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                              Cahokia Nursing and Rehabilitation Center, DAB No. 2991 (2020)
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Cahokia Nursing and Rehabilitation Center, DAB No. 2991 (2020)








  
  
    

  
      
Department of Health and Human Services 
    DEPARTMENTAL APPEALS BOARD
          Appellate Division





Cahokia Nursing and Rehabilitation Center
Docket No. A-19-132Decision No. 2991March 12, 2020

        
              
    

      FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE DECISION
Cahokia Nursing and Rehabilitation Center (Cahokia; Petitioner), a skilled nursing facility (SNF) located in Illinois, appeals a decision by an Administrative Law Judge (ALJ) upholding the determination of the Centers for Medicare & Medicaid Services (CMS) that Cahokia was out of compliance with Medicare program requirements at the level of immediate jeopardy from May 31, 2016 through July 20, 2016. *Cahokia Nursing and Rehabilitation Center*, DAB CR5374 (2019) (ALJ Decision). The facility was cited for multiple deficiencies after a May 31, 2016 fire. Cahokia did not dispute the deficiency findings but argued unsuccessfully to the ALJ that immediate jeopardy was abated once all residents were relocated and the facility remained vacated during repairs. The ALJ also upheld as reasonable a $7,250 per day civil money penalty (CMP) imposed by CMS for the period of Cahokia’s noncompliance, totaling $369,750.
The situation in this case is unusual in that the facility discharged **all** its residents safely to other facilities, was empty during the entire time it was correcting conditions, and did not readmit any residents until July 21, 2016. Under these circumstances, we conclude that CMS’s determination that Cahokia’s noncompliance continued to be at the immediate jeopardy level between June 1, 2016 and July 20, 2016 was clearly erroneous. We conclude that the deficiencies no longer posed immediate jeopardy once all residents at Cahokia were safely relocated to other facilities because, after that, it was not possible for conditions at Cahokia to present a likelihood of causing “serious injury, harm, impairment, or death” to any resident. 42 C.F.R. § 488.301. By the time any residents were again in the facility, i.e., July 21, 2016, it is undisputed that the conditions that had created immediate jeopardy had been corrected.  However, the per-day CMP for noncompliance properly continued even after immediate jeopardy was removed, until the facility demonstrated that it had fully corrected the deficiencies and returned to substantial compliance.
Based on this analysis, as explained in more detail below, we modify the CMP amounts to $7,250 for one day of noncompliance at the immediate jeopardy level on May 31, 2016, and $3,000 per day (the maximum CMP for noncompliance not at the immediate
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jeopardy level) between June 1, 2016 and July 20, 2016, for a total CMP of $157,250.
Legal Background
To participate in the Medicare program, a SNF must be in “substantial compliance” with the participation requirements in 42 C.F.R. Part 483, subpart B. Social Security Act (Act) § 1819(h); 42 C.F.R. §§ 483.1, 488.400.1
 State survey agencies, under agreements with the Secretary, conduct surveys at SNFs to determine whether they are in substantial compliance. Act § 1819(g); 42 C.F.R. § 488.300 et seq. A SNF is not in substantial compliance when it has a “deficiency” – that is, a failure to meet a participation requirement – that creates the potential for more than minimal harm to one or more residents. *See* 42 C.F.R. § 488.301 (defining “substantial compliance”). The term “noncompliance,” as used in the applicable regulations, is synonymous with lack of substantial compliance. *Id*. (defining “noncompliance”).
CMS may impose enforcement remedies (such as CMPs) on a SNF that is not in substantial compliance with one or more participation requirements. Act § 1819(h)(2); 42 C.F.R. §§ 488.400, 488.402(b), (c), 488.406. When CMS decides to impose a CMP for a nursing home’s noncompliance, it must consider various regulatory factors, including the “seriousness” of the SNF’s noncompliance, in setting the amount of the CMP. 42 C.F.R. §§ 488.404(b), 488.438(f). “Seriousness” is a function of the noncompliance’s scope (whether it is “isolated,” constitutes a “pattern,” or is “widespread”) and severity (whether it has created a “potential for harm,” resulted in “actual harm,” or placed residents in “immediate jeopardy”). *Id*. § 488.404(b).
The most severe noncompliance is that which puts one or more residents in “immediate jeopardy.” *See id*. § 488.438(a) (authorizing the highest CMPs for immediate-jeopardy-level noncompliance); *Woodland Oaks Healthcare Facility*, DAB No. 2355, at 2 (2010) (citing authorities). “Immediate jeopardy” means “a situation in which the provider’s noncompliance with one or more requirements of participation has caused, or is likely to cause, serious injury, harm, impairment, or death to a resident.” 42 C.F.R. § 488.301.
When CMS imposes a per-day CMP for noncompliance at the immediate jeopardy-level of severity, it must set the CMP amount within the “upper range” of $3,050 to $10,000 per day. *Id*. § 488.438(a)(i). A CMP in the “lower range” range of $50-$3,000 per day
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may be imposed for noncompliance that does not place residents in “immediate jeopardy” but that either causes actual harm or creates the potential for more than minimal harm. *Id*. § 488.438(a)(ii). A per-day CMP may accrue until the facility achieves substantial compliance or its provider agreement is terminated. *Id*. § 488.454(a).
A SNF may appeal the findings of noncompliance that led to the imposition of a remedy. *Id*. §§ 488.408(g)(1), 498.3(b)(13). The scope of review includes whether the amount of the CMP is reasonable. *See* *id*. § 488.438(e)(3), (f); *Capitol Hill Cmty. Rehab. & Specialty Care Ctr.*, DAB No. 1629 (1997).
Case Background2
***1. May 31, 2016 Fire Incident***
On May 31, 2016, a fire broke out at Cahokia’s facility. ALJ Decision at 1. Prior to the fire, Cahokia’s maintenance supervisor and a maintenance worker were working in the facility’s attic to repair mechanical systems when a fire alarm went off. *Id*. at 5 (citing CMS Ex. 26, at 1). The maintenance employees left the attic, and silenced the alarm. *Id*. When fire personnel arrived at the facility, the maintenance supervisor told them it was a false alarm. *Id*. (citing CMS Ex. 26, at 2; CMS Ex. 51, at 1). Thereafter, Cahokia’s charge nurse held down the fire alarm silence button to prevent the alarm from going off again until she learned that there was a real fire. *Id*. (citing CMS Ex. 26, at 7; CMS Ex. 51, at 1). Smoke was coming from an occupied room and, when the door was opened, “fire shot out up the wall above the door and onto the ceiling.” *Id*. (quoting CMS Ex. 26, at 5). The room’s two residents, R1 and R2, were carried out of the room. One was brought to the nurses’ station and the other was placed on the corridor floor as staff then returned to the room to fight the fire. *Id*. The maintenance worker and nurse aide left the area when the heat and smoke became too much, but R2 remained in the corridor where she was later found by firefighters and rescued. *Id*. (citing CMS Ex. 26, at 5, 10).
Fire personnel returned, finding heavy smoke coming from the building and police and staff trying to remove residents. *Id*. (citing CMS Ex. 20, at 2). Approximately fourteen residents, including R2, were taken to the hospital. *Id*. at 6 (citing CMS Exs. 52-61). All other residents received emergency medical care as needed and were ultimately relocated to other facilities. *Id*. (citing CMS Ex. 20, at 2; CMS Ex. 48). Nothing in the record suggests that the residents’ placements were in any way unsafe or improper.
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It is undisputed that conditions in the facility as of the day of the fire presented immediate jeopardy to all its residents. The ALJ described the “facility’s many problems regarding fire safety” as the following:
When the fire broke out, it appears that no one was in charge. The facility’s administrator was not in the building. The facility had no director of nursing; and the assistant director of nursing was not in the building. CMS Ex. 26 at 4.
	The employees heard no fire-code announcements. CMS Ex. 26, at 5, 6.
	As is painfully obvious from their responses, facility staff were not properly trained to respond to a fire. The maintenance supervisor admitted that the facility had not trained him; they just gave him a book. CMS Ex. 26 at 2. Nurse aides reported that they had not received fire training in years. CMS Ex. 26 at 7. The maintenance worker had received no fire training. CMS Ex. 26 at 11. The charge nurse could not remember any fire training. CMS Ex. 26 at 12.
	The facility’s sprinklers did not work. CMS Ex. 26 at 1, 2, 18; CMS Ex. 86 at 2 (Barnett Decl. ¶4) (indicating the “rainbow mud pattern” on the facility walls showed that the sprinklers were spraying out debris instead of water). Inspection reports show that the facility knew that its sprinklers were eroded and deteriorating. CMS Ex. 79 at 3, 9-10, 43; *see* CMS Ex. 12 at 1 (2/16 [Life Safety Code (LSC)] survey, finding that the sprinkler system was not in reliable operating condition).
	Someone propped open the smoke barrier door. CMS Ex. 26 at 9; CMS Ex. 51 at 1-2.
	No plans were in place for evacuating and placing residents.*Id*. at 7.
***2. Survey and Enforcement Actions***
As a result of the fire, the Illinois Department of Public Health (IDPH) conducted an LSC survey on June 29, 2016. IDPH found six deficiencies, including noncompliance with the following provisions at the scope and severity level “L” (widespread immediate jeopardy):
LSC § 19.7.1.1 (Tag K048, Requiring a written plan for the protection of all patients and for their evacuation in the event of an emergency)
	LSC §§ 18.7.1.2; 19.7.1.2 (Tag K050, Requiring regular fire drills)
	LSC §§ 19.7.6; 4.6.12; 9.7.5 (Tag K062, Requiring automatic sprinkler systems that are continuously maintained in reliable operating condition and are inspected and tested periodically)Page 5
LSC § 9.7.6.1 (Tag K154, Requirements for when a facility’s sprinkler system is out of service)*Id*. at 3 (citing CMS Exs. 1, 14). The surveyors found that immediate jeopardy for the LSC deficiencies began on May 31, 2016 and was not abated as of the June 29, 2016 survey. CMS Ex. 4.
On July 12, 2016, IDPH conducted a health survey and found five deficiencies, including noncompliance with the following provisions at the scope and severity level “L”:
42 C.F.R. § 483.13(c) (Tag F224, Requiring written policies that prohibit mistreatment, neglect, and abuse of residents and misappropriation of resident property)
	42 C.F.R. § 483.75 (Tag F490, Administration)
	42 C.F.R. § 483.75(m)(1) (Tag F517, Requiring written emergency and disaster plans)
	42 C.F.R. § 483.75(m)(2) (Tag F518, Emergency preparedness training)*Id*. (citing CMS Exs. 2, 5, 37). The surveyors found that immediate jeopardy for the health survey deficiencies began on May 31, 2016 and was “abated during the July 12, 2016 survey,” but that the immediate jeopardy for the LSC deficiencies was not abated. CMS Ex. 5, at 1.
After follow-up visits on July 21, August 2, and August 18, 2016, IDPH found that Cahokia abated immediate jeopardy as to all deficiencies and achieved substantial compliance as of July 20, 2016. CMS Ex. 31, at 1. By letters dated July 12, 2016 and November 1, 2016, CMS informed Cahokia that it was imposing a CMP of $7,250 per day for 51 days of immediate jeopardy – beginning May 31, 2016 and continuing through July 20, 2016 – for a total of $369,750. ALJ Decision at 4; CMS Exs. 1, 2.
***3. ALJ Proceedings and Decision***
Cahokia made multiple hearing requests which were ultimately consolidated under a single appeal. Acknowledgment and Consolidation Order at 1; ALJ Decision at 1. CMS submitted a prehearing brief, lists of proposed witnesses and exhibits, and 88 numbered exhibits (CMS Exs. 1-88). Cahokia then filed a prehearing brief and motion for summary judgment (Pet. Prehearing Br.), lists of proposed witnesses and exhibits, and three numbered exhibits (Pet. Exs. 1-3). In its prehearing brief, Cahokia did not dispute the initial finding of immediate jeopardy on May 31, 2016, or that it was not in substantial compliance between May 31, 2016, and July 20, 2016. Cahokia argued, however, that its deficiencies no longer posed immediate jeopardy to resident health and safety after all residents were relocated on May 31, 2016. Pet. Prehearing Br. at 8-14. Thus, Cahokia
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argued, the CMP amount imposed by CMS was “unsupported and unreasonable.” *Id*. at 14-15.
In response, CMS argued that, regardless of the relocation of every resident on May 31, 2016, Cahokia did not present evidence that it completed corrective measures to address the underlying noncompliance before July 21, 2016. CMS Response to MSJ at 6-10. Further, CMS argued that Cahokia’s abatement plan listed July 21, 2016, as the date of completion for all corrective measures. *Id*. at 10-11. CMS later filed its own motion for summary judgment, reiterating its arguments that Cahokia did not abate immediate jeopardy until July 20, 2016.  Cahokia responded that CMS confused abating immediate jeopardy with correcting all its deficiencies and returning to substantial compliance. Pet. Response to MSJ at 1-3.
The ALJ issued her decision on July 19, 2019, granting summary judgment in favor of CMS. The ALJ found that, “from May 31 through July 20, 2016, the facility was not in substantial compliance with Medicare program requirements and that its deficiencies posed immediate jeopardy to resident health and safety.” ALJ Decision at 2. The ALJ also found that the $7,250 per day CMP amount “is not unreasonably high.” *Id*.
The ALJ stated that “[i]mmediate jeopardy is deemed to have been removed only when the facility has implemented necessary corrective measures.” *Id*. at 9 (emphasis omitted). Further, “a facility must affirmatively demonstrate that it has corrected those conditions that posed immediate jeopardy.” *Id*. at 8 (footnote omitted). Here, the ALJ found that Cahokia “had not shown that it ‘implemented necessary corrective measures’ prior to [July 21, 2016].” *Id*. at 9.
The ALJ also rejected Cahokia’s argument that it abated immediate jeopardy when it discharged all of its residents:
[S]o long as a facility remains in the program, it must be safe and livable. If a facility’s conditions render it so unsafe that no one can live there (i.e., likely to cause serious harm, injury, or even death) those conditions pose immediate jeopardy.
*Id*. Thus, the ALJ concluded that immediate jeopardy continued until the residents were able to return safely.
Standard of Review
We review a disputed finding of fact to determine whether the finding is supported by substantial evidence, and a disputed conclusion of law to determine whether it is erroneous. *Guidelines – Appellate Review of Decisions of Administrative Law Judges Affecting a Provider’s or Supplier’s**Enrollment in the Medicare Program*, accessible at
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http://www.hhs.gov/about/agencies/dab/different-appeals-at-dab/appeals-to-board/guidelines/index.html?language=en.
The Board reviews a determination of immediate jeopardy, including whether ongoing noncompliance remains at the level of immediate jeopardy, under the clearly erroneous standard. 42 C.F.R. § 498.60(c)(2); *see also**Brian Ctr. Health & Rehab./Goldsboro*, DAB No. 2336, at 6 (2010) (A determination that immediate jeopardy is present is a determination about the level of noncompliance, and the regulations provide that “CMS’s determination as to the level of noncompliance of an SNF or NF must be upheld unless it is clearly erroneous.”); *Fairfax Nursing Home, Inc.*, DAB No. 1794, at 17 (2001), *aff'd*, *Fairfax Nursing Home v. Dep’t of Health & Human Servs.*, 300 F.3d 835 (7th Cir. 2002), *cert. denied*, 537 U.S. 1111 (2003); *Rolling Hills Rehab Ctr.*, DAB No. 2119, at 5 (2007); *Harlan Nursing Home*, DAB No. 2174, at 9-13 (2008). Under the clearly erroneous standard, CMS’s determination is presumed to be correct, and the facility bears a heavy burden to demonstrate clear error.  *Somerset Nursing & Rehab. Facility*, DAB No. 2353, at 23 (2010), *modified on other grounds*, *Somerset Nursing & Rehab. Facility v. United States Dep’t of Health & Human Servs.*, 502 F. App’x 513 (6th Cir. 2012).
Analysis
We conclude that the ALJ erred in determining that the empty facility continued to pose immediate jeopardy until it was ready to receive residents again. We reach this conclusion because the focus of an immediate jeopardy determination is not merely whether “conditions pose immediate jeopardy,” as the ALJ found, but whether conditions pose immediate jeopardy “**to a resident**,” as the regulation defines it. 42 C.F.R. § 488.301 (emphasis added).
On appeal, Cahokia does not deny the deficiency findings or that conditions on the date of the fire posed immediate jeopardy to its residents, but argues that after the residents were relocated “there was absolutely no ‘likelihood of serious harm’ because there were no residents in the facility.” Reply at 2; *see also* Request for Review (RR) at 9 (“[I]t was impossible for any injury or death to occur because there were no residents in the building. Thus, the ‘likelihood’ of serious harm was nonexistent.”). Accordingly, Cahokia asserts, the CMP amount imposed by CMS is unreasonable and should reflect only one day of immediate jeopardy – May 31, 2016. Cahokia does not deny that it continued to be out of substantial compliance until July 20, 2016, and therefore remained subject to a per-day CMP until it returned to substantial compliance.
As set forth below in more detail, we conclude that Cahokia met its burden of showing that continuing to find immediate jeopardy after May 31, 2016, was clear error. With no residents in the facility at all, no residents were subject to immediate jeopardy, i.e., to a likelihood of serious injury, harm, impairment, or death. Since immediate jeopardy ceases to exist once conditions no longer present such a likelihood for **any** resident, it
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was clear error, in this unusual situation, to find that immediate jeopardy continued until the facility was in substantial compliance as to the deficiency findings. We also conclude that Cahokia is entitled to a reduction in the penalty amount consistent with the applicable regulatory provisions.
**I.*CMS’s finding of noncompliance at the immediate jeopardy level between June 1, 2016, and July 20, 2016, is clearly erroneous because immediate jeopardy was removed when all of Cahokia’s residents were safely relocated until Cahokia corrected the underlying conditions that had presented immediate jeopardy.***
A. *Immediate jeopardy ends once facility noncompliance no longer exposes **any** resident to the likelihood of serious injury, harm, impairment, or death.*
“Immediate jeopardy,” as noted, is defined in the regulations as “a situation in which the provider’s noncompliance with one or more requirements of participation has caused, or is likely to cause, serious injury, harm, impairment, or death to a resident.” 42 C.F.R. § 488.301.****While the regulations do not expressly provide for how to determine the duration of immediate jeopardy, the Board has repeatedly made clear that merely removing the resident(s) or staff involved in an event that triggered an immediate jeopardy determination is not sufficient to abate the immediate jeopardy. *Glenoaks Nursing Ctr.*, DAB No. 2522, at 20 (2013); *Liberty Health & Rehab of Indianola, LLC*, DAB No. 2434, at 16 (2011) (stating that measures to abate immediate jeopardy “had to address more than just the residents involved in the incident or incidents that brought the noncompliance to a surveyor’s attention,” and that “whether immediate jeopardy continued to exist depended on the likelihood of serious harm to any resident.”). The facility must demonstrate that the conditions that led to immediate jeopardy no longer exist to expose other residents to a likelihood of serious harm. *Countryside Rehab. & Health Ctr.*, DAB No. 2853, at 25 (2018) (“[I]immediate jeopardy is abated only when the facility has implemented necessary corrective measures so that there is no longer any likelihood of serious harm.”) (quoting *Glenoaks*at 19);*****see also**The Bridge at Rockwood*, DAB No. 2954, at 29 (2019) (“The facility must allege and prove that it has abated the conditions that created the immediate jeopardy and act to prevent their recurrence”) (citing*Life Care Ctr. of Elizabethton*, DAB No. 2367, at 16 (2011)). Put another way, immediate jeopardy can be abated only by removing the conditions that create the likelihood for serious harm for **any** resident.
The Board has also held that, as a general rule, facilities will not be considered to have successfully abated immediate jeopardy, or to have attained substantial compliance respectively, until they have at least completed the steps to accomplish each of those that they have set out in their own plans of correction. *See, e.g., Countryside* at 27 n.12 (“The Board ordinarily holds that a SNF cannot be regarded as having returned to substantial compliance, or abated immediate jeopardy, until measures specified in an approved plan of correction, or plan to remove immediate jeopardy, have been implemented.”); *see also*
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*Meridian Nursing Ctr*., DAB No. 2265, at 20-21 (2009) (affirming the determination of a multi-day immediate jeopardy period because, although the SNF had taken certain corrective measures prior to the survey, the SNF failed to show that it had implemented all of the corrective actions that its own staff determined to be necessary to abate the immediate jeopardy); *Lake Mary Health Care*, DAB No. 2081, at 29 (2007) (“The burden is on the facility to show that it timely completed the implementation of [its] plan [of correction] and in fact abated the [immediate] jeopardy (to reduce the applicable CMP range) or achieved substantial compliance (to end the application of remedies).”). We reaffirm these long-standing precedents.
This appeal, however, as the ALJ recognized, presents a novel issue for the Board’s consideration: whether immediate jeopardy can continue to exist if *every* resident is relocated to other, appropriate facilities until such time as the situation that caused the likelihood of serious harm has been fixed. *See* ALJ Decision at 9 (“[T]he Board has not yet addressed whether a facility can reverse a finding of immediate jeopardy by getting rid of all of its residents.”). The ALJ concluded that the relocation of every resident to new facilities did not remove Cahokia’s immediate jeopardy because “[i]f a facility’s conditions render it so unsafe that no one can live there (i.e., likely to cause serious harm, injury, or even death), those conditions pose immediate jeopardy.” *Id*.
The ALJ’s analysis, and much of CMS’s argument, conflates the requirements to demonstrate substantial compliance with the prerequisites for abatement of immediate jeopardy. A facility deemed “not safe to enter” certainly remains out of substantial compliance with applicable conditions of participation and subject to appropriate penalties. However, a finding that the noncompliance persists at the level of immediate jeopardy arises not merely from how bad the conditions are at the facility but how likely those conditions are to endanger its residents. In other words, the conditions – like the initial event that exposes the noncompliance – are not themselves the immediate jeopardy. Rather, the conditions **may** be the source of the continuing likelihood of serious harm to **residents**. In that sense, the determination of immediate jeopardy is centered on protecting the residents from likely serious harm.
B. *The relocation of all residents to new, appropriate facilities removed the likelihood of serious harm to any residents.*
CMS argues that the relocation of all residents was insufficient to remove a finding of immediate jeopardy and asserts that Cahokia instead needed to complete all corrective measures to fix the underlying deficiencies. *See* CMS Response at 20-21 (“Cahokia did not abate the immediate jeopardy situation at its facility simply by removing its residents; the problems at the facility persisted. . . . Cahokia’s removal of all of the residents did nothing to abate the substance of these immediate jeopardy deficiencies or correct the structural and systemic problems at Cahokia that resulted in the immediate jeopardy findings.”).
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CMS cites several cases in support of its argument that Cahokia was required to take additional corrective measures, but none are instructive here. *See*CMS Response at 19-21 (citing, *inter alia*, *Fairfax*; *Rosewood Care Ctr. of Rockford*, DAB No. 2466 (2012); *Sheridan* *Health Care Ctr*., DAB No. 2178 (2008)). As Cahokia observes, each case cited by CMS actually turns on whether the facilities’ noncompliance exposed **any** resident to the likelihood of serious harm. Every case is thus predicated on one distinguishing characteristic – the presence of one or more residents at the facility that were still exposed to the risks posed by ongoing noncompliance. *See* Reply at 4 (“[E]ach case CMS cites is distinguishable in a significant way: in the referenced cases, only one resident or employee was removed from the facility, but the potential harm had not yet been removed until more systemic approaches were implemented because all other remaining residents could be subjected to the alleged deficient conditions or practices of the facility.”).
*Fairfax* involved a facility that failed to implement a new protocol relating to residents in respiratory distress, which contributed to at least one resident’s premature death. The Board rejected Fairfax’s argument that this was an isolated incident, and found that Fairfax failed to effectively communicate to staff the need to follow its new protocol for residents in respiratory distress, thus exposing **all** residents remaining at the facility to the likelihood of serious harm. *Fairfax* at 15-17. In *Rosewood*, facility staff endangered the life of a resident by failing to administer proper medication, which resulted in the need to transfer that resident to the hospital. *Rosewood* at 2. The Board held that it was not clearly erroneous for CMS to determine that immediate jeopardy continued until Rosewood’s staff comprehended the extreme danger that its inaction posed to that resident “and other similarly situated residents,” and until Rosewood instituted new mechanisms for providing medications to new residents. *Id*. at 7. *Sheridan* concerned a facility that did not sufficiently respond to a resident’s fasting behaviors, which led to the resident’s transfer to the hospital. Based on a pattern of deficient practices regarding patients with weight loss, the Board determined that it was not clearly erroneous for CMS to find immediate jeopardy continued to exist because “Sheridan’s deficient practices together could have created situations in which others at high risk for malnutrition would . . . face significant” medical complications. *Sheridan* at 42. The common thread in all of these cases is that residents remained at the facilities and were left exposed to the likelihood of serious harm by the ongoing noncompliance.
In the present case, it is undisputed that all residents were transported from the facility to either the hospital or other facilities on the evening of May 31, 2016. CMS Ex. 20, at 2; CMS Ex. 48. It is also undisputed that the residents were safely relocated while corrections were made and that no resident returned to Cahokia before July 21, 2016, at 12:45 pm, the time that IDPH informed the facility that deficiencies cited at the immediate jeopardy level had been corrected. Pet. Ex. 2, at 4 ¶ 33. CMS does not allege that the transfer put any resident in danger, nor that the quality of care available in the other facilities to Cahokia’s residents was inappropriate. Further, Cahokia followed up
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with its residents “after they were transferred to ensure they were receiving the services they required and had adjusted to the transfer.” *Id*. at 3 ¶ 24. The determination of continued immediate jeopardy was thus based solely on fire safety conditions found *at Cahokia*.
Cahokia’s Regional Director of Operations asserts that he “spoke with the surveyors and questioned how an Immediate Jeopardy could exist when the residents were not in the facility and had been transferred to other appropriate facilities,”3
 but “[t]he surveyors did not agree that the Immediate Jeopardy could be abated by transferring residents to other facilities and demanded an abatement plan that contained specific actions related to the life safety code and health survey findings.” *Id*. at 3-4 ¶ 25, 27-28. The surveyors focused on the three “components” that they understood to be relevant based on guidance issued to surveyors, i.e., harm, immediacy, and culpability – found in the State Operations Manual (SOM) Appendix Q – and concluded that “immediacy” was not removed until July 12, 2016, for the health survey deficiencies, and July 21, 2016, for the LSC deficiencies. CMS Exs. 5, 6.  In a July 1, 2016 letter from IDPH to Cahokia, the surveyors repeatedly stated that the LSC deficiencies are “likely in the very near future to cause serious injury, harm, impairment or death to all 106 residents, if immediate action is not taken . . . .” CMS Ex. 3. The surveyors’ comments overlook the plain fact that immediate action **was** taken to eliminate every resident’s exposure to Cahokia’s deficiencies when they were safely relocated to other facilities.4

	CMS also argues that Cahokia could not remove immediate jeopardy until the steps listed in its own abatement plans had been implemented. CMS Response at 22-23; *see also* ALJ Decision at 9. Cahokia submitted a plan in response to the June 29, 2016 LSC
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survey titled “Abatement Plan/Plan of Correction” (CMS Exs. 15, 77), and a plan in response to the July 12, 2016 health survey titled “Plan of Correction” (CMS Ex. 38).5
 The plans laid out the systemic changes Cahokia took to return to substantial compliance – such as consulting with LSC experts, revising its emergency preparedness manual, retraining its staff, and replacing the fire alarm panel and detection components – and assigned a completion date of July 21, 2016 for its corrections. CMS Exs. 15, 38. CMS argues that, “where Cahokia’s own Abatement Plan specifies that its plans to address the deficiencies were not going to take place until July 21, 2016, it is disingenuous for Cahokia to now argue that it had remedied the immediate jeopardy by May 31, 2016.” CMS Response at 23. Cahokia’s plan in response to the ongoing LSC immediate jeopardy deficiencies is convoluted; it does not distinguish between abating immediate jeopardy and returning to substantial compliance, and the date of completion for all corrective steps is listed as July 21, 2016. Cahokia nonetheless stated under each deficiency that all residents had been relocated “on May 31, 2016 to other facilities.” CMS Exs. 15, 38. CMS was thus plainly on notice, once again, that the conditions for immediate jeopardy no longer existed at the facility as of June 1, 2016.
The ALJ suggested that CMS could have elected to take harsher measures, such as placing the starting date of immediate jeopardy earlier based on the conditions that existed well before they were exposed by the fire. ALJ Decision at 8 n.4. Or, the ALJ opined, the depopulated facility could have been terminated for failing to meet the definition of a SNF as primarily engaged in caring for residents. *Id*. at 8, and n.5; *see also* 42 C.F.R. §§ 488.456(b), 488.412. We decline to speculate about other enforcement options that CMS might have imposed, as the issue before us is limited to whether the remedies imposed are legally supportable. Cahokia, for its part, argues that it already incurred a financial penalty in foregone revenue caused by the long absence of residents. *See* Pet. Ex. 2, at 4 ¶ 36 (“Because of Cahokia’s determination to relocate all of its residents from June 1, 2016 to July 21, 2016, Cahokia lost significant revenue.”).
In sum, we find that Cahokia met its burden of demonstrating that immediate jeopardy was abated, effective June 1, 2016, by showing that: 1) all residents were removed and relocated to appropriate facilities on May 31, 2016; and 2) no resident returned to the facility until after CMS determined that the conditions that originally caused immediate jeopardy for Cahokia’s residents were removed. Accordingly, we find clear error in CMS’s determination that Cahokia’s deficiencies continued to exist at the immediate jeopardy level between June 1, 2016, and July 20, 2016.
Page 13
**II. *The CMP amount imposed by CMS is not reasonable as a matter of law.***
Because we conclude that Cahokia’s noncompliance between June 1, 2016, and July 20, 2016, was not at the immediate jeopardy level, we must set aside the ALJ’s finding that $7,250 is a reasonable per-day CMP amount for the noncompliance during that period. The regulations in effect at the time of the noncompliance provided for an “upper range” of $3,050 to $10,000 per day for deficiencies cited at the immediate jeopardy level, and a lower range of $50 to $3,000 per day for deficiencies not cited at the immediate jeopardy level that either caused actual harm or had the potential for more than minimal harm. 42 C.F.R. § 488.438(a)(1). The $7,250 per day CMP imposed by CMS between June 1, 2016, and July 20, 2016, is above the maximum amount for noncompliance not at the immediate jeopardy level, and must be reduced to comply with the regulatory provisions.
In determining the amount of a CMP, ALJs and the Board are limited to considering the factors listed in section 488.438: 1) The facility’s history of noncompliance, including repeated deficiencies; 2) The facility’s financial condition; 3) The factors specified in section 488.404; and 4) The facility’s degree of culpability, which includes, but is not limited to, neglect, indifference, or disregard for resident care, comfort or safety. 42 C.F.R. § 488.438(f).
For the one day of noncompliance at the immediate jeopardy level – May 31, 2016 – we see no reason to disturb the ALJ’s conclusion that a $7,250 CMP “is not unreasonably high.” *See* ALJ Decision at 10-12. The ALJ provided a detailed analysis of the regulatory factors, including Cahokia’s extensive prior noncompliance with LSC fire safety requirements, which the ALJ deemed “appalling” and “disturbing.” *Id*. at 10-11. The ALJ found that Cahokia was “explicitly and repeatedly warned about its very serious fire safety problems,” and that its failure to “correct and maintain substantial compliance, by itself, justifies a significant, perhaps maximum, penalty.” *Id*. (citations omitted). The ALJ noted that Cahokia did not claim that it did not have the funds to pay the CMP, and dismissed Cahokia’s arguments that it has already incurred significant financial penalties by bringing the facility into substantial compliance. *Id*. at 11-12 (“The facility gets no credit for finally correcting the serious deficiencies that were of its own making.”). Finally, the ALJ found that Cahokia is “culpable for all of these very serious failings” because “facility management knew that its fire safety systems were dangerously noncompliant,” but “failed to repair its sprinklers, failed to develop adequate fire-safety plans; and failed to train its staff.” *Id*. at 12.
We find the ALJ’s analysis of the regulatory factors to be supported by substantial evidence, and adopt her conclusions in setting the new CMP amount for the 50-day period of noncompliance not at the immediate jeopardy level. Accordingly, we conclude that the maximum CMP allowed by the regulations – $3,000 per day – is warranted for June 1, 2016, through July 20, 2016. Cahokia does not argue that the penalty amount should be lower than the maximum allowed by the regulations, nor present evidence that
Page 14
would compel us to lower the amount. We therefore modify the CMP imposed on Cahokia to $7,250 for one day of noncompliance at the immediate jeopardy level (May 31, 2016), and $3,000 per day for the 50 days of noncompliance not at the immediate jeopardy level (June 1, 2016 – July 20, 2016), for a total CMP amount of $157,250.
Conclusion
For the reasons stated above, we affirm the ALJ Decision in part as to the findings of noncompliance, and reverse in part as to the duration of immediate jeopardy. Accordingly, the CMP amount is now $7,250 for May 31, 2016, and $3,000 per day between June 1, 2016 and July 20, 2016, for a total CMP of $157,250.


          /s/
        Christopher S. Randolph

                      Board Member
          /s/
        Constance B. Tobias

                      Board Member
          /s/
        Leslie A. Sussan

                      Presiding Board Member
      1. In October 2016, the requirements for long-term care facilities in subpart B of Part 483, including those at issue here, were revised. Final Rule, Medicare and Medicaid Programs; Reform of Requirements for Long-Term Care Facilities, 81 Fed. Reg. 68,688 (Oct. 4, 2016); 82 Fed Reg. 32,256 (July 13, 2017) (technical corrections). The revisions took effect on November 28, 2016, with implementation of the revised regulations in phases, with the earliest implementation date beginning on November 28, 2016, after the surveys that formed the bases for CMS’s determination of noncompliance in this case. See 81 Fed. Reg. at 68,688, 68,696-698. We rely on the regulations in effect when the state agency performed the surveys in this case. See Carmel Convalescent Hosp., DAB No. 1584, at 2 n.2 (1996) (Board applies regulations in effect on the date of the survey and resurvey). back to note 1
                      2. The factual information in this section is drawn from the ALJ Decision and the record and is presented to provide a context for the discussion of the issues raised on appeal. Nothing in this section is intended to replace, modify, or supplement the ALJ’s findings of fact. back to note 2
                      3. In support of this argument, Cahokia relies on a letter (that it calls “CMS Guidance”) dated December 12, 2002, from CMS’s Dallas regional office to the Texas Department of Human Services. RR at 9-11 (citing Pet. Ex. 1, at 2 (“We believe there may be situations in which an immediate jeopardy is removed before the facility has implemented all corrective actions to ‘fix the systems breakdown’ that led to the immediate jeopardy”), and id. at 3 (“Immediate jeopardy can be removed by . . . removing the beneficiaries at risk[.] . . . Examples of removing beneficiaries include the closure of an under-staffed ICU in a rural hospital, or the transfer of all ventilator residents from a nursing home.”)). CMS objects to Cahokia’s reliance on this letter, arguing that it was never issued as a “national policy from CMS’s Central Office, and therefore was never a controlling policy,” and was only intended to clarify immediate jeopardy procedures found in a previous version of SOM Appendix Q. CMS Response at 18. In any event, neither Appendix Q, nor the 2002 guidance letter, are binding on the Board; in reaching our conclusion, we rely instead on the controlling regulatory definition for immediate jeopardy found in section 488.301. Kindred Transitional Care & Rehab – Greenfield, DAB No. 2792, at 20 (2017); see also Pinecrest Nursing & Rehab. Ctr., DAB No. 2446, at 19 (2012) (“Appendix Q’s purpose is to guide surveyors in applying a regulatory standard, not to define that standard. The immediate jeopardy standard is defined by regulation in 42 C.F.R. § 488.301, and the regulatory definition, not the SOM instructions, binds the Board.”). back to note 3
                      4. The ALJ observed – in the context of evaluating the appropriateness of the penalty amount – that Cahokia did not voluntarily transfer its residents; rather, because the facility was not safe, “[s]tate and local authorities determined that the residents could not return, and they arranged for the transfers.” ALJ Decision at 12 n.8. For the purpose of determining whether Cahokia’s deficiencies continued to exist at the immediate jeopardy level, we see no difference between whether the residents were relocated by the facility or by state and local authorities. The point is that the residents were permanently removed from the conditions that were likely to cause serious harm. back to note 4
                      5. During the July 12, 2016 health survey, IDPH surveyors determined that immediate jeopardy for Cahokia’s health deficiencies was abated during the survey. CMS Ex. 5, at 1. Cahokia’s “Plan of Correction” addressed only the ongoing noncompliance that was not at the immediate jeopardy level. CMS Ex. 38. The record also contains an undated document titled “Abatement Plan – Health Survey” that appears to list the steps Cahokia took to correct the immediate jeopardy health survey deficiencies, but it is unclear when this document was submitted and whether it was accepted by CMS. See CMS Ex. 66. back to note 5 Back to top
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