x 285 (4th Cir. 2013).  A facility’s return to substantial compliance usually must be established through a resurvey.  *Omni Manor Nursing Home*, DAB No. 2374 at 6 (2011).
Based on the state agency’s August 2, 2018 survey, CMS found that Petitioner no longer met the conditions of participation found at 42 C.F.R. §§ 482.12 (Governing Body), 482.13 (Patient Rights), 482.23 (Nursing Services), 482.26 (Radiology Services), and 482.27 (Laboratory Services).  CMS Ex. 2 at 2; CMS Ex. 3 at 1.  CMS further determined that Petitioner’s deficiencies represented immediate jeopardy to patient health and safety.  CMS Exs. 2, 3.  The cited deficiencies were extensive and involved significant failures in the areas of administration, staffing, and patient care and services.  For example, the survey findings included that Petitioner’s emergency room was minimally staffed; that no
Page 12
inpatient nurses were available to admit a patient to the hospital; that no radiologist or radiology technicians were on duty; and that no radiology services were being provided.  CMS Ex. 2 at 14-25.
Given the extent and nature of Petitioner’s violations, CMS and the state agency reasonably determined that it was not possible to verify that the deficiencies had all been corrected based solely on a review of documentary evidence.  As I have described above, the preamble to the final rule promulgating 42 C.F.R. § 488.454 suggests that a facility may establish substantial compliance based on written evidence alone for certain types of deficiencies.  59 Fed. Reg. at 56,207.  For example, the preamble describes a deficiency involving mechanical breakdown and repair of equipment as amendable to proof by credible written evidence.  *Id.* In such a case, a facility might offer a receipt or invoice to show that the malfunctioning equipment had been repaired or replaced.  *Id.* In contrast, the preamble notes that a deficiency involving personnel behavior may require observation of staff to verify that corrective actions have been fully implemented, and thus, a revisit would likely need to occur.7
  *Id.*
Because many of Petitioner’s cited deficiencies were related to staffing and patient care, CMS and the state agency reasonably found it would be necessary to verify that the deficient practices were no longer occurring by observing staff behavior (and that appropriate staff were present).  In light of these considerations, the state agency surveyors attempted to conduct an unannounced revisit survey on September 14, 2018.  However, they were unable to complete the revisit survey because Petitioner’s building was closed.  Thus, it was not possible for CMS or the state agency to verify that Petitioner had fully implemented its plan of correction and returned to substantial compliance with the conditions of participation.
V.  Conclusion
The undisputed evidence establishes that, as of September 14, 2018, Petitioner was no longer operating as a hospital.  Thus, it no longer met the statutory definition of a hospital.  For the same reason, the state agency was unable to verify that Petitioner was in substantial compliance with the Medicare conditions of participation for hospitals.  Accordingly, CMS was authorized to terminate Petitioner’s participation in Medicare as a
Page 13
hospital.  Act § 1866(b)(2); 42 C.F.R. § 489.53(a)(1).  I therefore grant CMS’s motion for summary judgment.


          /s/
        Leslie A. Weyn

                      Administrative Law Judge
      1. CMS filed three proposed exhibits with its motion for summary judgment, and subsequently filed eight proposed exhibits with its pre-hearing brief.  The three exhibits CMS offered with the motion for summary judgment also appear among the exhibits offered with the pre-hearing brief, but they are identified with different exhibit numbers.  For example, CMS Ex. 1 offered with the motion for summary judgment is the same document as CMS Ex. 3 offered with the pre-hearing brief.  To avoid confusion, throughout this decision, I cite only to the exhibits offered with the pre-hearing brief.  I do not refer to the exhibits offered with the motion for summary judgment. back to note 1
                      2. My conclusions of law appear as headings in bold italic type. back to note 2
                      3. My recitation of the facts is based on the facts set out on pages 1-2 of CMS’s motion, which were not disputed by Petitioner (P. Opp.; P. Pre-hrg. Br.), as well as additional undisputed facts from the record. back to note 3
                      4. In its request for hearing, Petitioner concedes that it “was closed due to a state issued suspension at the time [the] agency attempted its follow-up survey.”  DAB E-File, Docket Entry 1 at 2.  However, in its opposition to CMS’s motion, Petitioner characterizes the closure as “temporary.”  P. Opp. at 2.  Nevertheless, in its pre-hearing brief, Petitioner once again admits that it was “closed,” dropping any reference to a “temporary” closure.  P. Pre-hrg. Br. at 2.  Moreover, Petitioner has offered no evidence to show that its license suspension was lifted or that it had reopened at any time before CMS terminated its provider agreement. back to note 4
                      5. In its opposition to CMS’s motion for summary judgment, Petitioner states that its “supporting documents, presented at the October 3, 2018 [state agency] informal hearing, are evidence of [Petitioner’s] compliance.”  P. Opp. at 3. back to note 5
                      6. A number of the decisions cited in this portion of my analysis address appeals by skilled nursing facilities (SNFs).  Although Petitioner is a hospital, and not a SNF, its argument that it returned to substantial compliance prior to the revisit survey is analogous to those addressed in the cited decisions.  I therefore find it appropriate to look to these decisions for guidance in the present case. back to note 6
                      7. In making this observation, I am mindful of the appellate panel’s decision in Omni Manor Nursing Home.  In that case, the panel emphasized that the preamble to the regulation does not create a requirement that CMS or the state agency conduct a revisit survey to verify compliance with a quality of care deficiency.  Omni Manor, DAB No. 2374 at 6.  Nevertheless, in the panel’s view, the preamble does explain “why CMS or a state might choose a revisit survey over written submissions for deficiencies when, in CMS or a state’s view, observation of staff providing (or failing to provide) particular types of care to residents is needed.”  Id. back to note 7 Back to top
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