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

In the Case of:

Harlan Nursing Home
(CCN: 18-5166),

Date: September 10, 2007

Petitioner,

Docket No. C-06-10
Decision No. CR1644
Centers for Medicare & Medicaid

Services,

Respondent.

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DECISION

I sustain the determination of the Centers for Medicare and Medicaid Services (CMS) to
impose a civil money penalty (CMP) against Harlan Nursing Home (Petitioner or facility)
for failure to comply substantially with federal requirements governing participation of
long-term care facilities in Medicare and State Medicaid programs. CMS imposed a
CMP of $ 8,050 per day effective August 9 through August 17, 2005, based on a finding
of immediate jeopardy. CMS also concluded that the facility remained out of substantial
compliance at a less than immediate jeopardy level from August 18 through August 25,
2005, and imposed a $100 per day CMP for that period.
I. Background

This case is before me pursuant to a request for hearing filed by Petitioner dated October
13, 2005. Petitioner is a long-term care provider located in Harlan, Kentucky.

By letters dated August 17 and August 29, 2005, CMS informed Petitioner that, based on
a complaint survey conducted on August 12, 2005, and a revisit survey completed on
August 23, it was imposing selected remedies due to Petitioner’s failure to be in
substantial compliance with the applicable federal requirements for long-term care
facilities. The remedies were based on an immediate jeopardy deficiency under Tags F-
324 and F-490. The letter informed Petitioner that CMS was imposing the following
remedies:

* CMP in the amount of $ 8,050 per day effective August 9 through August 17,
2005 based on an immediate jeopardy violation.

* Denial of Payment for New Admissions (DPNA), effective August 19, 2005.'
* Termination of the provider agreement, effective February 12, 2006.”

I held a hearing on March 13 and 14, 2007, in Frankfort, Kentucky. At the hearing, CMS
offered 14 exhibits, identified as CMS Exs. 1-14. I received CMS Exs. 1-14 into
evidence without objection. Petitioner offered nine exhibits, identified as P. Exs. 1-9.° I
received these exhibits into evidence without objection. I also entered into the record
Petitioner’s Credible Allegation of Removal of Immediate Jeopardy dated August 12,
2005, as Administrative Law Judge (ALJ) Ex. 1.

' The DPNA was no longer in effect as of September 10, 2005. CMS Ex. 6, at 1.

? Petitioner came into substantial compliance prior to the effective date of the termination
of the provider agreement and therefore the termination was not effectuated.

> Petitioner Ex. 9 (Harlan Accident Investigative Report dated August 12, 2005) was
offered and admitted into evidence without objection during the testimony of Ms. Kathy
Hall (Harlan Corporate Director of Operations), with the parties’ agreement that the sole
purpose of its admission was to show that a report of investigation was submitted to the
State survey agency on August 15, 2005. Tr. at 321.
3

Subsequent to the hearing, the parties submitted post-hearing briefs (CMS Br. and P. Br.)
and response briefs (CMS Response and P. Response).

Based on the testimony offered at the hearing, the documentary evidence, the arguments
of the parties, and the applicable law and regulations, I find that Petitioner was not in
substantial compliance, at the immediate jeopardy level, on the dates determined by the
State survey agency and CMS. I further find that CMS was authorized to impose a CMP.
in the sum of $8,050 per day for the immediate jeopardy violation, and a $100 per day
CMP for the non-immediate jeopardy violations.

If. Applicable Law and Regulations

Petitioner is considered a long-term care facility under the Act and regulations
promulgated by the Secretary of Health and Human Services (Secretary). The statutory
requirements for participation by a long-term care facility are found at sections 1819 and
1919 of the Act, and at 42 C.F.R. Parts 483 and 488.

Sections 1819 and 1919 of the Act invest in the Secretary authority to impose CMPs and
DPNAs against a long-term care facility for failure to comply substantially with
participation requirements.

Pursuant to the Act, the Secretary has delegated to CMS and the States the authority to
impose remedies against a long-term care facility that is not complying substantially with
federal participation requirements. The regulations at 42 C.F.R. Part 483 provides that
facilities which participate in Medicare may be surveyed on behalf of CMS by State
survey agencies in order to ascertain whether the facilities are complying substantially
with participation requirements. 42 C.F.R. §§ 488.10-488.28. The regulations contain
special survey conditions for long-term care facilities. 42 C.F.R. §§ 488.300-488.335.
Under 42 C.F.R. Part 488, a State or CMS may impose a CMP against a long-term care
facility where a State survey agency ascertains that the facility is not complying
substantially with participation requirements. 42 C.F.R. §§ 488.406, 488.408, 488.430.
The CMP may start accruing as early as the date the facility was first out of compliance
through to either the date substantial compliance is achieved or the facility’s provider
agreement is terminated. 42 C.F.R. § 488.408.

CMS may impose a CMP for either the number of days a facility is not in substantial
compliance with one or more participation requirements or for each instance that a facility
is not in substantial compliance, regardless of whether or not the deficiencies constitute
immediate jeopardy. 42 C.F.R. § 488.430(a). Thus, CMS may impose a per instance
CMP ranging from $1,000 to $10,000 for an instance of noncompliance regardless of
whether the deficiency is at the immediate jeopardy level. 42 C.F.R. § 488.438(a)(2).
4

The regulations define the term “substantial compliance” to mean:

[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 causing minimal harm.

42 C.F.R. § 488.301.

“Immediate jeopardy” is defined to mean:
[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.

In determining the amount of the CMP, the following factors, specified at 42 C.F.R.
§ 488.438(f), must be considered:

the facility’s history of noncompliance, including repeated deficiencies;
the facility’s financial condition;

the seriousness of the deficiencies as set forth at 42 C.F.R. § 488.404. and
the facility’s degree of culpability.

PeNe

In a CMP case, CMS must make a prima facie case that the facility has failed to comply
substantially with participation requirements. To prevail, a long-term care facility must
overcome CMS’s showing by a preponderance of the evidence. Hillman Rehabilitation
Center, DAB No. 1611 (1997), aff'd Hillman Rehabilitation Center v. U.S. Dep’t of
Health and Human Services, No. 98-3789(GEB), slip op. at 25 (D.N.J. May 13, 1999).

The Act and regulations make a hearing available before an ALJ to a long-term facility
against whom CMS has determined to impose a CMP. Act, § 1128A(c)(2), 42 C.F.R. §§
488.408(g), 498.3(b)(12), (13). The hearing before an ALJ is a de novo proceeding.
Anesthesiologists Affiliated, et al, DAB CR65 (1990), aff'd 941 F.2d 678 (8th Cir. 1991).
III. Issues
The issues in this case are:

Whether the facility was complying substantially with federal participation
requirements;

Whether the finding of immediate jeopardy was clearly erroneous; and,

Whether the amount of the penalty imposed by CMS is reasonable, if
noncompliance is established.

IV. Findings and Discussion

The findings of fact and conclusions of law noted below in italics are followed by a
discussion of each finding.

A, Petitioner was not in substantial compliance with federal participation
requirements.

1. The facility failed to provide six residents who were at risk for
elopement, one of whom successfully eloped on August 9, 2005 (Resident
(R)1), with adequate supervision and assistance devices to prevent
accidents. 42 C.F.R. § 483.25(h)(2) (Tag F-324).

The applicable regulation at 42 C.F.R. § 483.25(h)(2) entitled, “Quality of Care” provides
that the facility must ensure that each resident receives adequate supervision and
assistance devices to prevent accidents.

A summary of the surveyor findings as reflected in the Statement of Deficiencies (SOD)
reveals that:

Based on observation, interview, and record review, it was determined that
the facility failed to provide adequate supervision to prevent accidents for 6
of 6 residents. The facility’s system for monitoring the whereabouts of 6
residents who were identified to be at risk for elopement included the use of
alarms on the exit doors. The facility staff knowingly disarmed the exit
door alarm system on the West unit to allow for supply deliveries without
6

implementing protective measures to monitor the residents who were at risk for
elopement. In addition, direct care staff members were not trained regarding use
of the alarm system and were not made aware when the alarm system was
disengaged to assure continued supervision of the residents.

Resident Number | exited the facility on August 9, 2005, and left the
grounds without staff knowledge. The facility staff was not aware of the
elopement for at least one hour after the resident was last observed by the
staff to be in the facility and the time that the resident was found to be
deceased in an open field behind the facility.

CMS Ex. 1, at 4-13.

R1 was admitted to the facility on September 27, 2002. CMS Ex. 11, at 1. His diagnoses
included dementia (Alzheimer type), a history of schizophrenia, and chronic obstructive
pulmonary disease (COPD). Jd. The facility determined that he needed supervision at all
times due to a history of elopement from his prior facility. CMS Ex. 11, at 5. After
admission to Harlan Nursing Home, he persisted in his attempts to elope. Jd. Betty
Morgan, Petitioner’s Minimum Data Set (MDS) coordinator stated that R1 often
expressed that he was going home and she considered that he needed “constant
supervision.” CMS Ex. 4, at 24.

At hearing, Surveyor Burton-Brock, who interviewed Petitioner’s staff members, testified
that R1 frequently attempted to exit the facility through the West Wing doors, and had
occasion to leave the building and head for the main road. Tr. at 10.

The following summary of events surrounding the elopement of R1 was provided by
surveyor Kimberly Burton-Brock during her testimony at the hearing. Surveyor Burton-
Brock based her testimony on staff interviews and personal observations during the
survey.

On August 9, 2005, R1 exited the facility but no one heard the alarm sound
to alert staff that a breach had occurred. Tr. at 12. Two Certified Nursing
Assistants (CNA), Summer Boggs and Madonna Ramsey, stated that they
had last seen R1 sometime between 4:50 p.m. and 5:00 p.m. at a time when
they were responding to a neighboring resident’s call for assistance. When
Ms. Boggs went to deliver R1's dinner food tray at approximately 5:10 p.m.,
he was not in his room. At that point, she began searching for him
throughout the facility. Tr. at 19. She began to look in the areas most often
frequented by the resident such as the smoking and TV rooms, but he was
not there. When Ms. Ramsey realized that Ms. Boggs was no longer
7

assisting with delivery of the food trays, she went to find out what had
happened. She encountered another nurse, Polly Napier, who indicated to
her that Rl was missing and Ms. Boggs was still searching for him. Ms.
Ramsey joined the search that eventually continued outside the facility,
when it became evident that the resident was not inside. Tr. at 15.

When Ms. Ramsey opened the 900 hallway door in the West wing, leading
to the outside, she noted that the alarm did not sound, and yelled back
toward the staff member located at the nurses station that the alarm had not
sounded, and proceeded to search outside. Tr. at 16. Ms. Ramsey later
learned from another CNA that the alarm had been disengaged for a coke
delivery that had been made during the day shift. Tr. at 17.

Once the search party was outside, they inquired at a nearby hospital and a
Comprehensive Care Center if they had seen R1. After looking around in
these facilities, the people that had been approached indicated that they had
no success in locating the resident. Tr. at 17. The search continued inside
an old, abandoned “skilled unit” but the resident was still not found. They
then looked in the gullies and ditches that are found in a field behind the
nursing home that leads to a river, but still without success. Tr. at 21, 22.
The field was described as very dense, with vegetation growth that was
taller than the surveyor. Tr. at 23. When the resident was not located in the
field, the search party returned to the facility, but the Director of Nursing
(DON), directed them to go back to the field leading to the river and look
around the river bank to be sure he didn’t fall in the water. When they were
by the river bank, they heard the maintenance man yell that he had spotted
the resident on the ground in the field from the top of a truck he had
climbed. Tr. at 24,25. Ms. Ramsey stated that her overall search lasted
about one hour and twenty minutes.

When Ms. Ramsey first saw R1 she noted that his head wasdown into the
ground and his face also on the ground. His buttocks was sticking up in the
air, his shoes were off one of which he was holding in his right hand. He
was positioned as if he was trying to push himself up. Tr. at 25. He had
removed a sweatshirt he always wore, and it was laying beside him, turned
inside out. Tr. at 26.

Madonna indicated that R1's face was distorted and discolored from blood
that had pooled, his nose was mashed up, his eyes were slanted, and his
mouth was open. Madonna also noted a small cut on R1's forehead from
which blood flowed. Tr. at 26, 27.
See also CMS Ex. 4, at 29-37.

CMS asserts that the timeline of the events that took place on August 9, 2005 can only be
estimated because several different times were given by different people. This is evident
from Petitioner’s allegation that the total time between when the resident was last
observed and the time when he was found was less than an hour. However, I find that it
is not crucial for me to reconcile the time differences in order to resolve the central issue
present in the deficiency under scrutiny here. That issue is whether the facility failed to
provide its residents, who were at risk for elopement, with adequate supervision and
assistance devices to prevent accidents. 42 C.F.R. § 483.25(h)(2).

CMS contends that Petitioner could not provide adequate supervision to R1 because it
never determined what was adequate supervision for him. Although R1 always exhibited
elopement seeking behavior, the facility planned for “frequent” monitoring of his
whereabouts without defining the meaning of that term. Thus, Petitioner did not have a
systematic method to keep track of the whereabouts of its wandering dementia residents
to ensure their safety at all times. Petitioner ignored the MDS coordinator’s assessment
that R1 required “constant supervision,” which I interpret to mean that staff was to know
the resident’s whereabouts at all times. CMS Ex. 4, at 24. Petitioner also disregarded an
assessment dated March 16, 2005 that found R1 in need of supervision at all times due to
a history of elopement from a prior facility. CMS Ex. 11, at 5. More specifically,
Petitioner failed to provide adequate assistance devices to its wandering dementia
residents because it voluntarily disabled and compromised the effectiveness of the door
alarms that had been designed to protect these residents from elopement. CMS. Br. at 19;
P. Ex. 1, at 14.

Petitioner argues that but for an isolated incident on August 9, 2005, residents with the
potential for eloping were adequately supervised and protected by the facility
administration and staff. P. Br. at 6. Although Petitioner acknowledges that elopement-
prone residents were not adequately protected on August 9, 2005, it contends that there is
ample proof in the record regarding the actions taken by the facility to prevent any
wandering resident from eloping. Jd. Petitioner adds that the facility’s historical
experience with the protection of wandering residents made R1's experience completely
unforeseen. P. Br. 7. I disagree.

The credible evidence of the record before me reveals that the facility had a practice of
disarming the door alarm for vendors providing weekly delivery services to the facility,
and that several staff members were unaware of the proper operation and monitoring of
9

the alarm system. CMS Ex. 4, at 6, 7, 18; Tr. at 54-57, 62,132. Contrary to Petitioner’s
assertion, this state of affairs existed not only on August 9, 2005, but persisted until CMS
determined that those deficiencies were corrected.

The facility engaged in the practice of disarming the alarms on a weekly basis on doors
number one (#1) and number six (#6) to allow for deliveries, and turning them back on
after delivery was completed.’ Tr. at 132. This was confirmed through an interview of
Darrin Waddle, a person who routinely made deliveries to the facility. When interviewed
by William Stewart, a State investigator, Mr. Waddle, stated that on August 9, 2005 (the
day Rleloped), he arrived at Harlan Nursing Home at approximately 12:30 p.m. and left
at approximately 2:30 p.m. That day he backed up his truck to the door labeled #1 on
Ex.14 (700 hall), and entered the facility through the laundry room door, which was
always unlocked. Once inside, he went to the nurses station, and asked the person there
to turn off the alarm. After the alarm was turned off, he made his trips to replenish the
vending machines by going in and out through door #1. When he had finished, he went
back to the nurses station to let the person there know that he was done. CMS Ex. 6, at 2,
3. Although the door alarm was disengaged (in this instance for 2 hours) during
deliveries, the facility had no system to safeguard that door, nor was there increased
monitoring of wandering residents while the door was disengaged for the benefit of
deliverymen. Tr. at 133. My finding of noncompliance, however, is not predicated on
the conclusion that R1 exited the facility during the time the alarm was turned off for the
vendor while he replenished the vending machines. I do find, however, that the practice
of disabling the door alarms together with the ignorance of the staff as to the manner of
operation of the alarm system caused, or was likely to cause, serious injury, harm,
impairment, or death to a resident. In the particular case of R1, he was able to exit the
facility, and suffered serious injury and harm because the alarm was not properly reset
after it had been disarmed either after the delivery man left the premises, or at some other
time, because of the staff’s incompetence in operating the alarm system. As will be
discussed later in greater detail, that incompetence was a systemic flaw that permeated all
levels of the facility administration.

Denise Ford, a quality assurance nurse employed by Petitioner, testified that it was her
understanding that the door was always armed while the vendor was in the facility
actually stocking the machines. Tr. at 183. She did not say, however, where that

4 Ms. Kathy Hall, Petitioner’s Corporate Director of Operations, testified that several
vendors would routinely visit the facility for whom the alarms were disengaged. Tr. at
315.
10

understanding came from. In fact, neither the vendor in his statement to the State
investigator (CMS Ex. 6, at 2, 3.), nor any staff member made reference to such practice.
I, therefore, find little probative value in that assertion.

During surveyor Burton’s interview of some staff members on August 10, 2005, it
became evident that they were unaware of the proper operation and monitoring of the
alarm system:

+ CNA Robin Rigney had been with the facility for three months, but had not been
trained on the alarm system. She only checked the panel when the alarm went off,
but did not know what the switches were for. CMS Ex. 4, at 7.

* Cindy Mefford, who had been in the facility about four years, was inserviced by
Darrell (Darrell Goodin, Maintenance Supervisor). However, she only took note
as to whether the alarm was activated by looking at the lights. If the red light was
on, the system was armed. And if the light was green, the system was not armed.
She would only look at the [switch] panel if the alarm went off.’ CMS Ex. 5, at 8;
Tr. at 136.

+ CNA Julie Birchfield, who had been in the facility for about a year, stated that
she knew how to reset that alarm, but did not know how to turn it off. She would
not pay attention to the alarm [switch] panel unless the alarm went off. By looking
at the [switch] panel she could determine which door was armed. CMS Ex. 5, at
10.

* The facility alarm system had a green light that indicated that it was powered, and a red
light to indicate that the system was armed. However, it was not possible to determine if
each individual door was armed unless one looked at a switch panel that had switches that
controlled the doors in each wing of the building. Thus, in order for each door to be
armed, it was necessary that each of the switches controlling those doors be in the up
position. It was, therefore, possible for a door to be disarmed even though the light
showed the system to be armed if the switch that controlled that particular door was in the
down position. I infer that those staff members that stated that they did not pay attention
to the switch panel or only paid attention to the lights, meant that when checking the
alarm system they did not take into account whether the switches were in the up or down
position. It is logical to conclude that inasmuch as the lights could be seen from a
distance to ascertain if the system was armed, it was not so easy to see which switch was
in the up or down position from that same distance. This was a problem because turning
an individual door off (switch in down position) did not affect the lights on the panel. Tr.
37, 38, 136, 139, 268-69, 272-73.
* The Social Serv

11

ices person as well as the facility administrator and the Director

of Nursing (DON) were unable to inform the surveyor as to the function of the

panel switches on

+ Summer Boggs
lights. Tr. at 126.

I note that in her affidavi
Ramsey, and Rhonda Cu

the alarm. Tr. at 36-39, 78.

determined if the alarm was properly engaged by observing the

it, Ms. Ford stated that Summer Boggs, Stacey Blas, Madonna
rtis asserted having received instruction and training during their

attendance in the Nurse Aide Training Program at Harlan Nursing Home. Aside from

constituting an implied a

dmission that they did not receive that training during the new

employee orientation, she provided no explanation, however, for the absence of such

training regarding Robin

Rigney, Cindy Mefford, Julie Birchfield, the Social Services

director, the DON, and the Administrator. It is interesting to note also that although
Summer Boggs allegedly received training on the alarm system during attendance at the

Nurse Aide Training Pro
alarm was properly enga

that the red and green lig

gram, she admitted to the surveyor that she would determine if the
ged by observing the lights. I have found, however, that the fact
ts were on provided no assurance that the alarm was engaged,

because it was also necessary to consider the position of the panel switches. Furthermore,

training on the operation

orientation. P. Ex. 4; Tr.
operation of the alarm sy

not supported by the cre

in that the person who a
elivery man left the pre
fact, Ms. Lorine Engle, t!
informed Mr. William S
button to reset the alarm
6.° Pertinent to this is t
that when Julie Birchfie
nurse aide proceeded to
indicator light.” P. Ex.
s

isengage one or more

[he absence or inadequa

of the alarm system was not part of the new employee

61, 62. Consequently, Ms. Ford’s testimony to the effect that
stem was part of the initial orientation for new staff members is
ible evidence of record. Tr. at 183-85.

cy of proper training on the facility’s alarm system is significant
egedly turned the alarm back on after the vending machine
‘mises, Julie Birchfield, was not fully versed on its operation. In
e staff member who witnessed Ms. Birchfield reset the alarm,

tewart, the State Investigator, that she saw Ms. Birchfield push a

(as opposed to turning a switch). Tr. at 116, 117; CMS Ex. 6 at
e fact that in her incident report, the facility administrator stated
d was told to reset the alarm as the “coke man” was leaving, “the
do as instructed and stated the system was armed as per the

9, at 4 (emphasis added). Additionally, anyone passing by the

witch panel, including a resident, could simply change the position of the switches and

oor alarms. Tr. at 134, 135. In essence, the situation at the

® It is worthy of note that all staff members interviewed by the State Investigator denied turning
off the alarm for the Vendor, nor did they observe anyone else turn it off. CMS Ex 6.
12

facility regarding the alarm system was chaotic, at best.’ Thus, it is not surprising that
when Ms. Ramsey exited the facility on August 9, 2005 in search of R1, the alarm did not
go off. Tr. at 125. Although she went out through the door at the 900 Hall and the door
deactivated for the vendor was in the 700 Hall Wing, the staff found that the alarm system
was on, but not in the activated mode, meaning that all doors on that system were
disarmed. Tr. at 126; CMS Ex. 4, at 1.

The record does reflect that Darrell Gooden, the maintenance supervisor, testified that
when he was informed that someone was missing, he went to check the system. Tr. at 258.
At that time, he heard one of the door alarms go off, and when he looked, he saw

Ms. Ramsey. Jd. He stated that he did not speak with her, nor did he have an idea what
she was doing. Jd. I find his testimony unreliable, in view of his prior statement that he
went to check the alarm system when he heard that a resident was missing. Furthermore,
he later admitted on cross-examination, that he did not hear an alarm go off at
approximately 5:00 p.m. because he was in the kitchen working on a panel. That
testimony is consistent with what he told the State investigator on November 8, 2005. At
the time he stated that on August 9, 2005 he had not been in the West wing and that he had
spent all day in the kitchen. He also admitted, when questioned, that he did not tell the
surveyors nor the State investigator that he heard an alarm go off when Ms. Ramsey tried
to exit the facility on August 9, 2005. Tr. at 265-67.

In view of the foregoing, I find that CMS has established a prima facie case that Petitioner
did not provide adequate supervision and assistance devices to prevent accidents pursuant
to 42 C.F.R. § 483.25(h)(2) (Tag F-324). Petitioner has not overcome’s CMS’s showing
by a preponderance of the evidence.

7 Even after implementing an intervention regarding the alarm system by placing a
plexiglass box over the alarm switches, there was confusion as to how access to the
control panel would be secured. The maintenance man, Darrell Gooden, testified that
access to the East Wing switch box was only possible using a key, which only he had.
The box on the West Wing was bolted down and only he could unscrew it open. Tr. at
276-79. On the other hand, Ms. Ford testified that the plexiglass box was locked with a
combination lock, and the nurses had the combination to the lock. Also, whereas

Ms. Ford testified that the East Wing alarm could be accessed for purposes of engaging
and disengaging by staff using a combination code, and the West Wing alarm could no
longer be disengaged (Tr. at 236), Mr. Gooden testified that the East and West Wing
alarms could still be disengaged with the key pad because they were not inside the
plexiglass box that covered the switches. Tr. at 279-80.
13

2. The facility failed to administer its resources effectively and efficiently
so as to attain or maintain the highest practicable physical, mental, and
psychosocial well-being of each resident. 42 C.F.R. § 483.75.

A summary of the surveyor findings as reflected in the SOD Tag F-490 reveals that:

The facility’s system for monitoring the whereabouts of residents with
known elopement risks included the utilization of door alarms to each exit
door. Facility administration indicated that it was routine facility practice
for the staff to disengage the exit door alarm system for vending deliveries.
The administration failed to ensure that residents with known elopement
risks (Residents 1, 2, 3, 4, 5 and 6) were supervised to assure that they did
not elope from the facility through unmonitored exit doors. As a result, R1
exited the facility on August 9, 2005, without staff knowledge, and was
subsequently found deceased off facility grounds.

CMS Ex. 1, at 13-18. The surveyor findings cross-reference violations under Tag F-324.

Petitioner argues that CMS has put absolutely no evidence into the record regarding what
the facility administration did not do or could have done differently to avoid the alleged
regulatory violation. Petitioner also maintains that the surveyors never interviewed Ms.
Ginger Parsons, the Administrator. Finally, Petitioner asserts that the facility had an
existing policy to prevent elopement “through assessments, alarms, code alert systems,
and otherwise.” P. Br. at 15 (emphasis added).

Contrary to Petitioner’s assertions there is ample evidence of the facility’s failure to
administer its resources effectively and efficiently. The following examples evince some
of the facility’s shortcomings regarding the deficiencies at Tag F-490:

* The Care Plan provided for frequent monitoring of R1 because he was an
elopement risk. P. Ex. 1, at 13. However, the indication that the resident was to be
monitored frequently, without specifying the interval is too vague, and overlooks
the facility assessments that found he required constant supervision and that he
needed to be supervised at all times. CMS Ex. 4, at 24; CMS Ex. 11, at 5.
Monitoring of R1 was also questionable inasmuch as staff members had never seen
a wandering resident list, and did not know that such a list existed. CMS Ex. 4, at
3, 15; CMS Ex. 5, at 8; Tr. at 59, 164.

14

+ The alarm system was disengaged on a weekly basis for vending machine service
people, and no monitoring of the unarmed doors was in place during that period of
time. On occasions prior to R1's elopement, an individual who replenished the
vending machines was allowed to disengage the alarm system. Tr. at 62,132-34.

* The facility had no policy or instructions regarding door or alarm checks, nor was
any documentation done by staff on the door system, according to Denise Ford, the
corporate quality assurance nurse. Tr. at 59. An interview with Amy Wilson and
Robin Rigney confirmed that they did not document checks on the alarm system,
nor were they ever oriented or trained to do so. Tr. at 60-61; CMS Ex. 4, at 7.

* The person in charge of training the new staff, Patty Lester, admitted that she
provided no training on the alarm panel to new staff. She only showed a film on
the use of the Wander-Guard, but covered nothing regarding the exit doors or alarm
panel. In fact, the orientation checklist did not include the alarm panel as one of the
items covered. Tr. at 61, 62.

The implication advanced by Petitioner that CMS cannot establish that the facility failed to
utilize its resources effectively and efficiently without having interviewed the
administrator is baseless. Moreover, the record does reflect that the surveyor spoke with
the administrator during an inquiry regarding the alarm system on August 10, 2005. At
that time, the administrator was unable to answer the surveyor’s questions regarding the
basic operation of the alarm system. It is not surprising that the administrator was ignorant
of the functioning of the alarm in view of her lackadaisical attitude when informed that R1
was missing as she was leaving for the day. Rather than turn back and exercise leadership
in dealing with an extremely serious emergency, she simply responded: “you better find
him,” and went home. Tr. at 29, 30.

Petitioner’s assertion that the facility had an existing policy to prevent elopement “through
assessments, alarms, code alert systems, and otherwise” is also without substance. P. Br.
at 15 (emphasis added).

The items mentioned by Petitioner cannot be deemed to take the place of facility policies
and procedures, but rather can be considered useful when applied correctly following
acceptable policies and procedures. It has been established that the facility had alarms and
Wander-Guard bracelets for wandering residents. Nonetheless, the staff was ill-trained in
the operation of the alarm, and made use of the system in a way that placed wandering
residents at risk of elopement.
15

I find that CMS established a prima facie case under Tag F-490. Petitioner has not
overcome that showing by a preponderance of the evidence.

B. CMS’s finding of immediate jeopardy was not clearly erroneous.

Immediate jeopardy exists where a 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. Fora finding of immediate
jeopardy, it is not necessary to show that the noncompliance caused serious injury, harm,
impairment, or death; it is sufficient to show that the noncompliance was likely to cause
serious injury, harm, impairment, or death. Fairfax Nursing Home, Inc., DAB No. 1794,
at 14 (2001).

In this case, there is strong prima facie evidence of immediate jeopardy level deficiencies
inasmuch as vulnerable residents were placed at risk of likely suffering serious injury,
harm, impairment, or death. The credible evidence of record establishes that R1 suffered
serious injuries and actual harm. He was found to have fallen with his head down into the
ground; his face distorted and discolored from blood that had pooled; blood flowing from
a cut on his forehead; and his nose mashed up and eyes slanted. As reported during the
hearing, R1 had removed his sweater which he wore indoors, but once outdoors, in the
dense brush, he collapsed during a hot August day.* Tr. at 25-27.

Although the Coroner did not conclude that the resident died from the intense
psychological and physical trauma to which he was subjected, the record reflects that he
was not being monitored for any acute condition, nor did he require special care for a life
threatening condition. CMS Ex. 9; CMS Ex.11, at 55. In spite of the Coroner’s failure to
order an autopsy,’ there is nothing in the record pointing to any reason to conclude that the
resident was likely to die at approximately 6:00 p.m. on August 9, 2005, had he not been
allowed to exit the facility undetected and unsupervised. No departure from his medical
baseline appears in the record, except the fact that he was tormented by the desperation of
being lost in a dense weed field on an hot August summer day in Harlan, Kentucky at the

* The Harlan County Coroner’s investigation report noted that the temperature was in the
upper 80s. CMS Ex. 9, at 3.

° The record does not indicate that the Coroner took the facility to task, as he should
have, for having moved the body after determining that he had expired.
16

age of 75, where his face appeared to be crushed into the ground where he fell. However,
even if I were to find that the resident’s demise was not in any way related to the
elopement, there is still irrefutable evidence that the elopement was not only likely to
cause serious injury, harm, impairment, or death, but did in fact cause him actual harm.'°

Petitioner should have foreseen that the practice of disarming the door alarms for vendors
providing weekly delivery services to the facility without monitoring the exits on those
occasions, and staff members’ unawareness of the proper operation and monitoring of the
alarm system could result in the elopement of wandering residents. I have already found
that CMS has established a prima facie case that Petitioner did not provide adequate
supervision and assistance devices to prevent accidents. Furthermore, Petitioner’s failure
to adopt and implement appropriate policies and procedures to protect elopement-prone
residents created a window for R1, as well as others similarly situated, to successfully exit
the facility without detection or supervision.

Petitioner contends that the finding of immediate jeopardy is not warranted because the
facility was at all times in substantial compliance with the regulatory requirements of
F-324 and F-490. However, I have rejected Petitioner’s arguments that it provided R1
with adequate supervision. Petitioner’s argument that the facility properly assessed the
resident for elopement/wandering risk and safety does not absolve it of liability. Instead, it
shows that the facility was well aware that R1 was a high risk for elopement and that he
was not to be left unsupervised. In fact, R1 had been known to actually exit the building
on more than one occasion. Tr. at 92, 93. Thus, it was well know that if given a window
of opportunity, R1 would elope. Petitioner’s indication in R1's care plan that he would be
frequently monitored was vague and gave no indication that facility staff knew his
whereabouts at all times.

Additionally, I must uphold CMS’s determination as to immediate jeopardy unless it is
clearly erroneous. 42 C.F.R. § 498.60(c)(2). Petitioner has not met its burden of showing
that CMS’s determination of immediate jeopardy is clearly erroneous.

C. The amount of the CMP is reasonable.

When an ALJ finds that the basis for imposing a CMP exists, the ALJ may not: (1) seta
penalty of zero or reduce the penalty to zero; (2) review the exercise of discretion by CMS
to impose a CMP; and (3) consider any factors in reviewing the amount of the penalty
other than those specified by regulation. 42 C.F.R. § 488.438(e). I have found that a basis
exists for CMS to impose a CMP because I have found that Petitioner was not in

'° The staff did indicate to the surveyor that they feared going into the dense vegetation in
search of R1, especially in light of their concern that snakes were present in the area.
17

compliance with 42 C.F.R. § 483.25(h)(2) and 42 C.F.R. § 483.75 . I must, therefore,
review de novo whether the amount of the CMP is reasonable by considering the four
factors specified in 42 C.F.R. § 488.438(f). These four factors are: (1) the facility’s
history of noncompliance, including repeated deficiencies; (2) the facility’s financial
condition; (3) the scope and severity of the deficiencies, the relationship of one deficiency
to other deficiencies, a facility’s prior history of noncompliance with reference to the
deficiency at issue (factors specified in 42 C.F.R. § 488.404); and (4) the facility’s degree
of culpability.

CMS imposed a $8,050 CMP for each day of noncompliance at the immediate jeopardy
level from August 9 through August 17, 2005. CMS also imposed a $100 per day CMP
for deficiencies at the less than immediate jeopardy level from August 18 through August
25, 2005. The CMP was reduced to $100 per day effective August 18 for noncompliance
based on the results of a revisit survey conducted on August 23, 2005. At that time,
removal of the immediate jeopardy was verified, but it was determined that deficiencies at
the less than immediate jeopardy remained. CMS Ex. 3.

There is no evidence in the record regarding one of the regulatory factors: the facility’s
financial condition. Therefore, the factors that I can consider in reviewing the
reasonableness of the CMP are the scope and severity of the deficiency, the facility’s
degree of culpability, and the facility’s prior history of noncompliance. In this case,
Petitioner failed to ensure that R1 received adequate supervision and assistance devices to
prevent accidents, and such failure resulted in his leaving the facility unsupervised, not
only placing him at risk of serious injury, harm, impairment, or death, but in fact, causing
serious injury and harm. Additionally, other wandering residents were equally placed at
risk of serious injury, harm, impairment, or death. These circumstances demonstrate that
the deficiency was serious and that the facility bears a certain degree of culpability.
Therefore, the penalty imposed is appropriate, given the circumstances of this case, where
Petitioner’s systemic failure to adopt and implement policies and procedures to provide
adequate supervision and assistance devices to prevent accidents, and to administer its
resources effectively and efficiently so as to attain or maintain the highest practicable
physical, mental, and psychosocial well-being of each resident, placed said residents’
health and safety at risk.

Kathy Hall, Petitioner’s Corporate Director of Operations, testified that the facility’s past
history of noncompliance included a citation for an immediate jeopardy violation, two
citations for actual harm deficiencies, and an undetermined number of deficiencies that
caused no actual harm, but had the potential for more than minimal harm. No description
by either party was provided as to the nature of the deficiencies. Thus, I am unable to
determine whether the facility’s prior history of noncompliance bears any relationship to
deficiencies here at issue. Tr. at 343, 344. Notwithstanding, in light of the factors
18

discussed above, a CMP of $8,050 is not unreasonable for the immediate jeopardy
violation. The $100 per day CMP for the non immediate jeopardy violations, which is at
the lower end of the permissible range, is also reasonable. Moreover, the onus is on
Petitioner to come forward with evidence, consistent with 42 C.F.R. § 488.404, to show
that the amount of the CMP is unreasonable. Petitioner has failed to do so.

Petitioner also maintains that the duration of the immediate jeopardy was unreasonable
and that if immediate jeopardy existed, it was removed by August 10, 2005''. The basis
for that contention is the allegation that beginning August 9, 2005, all facility staff were
inserviced regarding the policy of not disarming the alarm doors, and no one was allowed
on the floor until they received training. P. Br. at 17. In spite of Petitioner’s claim that
staff was inserviced on the operation of the alarm system on August 9, 2005, several staff
members that were on duty on August 10, 2005, admitted to the surveyors never having
received such training. One of those staff members who was ignorant as to the operation
of the alarm system was the administrator.

According to Patty Lester (Medicare coordinator), the person who conducted the inservice,
she was given a 10 to 15 minutes orientation by Denise Ford (Corporate Quality
Assurance Nurse) in preparation for her presentation to the staff of a few of the items that
were to comprise the overall training. Those items included: the wandering residents, the
elopement bracelet, the door alarms, and making sure that everybody knew where the
panels were and how to set the alarms. Tr. at 291. Furthermore, it was Ms. Lester’s
testimony that it only took her 20 to 30 minutes to make the presentation to the staff
covering the aforementioned items. Tr. at 292.

It is evident that the facility’s emphasis was not on helping the staff cope with the
psychological impact of the tragic event, or reaching out to R1's family for support and
comfort, but to do damage control. Thus, the hastily put together training fell short of
resolving the serious systemic problems that resulted in immediate jeopardy. Moreover, at
the hearing, Ms. Lester showed that she was still ignorant as to the operation of the alarm
system. This became obvious when she stated that if the lights on the alarm panel were lit
up, everything was alright. It has been established, however, that the condition of the
lights was no indicator as to whether the doors were properly armed . Tr. at 203; see also
n.5, supra.

'' Petitioner alleges that it began to remove the immediate jeopardy on August 9, 2005,
and concluded removal on August 10, that is, two days prior to being notified by the State
survey agency that its facility was in immediate jeopardy.
19

More importantly, Petitioner’s argument that it removed the immediate jeopardy on
August 10, 2005, is negated by Ms. Lester’s testimony to the effect that the next day and
as the days went on, new items were added to the inservice list. Tr. at 293. Although Ms.
Lester could not recall all of the items that were covered on the days following August 10,
2005, she did mention that the additional training included inservicing the nurses and
supervisors on how to evaluate a resident for wandering. Tr. at 293. A review of ALJ Ex.
1, which purports to include the facility’s Credible Allegation of Removal of Immediate
Jeopardy reveals that the sign-in sheets which cover the alleged training provided August
10-12, 2005, do not include the additional instruction referable to evaluation of wandering
residents. That subject was covered, to a certain degree, only on August 18, 2005. CMS
Ex. 13, at 10.

Ms. Ford confirmed that the immediate jeopardy was not removed until August 17, 2005.
She stated that at 8:05 p.m. on Friday, August 12, 2005, the surveyors informed the facility
of the immediate jeopardy finding. The staff wanted to submit an incomplete Credible
Allegation of Removal of Immediate Jeopardy that same night, but it was approximately
11:15 p.m. and the surveyors would not wait anymore. Tr. at 197, 198. Consequently, the
facility sent a facsimile of the Allegation of Removal of Immediate Jeopardy on August
15,2005. ALJ Ex. 1, at 58.'7 On August 17, 2005, the State survey agency returned the
facility’s submission and asked for further clarification. Tr. at 204. Ms. Ford stated that
the clarifications were submitted on August 17, 2005, but the Credible Allegation of
Removal of Immediate Jeopardy is dated August 18, 2005. Tr. at 205; CMS Ex. 12.

On August 29, 2005, CMS notified Petitioner, in essence, that as a result of an August 23,
2005 revisit survey, it was determined that the immediate jeopardy had been removed, but
that the facility continued to be out of compliance with participation requirements. Thus, a
CMP of $100 per day was imposed effective August 18, 2005. Petitioner has not shown
that it returned to substantial compliance on a date earlier than determined by CMS.

In view of the foregoing, I find that there is a basis for the length of the immediate
jeopardy violation established by CMS, and that the amount of the CMP is not
unreasonable.

'. There was an amended transmission of the same documents, but with a transmission
date of August 16. ALJ Ex. 1. The documents, provided by way of facsimile to CMS, on
those occasions contained 5 pages. They were comprised of pages 2-4 of ALJ Ex. 1, and
a cover sheet. The cover sheets are found at ALJ Ex. 1, pages 57 and 58. ALJ Ex. 1,
page | is a purported cover sheet that allegedly accompanied the transmission of ALJ Ex.
1, pages 2-11. It is unclear when those documents were transmitted.
20

V. Conclusion

I conclude that CMS correctly determined that Petitioner was not complying with federal
requirements governing participation of long-term care facilities in Medicare and State
Medicaid programs at the immediate jeopardy level, and that the imposition of an
immediate jeopardy CMP of $ 8,050 per day from August 9 through August 17, 2005 is
appropriate. I also find that CMS was justified in the imposition of a CMP in the sum of
$100 per day for violations at the less than immediate jeopardy violation from August 18
through August 25, 2005.

/s/
José A. Anglada
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

In the Case of: )
)
Denis Boerjan, M.D., ) Date: September 6, 2007

)
Petitioner, )
)

-Vv.- ) Docket No. C-07-315

) Decision No. CR1643
Centers for Medicare & Medicaid )
Services. )
)

DECISION

conclude that the Center for Medicare & Medicaid Services (CMS) properly denied
Denis Boerjan’s (Petitioner’s) enrollment in Medicare.

I. Background

By letter dated August 7, 2006, CMS acting through the Noridian Administrative
Services, LLC (Noridian), the Medicare Part B carrier for lowa, notified Petitioner that

is request to participate in the Medicare program was denied because he did not meet the
conditions of enrollment or meet the requirement to qualify as a health care supplier since
e was convicted of a Federal or State felony offense that CMS had determined to be
detrimental to the best interests of the program and its beneficiaries as set forth in

42 C.F.R. § 424.530(a)(3). Petitioner had a 1999 felony conviction for Criminal Sexual
Conduct in the Second Degree. Petitioner requested a reconsideration-level carrier
earing. By decision dated January 17, 2007, the Medicare Hearing Officer issued an
unfavorable decision which upheld the denial of a provider enrollment number to
Petitioner. By letter dated March 8, 2007, Petitioner requested a hearing to appeal the
unfavorable decision by the Medicare Hearing Officer.

2

This case was assigned to me for hearing and decision. I convened a prehearing
conference in this matter on April 12, 2007. During the conference, the parties requested
additional time to confer with each other to determine whether to request an in-person
hearing. I granted the request for additional time and set another prehearing conference
for May 17, 2007. At the May 17, 2007 prehearing conference the parties informed me
that an in-person hearing would not be necessary and requested that I set a briefing
schedule so that the parties could address the issues of this case.

Petitioner filed its brief (P. Br.) on June 1, 2007, along with fifteen exhibits, Petitioner
Exhibits (P. Exs.) A-N. On July 5, 2007, CMS filed its brief in response (CMS Br.). On
July 20, 2007, Petitioner filed its reply brief (P. Reply Br.). I admit into evidence P. Exs.
A-N. I make my decision based on the applicable law and the parties’ briefs and exhibits.

If. Applicable Law

Section 1842(h)(8) of the Social Security Act (Act), 42 U.S.C. § 1395u(h)(8), grants the
Secretary of the Department of Health and Human Services (Secretary) discretion to
refuse to enter into an agreement, or to terminate or refuse to renew an agreement, with a
physician or supplier that “has been convicted of a felony under Federal or State law for
an offense which the Secretary determines is detrimental to the best interests of the
program.”

Section 1866(j) of the Act requires the Secretary to “establish by regulation a process for
the enrollment of providers of services and suppliers under this title,” and grants “[a]
provider of services or supplier whose application to enroll (or, if applicable, to renew
enrollment) under this title is denied” a “hearing and judicial review of such denial under
the procedures that apply under subsection (h)(1)(A).” Act, section 1866(j)(1)(A) and
(2).

The regulation governing enrollment denial in the Medicare program provides:

(a) Reasons for denial. CMS may deny provider’s or supplier’s enrollment in the
Medicare program for the following reasons...

(3) Felonies. If within the 10 years preceding the enrollment or revalidation
of enrollment, the provider, supplier, or any owner of the provider or
supplier, was convicted of a Federal or State felony offense that CMS has
determined to be detrimental to the best interests of the program and its
beneficiaries. CMS considers the severity of the underlying offense.
(I) Offenses include -

(A) Felony crimes against persons, such as murder, rape or assault,
and other similar crimes for which the individual was convicted,
including guilty pleas and adjudicated pretrial diversion.

(B) Financial crimes, such as extortion, embezzlement, income tax
evasion, insurance fraud and other similar crimes for which the
individual was convicted, including guilty pleas and adjudicated
pretrial diversions.

(C) Any felony that placed the Medicare program or its beneficiaries
at immediate risk (such as a malpractice suit that results in a
conviction of criminal neglect or misconduct).

(D) Any felonies outlined in section 1128 of the Act.
42 C.F.R. § 424.530.

The Departmental Appeals Board (Board) has held that section 1866(j)(2) of the Act
gives appeal rights to suppliers. “Section 1866(j)(2) of the Social Security Act (the Act)
gives suppliers appeal rights, for certain determinations involving enrollment, using the
procedures that apply under section 1866(h)(1)(A) of the Act. Those procedures are at 42
C.F.R. Part 498 and provide for ALJ [Administrative Law Judge] hearings and Board
review.”' MediSource Corporation, DAB No. 2011, at 2 (2006).

Further, the Board has recognized the procedures and the burden of persuasion
established by the Secretary in the Program Integrity Manual (PIM, Pub. 100-08) at
Chapter 10, § 19:

The Medicare Provider Integrity Manual provides: “The burden of persuasion is
on the... supplier... to show that its enrollment application was incorrectly
disallowed or that the revocation of its billing number was incorrect.” [Citing PIM,
Ch. 10, § 19.B.] This provision is consistent with the Board’s conclusion in
provider appeals under 42 C.F.R. Part 498 that a provider must prove substantial

' A proposed rule, not yet effective, would extend to suppliers the due process
procedures of 42 C.F.R. Part 498, including the right to a hearing by an ALJ. See 72 Fed.
Reg. 9479 (March 2, 2007). CMS consents to the application of the procedures in 42
C.F.R. Part 498 to the matter before me.
4

compliance by the preponderance of the evidence, once CMS has
established a prima facie case that the provider was not in substantial
compliance with relevant statutory or regulatory provisions.

Id. at 2-3.
Ill. Issue

The issue in this case is whether CMS has authority to deny enrollment to Petitioner in
the Medicare program.

IV. Discussion

I make findings of fact and conclusions of law (Findings) to support my decision in this
case. I set forth each Finding below as a separate heading. I discuss each Finding in
detail.

I. CMS is authorized to deny a provider’s or supplier’s enrollment in the
Medicare program if the provider or supplier has been convicted within 10 years
of a felony determined to be detrimental to the best interests of the program or its
beneficiaries.

On May 15, 2006, Petitioner filed a Medicare Enrollment Application, CMS Form 8551.
P. Ex. A” On August 7, 2007, Noridian notified Petitioner that his request to participate
in Medicare had been denied, pursuant to 42 C.F.R. § 424.530(a)(3). P. Ex. G. Petitioner
admits that on May 7, 1999, he pled guilty to the charge of Second Degree Criminal
Sexual Conduct before the District Court, Third Judicial District of the State of
Minnesota. P. Br. at 4; P. Ex. H. The District Court accepted Petitioner’s guilty plea and
entered a guilty judgment against him. Petitioner was convicted of an offense as defined
by section 1128(1) of the Act. The Sentencing Order established that the criminal offense
was at a severity level of six on an 11 point scale under Minnesota law. Jd. The
Sentencing Order established that the criminal offense that Petitioner plead guilty to
occurred from approximately from 1984 through 1988. /d. Petitioner was placed on
probation and sentenced to participate in sex offender treatment programming, serve 90
days of work release detention in an adult detention center, and was prohibited in
engaging in unsupervised contact with individuals under the age of 18. Jd. The Court

? In 1998, Petitioner’s practice changed physical addresses and status from a sole
proprietorship to a limited liability corporation (LLC). Petitioner, as a result of these
changes, terminated his previous Medicare Provider Number and applied for a new one.
5

later amended the sentencing order to allow Petitioner to have professional contact in
treatment of children under the age of 18 with the presence of a parent or adult staff
member. P. Br. at 4.

On January 21, 1998, the lowa Board of Chiropractic Examiners entered into a Consent
Agreement/Order, prohibiting Petitioner from having professional contact with children
under the age of 18 unless there was a parent or adult staff member present. P. Ex. J. On
April 23, 1998, the Minnesota Board of Chiropractic Examiners entered into a Stipulation
and Order requiring that Petitioner only have professional contact with children under the
age of 18 if a parent or adult staff member was present, and had his license placed on
probation. P. Ex. L. On May 5, 2000, the Iowa Board of Chiropractic Examiners filed a
Combined Statement of Charges and Settlement Agreement and Final Order where
Petitioner was ordered to continue to have professional contact with children under the
age of 18 only in the presence of a parent or an adult staff member and had his license
placed on probation. P. Ex. K.

Petitioner contends that his enrollment application was outside the 10 year period
requiring denial since the events that were a basis of his felony conviction occurred
approximately between 1984 through 1988. The evidence shows that according to the
Sentencing Order, the criminal offense that Petitioner pled guilty to occurred
approximately from 1984 through 1988. P. Ex. H. However, Petitioner was convicted in
May of 1999. The regulation clearly states that it is the date of conviction that controls
the beginning of the 10-year period. Had the Secretary chosen to make the date of the
underlying offense controlling, he could have done so, but he did not. Petitioner claims
that the legislative intent was to exclude any offense that was greater than 10 years old
because the offense occurring “beyond the ten (10) year requirement would be dated and
not an accurate or sufficient way in which to judge the alleged offender.” P. Br. at 6.
Petitioner does not point to any legislative history or any legislative language to advance
his interpretation. I am bound to follow the Secretary’s regulations that are clearly and
plainly stated. The regulation is clear: it is the date of the conviction, not the date of the
events that were the basis of the conviction, that control the 10-year time period in

42 C.F.R. § 424.530. The date of the conviction, 1999, is within the 10-year period from
the date of the denial of Petitioner’s enrollment application.

2. The regulation requires that CMS consider the severity of the underlying
offense.

Petitioner claims that CMS never considered the severity of the underlying offense either
in the initial denial by Noridian or during the reconsideration level hearing. P. Br. at 8.
My authority to hear and decide this case is de novo. I conduct a de novo review of the
facts which relate to the issue of the severity of the underlying offense when the offense is
not one of the enumerated offenses mentioned in the regulations. I do not imply that
6

CMS has not considered the severity of the offense simply because it was silent on that
issue in its denial notification to Petitioner or in the hearing officer’s decision. It is
important to note that the severity of the offense is not the same as mitigating or
aggravating factors in exclusion cases where one of the parties is the Inspector General. I
make an independent decision as to whether Petitioner’s offense was a severe offense that
would be detrimental to the Medicare program or its beneficiaries.

Petitioner pled guilty to Criminal Sexual Conduct in the Second Degree on a severity
level of six on an 11 point scale with 11 being the most severe. Petitioner was placed on
probation and sentenced to participate in sex offender treatment programming, serve 90
days of work release detention in an adult detention center, and was prohibited in
engaging in unsupervised contact with individuals under the age of 18. Petitioner argues
that his offense was not so severe as to warrant the denial of his participation in the
Medicare program. I disagree.

Further, Petitioner argues that his offense was not related to his professional practice, the
Medicare program or its beneficiaries. It is clear that whether an offense is related to a
supplier’s professional practice, the Medicare program or its beneficiaries is not the issue
before me. The regulations clearly state that offenses include felony crimes against
persons, such as murder, rape, or assault and other similar crimes, none of which are
related to a supplier’s professional practice, the Medicare program or its beneficiaries.
42 C.F.R. § 424.530(a)(3)(i)(A). The regulations state that CMS is concerned with
“offenses that CMS has determined to be detrimental to the best interests of the program
and its beneficiaries.” 42 C.F.R. § 424.530(a)(3). The central question before me is
whether Petitioner’s inclusion in the Medicare program would be detrimental to the best
interests of the Medicare program or its beneficiaries. The intent of the statute is to
protect the Medicare program and its beneficiaries, not to punish prospective providers
and suppliers. Even Petitioner admits that this is the intent of the statute in his brief.

P. Br. at 13.

Petitioner pled guilty to the charge of Second Degree Criminal Sexual Conduct before the
District Court, Third Judicial District of the State of Minnesota. The severity level
assigned to this felony was six out of an 11 point scale, a mid-grade felony. This is not a
minor felony. Petitioner, in his brief, sets forth his own version of the background facts.
In 1984, Petitioner had an “incident” involving one of his own minor children for which
he sought counseling. P. Br. at 3. Petitioner, does not go into detail about this “incident.
Petitioner went to several therapists over the course of several years. Jd. Petitioner
enrolled in a sex therapy group for two years near the end of his completion of therapy
with his final therapist. Jd. In 1993, Petitioner and his wife divorced. Jd. Divorce, child
custody and child support proceedings were heated. Jd. In 1997, after Petitioner had
remarried, his first wife reported the incident for which he sought therapy to the police,
along with, according to Petitioner, several other allegedly fabricated charges. Jd. at 4.
7

On May 7, 1999, Petitioner pled guilty to the charge of Second Degree Criminal Sexual
Conduct. The remaining charges were dismissed. Jd. at 4. In spite of all the earlier
therapy and the sex therapy group that Petitioner attended during his first marriage,
Petitioner was sentenced, in part, to another sex offender treatment program after his
conviction. The Sentencing Order also shows that Petitioner was placed on probation,
ordered to serve 90 days of work release detention in an adult detention center, and was
prohibited in engaging in unsupervised contact with individuals under the age of 18. The
Court later amended the sentencing order to allow Petitioner to have professional contact
in treatment of children under the age of 18 with the presence of a parent or adult staff
member. P. Br. at 4.

Petitioner’s version of the background facts would make it seem that there was one
incident in 1984. But the Sentencing Order states that the events that were a basis of
Petitioner’s felony conviction occurred approximately from 1984 through 1988.

The offense was a mid-grade felony sexual offense against a vulnerable child that
continued for four years against Petitioner’s own minor child. Petitioner was unable to
onor the parent-child relationship and unable to comply with the expected conduct
etween a parent and his own child.

Medicare patients are usually vulnerable, elderly individuals who should not be put at the
mercy of untrustworthy suppliers of medical treatment. As a chiropractor, Petitioner will
ave physical, perhaps intimate contact with vulnerable patients in a treatment room
where the vulnerable patient is alone with Petitioner. I find that there is doubt whether
Petitioner can be trusted to honor the physician-patient relationship. The lowa and
Minnesota chiropractic boards have prohibited Petitioner from treating patients under the
age of 18 without a parent or adult staff member present. This prohibition is ongoing,
even though the underlying events behind Petitioner’s conviction happened almost 20
years ago and in spite of all the subsequent treatment and two programs with sex therapy
groups. This indicates that in the professional opinion of two different states’ chiropractic
boards, Petitioner still requires supervision with vulnerable patients. Allowing a provider
or supplier to participate in Medicare who has been convicted of a sexual offense against
his own child cannot be in the best interests of the Medicare program or its beneficiaries.

V. Conclusion

I find that Petitioner was convicted within the 10-year window prior to his Medicare
enrollment application of an offense that is detrimental to the Medicare program and its
beneficiaries. I conclude that CMS properly denied Petitioner’s enrollment in Medicare.

/s/
Alfonso J. Montano
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

In the Case of: )
)

Daniel W. Bullock, M.D., ) Date: August 23, 2007
)
Petitioner, )
)

-V.- ) Docket No. C-07-256

) Decision No. CR1640
Centers for Medicare & Medicaid )
Services. )
)

DECISION

In January 2002, Petitioner, Daniel W. Bullock, M.D., was convicted of felony tax
fraud. Based on that conviction, the Centers for Medicare & Medicaid Services (CMS)
has revoked his Medicare billing privileges. Petitioner appeals. CMS now moves for
summary judgment, arguing that no material facts are in dispute and that it is entitled to
judgment as a matter of law. I agree and affirm CMS’s revocation of Petitioner’s
Medicare billing privileges.

Background

CMS, acting on behalf of the Secretary of Health and Human Services, “may” revoke a
currently enrolled provider’s Medicare billing privileges if, within the preceding 10 years,
the provider was convicted of a felony offense that CMS “has determined to be
detrimental to the best interests of the program and its beneficiaries.” 42 C.F.R.

§ 424.535(a)(3); see also Social Security Act (Act) §§ 1842(h)(8) (The Secretary may
terminate his agreement with a participating physician who has been convicted of a felony
for an offense which the Secretary has determined is “detrimental to the best interests of
the program or program beneficiaries”) and 1866(b)(2)(D) (The Secretary may terminate
a provider agreement after he ascertains that the provider has been convicted of a felony
“which the Secretary determines is detrimental to the best interests of the program or
program beneficiaries”). Offenses for which billing privileges may be revoked include
financial crimes such as tax evasion, and any crime that would result in mandatory
exclusion under section 11 28(a) of the Act. 42 C.F.R. § 424.535(a)(3)(i)(B) and (D).

Section 1866(j)(2) of the Act creates appeal rights for providers and suppliers where
enrollment has been denied, including the revocation of billing privileges, using the
procedures that apply under section 1866(h)(1) of the Act. These procedures provide for
review by an Administrative Law Judge (ALJ) and the right to appeal the ALJ’s decision
to the Departmental Appeals Board, 42 C.F.R. Part 498, et seq.

In this case, the parties agree that in January of 2002, Petitioner was convicted of felony
tax fraud in U.S. District Court for the Eastern District of California.' CMS Ex. 3. CMS
now asks for summary judgment (CMS Br.), arguing that, based on that conviction, CMS
had the discretion to revoke Petitioner's Medicare billing privileges, and CMS’s exercise
of its discretion is not reviewable. Petitioner opposes (P. Br.) and argues that a hearing is
necessary to consider certain relevant factors. CMS has submitted exhibits marked CMS
Exs. 1-3, and Petitioner has submitted exhibits marked P. Exs. 1-4. The parties also filed
Reply briefs (CMS Reply and P. Sur-reply).

Discussion

CMS may revoke Petitioner’s Medicare billing privileges because, within
the last 10 years, Petitioner was convicted of tax fraud and conspiracy to

commit fraud against the United States, which are felonies detrimental to
the best interests of the program.

Summary judgment is appropriate if the affected party has either “conceded all of the
material facts or proffered testimonial evidence only on facts which, even if proved,
clearly would not make any substantive difference in the result.” Michael J. Rosen, M.D.,
DAB No. 2096 (2007), at 4; see also Big Bend Hosp. Corp. d/b/a Big Bend Medical Ctr.,
DAB No. 1814 (2002), aff'd, Big Bend Hosp. Corp. v. Thompson, No. P-02-CA-030
(W.D. Tex. Jan. 2, 2003).

' CMS tefers to the January 29, 2002 conviction, and Petitioner refers to the
January 7, 2007 sentencing. CMS Ex. 1; P. Br. at 2. Petitioner was sentenced to eighteen
months in prison followed by three years of supervised release. P. Ex. 1, at 10-11.

° IT make this one finding of fact/conclusion of law to support my decision.
3

he relevant regulation provides that if a provider has been convicted of “financial
crimes, such as... income tax evasion” within the last 10 years preceding revalidation of
enrollment, CMS may revoke its Medicare billing privileges. 42 C.F.R. § 424.535(a)(3).
Asa matter of law, the Secretary has determined that tax fraud is among those felonies
“detrimental to the best interests of the Medicare program or its beneficiaries” for which
billing privileges may be revoked. Md.

Here, there is no dispute as to Petitioner’s January 2002 conviction of tax fraud and
conspiracy to commit fraud against the United States. P. Br. at 1. Thus, under the plain
language of the regulation, CMS may revoke Petitioner’s billing privileges.

Petitioner nevertheless points to language from the regulation’s preamble that provides
that when revoking a provider’s billing privileges, CMS would consider certain factors
(severity of the offenses, mitigating circumstances, risk to the Medicare program and
beneficiaries, the possibility of corrective action plans, and beneficiary access to care).

P. Request for hearing at 2; see 71 Fed. Reg. 20,754, 20,761. In Petitioner’s view, CMS
was required to consider these factors, failed to do so, and such failure is a basis for
reversal of the revocation. At the least, Petitioner argues, he is entitled to present
evidence at an in-person hearing so that | may determine whether, based on those factors,
his Medicare participation is “detrimental” to the program or its beneficiaries. I disagree.

Where the statutory and regulatory language is unambiguous, there is no need to look
further” Abermarle Corp. v. Herman, 221 F.3d 782, 786 (Sth Cir. 2000); see also County
of Los Angeles v. U.S. Dep't of Health & Human Services, No. 96-55161, 1997 WL
257492 (9th Cir. May 14, 1997); Wildlife Federation v. Marsh, 721 F.2d 767, 773 (Sth
Cir. 1983); Ass'n of American Railroads v. Costle, 565 F.2d 1310, 1316 (D.C. Cir. 1977);
Alexander v. U.S. Dep't of Hous. & Urban Dev., 555 F.2d 166, 171 (7th Cir. 1977).
Moreover, the statute and regulation explicitly afford CMS that discretion to revoke
Petitioner's billing privileges, and | have no authority to review CMS’s exercise of
discretion. The Departmental Appeals Board has repeatedly declined to interject itself
into the discretionary enforcement processes of components of the Department of Health
and Human Services. CMS Br. at 5-6; see Wayne E. Imber, M.D., DAB No. 1740 (2000);

* Elsewhere in the preamble, drafters emphasized that income tax evasion is
among the felonies that “we determine to be detrimental to the best interest of the
Medicare program or its beneficiaries.” 71 Fed. Reg. at 20,760. “We believe it is
reasonable for the Medicare program to question the honesty and integrity of the
individual or entity with such a history [of financial crimes] in providing services and
claiming payment under the Medicare program.” /d.
4

Brier Oak Terrace Care Ctr, DAB No. 1798 (2001). Once | have determined that there
is a legal and factual basis for revoking Petitioner's billing privileges, | am “without
jurisdiction to evaluate on any basis whatsoever the propricty of [CMS’s] exercise of
discretion in deciding to proceed with the imposition of the exclusion.” Michael J.
Rosen, M.D., DAB No. 2096 (2007), at 14 (citing Michael J. Rosen, M.D., DAB CRIS66
(2007)); see also Puget Sound Behavioral Health, DAB No. 1944 (2004), at 15-16 (where
regulation uses perm e rather than mandatory language AIL.J had no authority to
compel CMS to exercise its discretion).

Conclusion

Here, Petitioner admits that he was convicted of a felony ~ tax fraud. CMS may revoke
his Medicare billing number for a felony it determines to be detrimental to the best
interests of the program or program beneficiaries. CMS has determined that tax fraud is
detrimental to the best interests of the program or its beneficiaries. | therefore affirm the
Hearing Officer's decision.

/s/ Carolyn Cozad Hughes
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

In the Case of: )
) Date: August 24, 2007

In re CMS LCD COMPLAINT: )

Local Coverage Determination: )
OXALIPLATIN (ELOXATIN®), ) Docket No. C-06-656
LCD Database ID Number L13743. ) Decision No. CR1639

)

DECISION

issue this decision deciding the hearing request brought by an aggrieved Medicare
eneficiary (AB) challenging Local Coverage Determination (LCD) L13743, issued by
the local New Jersey Medicare Contractor, Empire Medical Services (Empire), refusing
coverage and payment by the Medicare program for treatment with oxaliplatin (Eloxatin)
for the AB’s transitional cell carcinoma of the bladder. I find the record of the LCD is
complete and adequate to support the validity of the LCD and, thus, conclude that the
LCD is reasonable.

I. Background and Undisputed Facts

hear and decide this case pursuant to regulations governing challenges to LCDs
published at 42 C.F.R. Part 426, Subparts C and D.

The following facts appear undisputed and I accept them as true. The AB was diagnosed
with bladder carcinoma. He initially had chemotherapy and it appeared that the bladder
carcinoma was responding. A recurrence was noted and in May 2005 he had a radical
cystoprostectomy, bilateral lymph node dissection and ileoconduit urinary diversion.
When certain neoadjuvant and adjuvant chemotherapy did not bring about expected
results, it was decided in November 2005 to change the protocol of his treatment and start
chemotherapy with oxaliplatin (Eloxatin®). He had an excellent response through March
2006, but that regimen ended in April 2006 when the markers began to increase again.
2

While oxaliplatin is indicated for colorectal cancer, it was used for the AB’s bladder
cancer because he was not responding to traditional therapy and there had been some
indication in clinical trials that oxaliplatin might be beneficial in the treatment of bladder
cancer as well.

Claims were made for this treatment under Medicare Part B by the AB’s doctor, but those
claims were denied by the Medicare Carrier, Empire, due to LCD L13743, which does
not cover bladder cancer as a coverable diagnosis that supports the use of oxaliplatin.

The AB submitted a hearing request with various attachments. I directed the intermediary
to provide me with a copy of its LCD record. Empire submitted its LCD record under
cover of a letter dated October 12, 2006 (although not received in my office until
November 15, 2006). I provided the AB with the opportunity to comment on the LCD
record and to provide supplemental evidence if he wished within 30 days of his receipt of
that record. When I did not receive a response from the AB, I sent another letter
indicating he could have until January 26, 2007 to submit his written response. No
response or communication was received.

Therefore, I find the record of this case to be closed. The record consists of the AB’s
request for review of the LCD with Attachments 1-6, and the submission of the LCD
record for this LCD complaint from Empire.

II. Discussion
A. Applicable Law

An LCD, as defined by the Social Security Act (Act), is “a determination by a fiscal
intermediary or a carrier. . . respecting whether or not a particular item or service is
covered” within the area covered by the contractor. Act, section 1869(f)(2)(B) (42 U.S.C.
§ 1395ff(£)(2)(B)).

The Secretary of the Department of Health and Human Services promulgated regulations
pursuant to sections 1102 and 1871 of the Act (42 U.S.C. §§ 1302 and 1395hh),
implementing sections 1869(f)(1) and (f)(2) of the Act. 42 C.F.R. § 426.100. The
regulations are found at 42 C.F.R. Part 426. The procedures for review of an LCD are in
42 C.F.R. Part 426, Subpart D (42 C.F.R. § 426.400 et. seq.).
3

The reasonableness standard is defined at 42 C.F.R. § 426.110, as:

[T]he standard that an ALJ or the Board must apply when
conducting an LCD or an NCD [national coverage
determination] review. In determining whether LCDs or
NCDs are valid, the adjudicator must uphold a challenged
policy (or a provision or provisions of a challenged policy)
if the findings of fact, interpretations of law, and applications
of fact to law by the contractor or CMS are reasonable

based on the LCD or NCD record and the relevant record
developed before the ALJ or the Board.

Further definition of the reasonableness standard is provided by the notice of final
rule making at 68 Fed. Reg. 63,692, 63,703-04 (2003). The drafters of the regulation
discussed the reasonableness standard adopted as follows:

We are using the statutory language from sections
1869(f)(1)(A)(iii) and (f)(2)(A)(i)() of the Act, which
instructs adjudicators to defer only to the reasonable
findings of fact, reasonable interpretations of law, and
reasonable applications of fact to law by the Secretary.
The logical corollary is that the ALJs and the Board must
accord deference if the contractor’s or CMS’s findings of
fact, interpretations of law, and application of fact to law
are reasonable. The concept of deference is one that is
generally applied by courts to administrative decision
making, in recognition of the expertise of a program
agency. Thus, we view the statute as setting out a
reasonableness standard that recognizes the expertise of
the contractors and CMS in the Medicare program--
specifically, in the area of coverage requiring the exercise
of clinical or scientific judgment. So long as the outcome
is one that could be reached by a rational person, based
on the evidence in the record as a whole (including
logical inferences drawn from that evidence), the
determination must be upheld. This is not simply based
on the quantity of the evidence submitted, but also
includes an evaluation of the persuasiveness of the
material. If the contractor or CMS has a logical reason as
to why some evidence is given more weight than other
4

evidence, the ALJs and the Board may not overturn the
determination simply because they would have accorded
more weight to the evidence in support of coverage. In
some situations, different judgments by different
contractors may be supportable, especially if explained by
differences such as the ready availability of qualified
medical professionals in one contractor’s area, but not in
another. Moreover, an ALJ or the Board may not
determine that an LCD is unreasonable solely on the basis
that another Medicare contractor has issued an LCD that
permits coverage of the service at issue, under the clinical
circumstances presented by the complaint. For legal
interpretations, the reasonableness standard would not be
met if an interpretation is in direct conflict with the plain
language of the statute or regulation being interpreted.
Moreover, an interpretation in an LCD would not meet
the reasonableness standard if it directly conflicts with an
NCD or with a CMS Ruling. So long as an interpretation
is one of the readings permitted by the plain language of
the law and can be reconciled with relevant policy,
however, it must be upheld, even if the ALJ or the Board
might have reached a different result if interpreting the
statute or regulation in the first instance.

Id.
B. The LCD

The LCD provides as follows:
Indications and Limitations of Coverage and/or Medical Necessity
Oxaliplatin for injection (Eloxatin™) is an organoplatinum complex

used as antineoplastic agent.

Indications
FDA Labeled Indication:

1. ELOXATIN, used in combination with infusional 5-FU/LV, is
indicated for the treatment of patients with metastatic carcinoma of
the colon or rectum whose disease has recurred or progressed
5

during or within 6 months of completion of first-line therapy, with
the combination of bolus 5-FU/LV irinotecan.

2. Effective 01/09/2004, the FDA has approved the use of oxaliplatin
as first line therapy in combination with infusional 5-FU/LV for
the treatment of patients with advanced metastatic carcinoma of the
colon or rectum.

3. Effective 05/01/2004, coverage is extended to include patients
receiving oral capecitabine as an alternative to infusional 5-FU, in
combination with oxaliplatin.

4. Effective 11/04/2004, the FDA has approved oxaliplatin for use as
an adjuvant therapy in patients with stage 3 colon cancer who have
undergone resection of the primary tumor, when used in
combination with infusional 5-FU and leucovorin. Empire
Medicare Services will also reimburse the oxaliplatin when given
with 5-FU and capecitabine.

5. Effective December 1, 2005, oxaliplatin has been approved for use
as an adjuvant therapy in patients with stage II colon cancer, in
combination with 5-fluorouracil/leucovorin.

6. Effective May 1, 2005, oxaliplatin is covered for the off-label
indication of patients with malignant neoplasm of the stomach.

Limitations

1. Oxaliplatin is not covered for any indications other than those
specifically listed above in the Indications section of this LCD.

LCD for Oxaliplatin (ELOXATIN®), L13743, Contractor: National Government
Services, Inc. (formerly known as Empire Medicare Services).

The LCD precludes reimbursement under Medicare Part B for use of this drug for
outpatient chemotherapy for any indications other than those specifically listed. In
this case, Empire denied coverage for its use in chemotherapy for a patient with
bladder cancer, an off-label use.
C. Issue

The issue in this case is whether the LCD unreasonably prohibits Part B Medicare
reimbursement for coverage of oxaliplatin for the treatment of patients with bladder
cancer.

D. Findings Pursuant to 42 C.F.R. §§ 426.450 through 426.457

I make findings to support my decision in this case. I set forth each finding below as
a separate heading. I discuss each finding in detail.

1. The LCD record is complete and adequate to support the
validity of the LCD provisions at issue and I find the LCD is
reasonable under the reasonableness standard.

The AB is disputing the determination by Medicare not to cover the use of
chemotherapy treatment with oxaliplatin for his bladder cancer. The statements of
the AB and his physician, as well as the other materials submitted with his complaint,
indicate that oxaliplatin is not labeled for use or indicated for patients with bladder
cancer. Essentially, the AB is requesting that I find the LCD unreasonable because it
does not recognize as appropriate the off-label use in this instance for bladder cancer.

My focus is upon the LCD challenged by the AB and whether or not the LCD record
is complete and adequate to support the validity of the LCD provisions under the
reasonableness standard. I find that the LCD is reasonable and consistent with
longstanding CMS policy.

Medicare policy recognizes that often medical science progresses rapidly and what
one day may be considered experimental, may later be considered acceptable
treatment after studies show that a procedure or drug regimen is effective. Anti-
cancer chemotherapeutic agents are eligible for coverage when used in accordance
with Food and Drug Administration (FDA)-approved labeling, when the off-label use
is supported in one of the authoritative drug compendia listed in section
1861(t)(2)(B)(ii)() of the Act, or when the Medicare Carrier/Contractor determines
an off-label use is medically accepted based on guidance provided by the Secretary
(section 1861(t)(2)(b)(ii)(ID of the Act). See Medicare Benefit Policy Manual,
CMS Publication 100-2, Chapter 15, Section 50.4.5. Also, there is an NCD that
states that oxaliplatin will be covered for off-label use only when it is being used in
specific clinical trials identified by CMS for coverage. Medicare NCD Manual Part
2, section 110.17 (effective January 28, 2005), CMS Publication 100-03. That
7

section specifically lists the clinical trials for which its use is approved and it does not
include any trials for bladder cancer and the LCD record here does not support that
its use for the aggrieved party was pursuant to any CMS-approved clinical trials.

That section further states —

This policy does not alter M

edicare coverage for items and

services that may be covered or non-covered .. . The existing
requirements for coverage for oxaliplatin for FDA-approved

indications are not modified
make reasonable and necess:

section 1861(t)(2)(b)(ii)(II) o

. .. Contractors shall continue to
ary coverage determinations under
f the [Social Security] Act based on

guidance provided by the Secretary for medically accepted uses
of off-label indications of oxaliplatin . . . provided outside of the

identified clinical trials ....
Medicare NCD Manual, Part 2, Section 1

In this case, there is no dispute that oxalip

0.17.C.

latin is not FDA-approved for the AB’s

type of bladder cancer; it is also clear from the LCD record that the off-label use for

bladder cancer is not supported by one of
under section 1861(t)(2)(B) of the Act. T:

the authoritative drug compendia listed
us, the only issue before me is whether the

Medicare Contractor should have determined that the off-label use of oxaliplatin for

the AB’s bladder cancer is medically acce
Medicare Contractor reviewed submitted
the use of oxaliplatin for pancreatic, blad
Therefore, the Contractor determined that

pted. The LCD record indicates that the
iterature and found that it did not support
er or refractory germ cell cancer.

the LCD would not be revised to include

these conditions at this time. The Contractor further indicated that it would review

any published peer-reviewed double-blin
extending coverage for such conditions.
no further evidence to show that any such

ed and randomized studies which support
rhe AB submitted no response and provided
peer-reviewed double-blinded and

randomized studies have been done that support a finding that off-label use of this
drug for bladder cancer is safe and effective.
8

I therefore find that the LCD at issue here is valid and reasonable under the
reasonableness standard.

2. The review process is complete upon issuance of this decision.

Since I find that the LCD record is complete and adequate to support the validity of
the challenged LCD under the reasonableness standard, “issuance of a decision
finding the record complete and adequate to support the validity of the LCD ends the
review process.” 42 C.F.R. § 426.425(c)(2).

/s/
Alfonso J. Montano
Administrative Law Judge