Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Woodland Hills Healthcare and Rehabilitation
Center of Jacksonville, LLC,
(CCN: 04-5378),

Petitioner,
v.
Centers for Medicare & Medicaid Services.
Docket No. C-11-734
Decision No. CR2780

Date: May 9, 2013

DECISION

Following a June 15, 2011 complaint investigation survey, the Arkansas Department of
Human Services, Office of Long-Term Care (state agency) determined that Woodland
Hills Healthcare and Rehabilitation Center of Jacksonville, LLC, (Petitioner or facility)
was not in substantial compliance with Medicare participation requirements for skilled
nursing facilities, and that its noncompliance posed immediate jeopardy to the health and
safety of its residents. Specifically, the state agency determined that Petitioner’s facility
did not report or investigate two rape allegations in accordance with federal requirements.
Based on the state agency’s survey findings, the Centers for Medicare & Medicaid
Services (CMS) imposed a $5,000 per-day civil money penalty (CMP) for one day, June
10, 2011, and a $300 per-day CMP for 31 days, from June 11, 2011 to July 11, 2011, for
a total CMP of $14,300.

For the reasons explained below, I find and conclude that Petitioner’s reporting and
investigation of the two rape allegations at issue was appropriate and reasonable in light
of the circumstances surrounding the allegations. Petitioner remained in substantial
compliance with Medicare participation requirements at all times relevant to this case.
Accordingly, there is no basis for an enforcement remedy, and the per-day CMPs
imposed by CMS are reversed.

I. Case Background and Procedural History

Petitioner is a long-term care facility in Jacksonville, Arkansas that participates in the
Medicare and Medicaid programs. As stated, two rape allegations and the facility’s

response to those allegations are at the center of the deficiencies that the state agency
cited. The basic facts and timeline of events set forth below are generally undisputed.

Resident 1 was an 87-year-old female who suffered from, among other things, dementia.
She frequently made untrue statements when suffering from a urinary tract infection
(UTD, which she was experiencing at the time of the incident giving rise to this case. On
June 5, 2011, at approximately 8:30 p.m., a male certified nursing assistant (CNA 1)
entered the room of Resident | to provide peri-care. The door to the room remained
open; the charge nurse, a licensed practical nurse (LPN 1) was outside the room and
could hear inside. CNA | exited the room shortly thereafter and requested assistance
from LPN | to change Resident 1’s leaking colostomy bag. While LPN 1 gathered the
supplies needed, a laundry attendant entered Resident 1’s room along with CNA 1. Soon
after the laundry attendant left the room, LPN 1 returned, entered the room, and began to
assist CNA | with changing Resident 1’s colostomy bag. Resident 1 was agitated,
waving her hands and scratching while CNA 1 and LPN | changed her colostomy bag.
LPN | asked that CNA | hold Resident 1’s hands to prevent her from hitting LPN 1
during the process. After the colostomy bag was changed, LPN 1 left the room while
CNA | remained inside the room to finish providing peri-care. LPN | stayed outside the
room; the door remained open. Two minutes later, CNA | exited the room, approached
LPN 1, and told her that Resident 1 was “saying that [he] raped her.” LPN 1 then entered
the room, evaluated the circumstances in the room, and asked Resident 1 what happened.
Resident 1 responded “I don’t know; I don’t understand you.” LPN | determined that the
rape allegation was unfounded. Nevertheless, LPN 1 and CNA | each completed
separate incident reports. Another staff member placed the two incident reports in the
facility administrator’s inbox. The following day, on June 6, 2011, at 4:30 p.m., the
facility administrator found the incident reports and initiated an internal investigation
along with the director of nursing (DON). The day after, on June 7, 2011, at 11:00 a.m.,
the facility reported the incident to the state agency.

Resident 2 was an 89-year-old female resident who suffered from, among other things,
dementia, hallucinations, frequent yelling, cellulitis, and delirium when suffering from a
UTL On June 7, 2011, at 4:00 p.m., a male CNA (CNA 2) and a female LPN (LPN 2)
entered the room of Resident 2 to provide peri-care. While CNA 2 was providing care,
Resident 2 claimed he was trying to look at her “private area.” LPN 2 immediately took
over the peri-care. Once peri-care was complete, CNA 2 transported Resident 2 in a
wheelchair to the facility’s dining area. Resident 2 appeared upset, and the facility’s

beautician asked what was wrong. Resident 2 said that a “black man” had tried to rape
her in her room. When asked what happened, Resident 2 told the beautician that the man
pulled her pants off, lifted her up, and put her pants back on. The beautician reassured
Resident 2 that he was likely changing her pants. The beautician immediately notified
the DON, who started an internal investigation. The next day, on June 8, 2011 at 11:00
a.m., the facility reported the incident to the state agency.

Beginning June 10, 2011, the state agency conducted a complaint investigation survey of
Petitioner’s facility. The state agency determined that the facility was not in substantial
compliance with Medicare participation requirements, citing three specific deficiencies:

© 42 CER. § 483.13(c)(1)(ii)-(iii), (c)(2)-(4) (Tag F-225) -- failure to investigate or
report allegations of abuse of a resident;

e 42 C.F.R. § 483.13(c) (Tag F-226) -- failure to develop and implement abuse and
neglect prevention policies; and

e 42C.F.R. § 483.75 (Tag F-490) -- failure to provide effective administration.

The state agency further determined that all of Petitioner’s deficiencies posed immediate
jeopardy to the health and safety of the facility’s residents. The state agency cited each
deficiency at a “K” level, meaning the surveyor found a pattern of immediate jeopardy.
However, the state agency also determined that the facility had abated the immediate
jeopardy as of June 10, 2011, but remained out of substantial compliance at a lower scope
and severity until July 11, 2011. CMS adopted the state agency’s findings, and imposed
two levels of per-day CMPs: (1) a $5,000 per-day CMP for one day, June 10, 2011; and
(2) a $300 per-day CMP for 31 days, from June 11, 2011 through July 11, 2011, when a
revisit survey determined that Petitioner had returned to substantial compliance.

Petitioner requested a hearing to challenge the state agency’s finding of noncompliance,
the scope and severity of noncompliance, and the enforcement remedies imposed. After
the parties submitted pre-hearing briefing, I held a hearing from May 21-23, 2012, in
Little Rock, Arkansas, where I admitted CMS Exhibits (CMS Exs.) 1-10 as well as
Petitioner’s Exhibits (P. Exs.) 1-67. Each party also presented testimony from several
witnesses. A transcript of the proceedings (Tr.) is incorporated into the record. Each
party has submitted a post-hearing brief (Br.) and a reply brief (Reply Br.).

II. Statutory and Regulatory Framework

The Social Security Act (Act) establishes the requirements that a long-term care facility
must meet to participate in the Medicare and Medicaid programs, and authorizes the
Secretary of Health and Human Services (Secretary) to promulgate regulations
implementing those statutory requirements. Act §§ 1819, 1919.' Specific Medicare
participation requirements for long-term care facilities are at 42 C.F.R. Part 483. A long-
term care facility must remain in substantial compliance with program requirements to
participate in Medicare. 42 C.F.R. § 483.1(b). “Substantial compliance” means “‘a level
of compliance with the requirements of participation such that any identified deficiencies
pose no greater risk to resident health or safety than the potential for minimal harm.

42 C.F.R. § 488.301. By contrast, “noncompliance” means “any deficiency that causes a
facility not to be in substantial compliance.” Jd. A “deficiency” is a violation of a
statutory or regulatory participation requirement. Id.

The Act authorizes the Secretary to impose enforcement remedies against a long-term
care facility for failure to comply substantially with the federal participation
requirements. See Act § 1819(h); 42 C.F.R. § 488.402. The Secretary may not continue
Medicare payments to a long-term care facility for more than six months after the facility
is first found not to be in substantial compliance. Act § 1819(h)(2)(C). Ifa facility does
not return to substantial compliance within three months, the Secretary must deny
payments for all individuals admitted to the facility after that date - commonly referred to
as the mandatory or statutory denial of payments for new admissions (DPNA). See Act

§ 1819(h)(2)(D).

The Secretary has delegated to CMS and the states the authority to impose remedies
against a long-term care facility not in substantial compliance with program participation
requirements. State agencies survey facilities on behalf of CMS to determine whether the
facilities comply with federal participation requirements. 42 C.F.R. §§ 488.10-.28,
488.300-.335. The regulations specify the enforcement remedies that CMS may impose
if a facility is not in substantial compliance with Medicare requirements. See 42 C.F.R.

§ 488.406.

CMS may impose a per-day CMP for the number of days a facility is not in substantial
compliance or a per-instance CMP for each instance of the facility’s noncompliance.

42 C.F.R. § 488.430(a). A per-day CMP, which CMS imposed in this case, has an upper
and lower range, depending on the severity of a facility’s noncompliance. The upper
range is from $3,050 to $10,000 per day for noncompliance that constitutes immediate
jeopardy. 42 C.F.R. § 488.438(a)(1)(i). The lower range is from $50 to $3,000 per day
for noncompliance that does not constitute immediate jeopardy. 42 C.F.R.

§ 488.438(a)(1)(ii).

A long-term care facility may request a hearing before an administrative law judge (ALJ)
to challenge a noncompliance finding and enforcement remedies. Act §§ 1128A(c)(2),

' The Act, as amended, is available at http://www.ssa.gov/OP_Home/ssact/ssact.htm.
On this website, each section of the Act contains a reference to the corresponding chapter
and code in the United States Code.
1866(h); 42 C.F.R. §§ 488.408(g), 498.3(b)(13). The hearing before an ALJ is de novo.
The Residence at Salem Woods, DAB No. 2052 (2006); Cal Turner Extended Care, DAB
No. 2030 (2006); Beechwood Sanitarium, DAB No. 1906 (2004); Emerald Oaks, DAB
No. 1800 (2001); Anesthesiologists Affiliated, DAB CR65 (1990), aff'd, 941 F.2d 678
(8th Cir. 1991). The choice of remedies or factors CMS considered when choosing
remedies is not subject to review. 42 C.F.R. § 488.408(g)(2). A facility may only
challenge the scope and severity level of noncompliance if a successful challenge would
affect the range of the CMP that may be imposed or impact the facility’s authority to
conduct a nurse aid training and competency evaluation program (NATCEP). 42 C.F.R.
§ 498.3(b)(14), (d)(10)(i).

The standard of proof, or quantum of evidence required, is a preponderance of the
evidence. CMS has the burden of coming forward with the evidence and making a prima
facie showing of a basis for imposition of an enforcement remedy. Petitioner bears the
burden of persuasion to show by a preponderance of the evidence that it was in
substantial compliance with participation requirements or any affirmative defense.
Batavia Nursing & Convalescent Ctr., DAB No. 1904 (2004), aff'd, 129 F. App’x. 181
(6th Cir. 2005); see Hillman Rehab. Ctr., DAB No. 1611 (1997), aff'd, No. 98-3789,
1999 WL 34813783 (D.N.J. May 13, 1999).

III. Issues
This case presents the following three issues:

1. whether, from June 10, 2011 through July 11, 2011, Petitioner was in substantial
compliance with Medicare participation requirements;

2. if Petitioner was not in substantial compliance during the period cited, whether the
facility’s noncompliance posed immediate jeopardy to the health and safety of its
residents on June 10, 2011; and

3. if Petitioner was not in substantial compliance during the period cited, whether the
per-day CMPs imposed are reasonable.

As explained below, Petitioner was in substantial compliance with Medicare participation
requirements for the period cited. Therefore, the second and third issues are moot.

IV. Findings of Fact, Conclusions of Law, and Analysis
I make five findings of fact and conclusions of law (FFCL) to support this decision. Each

FFCL is set forth as a separate heading in bold and italics, followed by a discussion for
that FFCL.
1. Petitioner substantially complied with the abuse reporting requirements at
42 C.F.R. § 483.13(c)(2).

By regulation, a facility must report all allegations of resident abuse:

The facility must ensure that all alleged violations involving mistreatment,
neglect, or abuse, including injuries of unknown source ... are reported
immediately to the administrator of the facility and to other officials in
accordance with State law through established procedures (including to the
State survey and certification agency).

42 C.F.R. § 483.13(c)(2). The regulations do not provide a time frame for reporting an
abuse allegation “immediately,” but Appendix PP of the State Operations Manual
(SOM), a non-binding guidance manual that CMS publishes for surveyors of long-term
care facilities, defines “immediately” to mean “as soon as possible, but ought not exceed
24 hours after discovery of the incident, in the absence of a shorter State time frame
requirement.” SOM, app. PP, Guidance for F225.

Here, staff reported the rape allegations by Residents 1 and 2 to the facility administrator
and the DON. See P. Exs. 7, 14. CMS does not argue that the substance of the reports
was improper or insufficient, but rather that staff did not “immediately” report the
incident involving Resident 1 to the facility administrator. CMS Br. at 3; CMS Reply Br.
at 2-3. CMS argues that Petitioner’s staff had to report the rape allegation by Resident |
well before 4:30 p.m. the day after it occurred, but cites nothing other than the surveyor’s
belief that “immediately” means only “as soon as possible.” See Tr. 121; CMS Br. at 3;
CMS Reply Br. at 1-3. Petitioner aptly cites CMS’s own guidance — of which the
surveyor had no apparent knowledge (Tr. 122) — that says reporting an incident
“immediately” may include reports made up to 24 hours after the incident is discovered.
See SOM, app. PP, Guidance for F225. Here, Petitioner’s staff successfully reported
Resident 1’s allegation to the facility administrator within 21 hours of its occurrence.
While the means of reporting the allegation, placing two incident reports in the
administrator’s inbox, were perhaps more passive than might be desirable in other
circumstances not present here, the critical fact remains that the administrator had
nowledge of the incident within the range that CMS set as a guideline.? CMS has not

> CMS argues that its guideline for surveyors does not apply because the definition of
“immediately” refers to a “shorter State time frame requirement.” CMS Reply Br. at 2.
According to CMS, this definition of “immediately” only applies with reference to when
the facility must notify the state agency. CMS’s position, however, is unreasonable and
legally untenable, as it would result in one word, “immediately,” having two meanings in
(continued...)
offered any basis for why its current ipse dixit position of what “immediately” means
should have more weight than its own published guidelines. Moreover, LPN 1’s
immediate assessment of the allegation, which determined it to be unfounded,
demonstrates that the slight delay in reporting the incident to the facility administrator,
even if deficient, did not create a potential for even minimal harm to Resident | or other
residents. See P. Ex. 7, at 5-6; Tr. 289. CMS, therefore, has not established a prima facie
case that the facility staff failed to report the rape allegation “immediately” in accordance
with Medicare participation requirements and its own guideline for applying the
applicable regulatory requirement.* CMS cannot meet its burden by ignoring its own
published guidance manual and substituting the unsupported belief of a surveyor. Even if
CMS had met its burden, Petitioner has come forward with ample evidence — certainly
more than a preponderance — showing that staff reported the incident to the
administrator within an appropriate time for doing so based on the circumstances of the
rape allegation. Additionally, to the extent it may be perceived as a deficiency, the minor
delay in reporting the rape allegation did not result in actual harm and, based on the
immediate assessment of the allegation by the charge nurse, did not have the potential to
cause more than minimal harm. Therefore, Petitioner substantially complied with the
regulation.

The facility administrator reported the June 5, 2011 incident to the state agency on June
7, 2011, the morning after he received the staff reports and initiated an internal
investigation. Indeed, CMS has not argued that Petitioner’s notice to the state agency
was deficient in its timeliness. CMS Br. at 2-7; CMS Reply Br. at 2 (“This case involves
Petitioner’s failure to immediately report allegations of abuse to its Administrator.
CMS’[s] Guidelines regarding reporting allegations to state officials are therefore not
applicable.”). The state agency requires that a facility report an incident to the state
agency by 11:00 a.m. the following business day. Tr. 141-142. Here, while evidence
shows that the facility did not report the incident until the second business day, and thus
did not comply with the state agency’s reporting requirements, see P. Ex. 7, that showing
does not equate to a prima facie case of noncompliance with the regulatory requirement
the state agency cited. To show “noncompliance,” CMS must make a prima facie
showing of “any deficiency that causes a facility not to be in substantial compliance.”

42 C.F.R. § 488.301. As noted above, “substantial compliance” means “a level of
compliance with the requirements of participation such that any identified deficiencies
pose no greater risk to resident health or safety than the potential for minimal harm.” Jd.

the same regulation. Under CMS’s position, “immediately” with reference to reports to
an administrator means “as soon as possible,” while “immediately” with reference to
reports to the state agency means “within 24 hours.”

> The SOM does not establish requirements that a facility must follow, nor is CMS
bound by it. However, its application here is particularly useful because there is no other
guidance as to what “immediately” means in 42 C.F.R. § 483.13(c)(2).
CMS offered no evidence showing that the delay in reporting to the state agency caused
actual harm to Resident | or had the potential to cause more than minimal harm to
residents. Merely demonstrating that the facility did not meet a reporting deadline with
the state agency by one day is insufficient to show noncompliance with the Medicare
participation requirement because it is not clear on its face how failing to meet that
deadline was likely to cause more than minimal harm, especially when, as here, the
facility immediately assessed the resident and began an investigation of the incident.*
See P. Ex. 7, at 2-3. Petitioner correctly pointed out at the hearing that if the incident
occurred on a Saturday rather than a Sunday, the period in which Petitioner would have
been permitted to make a timely report (Saturday to Monday at 11:00 a.m.) would have
been the same period as what actually happened here (Sunday to Tuesday at 11:00 a.m.).
See Tr. 223. Therefore, any possibility of more than minimal harm associated with the
reporting delay is unsupported because the state agency’s own reporting requirements
permit the same reporting period as happened here without imposing a per se finding of
arm. Moreover, CMS did not suggest in its briefing how this technical deficiency with
the state agency reporting requirements posed the possibility of more than minimal harm.
Even the state agency did not find that the facility’s delayed incident report showed that
“harm could have or may have occurred” because the state agency waited an additional
three days before entering the facility.* See Tr. 215-216.

CMS also relies on certain subsequent acts of the facility administrator to support its
position that facility staff did not immediately report the rape allegations to the
administrator. See CMS Br. at 4; Tr. 32, 304. CMS and the surveyor repeatedly refer to
a written warning that the administrator issued to LPN | for not immediately reporting
the rape allegation or suspending CNA 1. CMS Ex. 10, at 137. Under CMS’s theory, the
administrator’s warning shows that he understood LPN 1 did not comply with the
regulatory reporting requirement. See CMS Br. at 4. But CMS overlooks two critical
points: first, this warning was given on June 11, 2011, after the state agency had begun
its survey and informed the facility of its immediate jeopardy determination; and second,

+ CMS could, for example, show that the administrator took no action, and that a delay in
reporting to the state agency likely exposed residents to a risk of more than minimal harm
as a result. CMS did not make such a showing here, but rather submitted evidence that
demonstrated the facility took steps to prevent further abuse and start an internal
investigation. By contrast, not reporting an incident to a facility administrator could be,
on its face, enough to demonstrate the potential for more than minimal harm because it
may prolong possible abuse or put other residents for similar types of abuse. The facility
administrator has the ability to respond immediately to such reports, making immediate
notification critical. A delay in reporting to a state agency does not implicate the same
potential for harm to residents.

> The surveyor testified that if the state agency finds that “harm could have or may have
occurred,” it will enter a facility within two days. Tr. 215-216.
the facility administrator’s conduct is not a legal determination that must be afforded
deference when determining the facility’s compliance. The written warning carries little
weight here because it was most likely prompted by the presence of the state agency in
the facility, not the administrator’s independent belief that staff had failed to report the
incident immediately. The administrator likely felt pressured into taking the action he did
in light of the scrutiny with which the state agency was reviewing the facility’s actions as
well as the state agency’s determination of immediate jeopardy on June 10, 2011.° See
Tr. 373 (testimony of administrator, stating he did not find anything that “warranted
[CNA 1’s] suspension”). It is unreasonable for CMS to prompt a facility into taking
action that it deems necessary to abate an immediate jeopardy determination, and then
rely on that act as evidence the facility knew it was not in substantial compliance. Such
reliance is more unfounded when, as here, the basis for finding immediate jeopardy was
erroneous. Thus, the written warning to LPN | does not support CMS’s case here.

CMS does not allege that Petitioner failed to comply substantially with participation
requirements based on its reporting of the incident involving Resident 2 on June 7, 2011.
Tr. 40; CMS Br. at 5. Therefore, I need not address Petitioner’s reporting practices for
that rape allegation.

2. Petitioner substantially complied with the abuse investigation requirements
at 42 C.F.R. § 483.13(c)(3).

Once an allegation of abuse has occurred, the regulations require that the facility
investigate the allegation thoroughly while protecting residents from any further potential
abuse. The applicable regulation states:

(3) The facility must have evidence that all alleged violations are thoroughly
investigated, and must prevent further potential abuse while the investigation
is in progress.

42 CFR. § 483.13(c)(3).

° The state agency advised Petitioner of the noncompliance notification by letter dated
June 27, 2011, though the surveyor testified that she told the facility about the immediate
jeopardy determination on June 10, 2011, while she was conducting the survey. Tr. 32.

’ The F-Tag that CMS cited here (F-225) includes 42 C.F.R. § 483.13(c)(4):

The results of all investigations must be reported to the administrator or his
designated representative and to other officials in accordance with State law
(including to the State survey and certification agency) within 5 working days

(continued .. . )
10

The thoroughness of a facility’s investigation of potential abuse must be assessed in light
of all relevant facts and the steps the facility took based on those facts. The evaluation is
not meant to pinpoint diversions from the facility’s internal investigation policies, but to
determine whether the facility took reasonable steps to investigate the potential abuse
thoroughly based on the surrounding circumstances. See, e.g., Amboy Care Ctr., DAB
CR1411 (2006). In addition, to ensure no further instances of potential abuse occur, the
facility must take some preventative measures to protect the resident from the alleged
cause of the abuse. See, e.g., Somerset Nursing & Rehab. Facility, DAB CR2166, at 7-9
(2010), aff'd, DAB No. 2353 (2010). In the specific context of the circumstances
presented here, the two investigations Petitioner undertook were thorough and
substantially complied with the Medicare participation requirement, and Petitioner took
adequate preventative measures to protect Residents 1 and 2 from further potential abuse
during the investigations.

a. Investigation into the allegation by Resident 1.

After CNA | relayed the rape allegation Resident 1 had made against him — moments
after the allegation — LPN | immediately interviewed Resident 1. Tr. 287-288. LPN 1
determined that the rape allegation was unfounded, which the surrounding circumstances
at the time confirm: Resident 1 was confused about the rape allegation she just made
against CNA 1 (Tr. 288; P. Ex. 7, at 6); CNA | and LPN | had provided Resident 1 with
intimate care in the minutes before the allegation (P. Ex. 7, at 5-6); Resident 1 had a UTI
that made her delirious (Tr. 238; CMS Ex. 7, at 138); Resident 1 had a history of making
accusations against staff in the past (Tr. 442); and LPN 1 was just outside the room when
the alleged act occurred (P. Ex. 7, at 5). The following day, the administrator and DON
learned of the incident, prompting them to interview Resident | immediately. Tr. 367; P.
Ex. 7, at 2. Resident 1 expressed her satisfaction with CNA | and never repeated the rape
allegation or any other inappropriate behavior by CNA 1. Tr. 369. The administrator did
not ask pointed questions, but made them “as open-ended as possible . . . without putting
any particular thoughts in her head.” Tr. 368. During the interview, the DON conducted
a full body audit, but discovered no unexplained bruises or injuries. P. Ex. 7, at 2. The
administrator then interviewed CNA 1, who explained that he provided peri-care to
Resident 1 and changed her colostomy bag, consistent with his statement at the time of
the incident. Tr. 370. Next, the administrator reviewed surveillance video footage of the
hallway outside Resident 1’s room, and determined there was no suspicious activity at the

of the incident, and if the alleged violation is verified appropriate corrective
action must be taken.

CMS has not argued or presented any evidence that Petitioner violated this specific
regulatory requirement. Rather, the evidence here demonstrates that Petitioner timely
submitted investigation reports to the state agency as required. CMS Ex. 10, at 52, 486.
11

time of the allegation. Tr. 370-371; CMS Ex. 10, at 53; see P. Ex. 65. The administrator
then interviewed a generally coherent and reliable resident, referred to at hearing as
“M.V.,” who was seen in the video just outside Resident 1’s room at the time of the
allegation. Tr. 280-281, 371; P. Ex. 65. M.V. denied noticing any unusual activity in or
around Resident 1’s room at that time. Tr. 371; CMS Ex. 10, at 53. The administrator
also interviewed other residents that CNA | had cared for around the time of the
allegation to determine if he was ever inappropriate with them. Tr. 373. All of the
residents denied that CNA | was ever inappropriate. Tr. 373; CMS Ex. 10, at 54. The
facility staff contacted local police, who initiated their own investigation of the rape
allegation. See P. Ex. 7, at 4. Staff also contacted Resident 1’s primary care physician
and her family to notify them of the rape allegation. CMS Ex. 10, at 53. The family’s
reaction was not one of immediate concern: “Yeah, she says a lot of things.” CMS Ex.
10, at 53.

The next day, the facility notified the state agency of the allegation and initiated a broader
investigation. P. Ex. 7. The administrator and DON obtained witness statements from
numerous staff members and residents regarding CNA 1’s behavior. See CMS Ex. 10, at
142-176. All of the statements denied witnessing or being aware of inappropriate
behavior by CNA 1. CMS Ex. 10, at 54, 142-176. The facility also performed follow-up
staff in-services about the proper procedures for handling and reporting abuse allegations.
CMS Ex. 10, at 54.

The facility’s investigation included immediate interviews of the alleged victim, the
alleged perpetrator, and a critical witness (LPN 1) to the alleged act. The facility’s
investigation also consisted of reviewing video footage of the area outside Resident 1’s
room, which alerted the facility administrator to another possible witness, M.V., the
coherent and reliable resident-witness mentioned above, who was passing by the room at
the time of the alleged incident. The facility staff performed a body audit within 24 hours
of the alleged incident and found no unexplained injuries. The facility notified
Resident 1’s family and primary care physician. All of these steps reflect a thorough
investigation of an incident that, from the outset, seemed implausible and unfounded.
Based on Resident 1’s history of dementia, delusions, and making allegations against
staff when suffering from a UTI, as she was on June 5, 2011, as well as the assessments
and interviews conducted within 24 hours of the incident, Petitioner’s staff took
reasonable measures to investigate the rape allegation and complied with the regulatory
requirement that investigations be done thoroughly.

CMS does not offer any additional action that Petitioner could have taken to make its
investigation more thorough, other than an intrusive pelvic examination, commonly
called a “rape kit.” The surveyor testified that a proper investigation would “entail
immediately doing a body audit, questioning the resident, [and] perhaps getting a rape
kit.” Tr. 29. It is beyond question that the facility questioned Residents 1 and 2 and
performed body audits immediately after their allegations. P. Exs. 7, 14. The “rape kit”

12

that the surveyor referred to as a helpful and possibly-productive step for a thorough
investigation is simply too extreme — too traumatic, too intrusive, and too likely to
exacerbate Resident 1’s emotional distress — in the context of this incident. CMS has
offered no authority for the very dangerous assertion that all rape allegations — even
when a full and carefully-conducted investigation of the circumstances surrounding the
allegation determines it to be unfounded — must have a rape kit to be considered
“thorough” under the regulation. Petitioner, however, has provided credible testimony
that a rape kit would have been much more detrimental to Resident 1 in light of the
circumstances surrounding the allegations. Tr. 448 (testimony of Resident 1’s physician,
stating that a rape kit exam “probably would cause a significant emotional distress for the
patient because she wouldn’t be able to understand the nature of the exam and what
exactly is happening to her. . .”). The surveyor also testified that the thoroughness of an
investigation depends on the facility following its internal investigation policy, though
neither she nor CMS cites authority to support that argument. See Tr. 210-211. Rather,
the applicable regulatory standard only requires that an investigation must be done
“thoroughly” without reference to the facility’s investigation policy. 42 C.F.R.

§ 483.13(c)(2); see Amboy Care Ctr., DAB CR1411, at 10-11.

The investigation of Resident 1’s allegation is consistent with other cases where an ALJ
has found a facility performed a thorough investigation of potential abuse. In Amboy
Care Center, supra, the ALJ found an investigation was thorough because the facility
interviewed all persons who could have had knowledge of the alleged abuse. DAB
CR1411, at 11. Similarly, Petitioner here interviewed all witnesses — and even
uncovered through the video footage a previously unknown witness — who could have
had knowledge of the alleged rape. Also, in Singing River Rehabilitation & Nursing
Center, DAB CR1838 (2008), the ALJ found an investigation was thorough when facility
staff interviewed two witnesses who corroborated what the DON had learned by
interviewing the principals in the incident. DAB CR1838, at 14. Like in Singing River,
Petitioner here interviewed Resident M.V., who was in the hallway at the time of the
alleged rape, and who corroborated the LPN’s and CNA’s statement that nothing unusual
had occurred in or around the room.

By contrast, this case is not at all like those where the ALJ has found an investigation
failed to be thorough. In New Homestead Care Center, DAB CR1906 (2006), the ALJ
found a facility’s investigation was not thorough simply because it interviewed the
resident and alleged perpetrator and determined the allegation unfounded. DAB CR1906,
at 10. Here, unlike in New Homestead, the facility interviewed many more witnesses
than just Resident 1 and CNA 1. As stated, the facility reviewed video footage,
interviewed other staff members and residents, conducted a body audit, and notified
police. Therefore, the investigation Petitioner performed in this case is more like those in
Amboy Care Center and Singing River, rather than New Homestead. Accordingly,
Petitioner has shown that its investigation of the allegation by Resident 1 was thorough
under the requirement at 42 C.F.R. § 483.13(c)(2).
13

b. Investigation into the allegation by Resident 2.

Immediately after the facility’s beautician reported the rape allegation by Resident 2, the
DON interviewed Resident 2, CNA 2, and the other female staff member present in the
room during the alleged incident. P. Ex. 14, at 2. The DON also performed a body audit
and found no unexplained bruises or injuries. CMS Ex. 10, at 487. The DON and
administrator reviewed the video footage of Resident 2 with CNA 2 moments after the
rape allegedly occurred. Tr. 389. Based on statements by Resident 2 and the witnesses,
the body audit, and the video showing Resident 2’s demeanor, the DON determined the
rape allegation was not true. At hearing, the surveyor acknowledged that the DON
immediately investigated the rape allegation by Resident 2 and that the DON talked to
“every relevant witness.”® Tr. 110, 113. Ina similar case, Westview Manor, DAB
CR1308 (2005), the ALJ determined an investigation was thorough even though it was
limited to those witnesses with knowledge of the alleged incident. DAB CR1308, at 10.
Consistent with Westview, as well as the cases cited above, the interviews the DON
conducted here, as well as the body audit and review of video footage, amounted to a
thorough investigation in light of all the circumstances presented.

CMS implies that the beautician tainted the investigation by reassuring Resident 2 she
had not been raped, but that CNA 2 was simply changing her pants. CMS Br. at 7.
According to CMS, that reassurance resulted in Resident 2 believing she had not been
raped and therefore not repeating the allegation to the DON when asked. But CMS
overlooks that a female staff member who was in the room at the time the rape allegedly
occurred stated that no such rape or abuse occurred. CMS Ex. 10, at 487. The statements
Resident 2 made after her initial investigation were not the only means of investigating
that allegation. The facility took additional steps to investigate the claim, including
interviews with other witnesses who would have knowledge of the alleged incident and a
body audit shortly after the alleged incident occurred; none of these steps depended upon
Resident 2’s statements after her initial allegation. Therefore, it is unreasonable for CMS
to claim that the facility’s beautician tainted the investigation and resulted in the facility’s
noncompliance when she was doing a commendable job of calming an agitated and
anxious resident. CMS has offered nothing more than its speculation — entirely
unbuttressed by any objective evidence or logical support — to advance its position that
the beautician’s conduct actually hindered the investigation or delayed other steps’ being
taken. Such speculation will not stand to establish or support a noncompliance finding.

® CMS misrepresents the surveyor’s testimony on this issue, which seriously undermines
its overall position. In its brief, CMS claims that the surveyor determined Petitioner
“failed to interview key staff and residents.” CMS Br. at 5 (citing Tr. 42). CMS,
probably neglectfully, omitted the surveyor’s acknowledgement that Petitioner’s staff
interviewed “every relevant witness.” Tr. 113.

14

c. Prevention of further potential abuse during the investigations.

The regulation requires prevention of further potential abuse, but it does not articulate
specific measures for such prevention. 42 C.F.R. § 483.13(c)(3). Therefore, it is
important to consider all of the circumstances surrounding the allegation, as well as the
risk of further potential abuse to residents when evaluating the facility’s prevention of
further potential abuse. Here, facility staff determined soon after the rape allegations that
both were unfounded and there was no evidence of rape or any other abuse by CNA 1 or
CNA 2. Nevertheless, immediately after Resident 1 accused CNA | of rape, LPN |
directed him not to enter the room without a female staff member present. Tr. 290. The
next day, the administrator, the DON, and local police determined the rape allegation was
not credible and there was no evidence of abuse by CNA 1. Therefore, it would be
unreasonable to require further restrictions of CNA | after an investigation concluded he
did not commit the acts he was accused of committing. Similarly, a prompt and thorough
investigation of Resident 2’s allegation revealed that CNA 2 did not abuse her. The
regulation simply does not require ongoing segregation or suspension of staff members
that a thorough investigation has shown to be innocent.

CMS, however, seeks to impose an unreasonable standard here: that a staff member
accused of an unfounded rape must be and must remain suspended until a surveyor or
other official determines the investigation was appropriate. See Tr. 35-39; CMS Br. at
3-5. Here, the facility conducted a thorough investigation of the rape allegations.
Immediately after Resident 1 made the allegation, the facility staff preliminarily
determined that the rape allegation was unfounded and did not suspend CNA 1. Tr. 373.
The regulation does not require suspension of staff, but the prevention of further potential
abuse. 42 C.F.R. § 483.13(c)(2). While the investigation continued, the facility restricted
CNA 1’s access to female residents by requiring a female staff member to be present
while CNA | provided care to female residents. Tr. 290. After a more thorough
investigation, the facility determined that CNA | had not raped or otherwise abused
Resident 1. Only then did the surveyor enter the facility. She observed CNA | enter the
room of a female resident without a female staff member and called immediate jeopardy.
Tr. 128-129; CMS Ex. 7, at 138. She did not ask whether the restriction against CNA 1
had been lifted or whether the investigation had returned any conclusive results. The
surveyor did not recognize that the facility had already conducted a thorough
investigation — at that point five days after the allegation — and determined that CNA 1
was not a threat to female residents. See P. Ex. 7. The surveyor overlooked the facility’s

° As further support of the alleged deficiency under section 483.13(c)(3), CMS relies on
the facility’s failure to implement its abuse investigation policy, which says that under
certain circumstances of alleged abuse, involved staff members will be suspended. CMS
Br. at 3; CMS Ex. 5, at 20. But failure to implement an abuse investigation policy is not
part of a deficiency under section 483.13(c)(3). Accordingly, that issue is discussed
below in reference to the applicable regulatory requirement.
15

reasonable actions following the rape allegation, and instead seems to have imposed an
arbitrary and unarticulated standard related to CNA 1’s access to female residents. The
cascading acts the facility took after the surveyor called immediate jeopardy, including
the suspension of CNA | and CNA 2, do not reflect the facility’s noncompliance with
participation requirements, but show the reactive measures the facility believed it needed
to take to comply with the unreasonable standard the surveyor had imposed sua sponte.
Interestingly, the facility’s plan to remove the immediate jeopardy, the plan that the state
agency accepted, did not require continued suspension or that male staff members have
female staff present when providing care to female residents. CMS Ex. 4, at 55. The
accepted plan of removal provides further support that the surveyor’s determination of
what was needed to protect residents as of June 10, 2011, was arbitrary and unsupported.

3. Petitioner substantially complied with the general abuse prevention policy
requirement at 42 C.F.R. § 483.13(c).

By regulation, a facility must develop and implement a written abuse prevention policy.
42 C.F.R. § 483.13(c). Consistent with the regulatory requirement, the facility developed
two policies related to abuse prevention. The first, titled “Reporting Abuse,” says in
relevant part that the “administrator/designee should be notified IMMEDIATELY of any
potential resident abuse incident.” CMS Ex. 5, at 18. The other policy, titled “Resident
Abuse,” explains that the facility “will insurance [sic]that further potential abuse will not
occur while the investigation is in progress . . . based upon the results of the quick
internal investigation, appropriate action will be taken. Ifthe suspect is an employee of
the facility, that employee will immediately be suspended pending the outcome of further
investigation.” CMS Ex. 5, at 20.

CMS has not argued that the substance of Petitioner’s abuse policies do not comply with
the regulatory requirement. Instead, CMS asserts that Petitioner did not implement its
policies with regard to the allegations by Residents | and 2. The Board has repeatedly
stated that “multiple or sufficient examples of neglect may support a reasonable inference
that a facility has failed to develop or implement policies and procedures that prohibit
neglect.”!° Oceanside Nursing and Rehab. Ctr., DAB No. 2382, at 11 (2011); Columbus
Nursing and Rehab. Ctr., DAB No. 2398 (2011). The facts of the case must demonstrate
something fairly stark, the “underlying breakdown” of the facility’s policies. Columbus,
DAB No. 2398, at 11.

Here, CMS has not presented sufficient evidence to demonstrate any such “underlying
breakdown” of Petitioner’s abuse prevention policies. As explained above, the facility

'° The applicable regulatory provision speaks to policies that prevent both resident abuse
and neglect. 42 C.F.R. § 483.13(c). Therefore, the same standard for evaluating the
implementation of neglect policies must also apply to implementation of abuse policies.
16

staff reported the rape allegation to the facility administrator immediately, i.e., within the
24-hour guideline CMS established for surveyors. See CMS Ex. 10, at 53. Additionally,
Petitioner provided evidence showing that LPN | was the charge nurse on duty at the
time Resident 1 made her allegation, and was therefore acting as the administrator’s
designee for purposes of the facility’s own abuse reporting policy.'' Tr. 289; CMS Ex.
10, at 53. CMS has not refuted this evidence. CNA | reported the rape allegation to
LPN 1, the administration designee, within minutes of it being made. Tr. 286; CMS Ex.
10, at 53; P. Ex. 65. Moreover, it is undisputed that the facility’s beautician notified the
DON within minutes of Resident 2’s rape allegation. P. Ex. 14, at 4. Therefore, the
facility complied with its abuse reporting policy.

The facility did not suspend CNA | until several days after Resident 1 made a rape
allegation against him. See CMS Ex. 10, at 54. CMS argues that the delayed suspension
violates the facility’s abuse prevention policy, resulting in the facility’s noncompliance.
CMS Br. at 3-5. However, the facility’s policy for the suspension of suspected staff
members is premised upon “the results of the quick internal investigation,” which in this
case revealed that the allegation was unfounded. CMS Ex. 5, at 20. LPN 1 immediately
assessed the situation and questioned Resident 1 within minutes of the allegation. The
administrator and DON also questioned Resident | within a day of the incident and
performed a body audit that discovered no unusual injuries. The results of the “quick
internal investigation,” therefore, revealed that appropriate action did not include the
suspension of CNA 1. Even if suspension was required, CMS has not shown that the one
technical failure to follow the abuse policy demonstrated an “underlying breakdown” of
that policy or posed a potential for more than minimal harm. The facility administrator
and DON determined after a prompt and thorough investigation that CNA | was not a
threat to Resident 1 or other residents and based the facility’s decision accordingly. Such
a reasonable measure is not indicative of “underlying breakdown” in the facility’s
policies, and Petitioner’s conduct did not violate its policies or reflect some “underlying
breakdown” thereof.

4. Petitioner administered its facility in a manner that enabled the effective use
of resources and ensured its residents attained or maintained their highest
practicable physical, mental, and psychosocial well-being.

By regulation, “a facility must be administered in a manner that enables it to use its
resources effectively and efficiently to attain or maintain the highest practicable physical,
mental, and psycho-social well-being of each resident. 42 C.F.R. § 483.75. Here, CMS

'' CMS correctly notes that the reporting regulation does not permit the immediate
reporting to an administrator’s “designee,” but rather directly to the administrator. 42
C.F.R. § 483.13(c)(2). The facility policy, however, states a different standard than in the
regulation, and it is that policy standard at issue to determine compliance with the abuse
policy provision of the regulation. 42 C.F.R. § 483.13(c).
17

did not allege any separate facts to support its finding with regard to this regulatory
provision that it did not allege to support its findings related to other provisions. Rather,
CMS premised its finding on the facility administration’s failure to ensure that staff
implemented its abuse prevention policies as well as to ensure residents were protected
during the investigation. CMS Ex. 2, at 18-19. In essence, CMS presented its
noncompliance finding with this regulatory provision as a derivative of Petitioner’s
alleged noncompliance with other regulatory provisions previously discussed. Having
determined that Petitioner remained in substantial compliance with all other regulatory
provisions, it follows that Petitioner administered its facility in a manner consistent with
regulatory requirements.

5. There is no basis for CMS to impose enforcement remedies.

CMS may impose an enforcement remedy, such as per-day CMP, when a facility is not in
substantial compliance with Medicare participation requirements determined during a
survey. 42 C.F.R. § 488.402(b). As explained above, Petitioner remained in substantial
compliance with Medicare participation requirements at all times relevant to this case.
Accordingly, there is no legal basis upon which CMS may impose enforcement remedies
against Petitioner. Therefore, the per-day CMPs that CMS imposed against Petitioner
between June 10, 2011 and July 11, 2011, are reversed.

V. Conclusion

For the foregoing reasons, Petitioner remained in substantial compliance with Medicare
participation requirements at all times related to this case. Therefore, there is no basis for
enforcement remedies, and any such remedies imposed are reversed.

/s/
Richard J. Smith
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Center for Tobacco Products,
Complainant,
v.

Mannheim Discount Liquors, Inc.
d/b/a Discount Liquors,

Respondent.

Docket No. C-13-538
FDA Docket No. FDA-2013-H-0302

Decision No. CR2777

Date: May 7, 2013

INITIAL DECISION AND DEFAULT JUDGMENT

The Center for Tobacco Products (CTP) initiated the above-captioned matter when it
filed an Administrative Complaint for Civil Money Penalties (Complaint) with the Civil
Remedies Division (CRD) and the Food and Drug Administration’s (FDA) Division of
Dockets Management. CTP seeks to impose civil money penalties under the Federal
Food, Drug, and Cosmetic Act (Act) and the Act’s implementing regulations.

The Complaint alleges the following facts. Respondent owns an establishment in Stone
Park, Illinois that sells tobacco products. Complaint § 3. CTP conducted three
inspections of the establishment. Complaint § 9. During a September 17, 2011
inspection, an FDA-commissioned inspector observed that Respondent “s[old] tobacco
products to a minor, in violation of 21 C.F.R. § 1140.14(a).” Complaint § 12.
2
On December 15, 2011, CTP issued a warning letter to Respondent specifying the
violation that the inspector observed. Complaint § 12. The letter warned Respondent that
a failure to correct the violation could result in the imposition of a civil money penalty
and that it was Respondent’s responsibility to ensure compliance with the law.
Complaint § 12.

On December 28, 2011, and January 3, 2012, CTP received telephone calls from Jerry
Marshall, Store Manager, in response to the warning letter and on behalf of Respondent.
Complaint § 13. Mr. Marshall stated that “it is the store’s policy to request ID from
anyone under 27 years old who purchases tobacco products and not to sell tobacco
products to persons younger than 18 years of age.” Complaint § 13.

On January 25, 2012, CTP acknowledged, in writing, receipt of the establishment’s
response. Complaint { 13. In the letter, CTP reminded Respondent of its continuing
obligation to comply with the Act and its implementing regulations. Complaint § 13.

During another inspection conducted on March 22, 2012, FDA-commissioned inspectors
observed Respondent “selling tobacco products to a minor, in violation of 21 C.F.R.

§ 1140.14(a).” Complaint § 10. On July 24, 2012, CTP initiated a civil money penalty
action, FDA Docket Number FDA-2012-H-0787, against Respondent. Complaint § 10.
On September 7, 2012, an Administrative Law Judge entered a default judgment in the
action and found Respondent liable for violations of 21 C.F.R. Part 1140. Complaint

§ 11; see also Mannheim Discount Liquors, Inc., DAB CR2610 (2012).

During a subsequent inspection on November 7, 2012, at approximately 2:45 p.m., FDA-
commissioned inspectors documented that “a person younger than 18 years of age was
able to purchase a package of Newport Box cigarettes.” Complaint § 1.

In compliance with 21 C.F.R. §§ 17.5 and 17.7, CTP served Respondent with the
Complaint on March 20, 2013, via United Parcel Service. CTP charged Respondent with
violating 21 C.F.R. § 1140.14(a) (sale of tobacco products to a minor). Complaint 4 1,
10, 12. CTP asked the CRD to impose a $500 civil money penalty based on three alleged
violations of the regulations in a 24-month period. Complaint § 15.

The Complaint provided detailed instructions related to filing an answer and requesting
an extension of time to file an answer. Complaint {J 16-20, 22-24. The Complaint stated
that a failure to file an answer could result in the imposition of a civil money penalty
against Respondent. Complaint § 21. Respondent neither filed an answer nor requested
an extension of time within the 30-day time period prescribed in 21 C.F.R. § 17.9.

If a respondent does not file an answer within 30 days of a properly served complaint, the
regulations provide that:
3

the presiding officer shall assume the facts alleged in the complaint to be
true, and, if such facts establish liability under the relevant statute, the
presiding officer shall issue an initial decision within 30 days of the time
the answer was due, imposing: (1) The maximum amount of penalties
provided for by law for the violations alleged; or (2) The amount asked for

in the complaint, whichever amount is smaller.

21 CFR. §

7.11(a). Further, a failure to file a timely answer means that “respondent

waives any right to a hearing and to contest the amount of penalties and assessments”

imposed in tl

e initial decision. 21 C.F.R. § 17.11(b).

Accepting the facts alleged in the Complaint as true, I find that those facts establish
Respondent’s liability under the Act. See 21 U.S.C. §§ 333(f)(9), 387c(a)(7)(B), 387£(d);
21 C.F.R. §§ 1140.1(b), 1140.14. Lalso find that CTP’s request to impose a $500 civil

money penal

ty is permissible. See 21 C.F.R. § 17.2.

Therefore, Respondent is directed to pay a civil money penalty in the amount of $500.00.
This initial decision becomes final and binding upon both parties within 30 days of the
date of its issuance. 21 C.F.R. § 17.11(b).

It is so ordered.

/s/
Scott Anderson
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Karissa M. Misner, D.O,
Karissa Misner, PLLC,
(PTANs: GG783Z, GF705A),

Petitioners,
v.
Centers for Medicare & Medicaid Services.
Docket No. C-13-103
Decision No. CR2776

Date: May 6, 2013

DECISION

Karissa M. Misner, D.O., appeals on behalf of herself and her practice group, Karissa
Misner, PLLC (Petitioners, collectively), the June 5, 2012 effective date determination of
her and her practice group’s enrollment as suppliers in the Medicare program.' The
Centers for Medicare and Medicaid Services (CMS) now moves for summary judgment.
For the reasons explained below, I grant summary judgment in favor of CMS and affirm
an effective date for Petitioners’ enrollment as of June 5, 2012, with a retrospective
billing period starting May 6, 2012.

I. Background and Procedural History

This case involves two separate sets of enrollment applications. While only one of those
application sets (the second application set) is material to the decision here, it is
important to explain the background of both application sets because much of Petitioners’
argument on appeal focuses on the first application set.

' A “supplier” is “a physician or other practitioner, or an entity other than a provider, that
furnishes health care services under Medicare.” 42 C.F.R. § 400.202.
The facts of this case are undisputed. On November 28, 2011, Palmetto GBA, a
Medicare contractor, received enrollment applications from Karissa Hannasch, D.O.
(now known as Karissa Misner), and Karissa Misner, PLLC to enroll in the Medicare
program. Palmetto GBA ultimately denied the applications after it had given Petitioners
an opportunity to provide additional documentation needed to complete the application
process. Petitioners requested reconsideration of the enrollment denials. On April 9,
2012, a Palmetto GBA hearing officer upheld the denials. Petitioners did not request a
hearing before an administrative law judge (ALJ) to challenge the reconsidered
determinations.

On June 5, 2012, Palmetto GBA received a new enrollment application that Dr. Misner
electronically submitted that day on behalf of her and her practice group, Karissa Misner,
PLLC.’ On July 26, 2012, Palmetto GBA sent a notice to Dr. Misner, stating that the
enrollment application for the practice group was approved and assigning Dr. Misner and
Karissa Misner, PLLC two new Provider Transaction Access Numbers (PTANs)
associated with the practice group. The notice stated that the group’s PTAN was
“effective May 6, 2012.”° Petitioners requested reconsideration, seeking to change the
effective date of the PTAN to August 15, 2011, based on the previously filed application

> A prospective supplier that has been denied enrollment must wait to file a new
enrollment application until the time to appeal has expired, or, if appealed, after notice
that the determination has been upheld. 42 C.F.R. § 424.530(b). Here, Petitioners filed
the new enrollment application after they received notice that the reconsideration
determinations denying the applications had been upheld.

> The parties use the term “effective date” to refer to the date on which Petitioner could
retrospectively bill for Medicare services. See, e.g., CMS Exhibit (Ex.) 5 (Palmetto GBA
letter to Petitioners on July 26, 2012, stating the group’s PTAN was “effective May 6,
2012”). By regulation, the effective date would ordinarily be the date Palmetto GBA
received Petitioners’ application that it approved. CMS is authorized, however, to permit
Petitioners to “retrospectively bill” for services for up to 30 days prior to that effective
date, as they did here. 42 C.F.R. § 424.521(a). For clarity, I prospectively only use
“effective date” in this decision to refer to the effective date of enrollment that is
established by regulation and not the date on which Petitioners’ retrospective billing
begins.
dated September 27, 201 1.4 On September 18, 2012, Palmetto GBA issued a
reconsidered determination that upheld the effective date established in the initial
determination letter.

On November 8, 2012, Dr. Misner filed her request for hearing. Following the issuance
of my Acknowledgement and Pre-Hearing Order dated November 14, 2012, CMS moved
for summary judgment and filed a supporting brief (CMS Br.) with seven proposed
exhibits (CMS Ex. 1-7). Petitioner then submitted a pre-hearing brief (P. Br.) with nine
proposed exhibits (P. Exs. 1-9). In the absence of any objections, CMS Exs. 1-7 and P.
Exs. 1-9 are admitted into the record.

II. Applicable Law

Suppliers such as Petitioners must enroll in the Medicare program to “receive payment
for covered Medicare items or services from either Medicare (in the case of an assigned
claim) or a Medicare beneficiary (in the case of an unassigned claim) ....” 42 C.F.R.

§ 424.505. The regulations at 42 C.F.R. Part 424, subpart P, establish the requirements
for a supplier to enroll in the Medicare program. Id. § 424.510 et seq.; see also Social
Security Act (Act) § 1866(j)(1)(A) (authorizing the Secretary of the Department of
Health and Human Services to establish by regulation the process for enrolling providers
and suppliers in the Medicare program). CMS may deny or revoke enrollment if a
prospective supplier or currently-enrolled supplier does not meet and continue to meet
enrollment requirements established by regulation. See 42 C.F.R. §§ 424.530, 424.535.
The effective date of enrollment for physicians, nonphysician practitioners, and physician
and nonphysician practitioner organizations is “the later of the date of filing of a
Medicare enrollment application that was subsequently approved by a Medicare
contractor or the date an enrolled physician or nonphysician practitioner first began
furnishing services at a new practice location.” Id. § 424.520(d).

The effective date of enrollment is an “initial determination” that a supplier may appeal
by requesting reconsideration from the contractor within 60 days of receipt of the initial
determination notice. Id. §§ 498.5(/)(1), 498.3(b)(15), 498.22(a). Any party dissatisfied
with a reconsidered determination may file a request for hearing within 60 days of receipt
of the reconsidered determination notice. Id. §§ 498.5(1)(2); 498.40(a)(2).

* The initial determination expressly applied the “effective date” of May 6, 2012 only to
the PTAN for Karissa Misner, PLLC, although the same effective date must also apply to
the PTAN for Dr. Misner because it was established in the same determination. See CMS
Ex. 5, at 1. Indeed, Dr. Misner appealed the effective date for both PTANs established in
the initial determination. See CMS Ex. 6 (requesting reconsideration for both PTANs).
The Palmetto GBA hearing officer addressed the effective date issue broadly in her
reconsidered determination without actually applying her decision to a specific PTAN.
CMS Ex. 7, at 1. The effective date for both PTANSs is at issue in this appeal.

II. Issues
This case presents the following issues:
1. whether summary judgment is appropriate; and

2. whether CMS or its contractor correctly established the effective date for
Petitioners’ enrollment as suppliers in the Medicare program.

Petitioners also raise the issue of whether Dr. Misner’s previous application, dated
September 27, 2011, is administratively final or may be subject to review in this appeal.
However, Petitioners did not request a hearing based on the denial of that application but
rather on the effective date established based on the application dated June 5, 2012.
Considering that Petitioners did not preserve review of the September 27, 2011
application, I do not have jurisdiction to address it in this appeal.

The limited review in this appeal may seem like a harsh result to Petitioners, who appear
in this appeal without representation by an attorney, so further explanation is warranted.
Petitioners view the two different application sets as a continuous application; however,
the regulations do not. Palmetto GBA took two separate and distinct actions based on
two separate applications. The first application was denied, and that denial was upheld
on reconsideration. See P. Ex. 8. Petitioners may have then appealed that reconsidered
determination by filing a request for hearing within 60 days of that determination. 42
C.F.R. §§ 498.5())(2), 498.22(a); see also P. Ex. 8 (advising Petitioners: “If you believe
that this determination is not correct, you may request a final ALJ review .... You must
file your appeal within 60 calendar days after the date of receipt of this decision”).
Instead, Petitioners submitted a new, separate enrollment application to Palmetto GBA.
Petitioners’ second application was not related to the first application because that first
application was denied and Petitioners did not appeal that denial further. See 42 C.F.R.
§ 498.25(b) (stating that a reconsidered determination is “binding” unless revised by
CMS or through a hearing decision). By choosing to submit a second application, rather
than appealing the denial of its first application, Petitioners essentially started the
enrollment process again. From the second application -- viewed as wholly distinct from
the first application that had been denied -- Palmetto GBA approved Petitioners’
enrollment and set the effective date that is now at issue. Petitioners requested
reconsideration from the second application, and the effective date was upheld.
Petitioners then requested a hearing on the reconsidered determination for the second
application. Accordingly, the denial of the first application is not at issue in this appeal
and may not even be considered here because Petitioners never requested a hearing on the
reconsidered determination upholding that denial.

IV. Discussion
1. Summary judgment is appropriate.

Summary judgment is appropriate if “the record shows that there is no genuine issue as to
any material fact, and the moving party is entitled to judgment as a matter of law.”
Senior Rehab. & Skilled Nursing Ctr., DAB No. 2300, at 3 (2010) (citations omitted).
The moving party must show that there are no genuine issues of material fact requiring an
evidentiary hearing and that it is entitled to judgment as a matter of law. Jd. If the
moving party meets its initial burden, the non-moving party must “come forward with
“specific facts showing that there is a genuine issue for trial... .”” Matsushita Elec.
Industrial Co. v. Zenith Radio, 475 U.S. 574,587 (1986). “To defeat an adequately
supported summary judgment motion, the non-moving party may not rely on the denials
in its pleadings or briefs, but must furnish evidence of a dispute concerning a material
fact — a fact that, if proven, would affect the outcome of the case under governing law.”
Senior Rehab., DAB No. 2300, at 3. To determine whether there are genuine issues of
material fact for hearing, an ALJ must view the evidence in the light most favorable to
the non-moving party, drawing all reasonable inferences in that party’s favor. Jd. When
ruling on a motion for summary judgment, an ALJ may not assess credibility or evaluate
the weight of conflicting evidence. Holy Cross Vill. at Notre Dame, Inc., DAB No. 2291,
at 5 (2009).

Here, CMS has moved for summary judgment. In support of its motion, CMS provided
documentary evidence establishing the material facts necessary for a decision.
Petitioners have not disputed any evidence that CMS submitted, nor have they provided
their own evidence that established a dispute of material fact. Therefore, this case must
be resolved on a question of law, and summary judgment is appropriate.

2. The undisputed facts show Palmetto GBA received Petitioners’ enrollment
application on June 5, 2012, and it later approved that application.

Palmetto GBA acknowledged electronic receipt of Petitioners’ enrollment application on
June 5, 2012. CMS Ex. 4, at 1. While Petitioners challenge the appropriateness of
establishing an effective date based on that application, Petitioners do not dispute that
they submitted, and Palmetto GBA received, a new enrollment application on that date.
P. Br. at 1; see also CMS Br. at 2. Accordingly, it is undisputed that Palmetto GBA
received a new enrollment application from Petitioners on June 5, 2012. Palmetto GBA
approved the June 5, 2012 application on July 26, 2012. CMS Ex. 5.

The Palmetto GBA hearing officer apparently misstated in the redetermination letter that
the contractor received Petitioners’ application on June 6, 2012, and calculated 30 days
prior to that date as May 6, 2012. CMS Ex. 7, at 1. But 30 days prior to June 6, 2012 is
actually May 7, 2012. No evidence supports that Palmetto GBA received Petitioners’
enrollment application on June 6, 2012. Indeed, CMS now argues that Palmetto GBA
received the application on June 5, 2012. CMS Br. at 2. Moreover, Palmetto GBA’s
initial and reconsidered determinations concluded that the PTANs were eligible for
retrospective billing starting May 6, 2012, which is consistent with the evidence
establishing that Palmetto GBA received the application on June 5, 2012. The simple
misstatement of the hearing officer in the reconsidered determination, which appears to
be a typographical error, does not preclude summary judgment especially when neither
party argues that the misstated fact is correct or otherwise material to the outcome of the
case.

3. The effective date of Petitioners’ enrollment in Medicare is June 5, 2012,
with retrospective billing privileges starting May 6, 2012.

By regulation, the effective date of a supplier’s enrollment, for a supplier already
furnishing services at a new location, is the date when a CMS contractor receives an
enrollment application that it subsequently approves. 42 C.F.R. § 424.520(d). Here,
Palmetto GBA received two enrollment applications from Petitioners, but only one of the
applications was later approved. The first application was denied, a decision which was
upheld in a reconsidered determination and not appealed further. P. Exs. 4, 8, 9. The
second enrollment application, which Palmetto GBA received on June 5, 2012, was later
approved. CMS Exs. 4, 5. Therefore, the effective date of Petitioners’ enrollment must
be June 5, 2012, the date Palmetto GBA received the enrollment application it
subsequently approved.

As noted above, the regulations permit retrospective billing for up to 30 days prior to the
effective date of enrollment. 42 C.F.R. § 424.521(a). Here, 30 days prior to the effective
date of June 5, 2012 is May 6, 2012. Accordingly, Petitioners may bill Medicare
retrospectively for reimbursement of covered services starting May 6, 2012.

V. Conclusion

For all of the foregoing reasons, I grant summary judgment in favor of CMS. Petitioners
enrollment in the Medicare program is effective June 5, 2012, with retrospective billing
privileges starting May 6, 2012.

/s/
Joseph Grow
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

America Home Care, Inc.,
(PTAN: 10-9111),

Petitioner
v.
Centers for Medicare and Medicaid Services.
Docket No. C-13-345
ALJ Ruling No. 2013-10

Date: May 3, 2013

RULING AND ORDER DISMISSING CASE

This case is before me in circumstances that no judge appreciates or enjoys. The brief
procedural history of this appeal is marked by one party’s inattention to — and by what
might easily be seen as its efforts to manipulate — the routine processes by which
appeals taken pursuant to 42 C.F.R. Part 498 move toward a speedy, orderly, and fair
resolution. As will be seen below, the present situation admits of no other outcome than
the dismissal of Petitioner’s Request for Hearing.

That Request for Hearing was filed on January 28, 2013, and it sought review and
reversal of actions by the Centers for Medicare and Medicaid Services (CMS) that
revoked Petitioner’s Medicare billing privileges as a Home Health Agency. In the
routine course of docketing Petitioner’s appeal, my standard Acknowledgment and Initial
Docketing Order was issued on February 6, 2013.

That Initial Docketing Order set out, as it has set out in numerous other cases in which
Petitioner’s counsel has appeared, a series of clear directives informing the parties of “the
initial steps they must follow to raise certain legal issues, and if necessary, to prepare the
case for the exchange of evidence and other material relevant to the disposition of
Petitioner’s appeal on its merits.” One of the most important substantive portions of the
Initial Docketing Order required motions seeking summary disposition to be filed within
30 days, i.e., in this case on or about March 8, 2013.

CMS timely filed such a Motion on March 8, 2013, and incorporated into its Motion a
memorandum of argument and authorities 13 pages in length, together with an appendix.
CMS also filed a list of proposed witnesses and exhibits on which it expected to rely if
the matter proceeded to a full hearing. This CMS pleading was fully compliant with
paragraph 2(b) of the Initial Docketing Order, and with Civil Remedies Division
Procedures (CRDP) § 9 in the marking of CMS’s exhibits.

By the plain terms of paragraph 2(b) of the Initial Docketing Order, Petitioner was
permitted — and obliged — to “answer as provided by the terms of 42 C.F.R. § 498.17.”
Petitioner was cautioned by the explicit terms of that same paragraph that “Any motions
not opposed as provided above will be treated as conceded and will be granted without
further notice.” Thus, Petitioner was required by the terms of the Initial Docketing Order
to do at least one of two things: first, if Petitioner intended to file a dispositive motion, it
was required to do so on or about March 8, 2013; and second, if it had not filed a motion
of its own, it was required by 42 C.F.R. § 498.17 to respond to CMS’s Motion within 20
days of March 8, 2013.

Instead of acting promptly, Petitioner did nothing. After 30 days of Petitioner’s silence, I
issued an Order to Show Cause on April 8, 2013, noting that Petitioner had filed nothing
in response to the Initial Docketing Order or in response to the CMS Motion. My Order
to Show Cause directed Petitioner to take two immediate steps or face dismissal of its
case as abandoned. The first step required Petitioner to explain why it had not replied to
my Initial Docketing Order or to the CMS Motion; the second step required Petitioner
actually to file whatever responses to that Initial Docketing Order or the CMS Motion it
intended to submit.

Petitioner filed its Motion in Opposition to CMS’s Motion for Summary Judgment and
additional material on April 11, 2013, and it is at that point that the record in this case
begins to reflect something other than simple confusion and excusable error. First,
Petitioner’s April 11 Opposition makes no effort to explain or justify its failure to
respond timely to the CMS Motion or the Initial Docketing Order. Next, the plain tenor
of the April 11 pleading was an effort to refute the arguments made by CMS in its March
8 Motion, but Petitioner makes no concurrent effort to explain waiting well past the
deadline to attempt any such refutation. Third, Petitioner’s April 11 pleading was
supported by approximately 350 pages of purported exhibits, not a single page of which
proffer was marked in accordance with the provisions of CRDP § 9, and a good deal of
which material had already been submitted as part of Petitioner’s Request for Hearing.
Fourth, Petitioner’s April 11 filing included a “Motion for the Issuance of Subpoena,” a
measure plainly premature and facially not in compliance with any of the terms of 42
C.F.R. § 498.58. It is very difficult to see Petitioner’s April 11 filings, when taken as a
whole, as anything other than a cavalier gesture intended more as a smokescreen than as a
serious effort to debate and refute the CMS Motion of March 8, and as a disingenuous
finessing of the Order to Show Cause.

My response to Petitioner’s filings appears in the letter composed by me and sent at my
explicit direction on April 22, 2013. My letter put Petitioner on notice that its April 11
filing was an untimely response to the CMS Motion, and that it had not attempted, much
less accomplished, a successful showing of good cause for that untimeliness. My letter
offered Petitioner a final opportunity to do so, but warned that Petitioner faced the
dismissal of its case in the event of its failure immediately to make that showing as
required by the Order to Show Cause.

On April 25, 2013, Petitioner’s Good Cause Response was filed. Its direct response to
my insistence that Petitioner explain its failure to respond to the Order to Show Cause
was to deny receipt of that Order. There is nothing in the records of the Civil Remedies
Division’s transmission of the Order to Show Cause to support Petitioner’s denial. But
beyond that question, Petitioner’s April 25 Response contained this remarkable assertion:
“On April 11, 2013, 30 days after receiving CMS’s Motion, etc., I timely filed
Petitioner’s Motion in Opposition .. . .” That assertion — that Petitioner’s April 11 filing
was timely — is an obvious and intentional misstatement of procedural fact. By the
terms of my Initial Docketing Order, and by the terms of 42 C.F.R. § 498.17 it was out-
of-time, and by the plain language of my Order to Show Cause Petitioner was on notice
that it was out-of-time. Thus, Petitioner’s April 25 filing offered an excuse unsupported
by Civil Remedies Division records and then willfully attempted to bluff its way past the
problem of its untimely filing on April 11, 2013.

I do not suggest that Petitioner’s conduct in this case approaches the absolute level of
defiant recalcitrance and willfulness that appeared in Meridian Nursing & Rehab of
Shrewsbury, DAB No. 2504 (2013) or in High Tech Home Health, Inc., DAB No. 2105
(2007). Nor have I forgotten the principle that invokes the greatest caution when the
dismissal of a request for hearing is under consideration, since such any dismissal
deprives a petitioner of the right to present its case on the merits. But I do find and
conclude that this Petitioner’s conduct has interfered with the development of this case to
a material degree, and that its conduct in doing so has been willful and intentional.

The question of what sanction or sanctions might be applied to bring Petitioner into a
more cooperative posture is, at first impression, somewhat more subtle. It may at first
appear that an additional warning, as seen in the Meridian and High Tech cases, might
achieve the desired result. But Petitioner’s April 25 pleading offers no reason whatsoever
to hope for a change in its approach to this forum, and its regard for the CRDP, the
regulations, and the statutes by which its appeal must proceed. As above, the April 25
pleading amounts to nothing beyond an unsupported excuse and a deliberate-but-

unsuccessful bluff. Further warnings or admonitions, after the Order to Show Cause and
my letter of April 22, offer meager hope of an improved result, and I find and conclude
that they would be pointless. Mindful of the reasoning in the cases cited above, as well
as Osceola Nursing and Rehabilitation Center, DAB No. 1708 (1999) and Goforth v.
Owens, 766 F.2d 1533 (11th Cir. 1985), I find and conclude that no lesser sanction short
of dismissal will ensure the speedy, orderly, and fair disposition of this case.

It is true that dismissal is a drastic measure, and that I am invested with some discretion
in deciding whether to invoke it here. But, as I wrote in Social Security Administration,
Office of Inspector General v. People’s Benefit Services, Inc., DAB CR1525, at 1 (2006):

"Men must turn square corners when they deal with the government." Rock
Island, A. & L. R. Co. v United States, 254 U.S. 141, 143 (1920) (Holmes,
J.). So, too, must litigants when they enter this forum. When a litigant in
this forum has placed itself in a position of procedural vulnerability and
seeks to avoid the consequences by an appeal to the Administrative Law
Judge's (ALJ's) discretion, a trail of "cut corners" marked by evasions and
failures of candor does not serve it well.

So it is in this case. For all the reasons set out above, and in the exercise of the authority
set out in section 1128A(c)(4) of the Social Security Act, 42 U.S.C. § 1320a-7a(c)(4),
and 42 C.F.R. § 498.69(b), Petitioner America Home Care, Inc.’s January 28, 2013
Request for Hearing should be, and it is, DISMISSED. The terms of 42 C.F.R. § 498.72
provide that I may vacate this dismissal of Petitioner’s Request for Hearing if, within 60
days of its receipt of this Ruling and Order, Petitioner files a request to that effect and
shows good cause why I should vacate this dismissal.

/s/
Richard J. Smith
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Social Security Administration,
Office of the Inspector General,

Petitioner,

v.
M.K.L.M.,
Respondent.
Docket No. C-13-132
Decision No. CR2772

Date: May 1, 2013

DECISION DISMISSING HEARING REQUEST

The Office of the Inspector General (I.G.) for the Social Security Administration (SSA)
filed, on February 4, 2013, a motion to dismiss Respondent’s request for hearing filed
November 13, 2012. I grant the I.G.’s motion to dismiss and find that Respondent’s
request for hearing was not timely filed, Respondent has not demonstrated good cause
for failing to meet the filing deadline, and Respondent’s hearing request fails to raise any
issue that may be properly addressed in a hearing .

I. Background

Ina July 12, 2010 certified letter, the I.G. warned Respondent of its intention to
commence a civil action against him pursuant to section 1129 of the Social Security Act
(Act) (42 U.S.C. § 1320a-8). I.G. Ex. 1. That letter advised that any civil monetary
penalties (CMPs) imposed would be based on the I.G.’s determination that Respondent
made false statements or misrepresentations of material facts, which he knew or should
have know were false or misleading. The letter further advised that, due to Respondent’s
actions, the I.G. may have erroneously paid him Supplemental Security Income (SSI)
payments. I.G. Ex. 1. The letter included a financial disclosure form for Respondent to
complete in order for the I.G. to consider his ability to pay a CMP. The letter also
included a copy of applicable regulations and informed Respondent that settlement may
be available. Respondent signed the certified mail return receipt of the letter on July 16,
2010. I.G. Ex. 1. On July 27, 2010, Respondent submitted the completed financial
disclosure form to the I.G. I.G. Ex. 2.

By certified letter dated April 1, 2011, and signed for by Respondent on April 7, 2011,
the I.G. notified Respondent that it was imposing a CMP of $30,000 and an assessment in
lieu of damages of $14,365.67 against him. The CMP was based on the I.G.’s
determination that Respondent made false statements or misrepresentations of material
fact to SSA regarding his travel outside the United States and that, because of his travel
outside of the United States, he received $14, 365.67 in SSI benefits for which he was not
entitled. The letter informed Respondent of all applicable due process rights and his
obligations. The notice letter also specifically informed him that if he wished to contest
the proposed CMP and assessment, he may request a hearing before an administrative
law judge and that he must file a written request for a hearing within 60 days of the date
of receipt of this letter. The I.G. also enclosed a copy of the regulatory hearing
procedures with the letter.

Because no hearing request had been filed 60 days from Respondent’s receipt of the I.G.
notice letter, by letter dated July 8, 2011, the .G. informed Respondent that the penalty
and assessment of $44,365.67 was owed and then due. I.G. Ex. 4. Respondent signed
the certified mail receipt for this letter on July 15, 2011.

Almost a year and a half later, on November 13, 2012, Respondent filed a request for
hearing. I.G. Ex. 6. In the request for hearing he acknowledged the request was late, but
it was “due to good cause because I was not aware that I had to file an appeal within 60
days from the time” he received the April 1, 2011 letter. He then claims that he did not
file an appeal in a timely matter because he misplaced the letter due to a brain injury
sustained in March of 1997 that causes memory loss and other ailments.

I convened a prehearing conference with the parties on January 7, 2013. Counsel for the
1.G. confirmed that she intended to file a motion to dismiss, and Respondent admitted he
received the I.G.’s letter but did not timely file a hearing request. I set a schedule for the
parties’ submissions. The I.G. submitted its motion, brief in support of the motion, and
1.G. Exhibits 1 through 6. Respondent submitted an answer brief together with three
exhibits which he labeled Exhibits A, B and C.
II. Issue

The Respondent has admitted that he did not timely file his request for hearing.
Therefore, I am only required to determine whether Respondent has demonstrated good
cause for his failure to timely file his hearing request. 20 C.F.R. § 498.(f)(1). If I find
that he has not demonstrated good cause, then I must dismiss his hearing request.

III. Findings and Discussion
1. Respondent has not shown good cause for his untimely hearing request.

The term “good cause” is not specifically defined by the regulations. The Departmental
Appeals Board (Board) has not found it necessary to decide the exact scope of the term
“good cause” under 20 C.F.R. Part 498. See SSA v. Parham, DAB CR1600 (2007). The
Board has sometimes found good cause in other types of cases where circumstances were
beyond the ability of a litigant to control. Id.

Respondent has not made such a showing here. He has offered no significant proof
beyond his own assertions that he suffers from a mental disability that would cause him
to suffer from memory loss and misplace items. Respondent claims his hearing request
was filed over a year and a half late because he has memory loss from a head injury he
suffered from a fall in 1997. He attached some medical records from his hospitalization
after the fall in 1997 and some medical records from 2012, but they are not particularly
relevant. None of these records indicate that Respondent suffers from such severe
memory loss that would make it impossible for him to respond timely. A discharge
summary dated March 12, 1997 from his hospitalization in 1997, after he sustained the
injury, makes no mention of any severe memory loss. The other records he submitted are
for medical visits to a family health center for periods in 2012 and 2013, which occurred
well after the time limit for filing a hearing request passed in June 2011.

The only record that shows any mention of memory loss is a visit to a health care
provider on April 10, 2012, which indicates that Respondent told a Nurse Practitioner
that he recently experienced another seizure and he had memory loss as a result. This
does not show that Respondent suffered from such severe memory loss during the
relevant time period that would make it impossible for him to timely file a request for
hearing. Even if this document was dated closer to the period of Respondent’s default, it
does not sufficiently show the extent of any memory loss that Respondent was suffering.

I do not find that any of Respondent’s medical records support a finding that somehow
Respondent’s memory loss caused him to misplace the I.G.’s April 1, 2011 letter or his
claim that he does not remember that he received the letter. His evidence simply does not
support a finding that Respondent was prevented from filing a timely hearing request due
to circumstances beyond his control. When Respondent received the first warning notice
from the I.G. on July 16, 2010, he promptly responded to that letter by completing and
sending the financial disclosure form to the I.G on July 27, 2010.! Also, in each instance,
Respondent signed the certified mail receipt for each of the certified letters the I.G. sent
to him. Further, it is uncontested that at no time did SSA appoint a representative payee,
either by request or upon SSA’s own determination, to handle Respondent’s SSI benefits
on his behalf.

Therefore, I conclude that Respondent has not shown good cause for his failure to file a
timely hearing request.

2. Respondent’s hearing request fails to raise any issue that may properly be
addressed in a hearing.

The LG. also has set forth an alternative basis for the dismissal of Respondent’s hearing
request. The I.G. contends that the applicable regulations state that a request for hearing
must state the specific issues or findings of fact and conclusions of law in the notice with
which Respondent disagrees, and it must state the basis for Respondent’s contention that
the specific findings and conclusions were incorrect. 20 C.F.R. § 498.202(d)(1) and (2).
The I.G. contends that Respondent’s request for hearing did not state which of the
specific issues or findings of fact and conclusions of law with which he disagreed nor did
he state any basis for his contention that the findings and conclusions were incorrect. In
fact, besides offering reasons why his request for hearing was late, Respondent’s hearing
request states that he is requesting a hearing “to discuss the possibility of settlement terms
that would permit smaller payments over time.”

My authority in proceedings under Part 498 is limited to determining whether SSA had a
legal basis to assess a CMP or an assessment against a respondent. 20 C.F.R.

§ 498.215(a). Ido not have authority to compel settlement negotiations as Respondent
requests. 20 C.F.R. § 498.204(c)(3). Therefore, because Respondent’s hearing request
does not state any specific issues, findings of fact and conclusions of law with which he
disagrees, and the basis for his contentions, I must find that his hearing request fails to
raise an issue that requires a hearing before me, and I must dismiss it pursuant to 20
C.F.R. §498.202(f)(3).

' Respondent states he does not remember filling out the financial disclosure form
because the form was completed by one of his family members. He claims that he relies
on one of his sons or daughter to complete the forms for him. Although he speaks
English, he states he is not able to read or write in the English language.
IV. Conclusion

Based on the applicable law and the facts, I dismiss Respondent’s hearing request
because it was untimely filed, good cause does not exist to extend the time for filing, and
the hearing request fails to raise any issue that may be properly addressed in a hearing.

/s/
Joseph Grow
Administrative Law Judge