Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Titusville Rehabilitation and Nursing Center
(CCN: 10-5448),

Petitioner,
v.
Centers for Medicare & Medicaid Services.
Docket No. C-12-294
Decision No. CR2980
Date: November 6, 2013

DECISION

Petitioner, Titusville Rehabilitation and Nursing Center, violated 42 C.F.R. §§ 483.20(d)
and 483.20(k)(1), 483.20(k)(3)(i), and 483.25(h), during the period September 23, 2011
through November 14, 2011; and the violations posed immediate jeopardy for the entire
period. The civil money penalty (CMP) of $6,050 per day for the 53 days from
September 23 through November 14, 2011, a total CMP of $320,650, is a reasonable
enforcement remedy.

I. Background

Petitioner is located in Titusville, Florida, and participates in Medicare as a skilled
nursing facility (SNF) and in the state Medicaid program as a nursing facility (NF). From
November 7 through 9, 2011, Petitioner was subject to a complaint investigation by the
Florida Agency for Health Care Administration (state agency) and found not to be in
substantial compliance with program participation requirements. The Centers for
Medicare & Medicaid Services (CMS) notified Petitioner by letter dated November 23,
2011, that it was imposing the following enforcement remedies: a CMP of $6,050 per
day beginning on September 23, 2011 and continuing until Petitioner abated immediate
jeopardy to its residents or Petitioner’s provider agreement was terminated; a
discretionary denial of payments for new admissions (DPNA) effective November 25,
2011, if Petitioner did not return to substantial compliance before that date; and
termination of Petitioner’s provider agreement on December 2, 2011, if the immediate
jeopardy to resident health and safety was not removed by that date. CMS also advised
Petitioner that it was no longer eligible to conduct a nurse aide training and competency
evaluation program (NATCEP). CMS Exhibit (Ex.) 20.

Petitioner requested a hearing before an administrative law judge (ALJ) on January 18,
2012. The case was assigned to me for hearing and decision on January 24, 2012, and an
Acknowledgement and Prehearing Order (Prehearing Order) was issued at my direction.
On November 14 and 15, 2012, a hearing was convened by video teleconference (VTC)
with the parties’ representatives, counsel, and witnesses appearing in Maitland, Florida,
and the ALJ presiding from Kansas City. The hearing continued on November 28, 2012,
by telephone, with counsel for Petitioner participating from her office in Virginia,
Petitioner’s representative appearing by telephone from Florida, counsel for CMS
appearing by telephone from Georgia, and Petitioner’s expert witness testifying by
telephone from Florida. My attorney advisor and the court reporter participated by
telephone from Washington, D.C., and I presided by telephone from Kansas City. A
transcript (Tr.) of the proceedings was prepared. CMS offered CMS Exs. | through 22,
of which CMS Exs. 1 through 21 and CMS Ex. 22, page | were admitted as evidence.'
Tr. 31-33, 130-44. Petitioner offered Petitioner’s exhibits (P. Exs.) 1 through 14 that
were admitted as evidence. Tr. 34-35. CMS called the following witnesses during the
hearing: Surveyor Mark Foronda, a nutritionist consultant, and Surveyor Supervisor
Theresa DeCanio, Registered Nurse (RN). Petitioner called the following witnesses:
Mekeeba Mathews, CNA; Julie Dawkins, RN, MSN, MBA; and Robin Bleier, RN (who
testified as an expert in the area of nursing and CNA operations within a long-term care
facility, as well as with regard to standards of nursing and CNA care). Tr. 705-06.

The parties filed post-hearing briefs (CMS Br. and P. Br., respectively) and post-hearing
reply briefs (CMS Reply and P. Reply, respectively), as well as proposed findings of fact
and conclusions of law.

On February 28, 2013, CMS filed with its post-hearing brief a motion for leave to
supplement the record with CMS Exs. 23 and 24. CMS Ex. 23 purports to be U.S. Naval
Observatory information related to sunrise, sunset, moonrise, moonset, and similar data

' CMS Ex. 18 is not substantive evidence, but rather a sheet of paper on which is printed
the statement that “CMS hereby incorporates all the Petitioner’s Exhibits 1 — 15
exchanged on May 24, 2012.” Similarly, P. Ex. 15 was included on Petitioner’s list of
proposed exhibits but not offered because the exhibit list described P. Ex. 15 as “[alll
CMS exhibits 1-19 submitted on April 25, 2012.” Tr. 34.
for the dates of September 23, 2011 and November 7, 2011. CMS Ex. 24 purports to be
an extract from Mosby’s Textbook for Long-Term Care Assistants, (4th ed.). Petitioner
filed objections to the admission of CMS Exs. 23 and 24 on March 15, 2013. Petitioner’s
objections are sustained and neither document is admitted or considered as substantive
evidence. The parties were advised by the Amended Acknowledgement and Prehearing
Order dated January 26, 2012, § II.12.i that they would be given an opportunity to present
a rebuttal case, but they must articulate why rebuttal should be allowed. Tr. 18. CMS
does not assert that CMS Ex. 23 is offered to rebut any evidence offered by Petitioner.
Rather, CMS Ex. 23 is offered by CMS in support of its position regarding the lighting
level during the incident that underlies the deficiency citations in this case. CMS Br. at 3
n. 1. Accordingly, CMS Ex. 23 is not proper rebuttal evidence and should have been
offered by CMS as evidence in its case-in-chief rather than after Petitioner’s case-in-
chief.’ CMS has failed to show good cause for why it should be permitted to reopen its
case for the admission of additional evidence. CMS has also failed to provide
foundational evidence necessary to establish the authenticity of CMS Ex. 23. CMS Ex.
24 is also not appropriate rebuttal evidence and CMS has failed to show good cause to
permit reopening its case-in-chief. CMS does not offer CMS Ex. 24 to rebut Petitioner’s
evidence. Rather, CMS Ex. 24 is offered by CMS as evidence in support of the CMS
position on the appropriate standard of practice and this exhibit should have been offered
as part of the CMS case-in-chief and not held for rebuttal. CMS Br. at 7.

IL. Discussion
A. Issues

Whether there is a basis for the imposition of an enforcement
remedy; and,

Whether the remedy imposed is reasonable.
B. Applicable Law
The statutory and regulatory requirements for participation of a SNF in Medicare are at
section 1819 of the Social Security Act (Act) and 42 C.F.R. pt. 483. Section 1819(h)(2)

of the Act authorizes the Secretary of Health and Human Services (Secretary) to impose
enforcement remedies against a SNF for failure to comply substantially with the federal

“ See generally, Kenneth S. Broun, 1 McCormick On Evid. § 4 (7th ed. 2013) and cases
cited therein. Tr. 841-44.
participation requirements established by sections 1819(b), (c), and (d) of the Act.? The
Act requires that the Secretary terminate the Medicare participation of any SNF that does
not return to substantial compliance with participation requirements within six months of
being found not to be in substantial compliance. Act § 1819(h)(2)(C). The Act also
requires that the Secretary deny payment of Medicare benefits for any beneficiary
admitted to a SNF, if the SNF fails to return to substantial compliance with program
participation requirements within three months of being found not to be in substantial
compliance — commonly referred to as the mandatory or statutory DPNA. Act §
1819(h)(2)(D). The Act grants the Secretary discretionary authority to terminate a
noncompliant SNF’s participation in Medicare, even if there has been less than 180 days
of noncompliance. The Act also grants the Secretary authority to impose other
enforcement remedies, including a discretionary DPNA, CMPs, appointment of
temporary management, and other remedies such as a directed plan of correction. Act
1819(h)(2)(B).

an

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. “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 causing minimal harm.” 42 C.F.R.

§ 488.301 (emphasis in original). A deficiency is a violation of a participation
requirement established by sections 1819(b), (c), and (d) of the Act or the Secretary’s
regulations at 42 C.F.R. pt. 483, subpt. B. Noncompliance refers to any deficiency that
causes a facility not to be in substantial compliance. 42 C.F.R. § 488.301. State survey
agencies survey facilities that participate in Medicare on behalf of CMS to determine
whether the facilities are complying 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. 42 C.F.R. § 488.406.

CMS is authorized to impose a CMP for the number of days of noncompliance — a per
day CMP - or for each instance of noncompliance —a PICMP. 42 C.F.R. § 488.430.
The regulations specify that a CMP that is imposed against a facility on a per day basis
will fall into one of two ranges of penalties. 42 C.F.R. §§ 488.408, 488.438. The upper
range of CMPs, $3,050 per day to $10,000 per day, is reserved for deficiencies that pose
immediate jeopardy to a facility’s residents and, in some circumstances, for repeated

> Participation of a NF in Medicaid is governed by section 1919 of the Act. Section
1919(h)(2) of the Act gives enforcement authority to the states to ensure that NFs comply
with their participation requirements established by sections 1919(b), (c), and (d) of the
Act. SNFs and NFs are referred to generally as “long-term care facilities.”
deficiencies. 42 C.F.R. § 488.438(a)(1)(i), (d)(2). “dmmediate jeopardy means a
situation in which the provider’s noncompliance with one or more requirements of
participation has caused, or is likely to cause, serious injury, harm, impairment, or death
to aresident.” 42 C.F.R. § 488.301 (emphasis in original). The lower range of CMPs,
$50 per day to $3,000 per day, is reserved for deficiencies that do not pose immediate
jeopardy, but either cause actual harm to residents, or cause no actual harm but have the
potential for causing more than minimal harm. 42 C.F.R. § 488.438(a)(1)(ii). The only
range for a PICMP is $1,000 to $10,000. 42 C.F.R. §§ 488.408, 488.438(a)(2).

Petitioner was notified that it was ineligible to conduct a NATCEP for two years.
Pursuant to sections 1819(b)(5) and 1919(b)(5) of the Act, SNFs and NFs may only use
nurse aides who have completed a training and competency evaluation program.
Pursuant to sections 1819(f)(2) and 1919(f)(2) of the Act, the Secretary was tasked to
develop requirements for approval of NATCEPs and the process for review of those
programs. Sections 1819(e) and 1919(e) of the Act impose upon the states the
requirement to specify what NATCEPs they will approve that meet the requirements that
the Secretary established and a process for reviewing and re-approving those programs
using criteria the Secretary set. The Secretary promulgated regulations at 42 C.F.R. pt.
483, subpt. D. Pursuant to 42 C.F.R. § 483.151(b)(2) and (f), a state may not approve
and must withdraw any prior approval of a NATCEP offered by a skilled nursing or
nursing facility that has been: (1) subject to an extended or partial extended survey under
sections 1819(g)(2)(B)(i) or 1919(g)(2)(B)(i) of the Act; (2) assessed a CMP of not less
than $5,000; or (3) subject to termination of its participation agreement, a DPNA, or the
appointment of temporary management. Extended and partial extended surveys are
triggered by a finding of “substandard quality of care” during a standard or abbreviated
standard survey and involve evaluating additional participation requirements.
“Substandard quality of care” is identified by the situation where surveyors identify one
or more deficiencies related to participation requirements established by 42 C.F.R.

§ 483.13 (Resident Behavior and Facility Practices), § 483.15 (Quality of Life), or

§ 483.25 (Quality of Care) that are found to constitute either immediate jeopardy, a
pattern of or widespread actual harm that does not amount to immediate jeopardy, or a
widespread potential for more than minimal harm that does not amount to immediate
jeopardy and there is no actual harm. 42 C.F.R. § 488.301.

The Act and regulations make a hearing before an ALJ available to a long-term care
facility against which CMS has determined to impose an enforcement remedy. Act

§§ 1128A(c)(2), 1866(h); 42 C.F.R. §§ 488.408(g), 498.3(b)(13). The hearing before an
ALJ is a de novo proceeding. 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, at 11 (2001); Anesthesiologists Affiliated,
DAB CR65 (1990), aff'd, 941 F.2d 678 (8th Cir. 1991). A facility has a right to appeal a
“certification of noncompliance leading to an enforcement remedy.” 42 C.F.R.

§§ 488.408(g)(1), 488.330(e), 498.3. However, the choice of remedies, or the factors

CMS considered when choosing remedies, are not subject to review. 42 C.F.R.

§ 488.408(g)(2). A facility may only challenge the scope and severity level of
noncompliance determined by CMS, if a successful challenge would affect the range of
the CMP that may be imposed or impact the facility’s authority to conduct a NATCEP.
42 C.F.R. § 498.3(b)(14), (d)(10)(i). The CMS determination as to the level of
noncompliance, including the finding of immediate jeopardy, “must be upheld unless it is
clearly erroneous.” 42 C.F.R. § 498.60(c)(2); Woodstock Care Ctr., DAB No. 1726, at 9,
39 (2000), aff'd, 363 F.3d 583 (6th Cir. 2003). The Departmental Appeals Board (Board)
has long held that the net effect of the regulations is that a provider has no right to
challenge the scope and severity level assigned to a noncompliance finding, except in the
situation where that finding was the basis for an immediate jeopardy determination. See,
e.g., Ridge Terrace, DAB No. 1834 (2002); Koester Pavilion, DAB No. 1750 (2000).
ALJ review of a CMP is subject to 42 C.F.R. § 488.438(e).

The hearing before an ALJ is a de novo proceeding, i.e., “a fresh look by a neutral
decision-maker at the legal and factual basis for the deficiency findings underlying the
remedies.” Life Care Ctr. of Bardstown, DAB No. 2479, at 33 (2012) (citation omitted).
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 Inn, DAB No. 1911 (2004); Batavia Nursing &
Convalescent Ctr., DAB No. 1904 (2004), aff'd, 129 F. App’x 181 (6th Cir. 2005);
Emerald Oaks, DAB No. 1800; Cross Creek Health Care Ctr., DAB No. 1665 (1998);
Hillman Rehab. Ctr., DAB No. 1611 (1997) (remand), DAB No. 1663 (1998) (afi.
remand), aff'd, Hillman Rehab. Ctr. v. United States, No. 98-3789 (GEB), 1999 WL
34813783 (D.N.J. May 13, 1999).

C. Findings of Fact, Conclusions of Law, and Analysis

My conclusions of law are set forth in numbered bold text and are followed by my
findings of fact and analysis. I have carefully considered all the evidence and the
arguments of both parties, although not all may be specifically discussed in this decision.
I discuss the credible evidence given the greatest weight in my decision-making.’ I also
discuss any evidence that I find is not credible or worthy of weight. The fact that

* “Credible evidence” is evidence that is worthy of belief. Black's Law Dictionary 596
(18th ed. 2004). The “weight of evidence” is the persuasiveness of some evidence
compared to other evidence. Id. at 1625.
evidence is not specifically discussed should not be considered sufficient to rebut the
presumption that I considered all the evidence and assigned such weight or probative
value to the credible evidence that I determined appropriate within my discretion as an
ALJ. There is no requirement for me to discuss the weight given every piece of evidence
considered in this case, nor would it be consistent with notions of judicial economy to do
so.

CMS alleges, based upon a complaint survey that ended November 9, 2011, that
Petitioner was not in substantial compliance with program participation requirements
from September 23, 2011 through November 14, 2011 and that the noncompliance posed
immediate jeopardy for the entire period of 53 days. CMS alleges that violations of 42
C.F.R. §§ 483.20(d) and 483.20(k)(1) (Tag F279); 483.20(k)(3)(i) (Tag F281); 483.25(h)
(Tag F323); and 483.75 (Tag F490) posed immediate jeopardy (scope and severity of K)
to one or more of Petitioner’s residents. CMS also alleges that a violation of 42 C.F.R.

§ 483.70(h) (Tag F465) posed a risk for more than minimal harm (scope and severity E)
to Petitioner’s residents. CMS Prehearing Brief at 5-10; CMS Br. at 1, 5-20; Tr. 108-13.
The parties stipulated that the complaint survey was triggered by the report that Resident
3 fell on September 23, 2011. Joint Stipulation of Undisputed Facts (Jt. Stip.) § 3. The
parties also stipulated that a revisit survey determined that Petitioner returned to
substantial compliance effective November 15, 2011. Jt. Stip. 4; CMS Exs. 3, 21. The
DPNA and termination remedies were cancelled because Petitioner returned to
substantial compliance before the effective date of those remedies. CMS Exs. 3, 21. The
only remedy at issue before me is the proposed CMP of $6,050 per day from September
23, 2011 through November 14, 2011, a period of 53 days, resulting in a total CMP of
$320,650. Jt. Stip. | 5.° Whether or not Petitioner was ineligible to conduct a NATCEP,
while not an enforcement remedy, is also affected by the decision in this case.

1. Petitioner suffered no prejudice because the oral hearing was
conducted by VTC and telephone and Petitioner was not denied due
process.

On October 25, 2012, I advised the parties that on October 24, 2012, the ALJs of the
Civil Remedies Division were advised by the Chair of the Board that: there was no

> The parties’ stipulation states that the CMP continued through November 15, 2011.
However, because CMS found that Petitioner regained substantial compliance effective
November 15, 2011, CMS could not impose a CMP for that day. The parties correctly
state that the CMP was imposed for 53 days, which would be September 23, 2011
through November 14, 2011. Thus, I conclude the parties intended by their stipulation to
state that the daily CMP continued to, not through November 15, 2011.
longer money for ALJs to travel to hearings; budgetary constraints were expected to
continue through March 2013 and it was not foreseeable that there would be relief from
budget constraints at that time; and that the hearing in this case would need to be
conducted by VTC or not at all. Petitioner filed a motion and objection protesting my
participation in the hearing of this case by VTC. On November 9, 2012, I advised the
parties that I would receive oral argument and rule on the motion and objection the first
day of hearing on November 14, 2012.

On November 14, 2012, I overruled Petitioner’s objection to my conducting the hearing
by VTC. Lalso denied Petitioner’s motion that I be present in the same hearing room
with the parties and witnesses for the hearing. In post hearing briefing, Petitioner
renewed its objection to my participation in the hearing by VTC. Petitioner argues that:
(1) the use of VTC is not authorized by the Administrative Procedure Act (APA) (5
U.S.C. §§ 551-559), the Act, or the regulations; (2) CMS’s failure to provide Petitioner
an “in-person” hearing violates Petitioner’s right to due process; and (3) the appropriate
remedy for the due process violation is to disapprove the CMP and abate the proceedings.
P. Br. at 3-12.

Based upon my review of the record, including the transcript, and consideration of
Petitioner’s pleadings, I conclude that Petitioner suffered no prejudice and was not denied
a meaningful opportunity to present its case. My rationale is unchanged from that stated
in detail in the transcript of the proceedings. Tr. 50-76. There are two principal bases for
my rulings. First, the Administrative Procedures Act (APA), 5 U.S.C. §§ 554, 555, 556,
and 557, and sections 205(b) and 1866(h) of the Act do not require that an oral
evidentiary hearing be conducted with all participants in the same hearing room or
prohibit the participation of the judge by VTC. Second, I concluded based on application
of the principles articulated by the Supreme Court in Mathews v. Eldridge, 424 U.S. 319,
334-35 (1976),° that Petitioner was not deprived of due process and suffered no prejudice

° The Supreme Court addressed in Mathews v. Eldridge whether or not an evidentiary
hearing was required prior to termination of disability benefits rather than post-
termination. The Court decided no evidentiary hearing was required prior to termination.
The Court did not describe in any detail how an evidentiary hearing must be conducted.
Nevertheless, the principles articulated by the Court are helpful to determine whether or
not the appearance of the judge by VTC amounts to a deprivation of due process. The
application of the principles from Mathews v. Eldridge should not be considered to reflect
a determination that Petitioner has any property interest in continued participation in
Medicare and the receipt of reimbursement from Medicare. However, Petitioner
certainly has a property interest in the CMP that CMS seeks to collect. Mathews v.
Eldridge, at 332-33 (“Procedural due process imposes constraints on governmental
decisions which deprive individuals of “liberty” or “property” interests within the
(Footnote continued next page.)

simply because I was not physically present in the hearing room with the parties, counsel,
and the witnesses, but instead participated by VTC. Petitioner received the process due
under the APA, the Act, and the regulations, i.e., a hearing on the record, with
representation, an opportunity to present oral and documentary evidence, and to cross-
examine witnesses. The fact that I heard the oral evidence and observed the witnesses via
VTC, rather than in person, did not deprive Petitioner of any of the process due.’

2. Petitioner violated 42 C.F.R. §§ 483.20(d) and 483.20(k)(1).

3. Petitioner’s violation of 42 C.F.R. §§ 483.20(d) and 483.20(k)(1)
posed a risk for more than minimal harm.

4. Petitioner violated 42 C.F.R. § 483.20(k)(3)(i).

5. Petitioner’s violation of 42 C.F.R. § 483.20(k)(3)(i) posed a risk for
more than minimal harm.

6. Petitioner violated 42 C.F.R. § 483.25(h).

7. Petitioner’s violation of 42 C.F.R. § 483.25(h) posed a risk for more
than minimal harm.

(Footnote continued) —

meaning of the Due Process Clause of the Fifth or Fourteenth Amendment.” “Court
consistently has held that some form of hearing is required before an individual is finally
deprived of a property interest.”’)

7 The technical difficulties associated with conducting a proceeding by VTC, which are
apparent on the transcript, make the job of the judge and counsel more difficult than
when all parties are physically present in the same courtroom. However, the
professionalism of counsel and their cooperation with the judge ensured that Petitioner
had a full and fair hearing, despite some interruptions and delays. It is not possible to
determine whether or not the discomfort experienced by the witnesses was the same, less,
or greater, than that of inexperienced witnesses in any other hearing. However, whatever
discomfort the witnesses experienced in this case had no perceptible impact upon their
credibility or their ability to recall the matters to which they testified. Petitioner elected
to elicit the testimony of its expert by telephone rather than VTC and any objection on
that basis is waived. Tr. 522-27.
10

a. Facts

The complaint survey in this case was triggered by a report that Resident 3 fell and
suffered injuries in a facility shower room on September 23, 2011. It is not disputed that
Resident 3, who was 77 at the time, fell forward and out of her shower chair striking her
head on the shower room floor while a CNA was assisting her with showering. Jt. Stip. §
3; CMS Ex. 15 at 7; CMS Ex. 17; Tr. 1 13-14. Resident 3 was evaluated and admitted to
the hospital for observation on September 23, 2011, with a subarachnoid bleed and a
laceration to the left forehead and frontal area that required suturing. CMS Ex. 15 at 17-
18.

The evidence offered by CMS related to Resident 3 appears to have mostly been
collected by the surveyors from Petitioner’s clinical file for Resident 3.° CMS Ex. 15.
Petitioner offered some evidence related to Resident 3, also apparently from its clinical
record, and that evidence is not inconsistent with the evidence offered by CMS. The
evidence shows that Resident 3 was 76 when admitted to Petitioner on August 6, 2010,
with a medical history that included: a seizure disorder, spinal stenosis, weakness,
impaired balance, meningioma that required a craniotomy, hypothyroidism, hypertension,
dementia, anemia, rheumatoid arthritis, and chronic paralysis of her right arm and leg.
Resident 3 or her representative elected at admission that that her records be annotated as
DNR (do not resuscitate). CMS Exs. 10 at 6-9; 15 at 4, 6-8, 17, 20-21, 24.

There is no dispute that Resident 3 was at risk for falling.'° Petitioner assessed Resident
3 asa fall risk based on her history of falls; her medical, cognitive, and musculoskeletal

® There is no dispute that Resident 3 subsequently died, but the parties agree that her
death has no relevance to the issues before me. Tr. 114-15.

° CMS placed in evidence 107 pages of hospital records related to Resident 3’s May 2,
201 1fall. CMS Ex. 10. It is not possible to determine from the face of these records
whether they were taken from Petitioner’s clinical records for Resident 3 or obtained
directly from the hospital. The records are of minimal relevance.

'° The assessment that Resident 3 was a risk for falls was confirmed when on May 2,
2011, Resident 3 suffered an un-witnessed fall in her room, sustaining a contusion and
requiring hospitalization. CMS Exs. 10 at 6, 8-9, 89-90; 15 at 44. The hospital
admission summary dated May 2, 2011 indicates that Resident 3 was in a postictal state
on arrival, causing the physician to believe that the resident’s un-witnessed fall was likely
due to a seizure. She required no treatment for the fall. CMS Ex. 15 at 20-21. The
hospital discharge summary lists a final diagnosis of probable seizure and possible
cerebrovascular accident. CMS Ex. 10 at 6.
11

conditions; and the medications she was taking. Multiple interventions were care
planned to address her fall risk. CMS Ex. 15 at 24. Resident 3 was bed and wheelchair
bound. CMS Ex. 15 at 20. Resident 3 required extensive assistance for bed mobility and
was dependent on staff for wheelchair propulsion off the unit, although she could
independently propel her wheelchair on the unit. She required a one-person assist for her
wheelchair and two-person assistance for transfers using a sit-to-stand mechanical (Sara)
lift. Resident 3 was also assessed to have a swallowing problem that could result in
aspiration. P. Ex. 9; CMS Ex. 15 at 28, 30, 32, 34; Tr. 547. Prior to October 4, 2011,
Resident 3 was assessed and care planned as requiring the assistance of one staff member
for a bed bath or shower. P. Ex. 9 at 1.

Resident 3’s risk for falling forward from her wheelchair due to her difficulty
maintaining upper body positioning caused her physician to issue an order for a restraint
to prevent such a fall. On September 6 and 8, 2011, Resident 3’s physician ordered that a
lap tray be used on Resident 3’s wheelchair when she was out-of-bed to help maintain a
proper upper-body position. The physician ordered that the lap tray could be released
when the resident had one-on-one supervision during meals, activities of daily living
(ADLs), and activities. The order was issued based on the recommendation of
occupational therapy. Petitioner’s staff considered the use of the lap tray to be a restraint
because the resident could not remove it on her own or on demand. CMS Ex. 15 at 22-
23, 44; P. Ex. 10 at 17-18. The lap tray intervention and physician directions were added
to Resident 3’s care plan. P. Ex. 9 at 2. There is no evidence that Resident 3’s care plan
for bathing or showering was reevaluated or modified due to her assessed difficulty
maintaining upper-body position.

There is no dispute about what happened to Resident 3 in the shower room September 23,
2011. At approximately 8:30 p.m., CNA Dyer took Resident 3 to the shower room to
give her a shower. The shower room had a left side and a right side with a toilet room
between that connected to the two shower rooms by doorways. Each shower room had
its own window. The floors of the shower rooms were tiled with small, grouted, tiles.
According to RN Blier, the floor design was intended to minimize the risk for slipping.
CNA Dyer placed Resident 3 in the shower room on the left. P. Exs. 5, 6: Tr. 129, 589-
92, 809-10. Petitioner’s clinical record reflects that while receiving her shower, Resident
3 began to lean forward; CNA Dyer attempted to stop her but CNA Dyer slipped and fell;
and then Resident 3 fell forward and hit her head on the floor resulting in the laceration to
the left forehead and frontal area that required suturing and a subarachnoid bleed. CMS
Ex. 15 at 17-18, 38, 44; P. Ex. 11.

The parties’ witnesses agreed that shower rooms pose an increased risk for slips and falls.
Tr. 182, 227-29, 497, 514-15, 579-80, 809. Petitioner’s witnesses testified that it was
facility practice to shower residents using a shower chair with one-on-one supervision,
unless the resident suffered contractures, in which case they used a shower bed, or, in the
rare circumstance, when the resident was assessed as capable to safely stand to shower.
12

It was also a facility practice, and a standard of practice, that residents were not left in the
shower room by themselves. Tr. 554-57, 578-82, 733, 735-36, 743-44, 781.!! It was also
facility policy and a standard of practice that non-slip or non-skid shoes were to be worn
by staff, particularly in the shower room. But the evidence does not show that Petitioner
had a policy or that there was a standard of practice that required the use of a particular
type of non-slip or non-skid shoe or the shoe of a particular vendor. Petitioner did
provide non-slip foot wear for staff, referred to by witnesses as “Shoes for Crews”,” but
the evidence does not show that staff was not permitted to wear non-slip footwear from a
ifferent vendor. Tr. 123-25, 223-24, 273-75, 514-15.

b. Analysis

The surveyors alleged a violation of 42 C.F.R. §§ 483.20(d) and 483.20(k)(1) (Tag F279)
because “the facility failed to develop a plan of care related to the level of assistance
needed with showers.” CMS Ex. | at 2. The surveyors relied primarily upon the
example of Resident 3, but also referred to other specific residents as examples. The
surveyors alleged that “[t]he lack of a comprehensive care plan put the residents at risk
for harm, injury or death resulting from accidents while in the shower.” The surveyors
also alleged that the violation posed immediate jeopardy, i.e., the violation caused or was
likely to cause serious injury, harm, impairment, or death to a resident. CMS Ex. | at 2.

The surveyors alleged a violation of 42 C.F.R. § 483.20(k)(3)(i) (Tag F281) because
Petitioner’s failure to care plan resident needs for safe showers allowed or required that
unlicensed staff make decisions regarding interventions necessary to safely shower
residents in violation of the Florida “Nurse Practice Act” (Fla. Stat. §§ 464.001-.027).
CMS Ex. | at 8-9. The parties do not dispute application of the Florida Nurse Practice
Act and its requirement that the assessment of residents and care planning for their needs

"| The style of shower chair being used to shower Resident 3 when she fell was the
subject of considerable interest for the surveyors and the parties at hearing. CNA Dyer
allegedly told the surveyors that he typically used a shower chair with a bar because
Resident 3 tended to lean forward, but he could not locate that chair and was using a chair
with no bar at the time of the fall. Tr. 153-54. The parties believe that the chair to which
CNA Dyer referred was similar to that depicted in CMS Ex. 22 at 1. Petitioner
characterized the bar on the shower chair as a place where residents could rest their
hands. Petitioner objects to characterization of the bar as a safety feature of the shower
chair. CMS considers the bar to be a safety device. The evidence is not sufficient to
determine the purpose of the bar depicted on the shower chair in CMS Ex. 22 at 1. Tr.
127-28, 144-49. Furthermore, there appears to be no disagreement among the parties
that there is no standard of practice or other requirement to use a shower chair with a bar.
Tr. 254, 512-14.

13

be performed by licensed professional nurses. Tr. 708, 820. The surveyors cited the
example of Resident 3 and examples of multiple other specific residents. The surveyors
also alleged that this violation posed immediate jeopardy to the residents. CMS Ex. | at
8.

The surveyors also alleged a violation of 42 C.F.R. § 483.25(h) (Tag F323) because
Petitioner failed to provide necessary care and services, specifically supervision and
assistive devices, necessary to minimize or prevent the risk for harm to residents due to
accidents in the shower. The surveyors cited the example of Resident 3 and multiple
other residents. The surveyors also alleged that the violation posed immediate jeopardy.
CMS Ex. | at 12-13.

Theresa DeCanio, RN, the state agency field office manager who had oversight
responsibility for the survey before me, agreed that the focus of these deficiency citations
was the failure to assess and care plan for the safety needs of residents when using the
shower. Tr. 509-10.

I conclude that there were deficiencies under Tags F279, F281, and F323. I conclude that
the declaration of immediate jeopardy related to those deficiencies has not been shown to
be clearly erroneous. I conclude that enforcement remedies proposed by CMS are
reasonable for the deficiencies under Tags F279, F281, and F323. In light of the
foregoing conclusions, I also conclude that it is unnecessary to consider the alleged
deficiencies under Tags F465 and F490.

The analysis of the deficiencies under Tags F279, F281, and F323, must begin with a
review and understanding of the regulatory scheme. The regulations that require
assessment and care planning are 42 C.F.R. § 483.20(d) and (k)(1). The regulation that
requires interventions to prevent accidents is 42 C.F.R. § 483.25(h). A facility “must
conduct initially and periodically a comprehensive, accurate, standardized, and
reproducible assessment of each resident’s functional capacity.” 42 C.F.R. § 483.20.
The regulation requires that assessments be conducted or coordinated by an RN with the
appropriate participation of other health professionals. 42 C.F.R. § 483.20(h). Pursuant
to 42 C.F.R. § 483.20(d), the facility must “use the results of the assessments to develop,
review, and revise the resident’s comprehensive plan of care.” Pursuant to 42 C.F.R.

§ 483.20(k)(1), the “facility must develop a comprehensive care plan for each resident
that includes measurable objectives and timetables to meet a resident’s medical, nursing,
and mental and psychosocial needs that are identified in the comprehensive assessment.”
The comprehensive care plan must be prepared by an interdisciplinary team (IDT) that
includes the attending physician, the RN responsible for the resident, and other
appropriate staff in disciplines necessary to meet the resident’s needs. 42 C.F.R.

§ 483.20(k)(2)(1i). The services provided or arranged by the facility must meet
professional standards of quality and must be provided by qualified persons in
accordance with the written plan of care. 42 C.F.R. § 483.20(k)(3). The comprehensive
14

care plan must describe the services that are to be furnished to assist the resident to attain
or maintain his or her highest practicable physical, mental, and psychosocial well-being
as required by 42 C.F.R. § 483.25. 42 C.F.R. § 483.20(k)(1)(i). Section 483.25 of 42
C.F.R. requires that Petitioner provide and ensure its residents receive the care and
services necessary for the residents to attain their “highest practicable physical, mental,
and psychosocial well-being, in accordance with the comprehensive assessment and plan
of care.” Petitioner is required to ensure that: (1) “[t]he resident environment remains as
free of accident hazards as possible;” and (2) “[e]ach resident receives adequate
supervision and assistance devices to prevent accidents.” 42 C.F.R. § 483.25(h).

Appellate panels of the Board have addressed the care planning requirements in several
cases.

The Board has explained that a comprehensive care plan
“functions as a roadmap for all of the resident’s caregivers,
including those unfamiliar with a resident or without
professional training, to provide consistent care and services
tailored to ‘attain or maintain the [resident’s] highest
practicable physical, mental and psychosocial well-being.’”
Sheridan Health Care Ctr., DAB No. 2178, at 37 (2008),
quoting 42 C.F.R. § 483.20(k). “Accordingly, the care plan
must include sufficient guidance to ensure that the services
provided promote the plan’s specified objectives.” Id.

Deltona Health Care, DAB No. 2511, at 18 (2013) (concluding that a care plan that
required monitoring but did not specify who was to monitor, how often monitoring was
to occur, or how the monitoring was to be done, did not provide staff adequate guidance
to ensure a resident received required care); Brithaven of Havelock, DAB No. 2078, at
12-14 (2007) (physician order insufficient as a care plan).

Regarding 42 C.F.R. § 483.25(h), CMS instructs its surveyors that the intent of the
regulation is “to ensure the facility provides an environment that is free from accident
hazards over which the facility has control and provides supervision and assistive devices
to each resident to prevent avoidable accidents.” The facility is expected to: identify,
evaluate, and analyze hazards and risks; implement interventions to reduce hazards and
risks; and monitor the effectiveness of interventions and modify them when necessary.
State Operations Manual (SOM), CMS Pub. 100-07, app. PP, Guidance to Surveyors
Long Term Care Facilities, F323 (Rev. 27; eff. Aug. 17, 2007). The CMS interpretation
is consistent with a long-line of Board decisions.

The Board has provided interpretative guidance for adjudicating alleged violations of 42
CFR. § 483.25(h)(1):
15

The standard in section 483.25(h)(1) itself - that a facility
“ensure that the environment is as free of accident hazards as
possible” in order to meet the quality of care goal in section
483.25 -- places a continuum of affirmative duties on a
facility. A facility must determine whether any condition
exists in the environment that could endanger a resident's
safety. If so, the facility must remove that condition if
possible, and, when not possible, it must take action to protect
residents from the danger posed by that condition. [Footnote
omitted.] Ifa facility has identified and planned for a hazard
and then failed to follow its own plan, that may be sufficient
to show a lack of compliance with [the] regulatory
requirement. In other cases, an ALJ may need to consider the
actions the facility took to identify, remove, or protect
residents from the hazard. Where a facility alleges (or shows)
that it did not know that a hazard existed, the facility cannot
prevail if it could have reasonably foreseen that an
endangering condition existed either generally or for a
particular resident or residents.

Maine Veterans’ Home — Scarborough, DAB No. 1975, at 6-7 (2005).

The Board has also explained the requirements of 42 C.F.R. § 483.25(h)(2) in numerous
decisions. Golden Living Ctr. — Riverchase, DAB No. 2314, at 7-8 (2010); Eastwood
Convalescent Ctr., DAB No. 2088 (2007); Century Care of Crystal Coast, DAB No.
2076 (2007), aff'd, 281 F. App’x 180 (4th Cir. 2008); Liberty Commons Nursing and
Rehab. - Alamance, DAB No. 2070 (2007); Golden Age Skilled Nursing & Rehab. Ctr.,
DAB No. 2026 (2006); Estes Nursing Facility Civic Ctr., DAB No. 2000 (2005);
Northeastern Ohio Alzheimer’s Research Ctr., DAB No. 1935 (2004); Woodstock Care
Ctr., DAB No. 1726 (2000), aff'd, Woodstock Care Ctr. v. Thompson, 363 F.3d 583 (6th
Cir. 2003). The regulation does not make a facility strictly liable for accidents that occur,
but it does require that a facility take all reasonable steps to ensure that a resident receives
supervision and assistance devices that meet his or her assessed needs and mitigates
foreseeable risks of harm from accidents. Woodstock Care Ctr. v. Thompson, 363 F.3d at
589 (noting a SNF must take “all reasonable precautions against residents’ accidents”).

A facility is permitted the flexibility to choose the methods of supervision it uses to
prevent accidents, but the chosen methods must be adequate under the circumstances.
Whether supervision is “adequate” depends in part upon a resident’s ability to protect
him or herself from harm. /d. Based on the regulation and the cases in this area, CMS
meets its burden to show a prima facie case, if the evidence demonstrates that the facility
failed to provide adequate supervision and assistance devices to prevent accidents, given
what was reasonably foreseeable. Alden Town Manor Rehab. & HCC, DAB No. 2054, at
5-6, 7-12 (2006). An “accident” is an unexpected, unintended incident which may result
16

in injury or illness to a resident. It does not include adverse outcomes that are a direct
consequence of treatment or care provided in accordance with current standards of
practice (e.g., drug side effects or reactions). SOM, app. PP, Tag F323; Woodstock Care
Ctr., DAB No. 1726, at 4.

The regulation speaks in terms of ensuring that what is
“practicable” and “possible” to do is done. What is thus
required of facilities is not prescience but reason and
professional judgment in assessing what can be done to make
residents (given their special needs) safe, through removing
accident hazards, providing appropriate devices, and ensuring
adequate supervision.

Glenoaks Nursing Ctr., DAB No. 2522, at 8 (2013) citing Josephine Sunset Home, DAB
No. 1908, at 14-15 (2004); Briarwood Nursing Ctr., DAB No. 2115, at 11-12 (2007).

Applying the well-established law to the facts of this case reveals that Petitioner’s errors
and omissions are manifold.

The evidence shows that Resident 3’s IDT did care plan for her to receive a shower.
Evidence of that care planning is found on the Maintenance ADL & Safety Care Plan &
Communication Tool (referred to by the witnesses as the KARDEX). P. Ex. 9 at 1. The
care plan reflected on that KARDEX specified that Resident 3 required the assistance of
one to receive a bed bath or a shower. The KARDEX does not reflect when that care
plan was devised, but it shows that Resident 3 was admitted to Petitioner on August 6,
2010 and the KARDEX was last reviewed and updated on November 15, 2010, with the
next review scheduled for February 14, 2011. P. Ex. 9 at 1. Petitioner submitted a
second KARDEX (P. Ex. 9 at 2) which shows a change in interventions on October 4,
2011, but that change was after Resident 3’s fall on September 23, 2011 and, therefore, it
is not the focus of my analysis. Resident 3’s “Individualized Care Plan for Fall/Fall
Risk” does not specifically address interventions for the shower. CMS Ex. 15 at 24.

Petitioner does not deny that Resident 3 was assessed by occupational therapy as at risk
for falling forward from her wheelchair due to her difficulty maintaining upper body
positioning. CMS Ex. 15 at 44; P. Ex. 14 at 18; P. Br. at 14; P. Reply at 4. The
assessment caused Resident 3’s physician to issue orders on September 6 and 8, 2011, for
a lap tray to be used on Resident 3’s wheelchair when she was out-of-bed to help
maintain a proper upper-body position. The physician ordered that the lap tray could be
released when the resident had one-on-one supervision during meals, ADLs, and
activities. Petitioner’s staff evaluated the use of the lap tray and determined that it was a

17

restraint because the resident could not remove it on her own or on demand. CMS Ex. 15
at 22-23, 44; P. Ex. 10 at 17-18. The lap tray intervention and physician directions were
added to Resident 3’s KARDEX on September 8, 2011.’? P. Ex. 9 at 2.

There is no question that the evidence shows that staff used a shower chair to shower
Resident 3, which also required Resident 3 to sit upright. I infer, based on the fact that
Resident 3 was at risk to lean forward when sitting upright in a wheelchair, that she was
also at risk to lean forward when sitting upright in a shower chair. The shower chairs
depicted in CMS Ex. 22 at 1 and P. Ex. 5 appear to be less substantial and less stable than
the common wheelchair. Furthermore, the parties’ witnesses agreed that shower rooms
pose an increased risk for slips and falls. Tr. 182, 227-29, 497, 514-15, 579-80, 809.
However, Petitioner offers no evidence that Resident 3’s IDT ever considered those
safety risks for Resident 3.

Petitioner urges me to accept that the physician’s order adequately addresses the risk to
Resident 3 when sitting in a shower chair because he ordered that the lap tray could be
removed from the wheelchair when the resident was involved in ADLs, so long as she
ad one-on-one supervision. P. Reply at 5. However, Petitioner’s argument is
unsupported by any evidence that the physician considered the resident’s needs for safety
while sitting in a shower chair. The evidence shows that Resident 3’s physician only
addressed her sitting in a wheelchair. There is no evidence that occupational therapy or
the physician ever assessed whether Resident 3 was adequately protected from the risk
for accidental injury due to leaning forward while receiving a shower in a shower chair
with only one-on-one supervision. There is no evidence that Resident 3’s care plan for
bathing or showering was reevaluated or modified due to her assessed difficulty
maintaining upper-body position. CMS Ex. 15 at 25-27.

There is also no evidence that the IDT ever considered Resident 3’s risk for accidental
injury due to leaning forward while seated in a shower chair with no lap tray or
equivalent support or restraint, while receiving a shower with only one-on-one
supervision. The evidence shows that Petitioner had a policy that required staff to wear
non-slip footwear. Tr. 557, 608, 779; P. Br. at 23; P. Reply at 5-6. The evidence also
shows that Petitioner had a policy that required at least one-on-one supervision for a
resident using a shower. Tr. 579-80; P. Br. at 14, 18; P. Reply at 9. While Petitioner’s
policies may be excellent safety interventions to be generally applied for all residents,
Petitioner cites no authority for the proposition that such general policies adequately
substitute for the individualized care planning required by the regulations. Furthermore,
because the IDT did not assess and care plan to address Resident 3’s tendency to lean

The order for the lap tray is not listed on the copy of Resident 3’s “Individualized Care
Plan for Fall/Fall Risk” that is in evidence at CMS Ex. 15 at 24.
18

forward when sitting upright in a shower chair and the associated risk, unlicensed staff
who were not authorized under Florida law to assess and care plan were left to determine
ow to address the risk that Resident 3 might fall forward from the shower chair and
suffer accidental injury. There is also no evidence that, as required by 42 C.F.R. §
483.20(h), an RN coordinated the assessment and interventions adopted and implemented
by the unlicensed staff. Accordingly, Petitioner’s care planning for Resident 3 and the
development of interventions to meet Resident 3’s safety needs did not meet professional
standards.

In summary, Resident 3 had an assessed problem, in that she was unable to maintain her
body position and tended to lean forward when sitting upright. Resident 3’s physician
adopted the intervention that, when Resident 3 was sitting upright in her wheelchair, a lap
tray was to be used to help her maintain her position, except for specified activities
during which one-on-one supervision was required. There is agreement among the
parties that there is an increased safety risk for residents when using a shower room.
However, there is no evidence that either the physician or the IDT specifically assessed
ow Resident 3’s assessed problem impacted her safety while sitting upright in a shower
chair while receiving a shower. There is no evidence that either the physician or the IDT
specifically developed or implemented interventions to address any assessed safety risk
associated with Resident 3 sitting upright in a shower chair while receiving a shower

from a staff member. Because no assessment or care planning was done by the IDT,
unlicensed staff was left to determine how best to handle Resident 3 if she leaned forward
while sitting upright in a shower chair. Accordingly, I conclude that Petitioner failed to
assess and care plan for the accident hazard that the shower room represented for
Resident 3 given her assessed tendency to lean forward when sitting upright. Petitioner’s
delivery of care and services, therefore, failed to meet professional standards as required
by state and federal law.

I conclude that the regulatory violation posed a risk for more than minimal harm. There
is no dispute that showers pose an increased risk for slips and falls. Tr. 182, 227-29, 497,
514-15, 579-80, 809. There is no question that a fall may cause more than minimal harm
to a resident of a long-term care facility, as evidenced by the fact that Resident 3 suffered
actual harm due to her fall in the shower room on September 23, 2011.

8. Petitioner has failed to show that the declaration of immediate
jeopardy based on the violations of 42 C.F.R. §§ 483.20(d) and
483.20(k)(1); 483.20(k)(3)(i); and 483.25(h), was clearly erroneous.

The surveyors concluded that the violations of 42 C.F.R. §§ 483.20(d) and 483.20(k)(1);
483.20(k)(3)(i); and 483.25(h), posed immediate jeopardy that began when Resident 3
fell on September 23, 2011. CMS Ex. 1 at 1. CMS concluded that Petitioner abated
immediate jeopardy and returned to substantial compliance with program participation
requirements on November 15, 2011. CMS Ex. 21. CMS proposes to impose a CMP in
19

the higher range of CMPs that may be imposed for immediate jeopardy for the entire 53-
day period from September 23 through November 14, 2011, and that is the period of
immediate jeopardy at issue before me.

The CMS determination of immediate jeopardy must be upheld, unless Petitioner shows
the declaration of immediate jeopardy to be clearly erroneous. 42 C.F.R. § 498.60(c)(2).
CMS’s determination of immediate jeopardy is presumed to be correct, and Petitioner has
a heavy burden to demonstrate clear error in that determination. Yakima Valley Sch.,
DAB No. 2422, at 8-9 (2011); Cal Turner Extended Care Pavilion, DAB No. 2384, at 14
(2011); Brian Ctr. Health and Rehab./Goldsboro, DAB No. 2336, at 9 (2010) (citing
Barbourville Nursing Home, DAB No. 1962, at 11 (2005)), aff'd, Barbourville Nursing
Home v. U.S. Dep’t of Health & Human Srvs.,174 F. App’x 932 (6th Cir. 2006);
Maysville Nursing and Rehab. Facility, DAB No. 2317, at 11 (2010); Liberty Commons
Nursing and Rehab. Ctr— Johnston, DAB No. 2031, at 18-19 (2006), aff'd, Liberty
Commons Nursing & Rehab. Ctr.—Johnson v. Leavitt, 241 F. App’x 76 (4th Cir. 2007).
Once CMS presents evidence supporting a finding of noncompliance, CMS does not need
to offer evidence to support its determination that the noncompliance constitutes
immediate jeopardy, rather, the burden is on the facility to show that that determination is
clearly erroneous. Cal Turner Extended Care Pavilion, DAB No. 2384, at 14-15; Liberty
Commons Nursing & Rehab. Ctr.—Johnston, 241 F. App’x 76 at 3-4.

“Immediate jeopardy” under the regulations refers to 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,
489.3 (emphasis in original). In the context of survey, certification, and enforcement
related to SNFs and NFs under the regulations, a conclusion by the state agency and CMS
that noncompliance with program participation requirements poses immediate jeopardy
to facility residents triggers specific regulatory provisions that require enhanced
enforcement remedies, including authority for CMS to impose a larger CMP than may be
imposed when there is no declaration of immediate jeopardy. 42 C.F.R. §§ 488.408(e),
488.438(a)(1)(i), (c), and (d). The regulations also require termination of the facility’s
provider agreement on an expedited basis or the removal of the immediate jeopardy
through appointment of temporary management. 42 C.F.R. §§ 488.410, 488.440(g),
488.456, 489.53(d)(2)(B)(ii).

Pursuant to 42 C.F.R. § 498.3(d)(10), a finding by CMS that deficiencies pose immediate
jeopardy to the health or safety of a facility’s residents is not an initial determination that
triggers a right to request a hearing by an ALJ or that is subject to review. Rather, a
finding of noncompliance that results in the imposition of an enforcement remedy, except
the remedy of monitoring by the state, does trigger a right to request a hearing and is
subject to review. 42 C.F.R. §§ 488.408(g); 498.3(b)(8) and (13). Furthermore, the level
of noncompliance, i.e. the scope and severity, is subject to review only if a successful
challenge would: (1) affect the amount of CMP that may be imposed, i.e. the higher
20

range of CMP authorized for immediate jeopardy; or (2) affect a finding of substandard
quality of care that rendered the facility ineligible to conduct a NATCEP. 42 C.F.R.

§ 498.3(b)(14) and (16). Pursuant to 42 C.F.R. § 498.60(c)(2), in reviewing a CMP, the
ALJ must uphold the CMS determination of the level of noncompliance (i.e., the scope
and severity), unless it is clearly erroneous. The phrase “clearly erroneous” is not defined
by the Secretary.

Many appellate panels of the Board have addressed “immediate jeopardy.”'? In
Mississippi Care Ctr. of Greenville, DAB No. 2450, at 15 (2012), the Board commented:

CMS’s determination that a deficiency constitutes immediate
jeopardy must be upheld unless the facility is able to prove
that the determination is clearly erroneous. 42 C.F.R. §
498.60(c)(2); Woodstock Care Center. The “clearly
erroneous” standard means that CMS’s immediate jeopardy
determination is presumed to be correct, and the burden of
proving the determination clearly erroneous is a heavy one.
See, e.g., Maysville Nursing & Rehabilitation Facility, DAB
No. 2317 at 11 (2010); Liberty Commons Nursing and Rehab
Center — Johnston, DAB No. 203,1 at 18 (2006), aff'd,
Liberty Commons Nursing and Rehab Ctr. — Johnston v.
Leavitt, 241 F. App’x 76 (4th Cir. 2007). When CMS issued
the nursing facility survey, certification, and enforcement
regulations, it acknowledged that “distinctions between
different levels of noncompliance . . . do not represent
mathematical judgments for which there are clear or
objectively measured boundaries.” 59 Fed. Reg. 56,116,
56,179 (Nov. 10, 1994). “This inherent imprecision is
precisely why CMS’s immediate jeopardy determination, a
matter of professional judgment and expertise, is entitled to
deference.” Daughters of Miriam Center, DAB No. 2067, at
15 (2007).

3 Decisions often cited include: Lakeport Skilled Nursing Ctr., DAB No. 2435, at 6
(2012); Liberty Health & Rehab. of Indianola, LLC, DAB No. 2434, at 13, 18-19 (2011);
Yakima Valley Sch., DAB No. 2422, at 8; Lutheran Home at Trinity Oaks, DAB No.
2111 (2007); Daughters of Miriam Ctr., DAB No. 2067; Britthaven of Havelock, DAB
No. 2078 (2007); Koester Pavilion, DAB No. 1750; Woodstock Care Ctr., DAB No.
1726.
21

The Board’s statement that the CMS immediate jeopardy determination is entitled to
deference is subject to being misunderstood to limit ALJ and Board review of immediate
jeopardy beyond what was intended by the drafters of the regulations. In the notice of
final rulemaking on November 10, 1994, the drafters of 42 C.F.R. § 498.60(c)(2),
discussing the merits of the reviewability of deficiency citations, selection of remedy, and
scope and severity, commented:

We believe that a provider’s burden of upsetting survey
findings relating to the level of noncompliance should be
high, however. As we indicated in the proposed rule,
distinctions between different levels of noncompliance,
whether measured in terms of their frequency or seriousness,
do not represent mathematical judgments for which there are
clear or objectively measured boundaries. Identifying failures
in a facility's obligation to provide the kind of high quality
care required by the Act and the implementing regulations
most often reflect judgments that will reflect a range of
noncompliant behavior. Thus, in civil money penalty cases,
whether deficiencies pose immediate jeopardy, or are
widespread and cause actual harm that is not immediate
jeopardy, or are widespread and have a potential for more
than minimal harm that is not immediate jeopardy does not
reflect that a precise point of noncompliance has occurred,
but rather that a range of noncompliance has occurred which
may vary from facility to facility. While we understand the
desire of those who seek the greatest possible consistency in
survey findings, an objective that we share, the answer does
not lie in designing yardsticks of compliance that can be
reduced to rigid and objectively calculated numbers. Survey
team members and their supervisors ought to have some
degree of flexibility, and deference, in applying their
expertise in working with these less than perfectly precise
concepts. For these reasons, we have revised the
regulations to require an administrative law judge or
appellate administrative review authority to uphold State
or HCFA findings on the seriousness of facility
deficiencies in civil money penalty cases unless they are
clearly erroneous.

59 Fed. Reg. at 56,179 (emphasis added). It is clear from this regulatory history that the
drafters of 42 C.F.R. § 498.60(c)(2) ensured that the state agency or CMS determination
that there was immediate jeopardy would receive deferential consideration, by adopting
the clearly erroneous standard of review. Thus, caution must be exercised to ensure that
22

the Board’s decision in Mississippi Care Ctr. of Greenville, Daughters of Miriam Ctr.,
and other decisions that have mentioned deference relative to immediate jeopardy not be
read to require deference for the determination that there was immediate jeopardy beyond
that imposed by adoption of the clearly erroneous standard. Giving or requiring that the
immediate jeopardy determination be given deference in addition to applying the “clearly
erroneous standard” would be contrary to the intent of the drafters of the regulation;
would significantly limit the review of the determination by an ALJ and the Board; and
would impermissibly deny an affected party the due process right to review intended by
the drafters of the regulation.

In the foregoing quotation from Mississippi Care Ctr. of Greenville, that panel of the
Board states that the clearly erroneous standard means that “the immediate jeopardy
determination is presumed to be correct, and the burden of proving the determination
clearly erroneous is a heavy one.” Jd. at 15. Similar formulations have been used in
other Board decisions when referring to the “clearly erroneous standard.” However, the
Board’s characterization of the “clearly erroneous standard” in Mississippi Care Ctr. and
other cases does not define the standard. The “‘clearly-erroneous standard” is described in
Black’s Law Dictionary as a standard of appellate review applied in judging the trial
court’s treatment of factual issues, under which a factual determination is upheld unless
the appellate court has the firm conviction that an error was committed. Black’s Law
Dictionary 269 (18th ed. 2004). The Supreme Court has addressed the “clearly erroneous
standard” in the context of the Administrative Procedures Act (APA). The Court
described the preponderance of the evidence standard, the most common standard, as
requiring that the trier-of-fact believe that the existence of a fact is more probable than
not before finding in favor of the party that had the burden to persuade the judge of the
fact’s existence. In re Winship, 397 U.S. 358, 371-72 (1970); Concrete Pipe and
Products of California, Inc. v. Construction Laborers, 508 U.S. 602, 622 (1993). The
“substantial evidence” standard considers whether a reasonable mind might accept a
particular evidentiary record as adequate to support a conclusion. Consolidated Edison,
305 U.S. 197, 229 (1938); Dickinson v. Zurko, 527 U.S. 150, 162 (1999). Under the
“clearly erroneous” standard a finding is clearly erroneous even though there may be
some evidence to support it if, based on all the evidence, the reviewing judge or authority
has a definite and firm conviction that an error has been committed. United States v.
United States Gypsum Co., 333 U.S. 364, 395 (1948); Dickinson, 527 U.S. at 162;
Concrete Pipe, 508 U.S. at 622. The clearly erroneous standard has been characterized
by the Court as being stricter than the substantial evidence test and significantly
deferential. The Court stressed in discussing the clearly erroneous standard the

23

importance of not simply rubber-stamping agency fact-finding. The Court also
commented that the APA requires meaningful review.'* Dickinson, 527 U.S. at 162
(citations omitted); Concrete Pipe, 508 U.S. at 622-23.

Various panels of the Board have recognized other principles applicable to the review of
the immediate jeopardy issue. A finding of immediate jeopardy does not require a
finding of actual harm, only a likelihood of serious harm. Dumas Nursing and Rehab.,
L.P., DAB No. 2347, at 19 (2010), citing Life Care Ctr. of Tullahoma, DAB No. 2304, at
58 (2010), aff'd, Life Care Ctr. Tullahoma v. Sebelius, 453 F. App’x 610 (2011). The
efinition of immediate jeopardy at 42 C.F.R. § 488.301, does not define “likelihood” or
establish any temporal parameters for potential harm. Agape Rehabilitation of Rock Hill,
DAB No. 2411, at 18-19 (2011). The duration of the period of immediate jeopardy is
also subject to the clearly erroneous standard. Brian Ctr. Health and Rehab./Goldsboro,
DAB No. 2336, at 7-8 (2010). There is a difference between “likelihood” as required by
the definition of immediate jeopardy and a mere potential. The synonym for likely is
probable, which suggests a greater degree of probability that an event will occur than
suggested by such terms as possible or potential. Daughters of Miriam Ctr., DAB No.
2067, at 10. Jeopardy generally means danger, hazard, or peril. The focus of the
immediate jeopardy determination is how imminent the danger appears and how serious
the potential consequences. Woodstock Care Ctr., DAB No. 1726, at 39.

What is the meaning of serious injury, harm, or impairment as used in the definition of
immediate jeopardy found in 42 C.F.R. § 488.301? How does serious injury, harm, or
impairment compare with “actual harm?” On the first question the Board recognized in
Yakima Valley Sch., DAB No. 2422, at 8, that the regulations do not define or explain the
meaning of the term “serious” as used in the definition of immediate jeopardy.'> The

‘4 The Board’s characterization of the clearly erroneous standard as being highly
deferential to the fact-finding by the state agency surveyor and CMS, and even triggering
a rebuttal presumption, is entirely consistent with the Supreme Court’s characterization of
the standard. However, the Court’s cautions about ensuring meaningful review rather
than rubber-stamping agency decisions shows it is important for the ALJ and the Board
not to be tempted to simply defer to the surveyor, the state agency, or CMS on the
immediate jeopardy issue.

'S Appendix Q of the SOM also fails to provide surveyors a working definition of the
term “serious” that they can use to determine whether harm, injury, or impairment is
serious when deciding whether or not to declare immediate jeopardy. The Act does not
define the phrase “immediately jeopardize” and does not introduce the concept of serious
harm, injury, or impairment as the basis for finding immediate jeopardy. Thus, one is not
in error concluding that absent a definition of the term “serious” in the Act, the

(Footnote continued next page.)
24

Board suggested that the definitions may be unimportant because the Board has held that,
under the clearly erroneous standard, once the state agency or CMS declares immediate
jeopardy there is a presumption that the actual or threatened harm was serious and the
facility can only rebut the presumption of immediate jeopardy by showing that the harm
or threatened harm meets no reasonable definition of the term “serious.” Jd., citing
Daughters of Miriam Ctr., DAB No. 2067, at 9. In Daughters of Miriam Ctr, the Board
discussed that the ALJ attempted to define “serious” finding meanings such as dangerous,
grave, grievous, or life-threatening. The Board notes that the ALJ stated that serious
harm is outside the ordinary, requiring extraordinary care, or having lasting
consequences. The Board further noted that the ALJ stated that a serious injury may
require hospitalization, or result in long-term impairment, or cause severe pain, as
opposed to harm, injury, or impairment that is temporary, easily reversible with ordinary
care, does not cause a period of incapacitation, heal without special medical intervention,
or does not cause severe pain. The Board did not endorse or adopt the ALJ’s definitional
exercise but concluded that it was simply unnecessary in the context of that case. The
Board reasoned, as already noted, that the facility bore the burden to rebut the
presumption by showing that the actual or threatened harm met no reasonable definition
of serious. Daughters of Miriam Ctr., DAB No. 2067, at 9.

Applying the clearly erroneous standard to the record before me related to the
noncompliance I have found based on the violations of 42 C.F.R. §§ 483.20(d) and
483.20(k)(1); 483.20(k)(3)(i); and 483.25(h), I have no definite and firm conviction that
an error has been committed. There is no dispute that shower rooms in long-term care
facilities may be hazardous. It is also not disputed that Resident 3 fell from a shower
chair striking her head on a hard, tile, floor. P. Reply at 16. Petitioner has not shown that
the injury suffered by Resident 3 was not serious and, in fact, the evidence supports the
conclusion that her injury was indeed serious. Petitioner has not shown that slips and
falls by long-term care facility residents resulting in serious injuries, harm, impairment,
or death are not probable.

I conclude that Petitioner has failed to show that the declaration of immediate jeopardy
based on the violations of 42 C.F.R. §§ 483.20(d) and 483.20(k)(1); 483.20(k)(3)(i); and
483.25(h) was clearly erroneous.

(Footnote continued.)

regulations, the SOM, or decisions of the Board, it is essentially up to individual
surveyors, and whatever unpublished guidance they receive from their superiors or CMS
officials, to exercise their individual discretion and judgment to decide that there was
immediate jeopardy, which subjects a facility to the maximum imposable CMPs.
25

9. A CMP of $6,050 per day for the 53 days from September 23
through November 14, 2011, a total CMP of $320,650, is a reasonable
enforcement remedy.

I have concluded that Petitioner violated 42 C.F.R. §§ 483.20(d) and 483.20(k)(1);
483.20(k)(3)(i); and 483.25(h); that the violations posed a risk for more than minimal
harm to one or more facility residents; and that the declaration of immediate jeopardy
was not clearly erroneous. Ifa facility is not in substantial compliance with program
requirements, CMS has the authority to impose one or more of the enforcement remedies
listed in 42 C.F.R. § 488.406, including a CMP. CMS is authorized to impose a per day
CMP for the number of days that the facility is not in substantial compliance. 42 C.F.R.
§ 488.430(a). The regulations specify that a CMP that is imposed against a facility on a
per day basis will fall into one of two ranges of penalties. 42 C.F.R. §§ 488.408,
488.438. The upper range of CMPs, $3,050 per day to $10,000 per day, is reserved for
deficiencies that pose immediate jeopardy to a facility’s residents and, in some
circumstances, for repeated deficiencies. 42 C.F.R. § 488.438(a)(1)(i), (d)(2).
Accordingly, a CMP of $3,050 to $10,000 per day for each day of immediate jeopardy is
authorized in this case.

If I conclude, as I have in this case, that there is a basis for the imposition of an
enforcement remedy and the remedy proposed is a CMP, my authority to review the
reasonableness of the CMP is limited by 42 C.F.R. § 488.438(e). The limitations are: (1)
I may not set the CMP at zero or reduce it to zero; (2) I may not review the exercise of
discretion by CMS in selecting to impose a CMP; and (3) I may only consider the factors
specified by 42 C.F.R. § 488.438(f) when determining the reasonableness of the CMP
amount. In determining whether the amount of a CMP is reasonable, the following
factors specified at 42 C.F.R. § 488.438(f) must be considered: (1) the facility’s history
of non-compliance, including repeated deficiencies; (2) the facility’s financial condition;
(3) the seriousness of the deficiencies as set forth at 42 C.F.R. § 488.404(b), the same
factors CMS and/or the state were to consider when setting the CMP amount; and (4) the
facility’s degree of culpability, including but not limited to the facilities neglect,
indifference, or disregard for resident care, comfort, and safety and the absence of
culpability is not a mitigating factor. The factors that CMS and the state were required to
consider when setting the CMP amount and that I am required to consider when assessing
the reasonableness of the amount are set forth in 42 C.F.R. § 488.404(b): (1) whether the
deficiencies caused no actual harm but had the potential for minimal harm, no actual
harm with the potential for more than minimal harm, but not immediate jeopardy, actual
harm that is not immediate jeopardy, or immediate jeopardy to resident health and safety;
and (2) whether the deficiencies are isolated, constitute a pattern, or are widespread. My
review of the reasonableness of the CMP is de novo and based upon the evidence in the
record before me. I am not bound to defer to the CMS determination of the reasonable
amount of the CMP to impose but my authority is limited by regulation as already
26

explained. I am to determine whether the amount of any CMP proposed is within
reasonable bounds considering the purpose of the Act and regulations. Emerald Oaks,
DAB No. 1800, at 10; CarePlex of Silver Spring, DAB No. 1683, at 17—18 (1999);
Capitol Hill Cmty. Rehab. & Spity. Care Ctr., DAB No. 1629 (1997).

I conclude, based on my review of the regulatory factors, that the CMP of $6,050 per day
proposed by CMS for the 53 days of immediate jeopardy from September 23 through
November 14, 2011 is reasonable in this case.

The evidence shows that Petitioner has been found not in substantial compliance on prior
surveys dating to February 2007. The evidence shows one prior survey that was
completed on March 1, 2011, that involved a declaration of immediate jeopardy.
Petitioner returned to substantial compliance by April 1, 2011. Remedies were imposed
for the immediate jeopardy level noncompliance found by the March 1, 2011 survey.
There is no evidence of immediate jeopardy or of remedies being imposed for any survey
other than the March 1, 2011 survey and the survey presently before me. The evidence
oes not reflect prior noncompliance under Tags F279, F281, or F323 or other repeated
leficiencies. CMS Ex. 2. I accord this factor little weight in deciding the reasonableness
of the CMP.

Petitioner has not presented evidence that it is unable to pay a total CMP of $320,650.

[he noncompliance is based on three regulatory violations and is serious. The
noncompliance posed immediate jeopardy for Petitioner’s residents for 53 days. The
surveyors found that multiple residents were subject to immediate jeopardy and
concluded that there was a pattern of noncompliance. Petitioner’s evidence does not
rebut the surveyors’ findings. Petitioner submitted the KARDEX’s for the residents cited
as examples in the survey in addition Resident 3. P. Ex. 14. Those KARDEX’s provide
little more information than the KARDEX in effect for Resident 3 at the time of her fall
and the survey. The KARDEX’s show whether a tub bath, bed bath, or shower was to be
performed by a CNA and the number of staff required to assist. The KARDEX’s do not
show what further assessments were done or interventions were planned by the IDT for
shower safety for the residents. While the interventions listed on the KARDEX may be
adequate, Petitioner has not met its burden to present evidence to prove the interventions
are adequate for the individual residents. The seriousness of Petitioner’s noncompliance
is also evidenced by the actual harm that Resident 3 suffered.

I also conclude that Petitioner was culpable for its noncompliance. The hazards
associated with shower rooms in long-term care facilities are readily recognized by all
involved in the delivery of care and services to long-term care residents. Slips and falls
are a clearly foreseeable consequence of inadequate assessment and care planning to
address the foreseeable risk of harm from falls in the shower. In the case of Resident 3,
Petitioner’s policy required that CNAs use shower chairs absent other direction. P. Br. at
27

14; P. Reply at 9. Resident 3 was assessed as at risk to lean forward when sitting upright,
as she would be required to do in a shower chair. However, there is no evidence that
Petitioner ensured that the IDT for Resident 3 assessed her and considered the risks of the
shower room and her tendency to lean forward when sitting upright. There is no
evidence that the IDT then devised appropriate interventions to mitigate or eliminate the
accident hazard and the related risk for harm.

III. Conclusion

For the foregoing reasons, I conclude that Petitioner was not in substantial compliance
with program participation requirements and a CMP of $6,050 per day for the 53 days
from September 23 through November 14, 2011, a total CMP of $320,650, is a
reasonable enforcement remedy. Petitioner was ineligible to be approved to conduct a
NATCEP for two years based upon the CMP imposed.

/s/
Keith W. Sickendick
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Center for Tobacco Products,
Complainant
v.

Asia Supermarket, LLC
d/b/a Wallingford Food Land,

Respondent.

Docket No. C-13-1188
FDA Docket No. FDA-2013-H-0974

Decision No. CR2977

Date: October 31, 2013

INITIAL DECISION AND DEFAULT JUDGMENT

The Center for Tobacco Products (CTP) filed an Administrative Complaint
(Complaint) against Respondent, Asia Supermarket, LLC d/b/a Wallingford Food
Land, that alleges facts and legal authority sufficient to justify the imposition of a
civil money penalty of $500. Respondent did not answer the Complaint, nor did
Respondent request an extension of time within which to file an answer.
Therefore, I enter a default judgment against Respondent and assess a civil money
penalty of $500.

CTP began this case by serving the Complaint on Respondent and filing a copy of
the Complaint with the Food and Drug Administration’s (FDA) Division of
Dockets Management. The Complaint alleges that Respondent impermissibly sold
tobacco products to minors and failed to verify that a tobacco product purchaser
was 18 years of age or older, thereby violating the Federal Food, Drug, and
Cosmetic Act (Act), 21 U.S.C. § 301 et seq., and its implementing regulations,
Cigarettes and Smokeless Tobacco, 21 C.F.R. Part 1140 (2012). CTP seeks a civil
money penalty of $500.

On August 28, 2013, CTP served the Complaint on Respondent by United Parcel
Service, pursuant to 21 C.F.R. §§ 17.5 and 17.7. In the Complaint and
accompanying cover letter, CTP explained that within 30 days, Respondent should
pay the proposed penalty, file an answer, or request an extension of time within
which to file an answer. CTP warned Respondent that if it failed to take one of
these actions within 30 days, an Administrative Law Judge could, pursuant to 21
C.F.R. § 17.11, issue an initial decision ordering Respondent to pay the full
amount of the proposed penalty.

On September 27, 2013, Respondent requested additional time within which to file
an answer. Respondent’s representative stated that he had difficulties with the
Civil Remedies Division’s electronic filing system and did not have the
appropriate equipment needed to participate in that system. I granted
Respondent’s request for an extension on September 30, 2013, and gave
Respondent until October 7, 2013, to file an answer.

Respondent has not filed an answer within the additional time I provided.
Pursuant to 21 C.F.R. § 17.11(a), lam required to “assume the facts alleged in the
[C]omplaint to be true” and, if those facts establish liability under the Act, issue a
default judgment and impose a civil money penalty. Accordingly, I must
determine whether the allegations in the Complaint establish violations of the Act.

Specifically, CTP alleges the following facts in its Complaint:

e Respondent owns Wallingford Food Land, an establishment that sells
tobacco products and is located at 250 South Colony Road, Wallingford,
Connecticut 06492. Complaint § 3.

e On August 22, 2012, at approximately 2:40 PM ET, an FDA-commissioned
inspector observed a violation of 21 C.F.R. Part 1140 at Respondent’s
establishment. The inspector observed a violation of 21 C.F.R.

§ 1140.14(a) when “a person younger than 18 years of age was able to
purchase a package of Maverick Box cigarettes ....” Complaint § 10.

e CTP issued a Notice of Compliance Check Inspection to Wallingford Food
Land on August 27, 2012, due to the August 22, 2012 inspection. The
Notice of Compliance Check Inspection specifically informed Respondent
that “a minor was able to . . . purchase a regulated tobacco product at
approximately 2:40 PM” on August 22, 2012. Complaint § 10.
On November 8, 2012, CTP issued a Warning Letter to Respondent
regarding the inspector’s observations from August 22, 2012. The letter
explained that the observations constituted a violation of a regulation found
at 21 C.F.R. § 1140.14(a), and that the named violation was not necessarily
intended to be an exhaustive list of all violations at the establishment. The
Warning Letter went on to state that if Respondent failed to correct the
violation, regulatory action by the FDA or a civil money penalty action
could occur and that Respondent is responsible for complying with the law.
Complaint § 10.

Mr. Alam responded to the Warning Letter for Respondent in a March 25,
2013 telephone call. “Mr. Alam said he spoke with each employee
regarding the letter, he understood the law, and he would speak to each
employee to make sure they complied.” Complaint § 11.

Mr. Alam’s response came, however, after FDA-commissioned inspectors
had already documented additional violations of 21 C.F.R. Part 1140 at
Respondent’s establishment. On February 25, 2013, at approximately 1:30
PM ET, inspectors documented a violation of 21 C.F.R. § 1140.14(a) when
“a person younger than 18 years of age was able to purchase a package of
Gambler Premium Light cigarette tobacco . . . [.]” The inspectors also
documented a violation of 21 C.F.R. § 1140.14(b)(1) when “the minor's
identification was not verified before the sale... .” Complaint § 1.

CTP issued a Notice of Compliance Check Inspection to Wallingford Food
Land on March 1, 2013, due to the February 25, 2013 inspection. The
Notice of Compliance Check Inspection specifically informed Respondent
that “a minor was able to . . . purchase a regulated tobacco product at
approximately 1:30 PM” on February 25, 2013. Complaint { 2.

These facts establish that Respondent is liable under the Act. The Act prohibits
misbranding of a tobacco product. 21 U.S.C. § 331(k). A tobacco product is

misbranded if distributed or offered for sale in any state in violation o
issued under section 906(d) of the Act. 21 U.S.C. § 387c(a)(7)(B); 21

regulations
CFR

§ 1140.1(b). The Secretary issued the regulations at 21 C.F.R. Part 1140 under

section 906(d) of the Act. 21 U.S.C. § 387(a); 21 U.S.C. § 387£(d)(1)

; 75 Fed.

Reg. 13,229 (Mar. 10, 2010). The regulations prohibit the sale of cigarettes or

smokeless tobacco to any person younger than 18 years of age. 21 C.

F.R.

§ 1140.14(a). The regulations also require retailers to verify, by means of photo
identification containing a purchaser’s date of birth, that no cigarette or smokeless
tobacco purchasers are younger than 18 years of age. 21 C.F.R. § 1140.14(b)(1).
Taking the above alleged facts as true, Respondent had three violations of
regulations contained in 21 C.F.R. Part 1140 within a six-month period.
Specifically, Respondent had a violation on August 22, 2012, and two violations
on February 25, 2013. Respondent’s actions on both occasions violated the
prohibition against selling cigarettes or smokeless tobacco to persons younger than
18 years of age. 21 C.F.R. § 1140.14(a). Respondent’s actions on February 25,
2013, also violated the requirement that retailers verify, by means of photo
identification containing a purchaser’s date of birth, that no purchaser of cigarettes
or smokeless tobacco is younger than 18 years of age. 21 C.F.R. § 1140.14(b)(1).
Therefore, Respondent’s actions constitute violations of law for which a civil
money penalty is merited.

The regulations require me to impose a civil money penalty in the amount that is
either the maximum provided for by law or the amount sought in the Complaint,
whichever is smaller. 21 C.F.R. § 17.11(a)(1)-(2). The regulations currently
allow a maximum penalty of $500 for a third violation within a six-month period,
21 C.F.R. § 17.2, and CTP has requested a fine in that amount. Therefore, I find
that a civil money penalty of $500 is warranted and so order one imposed.

/s/
Steven T. Kessel
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Center for Tobacco Products,
Complainant
v.

B Plus B Enterprise, LLP
d/b/a B Mart / Citgo,

Respondent.

Docket No. C-13-1223
FDA Docket No. FDA-2013-H-1014

Decision No. CR2973
Date: October 30, 2013
INITIAL DECISION AND DEFAULT JUDGMENT

The Center for Tobacco Products (CTP) filed an Administrative Complaint
(Complaint) against Respondent, B Plus B Enterprise, LLP d/b/a B Mart / Citgo,
alleging facts and legal authority sufficient to justify the imposition of a civil
money penalty of $250. Respondent did not timely answer the Complaint, nor did
Respondent request an extension of time within which to file an answer.
Therefore, I enter a default judgment against Respondent and order that
Respondent pay a civil money penalty in the amount of $250.

CTP began this case by serving the Complaint on Respondent and filing a copy of
the Complaint with the Food and Drug Administration’s (FDA) Division of
Dockets Management. The Complaint alleges that Respondent’s staff unlawfully
sold cigarettes to a minor, failed to verify that the tobacco purchaser was of
sufficient age prior to this transaction, and impermissibly utilized a self-service
display of regulated tobacco products in a non-exempt facility, thereby violating
the Federal Food, Drug, and Cosmetic Act (Act) and its implementing regulations
found at 21 C.F.R. Part 1140. CTP seeks a civil money penalty of $250.

On August 29, 2013, CTP served the Complaint on Respondent by United Parcel
Service, pursuant to 21 C.F.R. §§ 17.5 and 17.7. In the Complaint and
accompanying cover letter, CTP explained that, within 30 days, Respondent
should pay the penalty, file an answer, or request an extension of time within
which to file an answer. CTP warned Respondent that if it failed to timely take
one of these actions the Administrative Law Judge could, pursuant to 21 C.F.R.
§ 17.11, issue an initial decision by default ordering Respondent to pay the full
amount of the proposed penalty. Respondent did not take any of the required
actions within the time provided by regulation.

I am required to issue an initial decision by default if the Complaint is sufficient to
justify a penalty, and the Respondent fails to timely answer or request an
extension. 21 C.F.R. § 17.11(a). For that reason, I must decide whether a default
judgment is appropriate here. I conclude that it is based on the allegations of the
Complaint and Respondent’s failure to answer them.

For purposes of this decision, I assume the facts alleged in the Complaint are true.
21 C.F.R. § 17.11(a). Specifically, CTP alleges the following facts in its
Complaint:

e Respondent owns B Mart / Citgo, an establishment that sells tobacco
products and is located at 592 Providence Road, Brooklyn, Connecticut
06234. Complaint § 2.

e¢ On September 21, 2012, an FDA-commissioned inspector observed
violations of the regulations found at 21 C.F.R. Part 1140 while inspecting
Respondent’s establishment. Respondent violated 21 C.F.R. § 1140.14(a)
when Respondent’s staff “[sold] tobacco products to a minor[;].. .
[s]pecifically, a person younger than 18 years of age was able to purchase a
package of Marlboro Gold Pack cigarettes . . . at approximately 10:50 AM.
...” Respondent’s staff also violated 21 C.F.R. § 1140.14(b)(1) when the
staff “[flail[ed] to verify the age of a person purchasing tobacco products[,]
by means of photographic identification containing the bearer’s date of
birth[,] .. . before the sale . .. on September 21, 2012... .” Complaint § 9.

¢ On November 15, 2012, CTP issued a Warning Letter to Respondent
detailing the inspector’s observations from September 21, 2012. In
addition to describing the violations, the letter advised Respondent that the
FDA may initiate a civil money penalty action or take other regulatory
action against Respondent if it failed to correct the violations. The letter

also stated that it was Respondent’s responsibility to comply with the law.
Complaint § 9.

e¢ On November 21, 2012, Muwahad Abel responded in writing to the
Warning Letter on behalf of Respondent. “Mr. Abel stated that the
violation was discussed with his employees and [that] all employees were
instructed to verify the identification of any person under the age of twenty-
seven.” Complaint § 10.

e On February 28, 2013, and March 13, 2013, FDA-commissioned inspectors
documented an additional violation of 21 C.F.R. Part 1140 during a two-
part inspection of Respondent’s establishment. Respondent violated 21
C.F.R. § 1140.16(c) by “using a self-service display in a non-exempt
facility.” The inspectors documented that the establishment “ha[d] tobacco
products, including chewing tobacco[,] accessible to the public.” On those
dates, the inspectors noted that Respondent’s establishment operated as a
convenience store and gas station. Complaint { 1.

These facts establish that Respondent is liable under the Act. The Act prohibits
misbranding of a tobacco product. 21 U.S.C. § 331(k). A tobacco product is
misbranded if sold or distributed in violation of regulations issued under section
906(d) of the Act. 21 U.S.C. § 387c(a)(7)(B); 21 C.F.R § 1140.1(b). Under

21 C.F.R. § 1140.14(a), no retailer may sell cigarettes to any person younger than
18 years of age. Under 21 C.F.R. § 1140.14(b)(1), a retailer must verify, by means
of photo identification containing the bearer’s date of birth, that no purchaser of
cigarettes is younger than 18 years of age. Under 21 C.F.R. § 1140.16(c)(1), a
retailer may sell cigarettes and smokeless tobacco only in a direct, face-to-face
exchange between the retailer and the consumer. The regulations prohibit retailers
from using self-service displays to sell cigarettes and smokeless tobacco. 21
C.F.R. § 1140.16(c). However, self-service displays are permitted if located in
facilities where the retailer ensures that no person younger than 18 years of age is
present, or permitted to enter, at any time. 21 C.F.R. § 1140.16(c)(2)(ii).

Here, Respondent violated 21 C.F.R. § 1140.14(a) on September 21, 2012, when
its staff sold cigarettes to a minor. On that same date, Respondent also violated

21 C.F.R. § 1140.14(b)(1) when its staff did not verify, by checking the tobacco
purchaser’s photographic identification, that the tobacco purchaser was 18 years of
age or older prior to this transaction. Additionally, on February 28, 2013, and
March 13, 2013, Respondent’s establishment contained a self-service display of
tobacco products, including smokeless tobacco. On those dates, the establishment
operated as a convenience store and gas station that was open to the public.
Therefore, Respondent impermissibly utilized a self-service display for regulated

tobacco products because Respondent’s facility was not one where minors were
prohibited from entering. 21 C.F.R. § 1140.16 (c)(2)(ii).

Respondent’s actions on multiple occasions at the same retail outlet constitute
violations of law for which a civil money penalty is merited. Accordingly, I find
that a civil money penalty of $250 is permissible under 21 C.F.R. § 17.2.

/s/
Steven T. Kessel
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division
Karen Richardson, M.D.,
(NPI: 1780789131),
Petitioner,
v.
Centers for Medicare & Medicaid Services.
Docket No. C-13-1020
ALJ Ruling No. 2014-9

Date: October 29, 2013

DISMISSAL AND REMAND

Petitioner, Karen Richardson, M.D., challenges the effective date of her participation in
the Medicare program. The Centers for Medicare & Medicaid Services (CMS) moves to
dismiss her appeal. CMS argues that Petitioner has no right to a hearing before an
administrative law judge, because she has not obtained a reconsidered determination.

For the reasons set forth below, I grant CMS’s motion and dismiss this case pursuant to
42 CFR. § 498.70(b).

Background

Petitioner is an emergency room physician and member of the Oakbend Medical Group.
In an application (CMS-855R) filed October 9, 2012, she applied for enrollment in the
Medicare program and asked that her benefits be reassigned to the group practice. CMS
Ex. 1. Apparently, other members of the practice filed similar applications at about the
same time.
In a letter dated December 4, 2012, the Medicare contractor, Novitas Solutions, Inc.,
advised Petitioner that her enrollment application had been approved with an effective
date of October 27, 2012. The notice advised her that, if she disagreed with the
established effective date, she could request reconsideration before a contractor hearing
officer. CMS Ex. 3.

Apparently, one of Petitioner’s medical group colleagues, Ian Smalling, N.P., had earlier
received a similar letter approving his Medicare application. On January 15, 2013, with
Petitioner and other members of the practice, he filed a joint request for reconsideration
challenging their effective dates of enrollment. CMS Ex. 4. Ina letter dated May 17,
2013, the contractor’s hearing specialist issued its reconsidered determination in Mr.
Smalling’s case. CMS Ex. 5. Although the letter refers to similar initial determinations
issued to other members of the practice, including Petitioner, it states that “a formal
decision is not rendered in this letter for [those] providers.” CMS Ex. 5 at 1.

CMS acknowledges, but does not explain or justify, that, to date, the contractor has not
issued a reconsidered determination in Petitioner’s case. In a letter dated June 20, 2013,
Petitioner requested an ALJ hearing to challenge the effective date of her enrollment.
CMS now moves to dismiss that hearing request.

Discussion

To receive Medicare payments for services furnished to program beneficiaries, a
Medicare supplier must be enrolled in the Medicare program. 42 C.F.R. § 424.505. To
enroll in Medicare, a prospective supplier must complete and submit an enrollment
application. 42 C.F.R. §§ 424.510(d)(1), 424.515(a). When CMS determines that a
supplier meets the applicable enrollment requirements, it grants her Medicare billing
privileges. For physicians, the effective date for billing privileges “is the /ater of the date
of filing” a subsequently approved enrollment application or “the date an enrolled
physician . . . first began furnishing services at a new practice location.” 42 C.F.R.

§ 424.520(d) (emphasis added).

CMS’s determination as to the effective date of enrollment is an “initial determination”
that is subject to review under the procedures set forth in 42 C.F.R. Part 498. 42 C.F.R.
§§ 498.3(1), (b)(15). A supplier or prospective supplier dissatisfied with an initial
determination may request reconsideration by filing a written request within 60 days from
receipt of the notice of the initial determination. 42 C.F.R. §§ 498.5(d)(1); 498.5(D(1);
498.22. If CMS (or its contractor) receives a properly-filed request for reconsideration, it
makes a reconsidered determination affirming or modifying the initial determination. 42
C.F.R. § 498.24(c). A supplier or prospective supplier dissatisfied with a reconsidered
determination is entitled to a hearing before an administrative law judge. 42 C.F.R.

§§ 498.5(d)(2); 498.5(1)(2). The regulations do not provide for a hearing in the absence
of a reconsidered determination. Denise A. Hardy, D.P.M., DAB No. 2464 at 4-5 (2012);
Hiva Vakil, DAB No. 2460 at 4-5 (2012).

I am deeply troubled by the contractor’s unjustified failure to issue a timely reconsidered
determination in this matter. Nevertheless, my authority is limited. I simply have no
jurisdiction to review the merits of this case. I therefore remand the matter to CMS and
recommend that it or its contractor immediately issue a reconsidered determination. But
see lan Smalling, N.P., DAB CR2971 (2013) (finding that the contractor properly
determined the effective date for Nurse Practitioner Smalling).

Conclusion
Because neither CMS nor its contractor issued a reconsidered determination in this case,

Petitioner does not have a right to an ALJ hearing. | therefore dismiss her hearing
request pursuant to 42 C.F.R. 498.70(b).

/s/

Carolyn Cozad Hughes
Administrative Law Judge