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                              Generations at Peoria, DAB CR6362 (2023)
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Generations at Peoria, DAB CR6362 (2023)








  
  
    

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





Generations at Peoria
(CCN: 145039),
Petitioner,

v.

Centers for Medicare & Medicaid Services.
Docket No. C-22-92Decision No. CR6362September 28, 2023

        
              
    

      DECISION

Following a complaint investigation completed on April 1, 2021 by the Illinois Department of Public Health (state agency), the Centers for Medicare & Medicaid Services (CMS) determined that Petitioner, Generations at Peoria, was not in substantial compliance with Medicare participation requirements at 42 C.F.R. § 483.80(a)(1)-(2), (4), (e), and (f) (Infection Prevention & Control).  As a result, CMS imposed a per-instance civil money penalty (PICMP) of $20,000 against Petitioner.  Petitioner timely appealed.

For the reasons explained in this decision, I find that the facility was not in substantial compliance with abovementioned Medicare participation requirements.  I further find that the PICMP imposed by CMS is reasonable.

I.    Background and Procedural History

Petitioner is a skilled nursing facility (SNF) located in Peoria, Illinois.  CMS Exhibit (Ex.) 1 at 1.  Based on complaints it received, the state agency conducted a complaint investigation survey of Petitioner’s facility that ended on April 1, 2021.  *Id*.  The state agency found that Petitioner was in substantial noncompliance with two Medicare requirements:

Page 2

42 C.F.R. § 483.80(a)(1)(2)(4)(e)(f) (Infection Prevention & Control), Scope and severity (S/S) level F (a deficiency that involves no actual harm, but has the potential for more than minimal harm that does not amount to immediate jeopardy)1;
	42 C.F.R. § 483.10(h)(1)-(3)(i)(ii) (Personal Privacy/Confidentiality of Records) Scope and severity (S/S) level E (a deficiency that involves no actual harm, but has the potential for more than minimal harm that does not amount to immediate jeopardy).CMS Exs. 1, 13.

Based on these findings, by letter dated April 20, 2021, the state agency informed Petitioner that it would recommend that CMS impose a civil monetary penalty (CMP) on Petitioner.  CMS Ex. 6 at 2-3.

On September 13, 2021, CMS issued an initial determination in which it informed Petitioner that the complaint survey, completed at Petitioner on April 1, 2021, found substantial noncompliance.  CMS Ex. 1.  CMS noted that the most serious of the deficiencies was cited at S/S level F:  42 C.F.R. § 483.80(a)(1)(2)(4)(e)(f) (Infection Prevention & Control).  CMS Ex. 1 at 1.  CMS imposed a PICMP of $20,000.  *Id*.  As CMS did not base any enforcement remedies on the alleged deficiency at 42 C.F.R. § 483.10(h)(1)-(3)(i)(ii) (Personal Privacy/Confidentiality of Records), it is not the subject of the present appeal, nor is it relevant to this decision.

Page 3

On November 12, 2021, Petitioner requested a hearing to dispute the initial determination.  The Civil Remedies Division acknowledged receipt of the hearing request and assigned the case to me.  On November 15, 2021, I issued my Standing Prehearing Order (SPO).

In accordance with the SPO, on February 14, 2022, CMS filed a prehearing brief (CMS Br.) and 30 exhibits (CMS Exs. 1-30).  CMS proposed one witness, Kizzie Gorsuch, R.N., whose written direct testimony was submitted by CMS as Exhibit 27.  On March 18, 2022, Petitioner filed a prehearing exchange consisting of a prehearing brief (P. Br.) and four exhibits (P. Exs. 1-4), which are clearer versions of duplicative demonstrative photographs of Petitioner’s dumpster area, sharps containers, medical waste bags, and totes that were included in CMS’s exhibits (CMS Ex. 26).2  Petitioner did not propose any witnesses, submit any written direct testimony, or affidavits.  On April 1, 2022, CMS filed its Reply to Petitioner’s brief, and on April 12, 2022, the parties filed Joint Statement of Fact, Joint Issues Presented and a Joint Settlement Status Report in which the parties also waived oral hearing and requested a decision on the written record only.

II.    Admission of Exhibits and Decision on the Record

Petitioner objected to CMS Exhibits 13 (Statement of Deficiencies (SOD)) and 17 (surveyor’s notes) on the grounds that they are hearsay and prepared in anticipation of litigation.  While they are hearsay, the SOD and surveyor’s notes are admissible and routinely admitted in nearly all nursing home cases before this tribunal.  *See, e.g.*, *Florence Park Care Ctr.*, DAB No. 1931 at 9-10 (2004); *St. Joseph Villa Nursing Ctr.*, DAB No. 2210 at 9-10 (2008).  Here, CMS Exhibits 13 and 17 were prepared and authenticated by CMS’s proposed witness, Kizzie Gorsuch, R.N., in her written direct testimony (CMS Ex. 27).  Any issues Petitioner may have with the contents of CMS Exhibits 13 and 17 could be addressed in cross-examination.  However, Petitioner declined to cross-examine Ms. Gorsuch as the parties waived oral hearing.  In addition, all information contained in CMS Exhibits 13 and 17 was reiterated in Ms. Gorsuch’s written direct testimony (CMS Ex 27), yet this document was not objected to by Petitioner.  Accordingly, I overrule Petitioner’s objections and admit CMS Exhibits 13

Page 4

and 17.  In the absence of objections, I further admit CMS Exs. 1, 2, 18, 22, 23, 26, 27-30.3  In the absence of objection by CMS, P. Exs. 1-4 are admitted.

As both parties have requested and I find that there are no factual issues in dispute requiring oral testimony, this decision is based solely on the written record.

II.    Issues

The issues in this case are:

Whether Petitioner was not in substantial compliance of the Medicare participation requirements at 42 C.F.R. § 483.80(a)(1)-(2),(4),(e), and (f) (Infection Prevention & Control);

and

If Petitioner was not in substantial compliance, whether the PICMP imposed on Petitioner is reasonable.

III.    Jurisdiction

I have jurisdiction to hear and decide this case.  Social Security Act (Act) §§ 1128A(c)(2), 1819(h)(2)(B)(ii) (codified at 42 U.S.C. §§ 1320a-7a(c)(2), 1395i-3(h)(2)(B)(ii)); 42 C.F.R. §§ 488.408(g), 488.434(a)(2)(viii), 498.3(b)(13).

IV.    Discussion

**A.    Applicable Legal Authority**

The Act establishes requirements for SNFs to participate in the Medicare program and authorizes the Secretary of Health and Human Services (Secretary) to promulgate regulations implementing those statutory provisions.  Act § 1819 (42 U.S.C. § 1395i-3).  The Secretary’s regulations are found at 42 C.F.R. pts. 483 and 488.

To participate in the Medicare program, a SNF 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.  “Noncompliance” means “any deficiency that causes a facility to not be in substantial compliance.”  *Id*.

Page 5

The Secretary contracts with state agencies to conduct periodic surveys to determine whether SNFs are in substantial compliance with the participation requirements.  Act § 1864(a) (42 U.S.C. § 1395aa(a)); 42 C.F.R. §§ 488.10, 488.20.  The Act and its implementing regulations require that facilities be surveyed on average every twelve months, and more often, if necessary, to ensure that identified deficiencies are corrected. Act § 1819(g)(2)(A) (42 U.S.C. § 1395i-3(g)(2)(A)); 42 C.F.R. §§ 488.20(a), 488.308.  The state agency must also investigate all complaints.  Act § 1819(g)(4) (42 U.S.C. § 1395i-3(g)(4)).

The regulations specify the enforcement remedies that CMS may impose if a facility is not in substantial compliance with Medicare requirements.  42 C.F.R. § 488.406.  Among other remedies, CMS is authorized to impose a per-day CMP for the number of days a facility is not in substantial compliance or a PICMP for each instance of the facility’s noncompliance.  42 C.F.R. § 488.430(a).  In this case, CMS imposed a PICMP.  The regulations specify that PICMPs fall into a single range of penalties between $2,233 and $22,320.  42 C.F.R. §§ 488.408, 488.438; 45 C.F.R. § 102.3 (Table).

If CMS imposes a remedy, such as a PICMP, based on a noncompliance determination, then the facility may request a hearing before an administrative law judge (ALJ) to determine whether there was a basis for the deficiency findings that led to the imposition of the remedy and whether the CMP imposed was reasonable.  Act §§ 1128A(c)(2), 1819(h)(2)(B)(ii) (42 U.S.C. §§ 1320a-7a(c)(2), 1395i-3(h)(2)(B)(ii)); 42 C.F.R. §§ 488.408(g), 488.434(a)(2)(viii), 498.3(b)(13).  However, the facility may not appeal CMS’s choice of remedies, or the factors CMS considered in selecting remedies.  42 C.F.R. § 488.408(g)(2).

A facility may only challenge CMS’s determination as to the scope and severity of noncompliance if a successful challenge would affect the range of the CMP that may be imposed or there is a finding of substandard quality of care that resulted in the loss of approval of a SNF’s nurse aide training and competency program (NATCEP).  42 C.F.R. § 498.3(b)(14), (d)(10)(i).  CMS’s determination as to the level of noncompliance, including the finding of immediate jeopardy, “must be upheld unless it is clearly erroneous.”  42 C.F.R. § 498.60(c)(2); *Woodstock Care Ctr.*, DAB No. 1726 at 9, 39 (2000), *aff’d, Woodstock Care Ctr. v. Thompson*, 363 F.3d 583 (6th Cir. 2003).

**B.    Findings of Fact, Conclusions of Law and Analysis**

**1.    42 C.F.R. § 483.80(a)(1)-(2), (4), (e), and (f) (Tag F880 - Infection Prevention & Control) applies to biohazardous medical waste within the control of and on the property of Petitioner, which includes its onsite dumpster area.**

Page 6

**2.    42 C.F.R. § 483.80(a)(1)-(2) requires Petitioner to have an infection prevention and control program (IPCP) that must include a system that follows accepted national standards for preventing infections and communicable diseases for all residents, staff, volunteers, visitors, and other individuals providing services under a contractual arrangement.**

**3.    Standard precautions for preventing infections include keeping secure at all times biohazardous medical waste until it is removed from the possession and control of Petitioner.**

The Infection Control regulation found at 42 C.F.R. § 483.80(a) states that:

The facility must establish and maintain an infection prevention and control program designed to provide a safe, sanitary, and comfortable environment and to help prevent the development and transmission of communicable diseases and infections.

(a) *Infection prevention and control program.* The facility must establish an infection prevention and control program (IPCP) that must include, at a minimum, the following elements:

(1) A system for preventing, identifying, reporting, investigating, and controlling infections and communicable diseases for **all residents, staff, volunteers, visitors, and other individuals providing services under a contractual arrangement** based upon the facility assessment conducted according to § 483.70(e) **and following accepted national standards**;

(2) Written standards, policies, and procedures for the program, which must include, but are not limited to:

(i) A system of surveillance designed to identify possible communicable diseases or infections before they can spread to other persons in the facility;

(ii) When and to whom possible incidents of communicable disease or infections should be reported;

(iii) **Standard and transmission-based precautions to be followed to prevent spread of infections**;

Page 7

(iv) When and how isolation should be used for a resident; including but not limited to:

(A) The type and duration of the isolation, depending upon the infectious agent or organism involved, and

(B) A requirement that the isolation should be the least restrictive possible for the resident under the circumstances.

(v) The circumstances under which the facility must prohibit employees with a communicable disease or infected skin lesions from direct contact with residents or their food, if direct contact will transmit the disease; and

(vi) The hand hygiene procedures to be followed by staff involved in direct resident contact.

(3) An antibiotic stewardship program that includes antibiotic use protocols and a system to monitor antibiotic use.

(4) A system for recording incidents identified under the facility's IPCP and the corrective actions taken by the facility.

42 C.F.R. § 483.80(a) (emphasis added).

The infection and control regulation makes clear that Petitioner must have an IPCP that follows accepted national standards and standard precautions to prevent infections and communicable diseases for all residents, staff, volunteers, visitors, and other contractors. *Id*.  The regulation does not otherwise specify what are accepted national standards or standard precautions for the prevention and spread of infections.

In this regard, Appendix PP to The State Operations Manual states that “‘Standard Precautions’ is based on the principle that all blood, body fluids, secretions, excretions except sweat . . . may contain transmissible infectious agents.”  SOM, Appendix PP at 758 (Rev. 208, October 21, 2022).  Furthermore, “equipment or items in the resident environment likely to have been contaminated with infectious fluids or other potentially infectious matter **must** be handled in a manner so as to prevent transmission of infectious agents.”  SOM, Appx. PP at 769 (emphasis added).

The SOM cites as an example of a Level 2 (no actual harm with the potential for more than minimal harm that is not immediate jeopardy, as Petitioner was cited with in the present matter) violation of F880 as follows:

Page 8

The facility failed to ensure that a staff member implemented appropriate processes related to handling and storing wound care supplies.  As a result, the potential existed for transmission of organisms between residents who received dressing changes.

SOM, Appx. PP at 785.  While this example relates to handling and storing wound care supplies that were placed on a resident’s bed and then back into the supply cart, the illustration demonstrates that the handling and storing of materials in a way that creates the potential for spread of infections is within the scope of Tag F880.

CMS offered evidence through the declaration of the nurse surveyor that in her professional experience the standard procedure for safety to prevent the spread of infection, in part, “provides that once a sharps container is full its swing lid is lifted into place and then locked into position,” “[t]hat sharps container is then taken to a special area in a medical facility, usually a locked room or a secure area, where it is placed in a bin, tote, or other similar container (collectively “tote”) supplied by the biohazardous waste disposal company,” “[o]nce the biohazardous waste tote is filled with the locked sharps containers, a lid is placed on that tote, it is sealed or locked,” and “the biohazardous waste totes remain in the locked room or secure area until retrieved by the hazardous waste disposal company, which will incinerate the totes containing the sharps containers.”  CMS Ex. 27 at 3-4.  Petitioner did not elect to cross-examine the nurse surveyor and did not offer any evidence or argument to refute this written testimony.  I find the articulation of this standard precaution credible.

Petitioner argues not that this is the incorrect standard, but that “F880 does not mandate . . . how hazardous waste is to be disposed of once it has been removed from the Facility. . . .”  P. Br. at 7.  This is incorrect.  By Petitioner’s logic, it could open full sharps containers and empty the used sharps out the window and be in compliance with Tag F880.  There is no basis, nor does Petitioner offer any, to construe 42 C.F.R. § 483.80(a) as only applying to the brick-and-mortar building of Petitioner and not to the entire Facility, including the grounds to which it has possession of and exercises control over.  The clear statement of intention of this requirement is to prevent the spread of infection to residents and all who work, visit, or volunteer at the Facility.  All of these individuals not only move within the facility’s buildings, but also transit the property.  That this requirement be interpreted to cease outside the walls of the buildings would undermine one of the essential purposes of the regulation: for a SNF to practice standard precautions to prevent the spread of infection and communicable disease where the SNF exercises the control to do so.

**4.    42 Petitioner was not in substantial compliance with 42 C.F.R. § 483.80(a)(1)-(2), (4), (e), and (f) (Infection Prevention & Control), Scope and severity (S/S) level F, because the undisputed evidence demonstrates that Petitioner did not properly dispose of biohazardous medical waste, including used sharps and**

Page 9

**lancets, which exposed staff, residents and visitors to the possibility for more than minimal harm.**

Petitioner’s Infectious Waste Policy, in place at all relevant times, requires that “[d]isposable items, which are contaminated with excretions or secretions from residents believed to be infectious, must be placed in red plastic bags and seals [sic] and stored until removal from the premises.”  CMS Ex. 18 at 3.

On March 31, 2021, in response to a complaint, state agency surveyor, Kizzie Gorsuch, R.N., toured Petitioner with Petitioner’s Assistant Director of Nursing (ADON), Leslie Smith.  As part of the survey, they toured Petitioner’s dumpster area in which Surveyor Gorsuch observed:

[T]wo red plastic biohazard totes containing five red sharps containers were on the ground to the left side of the dumpsters.  The red totes containing the five sharps containers did not have lids or a locking device.  The five red sharps containers were full of used needles, empty insulin bottles, and other medication vials.  Two of the five sharps containers were not locked shut, allowing easy access to used needles and vials.  Three other red plastic biohazard totes with lids contained red biohazard bags full of waste.  These totes were also located on the ground to the left of [sic] side of the dumpsters.  The dumpster area where the biohazard waste and sharps containers were located did not have a door or a lock.

CMS Ex. 13 at 7-8; CMS Ex. 17 at 1; CMS Ex 27 at 4.  Further, many of the items were contaminated with blood and body fluids.  CMS Ex. 27 at 4.  The ADON reported to Surveyor Gorsuch that once a sharps container is full, it is to be locked and taken to a red biohazard box in the dumpster area.  *Id*.  The ADON further reported that all departments and staff have access to the dumpster area.  *Id*. at 5.

On February 5, 2021, nearly two months prior to the subject survey, Petitioner held an in-service training regarding the proper handling and disposal of biohazardous waste.  CMS Ex. 27 at 5; CMS Ex. 18 at 1-3.  It was noted then that the red biohazard bins were to be used for biohazardous materials only and should never go in the green garbage bins.  CMS Ex. 27 at 5; CMS Ex. 18 at 1-3.  However, Surveyor Gorsuch, during her survey, spoke with Petitioner’s employee, Lori Cluney, R.N., who reported that she missed the February 5 training and was not aware that sharps containers were to be locked when full and should never be placed in the green dumpsters.  CMS Ex. 27 at 6.  Further, Petitioner’s Housekeeping Supervisor, Wanda Losh, reported to Surveyor Gorsuch that all housekeeping staff use the green dumpsters.  *Id*.  Petitioner’s Administrator stated to Surveyor Gorsuch that she was aware that sharps container lids should be locked once

Page 10

full, but the Administrator was not aware they were to be kept in a locked area until disposed.  *Id*.

In its Brief, Petitioner does not refute any of the above allegations.4  Petitioner submitted no affidavits or other documentary evidence to refute any of CMS’s allegations.  Indeed,  the only evidence Petitioner submitted were four duplicative demonstrative photographs of its dumpster area generally.  *See generally* P. Br.; P. Ex. 1-4.

Instead, Petitioner argues multiple times, without supporting evidence, that residents and staff could not access the dumpster area.  Therefore, the facility, argues Petitioner, was not out of compliance with Medicare participation requirements because there is no potential for more than minimal harm.  P. Br. at 6 (“[N]o resident or staff was at risk of increased infection”); P. Br. at 7 (“[T]his waste was stored outside, in a safe, proper manner, and nowhere near any resident space; even if one were to assume the waste was not stored properly, because that waste was outside and nowhere near a single resident, it did not create a risk to any of the residents in the Facility.”); P. Br. at 8 (“By removing the waste from the resident areas and securing it in a well lit [sic] and secured waste area, far from the facility on the day of pick up, the facility [was in substantial compliance].”); P. Br at 8 (“It is clear, storage of garbage outside of the facility, in a designated spot/bin, that is well away from residents, staff, does not have the potential or ability to impact a single facility resident – particularly in terms of infection control.  The Facility stored its medical/hazardous waste outside, away from its residents and staff, precisely to promote infection control best practices.”); P. Br. at 10 (“There is no resident access to this area.  The only staff who access this area are the staff who are taking out the regular and medical waste.”); P. Br. at 10 (“It is clear, the Facility stores its medical waste well away from residents to ensure that there is no infection control issue created by the Facilities medical waste.”).

Accordingly, Petitioner’s argument that it was in substantial compliance rests on the factual assertion that no residents, staff, visitors, or volunteers have access to the dumpster area.  Petitioner’s assertion is baseless, unsupported, and in direct contravention of evidence in the record.  Petitioner cites to no admissible evidence that residents, staff, and others did not have access to the dumpster area.  None of the factual assertions quoted in the preceding paragraph from Petitioner’s Brief contain a single cite to the record.  Indeed, Petitioner contradicts itself and admits in its brief that staff, in fact, do have access to the dumpster area.  P. Br. at 10 (“The only staff who access this area are the staff who are taking out the regular and medical waste.”).  Without any documentary or testimonial evidence, I simply cannot accept the bald assertion that residents and staff did not have access to the unlocked dumpster area where containers full of used sharps and other medical waste were left unlocked and open.  Moreover, the record contains

Page 11

explicit evidence that “[a]ll housekeeping staff use the dumpsters,” and “[a]ll departments and all staff have access to the dumpster area in the back of the building.”  CMS Ex. 13 at 10.  As the area was not secured, I also find that anyone entering and exiting the building, including residents, staff, visitors, or contractors, looking for a trash can outside could access the dumpster area where the biohazardous waste was placed.

Additionally, the ADON articulated Petitioner’s policy and procedure as the following:

All used intravenous bottles, insulin bottles, insulin syringes, intravenous needles, antibiotic vials, and other medication ampoules are disposed into a red biohazard sharps container.  Once the sharps container is full the nurses are to lock the top down and take it to a red biohazard box located in the dumpster area at the back of the building.

CMS Ex. 13 at 3-4.  It is well established that “a facility is not in substantial compliance with the regulation just because it has infection control policies in place.” *Heritage House of Marshall Health & Rehab. Ctr.*, DAB No. 2566 at 11 (2014) (*citing Park Manor Nursing Home*, DAB No. 2005, at 60 (2005)).  The evidence in the record demonstrates, however, that Petitioner’s staff was not aware of, and did not follow, its policy that full sharps containers were to be locked and placed in a tote and that infectious waste was not to be placed into regular green dumpsters.  CMS Ex. 27 at 6; CMS Ex. 18 at 1, 3.

In sum, Petitioner kept potentially infectious biohazardous waste on the ground in unsecured containers in an unlocked dumpster area on its property that was regularly accessed by staff and could be accessed by others.  I find this is a violation of F880 in that Petitioner failed to establish and maintain an effective IPCP and failed to follow its own policy on biohazard waste disposal.

**5.    The scope and severity finding of F by CMS is not reviewable.**

A facility may only challenge CMS’s determination as to the scope and severity of noncompliance if a successful challenge would affect the range of the CMP that may be imposed or there is a finding of substandard quality of care that resulted in the loss of approval of a SNF’s NATCEP.  42 C.F.R. § 498.3(b)(14), (d)(10)(i).  In the present case, as there is only a single range for PICMPs, regardless of scope and severity, the scope and severity finding by CMS in the present case is not reviewable.

**6.    The $20,000 PICMP amount imposed by CMS is reasonable.**

As I have concluded that Petitioner violated 42 C.F.R. § 483.80(a)(1)-(2), (4), (e), and (f) (Tag F880), I must now determine whether the PICMP imposed against Petitioner was reasonable.  In so determining, I apply the factors listed in 42 C.F.R. § 488.438(f):  1) the facility’s history of noncompliance; 2) the facility’s financial condition; 3) the factors

Page 12

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.  The factors listed in 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 and specifically with reference to the cited deficiencies.  Unless a facility contends that a particular regulatory factor does not support the CMP amount, I must sustain it.  *Coquina Ctr.*, DAB No. 1860 at 32 (2002).

The Board has explained that “it is settled law that ALJ review of the reasonableness of CMP amounts imposed by CMS is *de novo*.”  *Fireside Lodge Ret. Ctr., Inc.*, DAB No. 2794 at 19 (2017).  I consider whether the evidence supports a finding that the amount of the CMP is at a level reasonably related to an effort to produce corrective action by a provider with the kind of deficiencies found, and in light of the above factors.  I am neither bound to defer to CMS’s factual assertions, nor free to make a wholly independent choice of remedies without regard for CMS’s discretion.  *See, e.g.*, *Barn Hill Care Ctr.*, DAB No. 1848 at 21 (2002).  The Board has explained that “[t]he determination of whether a CMP amount is reasonable is a conclusion of law, not a finding of fact.”  *Cedar Lake Nursing Home*, DAB No. 2344 at 12 (2010), *aff’d*, *Cedar Lake Nursing Home v. U.S. Dep’t of Health & Human Servs.*, 619 F.3d 453, 457 (5th Cir. 2010).

Pursuant to 42 C.F.R. § 488.408(g)(2), a facility cannot appeal CMS’s choice of a remedy, and an appeal of a CMP is limited to review based on the regulatory factors set forth at 42 C.F.R. §§ 488.438(f) and 488.404(b)-(c).  *See, e.g.*, *Senior Rehab. & Skilled Nursing Ctr.*, DAB No. 2300 at 19-20 (2010).  As discussed above, the regulations specify one penalty range for PICMPs.  42 C.F.R. §§ 488.408, 488.438.  Here, CMS imposed a PICMP of $20,000.  This amount is at the upper end of the penalty range.

CMS argues that the CMP is reasonable based on the seriousness of the noncompliance and the facility’s history of noncompliance.  CMS Br. at 15; CMS Reply Br. at 2-3.  In response, Petitioner argues that CMS’s use of its prior history to determine the present PICMP is unfair and violates its due process rights.  P. Br. at 11.  Petitioner cites to no legal authority in furtherance of its argument.  Aside from the fact that the facility’s history of noncompliance is a statutory factor specifically set forth to be used in determining a CMP, this tribunal has no authority to address equitable arguments or ability to refuse to follow Federal statutes or regulations on constitutional grounds.  *Zahid Imran, M.D.*, DAB No. 2680 at 9 (2016).  Further, the regulations specifically state that “[a] facility may not appeal the choice of remedy, including the factors considered by CMS or the State in selecting the remedy.”  42 C.F.R. § 488.408(g)(2).

Page 13

Based on my consideration of the regulatory factors, the CMP amount is reasonable.  With respect to Petitioner’s history of noncompliance, CMS offered into evidence a document titled “Provider History Profile,” which shows Petitioner’s compliance history from September of 2017 through July of 2021.  CMS Ex. 29.  My review of this report shows that Petitioner has a lengthy history of noncompliance since 2017.  CMS further demonstrates that Petitioner was found to have been in substantial noncompliance with F880 at a scope and severity of “F,” the same Medicare requirement and scope and severity at issue here.  CMS Br. at 15; CMS Reply Br. at 2-3; CMS Ex. 29 at 3. Thus, the report establishes that Petitioner has repeated noncompliance under Tag F880.

In addition, although Petitioner has attempted to minimize its noncompliance, the noncompliance in the present case is serious.  Leaving unlocked and unsealed containers containing used sharps and other medical waste containing potentially infectious bodily fluids, including blood, exposed to staff, visitors, and residents who enter the  unlocked dumpster area poses potentially serious harm.  The fact that no actual harm occurred as a result of its noncompliance does not negate the potential for harm.  Accordingly, I find Petitioner’s culpability and the seriousness of the noncompliance to be high.

With respect to its financial condition, Petitioner has not argued or offered any evidence to establish that it cannot pay the $20,000 PICMP.  I thus find no basis to reduce the CMP based on Petitioner’s financial condition.

Accordingly, based on the regulatory factors, I conclude that the $20,000 PICMP is reasonable.

V.    Conclusion

For the reasons discussed above, I find that Petitioner was not in substantial compliance with the Medicare participation requirements at 42 C.F.R. § 483.80(a)(1)-(2), (4), (e), and (f).  I further find that the $20,000 PICMP is reasonable.

Endnotes

1  CMS or the state agency designates the scope and severity level using a letter from A through L, based on a scope and severity matrix published in the State Operations Manual (SOM), ch. 7, § 7400.3.1 (Rev. 185, eff. Nov. 16, 2018), available at https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/som107c07pdf.pdf (last visited February 1, 2023).  A scope and severity level of A, B, or C indicates a deficiency that presents no actual harm but has the potential for minimal harm, which is an insufficient basis for imposing an enforcement remedy.  Facilities with deficiencies of levels A, B, or C remain in substantial compliance.  SOM, Ch. 7, § 7400.3.1 (citing 42 C.F.R. § 488.301).  Levels D, E, or F indicate a deficiency that presents no actual harm but has the potential for more than minimal harm that does not amount to immediate jeopardy.  *Id.*Levels G, H, or I indicate a deficiency that involves actual harm that does not amount to immediate jeopardy.  *Id.*Levels J, K, and L indicate a deficiency that constitutes immediate jeopardy to resident health or safety.  *Id.*The matrix specifies which remedies are required and optional at each level based upon the pervasiveness of the deficiency.

2  Petitioner acknowledges that its Exs. 1-4 were included in CMS Ex. 26 and that Petitioner is submitting them solely due to the quality of the photographs in CMS Ex. 26.  P Br. at 9 n.2.  It is not disputed that the photographs were taken after the April 1, 2021 survey and therefore are not representative of Petitioner’s dumpster area at the time of the survey and are for general demonstrative purposes only.

3  While CMS submitted 30 exhibits, it only cited to Exs. 1, 2, 13, 17,18, 22, 23, 26, 28, 29 and 30 in its briefs.  Accordingly, I find that CMS Exs. 3-12, 14-16, 19-21, 24-25 and 27 are excluded as irrelevant.

4  Despite Petitioner not disputing any of CMS’s factual findings, Petitioner failed to stipulate to the aforementioned facts in the Joint Stipulation of Undisputed Facts in contravention of my SPO.
  
          /s/
        Jacinta L. Alves

                      Administrative Law Judge Back to top
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