Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Social Security Administration,
Vv.
Latoshia Walker-Mays,
Respondent.
Docket No. C-10-44
Decision No. CR2243

Date: September 17, 2010

DECISION

I sustain the determination of the Social Security Administration Inspector General (SSA
I.G.) to impose a civil money penalty of $61,000 against Respondent, Latoshia Walker-
Mays. The SSA LG. proved with overwhelming evidence that Respondent knowingly
made at least 13 false statements, along with numerous deliberate and material omissions
of fact, to the Social Security Administration to support her claim that her daughter was
eligible to receive Supplemental Security Income (SSI) benefits. Respondent engaged in
a pattern of false statements and deception over a period of more than four years,
resulting in SSI payments of more than $20,000 on behalf of her daughter to which she
was not entitled. The egregiousness of Respondent’s conduct, coupled with the complete
absence of mitigating evidence, more than justifies the substantial civil money penalty
that I impose.

I. Background

This case was assigned to me for a hearing and a decision after the SSA LG. notified
Respondent of his determination to impose the civil money penalty that I describe in the
opening paragraph of this decision, and Respondent requested a hearing to challenge that
determination. I held an in-person hearing by telephone on July 12, 2010. At the
hearing, I received exhibits from the SSA LG. that I identified as OIG Ex. 1 — OIG Ex.
25. I received exhibits from Respondent that I identified as R. Ex. 1 — R. Ex. 2. I
afforded the parties the opportunity to file post-hearing briefs. Each party filed a brief.

IL. Issues, Findings of Fact, and Conclusions of Law
A. Issues
The issues in this case are whether:

1. Respondent knowingly made materially false statements or omissions of
fact to the Social Security Administration to obtain SSI benefits for her
daughter.

2. Acivil money penalty of $61,000 is reasonable.
B. Findings of Fact and Conclusions of Law
I make the following findings of fact and conclusions of law (Findings).

1. Respondent knowingly made materially false statements or omissions
of fact to the Social Security Administration to obtain SSI benefits for
her daughter.

The SSA LG. brought this case against Respondent pursuant to section 1129 of the Social
Security Act (Act). This section of the Act, and implementing regulations, authorize the
imposition of a civil money penalty against any person who:

makes or causes to be made, a statement or representation of a material fact,
for use in determining any initial or continuing right to or the amount of
monthly insurance benefits under title II [Social Security] or benefits or
payments under title VIII or XVI [SSI], that the person knows or should
know is false or misleading . . . omits from a statement or representation for
such use, or otherwise withholds disclosure of, a fact which the person
knows or should know is material to the determination of any initial
payments under title VIII or XVI, if the person knows, or should know, that
the statement or representation with such omission is false or misleading or
that the withholding of such disclosure is misleading.

Act § 1129(a)(1); see 20 C.F.R. § 498.102
A material fact is any fact that the Commissioner of Social Security may consider as
relevant in evaluating whether an individual is entitled to Social Security benefits or

ild whose family d

show income and resi

eligible for SSI payments. Act § 1129(a)(2); 20 C.F.R. § 498.101.

SSI is a program that gives payments to eligible individuals. Payments may include
payments that are made on behalf of a child who is medically disabled. Eligibility for
such payments depends on very strict income and resource requirements being met. A

joes not meet these strict requirements is not eligible for SSI

c
payments even if he or she meets the medical disability criteria.

The SSA LG. presented compelling evidence proving that Respondent consistently and
materially misrepresented the truth about her and her daughter’s living arrangements to

ources that satisfied SSI eligibility criteria. For a more than four

year period, beginning in 2003 and continuing into 2008, Respondent repeatedly
misrepresented where she and her daughter lived and the composition of their household.

Respondent repeated.
determine eligibility

ly stated on forms that the Social Security Administration used to
‘or SSI payments that she and her daughter, Stefiana, resided

exclusively with Stefiana’s siblings at Respondent’s parents’ residence in Trenton,
Tennessee. Respondent consistently failed to reveal that she maintained another

residence, a three-be:

room two-bath apartment in Milan, Tennessee, which she and her

husband shared along with Respondent’s three children. These misrepresentations were
material, because they greatly understated the income and resources available to
Respondent. The Social Security Administration failed to count this income and
resources in calculating Stefiana’s eligibility for SSI, and, as a result, she received

payments for which she was not eligible.

The documentary evidence that supports the I.G.’s case includes the following:

e Statements for

Determining Continuing SSI Eligibility signed by or attested to by

Respondent. OIG Ex. 1 — OIG Ex. 5; see OIG Ex. 22 at 3. These documents
contain statements or attestations concerning Stefiana’s living arrangements. In
each of these documents Respondent certified that Stefiana resided at 9 Arthur
Hopper Road in Trenton, Tennessee with Respondent and Stefiana’s siblings. In
each of these documents Respondent also listed the names of individuals who
were purportedly living together at the Trenton domicile. Respondent consistently
asserted that Stefiana lived with her at her parents’ Trenton residence (9 Arthur
Hopper Road), with the exception of the period running between March 2001 and

February 2002

during which Respondent asserted that Stefiana lived at another

address in Trenton. In all of these documents, Respondent failed to inform the

Social Security Administration that she and her family maintained an apartment in
Milan, Tennessee, another community located miles away from the Arthur Hopper
Road residence in Trenton, and that she spent much of her time living at the Milan

residence with

her family.
e Documents relating to Respondent's residence in Milan, Tennessee. These
documents include apartment applications and associated leases for a three-
bedroom, two-bath apartment known as the Meadows of Milan, 4051 Reasons
Boulevard, Unit 305, Milan, Tennessee. OIG Ex. 6; OIG Ex. 9; OIG Ex. 11; OIG
Ex. 13. Each application and lease listed who would be living at the apartment.
These residents included Respondent, her husband Jerel Mays, Stefiana, and
Stefiana’s siblings. These documents included household income certification
forms showing the family’s total combined income. OIG Ex. 6 at 3; OIG Ex. 9 at
5; OIG Ex. 11 at 3; OIG Ex. 13 at 4.

Even a cursory examination of these documents establishes a gross disparity between
what Respondent told the Social Security Administration about her living arrangements
and her family structure and her actual living arrangements and family structure. Based
on the lease applications and leases that Respondent completed and signed, Respondent
did not, as she asserted, live exclusively with her daughter at her parents’ residence.
Rather, she, her children, and her husband maintained another residence consisting of a
rental apartment in a different community that is miles away from the residence that she
told the Social Security Administration that she lived in exclusively.

Closer examination of the foregoing documents establishes that Respondent uttered a
series of falsehoods to the Social Security Administration. In her Statements for
Continuing Disability, Respondent made the following statements:

e Inher January 13, 2005 statement, Respondent stated that, as of July 29, 2004,
Stefiana lived at 9 Arthur Hopper Road in Trenton, Tennessee. OIG Ex. 3 at 1, 2.

e Inthe same document, Respondent attested that the household in which Stefiana
lived included her mother (Respondent), her grandparents, and three siblings. Id.
at 2-3.

e Inthe same document, Respondent stated that the address of her own residence
was 9 Arthur Hopper Road. Jd. at 1-2.

e Inher November 1, 2005 statement, Respondent again attested that, as of July 29,
2004, Stefiana lived at the Arthur Hopper Road address in Trenton. OIG Ex. 4 at
2.

e In this same document, Respondent attested that the household in which Stefiana
lived included Stefiana’s mother (Respondent), her grandparents, and three
siblings. Id. at 2-3.
e Inthe same document, Respondent stated that, as of September 2, 2005, Stefiana
continued to reside at the Arthur Hopper Road address in Trenton. Id.

e Inthe same document, Respondent stated falsely that she lived at the Arthur
Hopper Road address in Trenton. Jd. at 4-5.

e Inher October 31, 2007 statement, Respondent again stated that Stefiana, as of
September 2, 2005, continued to live at the Arthur Hopper Road address. OIG Ex.
Sat 2.

e Inthe same document, Respondent stated that the household in which Stefiana
lived included Stefiana’s mother (Respondent), her grandparents, and her three
siblings. Jd. at 2-3.

e Inthe same document, Respondent attested that, as of November 1, 2007, Stefiana
continued to reside at the Arthur Hopper Road address. Id. at 2-3.

e Inthe same document, Respondent again attested that the household in which
Stefiana lived included her mother (Respondent), her grandparents, and her three
siblings. Jd. at 2-3.

e Inthe same document, Respondent stated that her home address was the Arthur
Hopper Road address. Id. at 4.

Each of these documents contained a statement in which Respondent avowed that what
she said was true:

You declared under penalty of perjury that all of the information on this
summary is true and correct to the best of your knowledge. Anyone who
knowingly gives a false or misleading statement about a material fact in a
redetermination, or causes someone else to do so, commits a crime and may
be sent to prison or may face other penalties, or both.

See, e.g., OIG Ex. 5 at 5.

The disparity between what Respondent told the Social Security Administration to
qualify her daughter for SSI payments and what she said in other documents is striking.
In 2003, 2005, 2006, and 2007, Respondent and her husband completed and signed
applications to rent an apartment in Milan, Tennessee. OIG Ex. 6; OIG Ex. 9; OIG Ex.
11; OIG Ex. 13. On each of these applications Respondent and her husband listed
themselves along with their children, including Stefiana, as residents of the apartment.
Id. They listed the Arthur Hopper Road address on the 2003 and 2007 applications as an
emergency contact address. On the 2003 application, Respondent stated that she paid her
mother $200 per month for childcare expenses. OIG Ex. 6 at 2.

Respondent and her husband completed Tennessee Housing Development Household
Income Certification forms, apparently to qualify for subsidized rent. On each of these
forms, Respondent and her husband listed themselves along with their children, including
Stefiana, as residents of the Milan address. OIG Ex. 6 at 1, 3; OIG Ex. 9 at 1, 3, 5; OIG
Ex. 11 at 1, 3; OIG Ex. 13 at 1, 2, 4.

Respondent and her husband signed leases for the Milan address covering the years
between 2003 and 2008. In the leases, they listed themselves along with their children,
including Stefiana, as residents of the Milan address. OIG Ex. 7; OIG Ex. 10; OIG Ex.
12; OIG Ex. 14; see OIG Ex. 8. The lease Respondent and her husband signed in
September 2003 contained the following statement, which Respondent and her husband
acknowledged by signing the lease:

The Resident(s) must live in the unit and the unit must be the Resident(s)
only place of residence. The Resident(s) shall use the premises only as a
private dwelling for himself/herself and the individuals listed below.

OIG Ex. 7 at 1. On each lease, the “individuals listed below” included Respondent, her
husband, and their children, including Stefiana. OIG Ex. 7; OIG Ex. 10; OIG Ex. 12;
OIG Ex. 14; see OIG Ex. 8.

Testimony strongly corroborates the documentary evidence. Among the witnesses that
the SSA LG. called was Ms. Pat Long, the former property manager of the Meadows of
Milan during 2007 and 2008. Ms. Long testified that she inspected the apartment that
Respondent and her husband leased on at least 20 occasions during 2007 and 2008. OIG
Ex. 24. Ms. Long saw both Respondent and her husband at the apartment along with
their children, although she did not recall seeing Stefiana there. Transcript (Tr.) at 15.
However, Ms. Long recalled seeing a wheelchair in the apartment, which would have
been consistent with Stefiana’s presence at the address at least part of the time. Tr. at 21.

The SSA LG. also produced the testimony of Ms. Jennifer Simer, the current property
manager of the apartment complex in Milan, Tennessee. OIG Ex. 23. Ms. Simer
testified that the facility’s records show that Respondent and her husband resided there
between 2003 and 2008. Tr. at 27.

Finally, the SSA I.G. called Ms. Pamela Mabry, an SSI technical expert with the Social
Security Administration. OIG Ex. 22. Ms. Mabry testified that Respondent had claimed
during three SSI reviews of her case that were conducted on January 13, 2005, November
1, 2005, and October 31, 2007, that she and her children lived at the Arthur Hopper Road
address in Trenton, Tennessee. Jd. at 3. Ms. Mabry testified that, in March 2008, she
discovered that Respondent and her husband shared the Milan address. Jd. at 3-4. She
determined that employer’s records for both Respondent and her husband showed them
living at the Milan address. Id.

I find the testimony of all three of these witnesses to be highly credible. None of these
witnesses had any interest in telling anything other than the truth.

The evidence and arguments that Respondent presented to counter the SSA I.G.’s case
are not persuasive. Respondent contends that she apprised the Social Security
Administration that she maintained dual residences. It is unclear what Respondent is
referring to, because she has provided no proof of any communication between her and
the Social Security Administration about her household status other than that which the
SSA LG. offered as evidence. Ms. Mabry testified that it was not until January 15, 2008
that Respondent acknowledged to the Social Security Administration that she maintained
two households. OIG Ex. 22 at 3. The fact that Respondent may have acknowledged her
dual residences after years of concealing that information is of no benefit to Respondent.

Respondent argues also that she did not live with Jerel Mays, her husband, in a marital
relationship and that they maintained the Milan apartment only as a convenience. | find
this assertion not to be credible, because Respondent has offered no explanation why
such an arrangement would benefit anyone. Respondent’s assertion provides no answer
to the following questions. Why would Respondent agree to pay rent on an apartment
that she did not use? Conversely, why would her husband agree to pay rent on an
apartment for himself, his wife, and their children, if the wife and children were not going
to reside there? Furthermore, Respondent did not explain how this allegedly unorthodox
living relationship would have relieved her of the obligation to be truthful to the Social
Security Administration when she provided it with information about her place of
residence, her income, and the resources that were available to her.

Significantly, Respondent admitted that she signed a lease for the Milan address. She did
not deny that she lived there at least part of the time, or that her husband’s income and
resources were available to her family. Respondent did not offer any explanation as to
why she failed to provide information to the Social Security Administration about her
alleged dual residence when she was asked directly about her living arrangements.

Respondent argues that her apartment in Milan was on the third floor, thereby precluding
Stefiana from living there. But, she has presented no evidence showing that Stefiana is
incapable of climbing to the third floor. Moreover, the fact that a wheelchair was present
in the Milan apartment is strong evidence that Stefiana lived there at least part of the
time. Tr. at 21.

Respondent presented the testimony of Ms. Wendy Gilliam, an individual who resided at
the Arthur Hopper Road home as a foster child between 2003 and 2005. Ms. Gilliam’s
testimony hurt Respondent’s case more than it helped it, because it corroborated the SSA
1.G.’s assertions that Respondent resided at the Milan apartment. Ms. Gilliam admitted
that she stayed in the Milan apartment with Respondent during the week. Ms. Gilliam
acknowledged that she babysat for Respondent and her children at the Milan apartment.
Tr. at 43-44.

Ms. Gilliam averred that Stefiana generally did not reside at the Milan apartment,
although she acknowledged that Stefiana came there from time to time. Tr. at 44. This
assertion does not benefit Respondent, assuming that it is true, because the fact that
Respondent may have lived separately from Stefiana much of the time does not justify
Respondent’s concealing the Milan apartment and her relationship with her husband from
the Social Security Administration.

Respondent asserts also that Stefiana attended school in Trenton, Tennessee, near the
Arthur Hopper Road address. That fact is not inconsistent, however, with the evidence
showing that Respondent maintained an apartment in Milan, nor is it inconsistent with
evidence showing that Stefiana spent at least part of the time there.

Finally, Respondent claims that she is the victim of retaliation by the Social Security
Administration — provoked by Ms. Mabry — in retaliation for a complaint that she made
about Ms. Mabry in the past. There is simply no evidence to support this claim.

Considered in its entirety, the evidence supports the conclusion that Respondent
repeatedly misrepresented and uttered falsehoods about her living arrangements, as well
as those of her daughter Stefiana. It may be that Stefiana spent part of the time — or even
the majority of it — living with her grandparents at the Arthur Hopper Road address. But,
that does not detract from the overwhelming proof that Respondent maintained two
residences, spent time living at both of them, had access to the income and resources of
her husband, and failed to report any of this information to the Social Security
Administration.

The misrepresentations made by Respondent in her statements concerning continued SSI
eligibility were material in two respects. First, in stating that she lived with her children
at the Trenton address, Respondent told the Social Security Administration that she was a
single parent who lived without the benefit of the support of a husband. These statements
were a series of falsehoods that created an image of Respondent’s material circumstances
that differed greatly from reality and which greatly understated the resources that were
available to her and her family. Second, in omitting to tell the Social Security
Administration about her true residence and family situation, Respondent concealed facts
showing the actual extent of her family’s income and resources.

2. A civil money penalty of $61,000 is reasonable.

The overwhelming evidence in this case is that Respondent repeatedly and egregiously
falsely represented to the Social Security Administration her living arrangements and her
resources to qualify her daughter for SSI payments. During the more than four year
period that is at issue here, Respondent received SSI payments of more than $20,000 on
her daughter’s behalf, money that she would not have been eligible to receive had
Respondent stated truthfully her places of residence and her resources. I have itemized
13 false statements that Respondent made to the Social Security Administration during
the period. That represents only an element of Respondent’s misrepresentation, because,
during the entire period that is at issue, Respondent continually omitted to inform the
Social Security Administration of the true nature of her living arrangements and
resources.

The Act authorizes a civil money penalty of $5,000 for each willful misrepresentation or
false statement that an individual makes to the Social Security Administration in
connection with an application for, or continuation of, Social Security benefits or SSI.
Act § 1129(a)(1). The civil money penalty that the SSA LG. seeks in this case is
considerably less than the maximum money damages that the law permits. The 13
separate false statements uttered by Respondent and proven by the SSA I.G. would, by
themselves, justify a civil money penalty of up to $65,000. Respondent’s material
omissions would justify the imposition of a civil money penalty substantially in excess of
$65,000. The law also permits an assessment of double the amount of benefits or
payments made as a consequence of an individual’s materially false statements or
omissions. In this case, that amount would be more than $40,000. Consequently, the
total amount of penalty and assessment that the SSA I.G. might have proposed would be
well over $100,000.

However, even the reduced penalty amount that the SSA I.G. proposes is substantial. In
deciding whether this penalty amount is reasonable, I must consider factors that include:
(1) the nature of Respondent’s false statements or misrepresentations and the
circumstances under which they were made; (2) the degree of her culpability, her history
of prior offenses, and her financial condition; and (3) such other matters as justice may
require.

I conclude that the penalty is reasonable here for the following reasons. First,
Respondent clearly intentionally uttered her false statements and omitted critical
information to deceive the Social Security Administration. It is evident that Respondent
intended to conceal a living arrangement and access to resources that she knew would
have rendered her daughter ineligible for SSI benefits, had the information been
truthfully reported. Indeed, Respondent has offered no plausible honest explanation — or
even an explanation at all — for concealing her living arrangement and her relationship
with her husband that would undercut my conclusion that she misstated this arrangement
10

and relationship deliberately. Second, Respondent uttered her falsehoods over a period of
more than four years. The persistence with which Respondent deceived the Social
Security Administration, and the obviously intentional quality of her false statements, is
persuasive evidence of a very high degree of culpability.

Respondent argues that her financial condition precludes her from paying the penalty.
However, the evidence proves otherwise. She has purchased a home in Medina,
Tennessee. She is presently employed with a salary of $32,000 per year. She presently
receives child support from her husband and receives financial support from Stefiana’s
father as well. Respondent has offered no evidence proving that she lacks the financial
wherewithal to pay the penalty amount. She has not offered any proof as to the degree of
her indebtedness.

/s/
Steven T. Kessel
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Jewish Home of Eastern Pennsylvania
(CCN: 39-5103),

Petitioner
Vv.

Centers for Medicare and Medicaid Services.
Docket Nos. C-08-280, C-08-281, and C-08-346
Decision No. CR2242
Date: September 17, 2010
DECISION

Petitioner, Jewish Home of Eastern Pennsylvania, was not in substantial compliance with
program participation requirements from November 2, 2007 through January 17, 2008.
There is a basis for the imposition of an enforcement remedy. A civil money penalty
(CMP) of $600 per day from November 2, 2007 through January 17, 2008, totaling
$46,200, is a reasonable enforcement remedy.

I. Background

Petitioner is located in Scranton, Pennsylvania and participates in Medicare as a skilled
nursing facility (SNF) and the state Medicaid program as a nursing facility (NF). On
November 2, 2007, Petitioner was surveyed by the Pennsylvania Department of Health
(state agency) and found not in substantial compliance with program participation
requirements. The Centers for Medicare and Medicaid Services (CMS) notified
Petitioner by letter dated December 6, 2007, that it was imposing the following
enforcement remedy: a CMP of $600 per day effective November 2, 2007, continuing
until Petitioner returned to substantial compliance or its participation in Medicare was
terminated. A revisit survey was conducted by the state agency on January 4, 2008, and
it was determined that Petitioner had not returned to substantial compliance. CMS
notified Petitioner by letter dated January 23, 2008, that it was imposing a denial of
payments for new admissions (DPNA) effective February 8, 2008, if Petitioner did not
2

return to substantial compliance before that date; and that Petitioner’s provider agreement
would be terminated on May 2, 2008, if Petitioner did not return to substantial
compliance before that date. CMS advised Petitioner by letter dated March 5, 2008, that
the state agency determined based on a revisit survey conducted on February 22, 2008,
that Petitioner returned to substantial compliance with program participation
requirements on January 18, 2008, and the DPNA and termination were cancelled. CMS
also advised Petitioner that the total CMP was $46,200, based upon a daily CMP of $600
for the period from November 2, 2007 through January 17, 2008.

Petitioner requested a hearing before an administrative law judge (ALJ) by letters dated
February 4, 2008 (docketed as C-08-280 and C-08-281)' and March 11, 2008 (docketed
as C-08-346). The cases were assigned to Judge Jose Anglada for hearing and decision
and an Acknowledgement and Initial Pre-Hearing Order was issued in each case. Judge
Anglada ordered the consolidation of C-08-280 and C-08-281 on April 2, 2008. Judge
Anglada consolidated C-08-280 and C-08-346 by “Ruling and Consolidation” dated
January 30, 2009. Judge Anglada also denied a CMS motion for dismissal or partial
summary disposition by ruling issued January 30, 2009.

On February 13, 2009, the consolidated cases were reassigned to me for hearing and
decision due to Judge Anglada’s departure from the Civil Remedies Division. On March
18, 2009, I issued a supplemental prehearing order. On August 25, 2009, a hearing was
convened in Scranton, Pennsylvania and a 313-page transcript (Tr.) of the proceedings
was prepared. CMS offered CMS exhibits (CMS Exs.) 1 through 37 that were admitted
as evidence. Tr. at 62. Petitioner offered Petitioner exhibits (P. Exs.) 6 through 10 that
were admitted as evidence. Tr. at 65. CMS called the following witnesses: Surveyor
Darin Ambosie; Daniel Haimowitz, MD; and Beryl Goldman, PhD. Petitioner called as a
witness, Mary Rose Applegate, Petitioner’s Administrator. CMS filed its post-hearing
brief (CMS Br.) on October 23, 2009, and its post-hearing reply brief (CMS Reply) on
November 23, 2009. Petitioner filed its post-hearing brief (P. Br.) on October 26, 2009,”
and waived filing a reply brief on November 24, 2009.

II. Discussion
A. Issues

The issues in this case are:

' Docketing the February 4, 2008 request for hearing twice was an administrative error.

> Petitioner's motion for leave to file its post-hearing brief out-of-time, was not opposed,
and the motion is granted.
3

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 by a long-term care facility
are found at sections 1819 (SNF) and 1919 (NF) of the Act and at 42 C.F.R. Part 483.
Section 1819(h)(2) of the Act vests the Secretary of Health and Human Services
(Secretary) with authority to impose enforcement remedies against a SNF for failure to
comply substantially with the federal participation requirements established by sections
1819(b), (c), and (d) of the Act.? Pursuant to 1819(h)(2)(C), the Secretary may continue
Medicare payments to a SNF not longer than six months after the date the facility is first
found not in compliance with participation requirements. Pursuant to 1819(h)(2)(D), ifa
SNF does not return to compliance with participation requirements within three months,
the Secretary must deny payments for all individuals admitted to the facility after that
date — commonly referred to as the mandatory or statutory DPNA. In addition to the
authority to terminate a noncompliant SNF’s participation in Medicare, the Act 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).

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. Part 483, Subpart B. 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.

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

> Section 1919(h)(2) of the Act gives similar 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.
4

range of a CMP, $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). “Immediate jeopardy means a
situation in which the provider’s noncompliance with one or more requirements of
participation has caused, or is likely to cause, serious injury, harm, impairment, or death
to a resident.” 42 C.F.R. § 488.301 (emphasis in original). The lower range of a CMP,
$50 per day to $3,000 per day, is reserved for deficiencies that do not constitute
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 Act and regulations make a hearing before an administrative law judge (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. Cal Turner Extended
Care, DAB No. 2030 (2006); The Residence at Salem Woods, DAB No. 2052 (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); 42 C.F.R. §§ 488.330(e), 498.3.
However, the choice of remedies or the factors considered by CMS 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, 38 (2000), aff'd, 363 F.3d 583 (6th Cir. 2003).
The Departmental Appeals Board (the 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 standard of proof or quantum of evidence required is a preponderance of the
evidence. CMS has the burden of coming forward with the evidence and making a prima
facie showing of a basis for imposition of an enforcement remedy. Petitioner bears the
burden of persuasion to show by a preponderance of the evidence that it was in
substantial compliance with participation requirements or any affirmative defense.
Batavia Nursing & Convalescent Ctr., DAB No. 1904 (2004), aff’d, Batavia Nursing &
Convalescent Ctr. v. Thompson, 129 F. App’x. 181 (6th Cir. 2005); Batavia Nursing &
Convalescent Inn, DAB No. 1911 (2004); Emerald Oaks, DAB No. 1800; Cross Creek
Health Care Ctr., DAB No. 1665 (1998); see Hillman Rehab. Ctr., DAB No. 1611
(1997), No. 98-3789, 1999 WL 34813783 (D.N.J. May 13, 1999).
5

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

My conclusions of law are set forth in bold text followed by my findings of fact and
analysis. Based upon the survey that ended November 2, 2007, CMS alleges that
Petitioner was not in substantial compliance with program participation requirements
beginning November 2, 2007, based upon violations of 42 C.F.R. §§ 483.10(f)(2) (Tag
F166, scope and severity (s/s) E); 483.13(c) (Tag F224, s/s D); 483.13(c)(1)(ii)-(iii),
(c)(2)-(4) (Tag F225, s/s D); 483.13(c) (Tag F226, s/s D); 483.15(e)(1) (Tag F246, s/s E);
483.15(g)(1) (Tag F250, s/s D); 483.25(c) (Tag F314, s/s G); 483.25(d) (Tag F315, s/s
G); 483.25(h) (Tag F323, s/s G); 483.25(m)(2) (Tag F333, s/s E); 483.30(a) (Tag F353,
s/s D); 483.35(f) (Tag F368, s/s E); 483.35(i)(2) (Tag F371, s/s E); and 483.75(m)(2)
(2007) (Tag F518, s/s E). CMS Ex. 2. Based upon the survey that ended on January 4,
2008, CMS alleges that Petitioner continued to be in violation of 42 C.F.R. §§ 483.25(h)
(Tag F323, s/s G) and 483.75(0)(1) (Tag F520, s/s D). CMS Ex. 25.

Petitioner stipulated at hearing that the exhibits offered by CMS and admitted as evidence
are sufficient for a prima facie showing of the deficiencies alleged by the November 2,
2008 survey. Petitioner stated that it would not introduce any rebuttal evidence.
Petitioner asserted that it preserved its right to proceed on certain alleged “equal
protection issues” and privilege issues related to the surveys. Petitioner alleges before me
that it returned to substantial compliance with program participation requirements on
November 30, 2007, and that it was not in violation of 42 C.F.R. §§ 483.25(h) (Tag

F323) and 483.75(0)(1) (Tag F520) as alleged by the revisit survey completed on January
4, 2008. Tr. at 18-28. By stipulating that the CMS evidence constitutes a prima facie
showing as to the November deficiencies and by not presenting a case in rebuttal,
Petitioner has conceded that CMS had a basis for imposing a $600 per day CMP
beginning November 2, 2007 and continuing to the date that Petitioner returned to
substantial compliance. The issues remaining for adjudication are whether Petitioner
returned to substantial compliance prior to January 18, 2007 (including whether
Petitioner violated 42 C.F.R. §§ 483.25(h) (Tag F323) and 483.75(0)(1) (Tag F520) as
alleged by the revisit survey completed on January 4, 2008) and whether the CMP
proposed is a reasonable enforcement remedy.

I have carefully considered all the evidence, including the documents and the testimony at
earing, and the arguments of both parties, though not all may be specifically discussed in
this decision.’ I discuss in this decision the credible evidence given the greatest weight

+ References are to the version of the Code of Federal Regulations (C.F.R.) in effect at
the time of the survey, unless otherwise indicated.

> “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. Jd. at 1625.
6

in my decision-making. The fact that 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.

1. Petitioner violated 42 C.F.R. § 483.25(h) and the violation caused
actual harm.

a. Facts

Resident 164 suffered from osteoporosis, degenerative joint disease (DJD), peripheral
vascular disease (PVD), atherosclerotic coronary disease (ASCD), glaucoma, urge
incontinence, urinary retention, chronic obstructive pulmonary disease (COPD),
congestive heart failure (CHF), hypertension, restless leg syndrome, anxiety, and
depression. CMS Ex. 27, at 24, 57. Petitioner had assessed the resident as at risk for fall
five times between October 2006 and September 2007. CMS Ex. 27, at 7. Resident 164
had a care plan dated July 10, 2006, that addressed her history of falls; the fact that she
liked to be at the sink in her room for personal hygiene, including make-up and she did
not like staff assistance; her diagnoses that contributed to her risk for falls including
hypertension, PVD, osteoarthritis, osteoporosis, CVA (cardio-vascular accident), and her
anti-anxiety medication. Hand written entries list other risk factors including her poor
balance, the fact she fatigues easily, and her propensity to self-transfer to a bedside
commode. CMS Ex. 27, at 9, 37, 50.

There is no dispute that in roughly six weeks Resident 164 fell four times on November
5, 2007 (CMS Ex. 27, at 20), November 27, 2007 (CMS Ex. 27, at 35), December 2,
2007 (CMS Ex. 2, at 5), and December 22, 2007 (CMS Ex. 27, at 45). There is no
dispute that the last comprehensive fall risk assessment of Resident 164 was done on
September 10, 2007. CMS Ex. 27, at 7. It is undisputed that no comprehensive fall risk
assessment of Resident 164 was performed between September 10, 2007 and the survey
on January 4, 2008, even though Resident 164 fell four times. Petitioner’s
Administrator, Mary Rose Applegate, admitted that no fall risk assessment was done after
any of the four falls but that one should have been done. Tr. at 296. Resident 164
received a score of eighteen on the September 10, 2007 Fall Risk Assessment, with a risk
for falls being indicated by a score above 10. The assessment indicated that Resident 164
was confused; she required nursing assistance with elimination; she had three or more
falls within the last six months; she was taking medication that increased her risk for
falls, including Lasix, Zoloft, Ativan, Lopressor, Imdur; she needed an assistive device
for ambulation; and she had balance problems when walking. CMS Ex. 27 at 7.

Resident 164’s care plan in effect at the time of the November 5, 2007 fall, included the
following interventions: place personal items and water in easy reach; refer to physical
therapy and treatment as indicated; administer medication as ordered; ophthalmology
7

follow-up as necessary; eyeglasses as appropriate; no side-rails; blood pressure monthly
and as necessary; encourage use of comfortable, non-skid shoes; non-skid mat both sides
of bed and bathroom; gripper socks at night when in bed; restorative nursing program as
ordered; and encourage use of wheelchair when off the unit and the roller walker when
on the unit. An undated hand-written entry at the end of the list of interventions that I
infer was added in response to the November 5, 2007 fall, states “PT screen.” CMS Ex.
27, at 19, 22-23; Tr. at 234-35, 298-302. Although not listed on the care plan,
Administrator Applegate testified that Resident 164 also had a low bed with no side rails
in place prior to her fall on November 5, 2007. Tr. at 234.

The facts related to each un-witnessed fall are undisputed as they are reported in
Petitioner’s records that have been admitted as evidence.

A fall occurred on November 5, 2007, at approximately 9:30 p.m. Resident 164 was
found on her buttocks on the non-skid mat next to her bed. Upon investigation, it was
determined that Resident 164 bent down in front of her dresser to get a shirt out of a low
drawer. When Resident 164 pulled the dresser drawer, the entire drawer came out and
she fell. Resident 164 was not injured except for reddened areas on her left elbow and
mid-spine. She had been last observed at 9:15 p.m. in bed. It is noted that the resident
does not always use the call bell and ask for assistance, the call bell was within reach, but
the call bell was not activated. It was noted that the resident had independently toileted
herself within the past two hours even though she was supposed to transfer only with the
assistance of one staff. CMS Ex. 27, at 20-21, 24, 25, 28, 29. The facility devised and
implemented the following interventions in response to the fall: Resident 164 was
educated not to reach for low items without ringing and asking for assistance;
maintenance worked on all the dresser drawers in the facility so that the drawers would
work properly and could not be pulled completely out; a PT screen was added to her care
plan. CMS Ex. 27 at 21, 23, 28. A fall screen on November 8, 2007 by occupational
therapy found that Resident 164 continued to require supervision with all transfers due to
safety and balance deficits. CMS Ex. 27, at 31. A Social Services Progress Notes entry
dated November 6, 2007, indicates that the resident was counseled regarding the danger
of not using her call bell. An entry dated November 8, 2007 reveals that the Falls
Committee felt that Resident 164’s bedside commode should be removed to avoid
dangers of self transferring but the resident asked to keep the commode. The resident
reportedly stated that if the commode was taken and staff did not respond quickly enough
to the call bell, she would attempt to walk to the bathroom on her own. The note
indicates that it was decided to keep the bedside commode but “a contract will be drawn
to inform” the resident of the dangers of non-compliance. CMS Ex. 27, at 33-34. The
“contract” dated and signed on November 9, 2007, includes a list of interventions with
spaces for the resident to indicate by her initials whether she would comply with the
listed interventions. Resident 164 indicated that she would comply with the assistance of
one staff member for transfers but only if she did not have to wait for assistance. She
indicated that she would not use the wheelchair when out of bed to go to the bathroom,
and she indicated that she would not use the call bell and wait for assistance. CMS Ex.
27, at 43.
8

A second fall occurred on November 27, 2007 at approximately 9:00 p.m. Resident 164
was found sitting on the floor in her room. Resident 164 reported that she fell while
straightening the blankets on her bed. No injury is noted. She was last observed prior to
the incident at 8:15 p.m. lying in bed. A nurse had seen her at 8:00 p.m. in bed with her
gripper socks on but when the resident was found on the floor she had on her dress shoes.
CMS Ex. 27, at 35, 41, 42. A Social Service Progress Notes entry dated November 28,
2007 shows that the resident was counseled regarding what shoes she should wear and
reminded to use the call bell for assistance and, it is noted, the resident agreed. CMS Ex.
27, at 42. The facility added to Resident 164’s care plan under “Problem/Need” that
Resident 164 had poor balance and fatigues easily. Under “Goal” Petitioner added that
the goal for the resident to ring the call bell for assistance and accept the assistance of one
staff member for transfers. An intervention to encourage use of the call bell was added to
the copy of the care plan filed with the event report but it is dated September 7, 2007. A
second new intervention was to post visual clues to remind Resident 164 that she should
ring for assistance. A previously listed intervention to encourage the resident to use her
wheelchair when off the unit and her walker when on the unit was discontinued with the
note that her wheelchair was her primary mode of transportation. CMS Ex. 27, at 37-38,
40; Tr. at 88.

A third fall occurred on December 2, 2007 at approximately 8:00 a.m. Resident 164 was
found on the floor beside her bed. Resident 164 reported that she was getting off the
bedside commode and fell pulling up her pants. Resident 164 reported that she rang the
call bell but does not want to wait for assistance and so transferred herself to the bedside
commode. She was last seen before the event at 7:50 a.m. sleeping in bed. Staff
assessment at the time revealed no apparent injury but the resident complained of right
arm pain. Petitioner’s investigation report form records that the resident was not
compliant with instruction to use her call bell to call for assistance; but the call bell was
in reach and activated; the resident had self-toileted within the past two hours; the
resident’s unsteady gait, impaired cognition, psychoactive medication, frequent need to
toilet, attempts to self-transfer, and noncompliance with visual cues to call for assistance
may have contributed to the event. The facility intervened by removing the bedside
commode from Resident 164’s room and offering the bedside commode between 7:00
a.m. and 8:00 a.m. and during rounds. Facility staff was to continue to encourage
Resident 164 to request assistance with transfers. CMS Ex. 27, at 5-6, 8. The resident’s
care plan was updated to reflect that the bedside commode was to be removed from her
room and offered between 7:00 and 8:00 a.m. and during rounds. CMS Ex. 27, at 10, 13.
Resident 164 subsequently requested the return of the bedside commode and the request
was granted on December 4, 2007, with the plan to offer assistance with use between
7:00 and 8:00 a.m. CMS Ex. 27, at 15, 51.

9

The fourth fall occurred on December 22, 2007 at approximately 2:30 a.m. Resident 164
was found sitting on the floor beside her bed on the non-skid mat with her legs extended
in front of her. Resident 164 stated that she was walking to the bathroom to get a glass of
water and slipped, fell, and banged her head.° The resident was last observed prior to the

event at 1:30 a.m. awa
her forehead, above bo
shows that the call bell
resident’s roommate a

e in bed. She was assessed as having abrasions and contusions to
th eyes, and on top of her head.’ Petitioner’s investigation report
was in reach and activated at the time of the event (but by the

ter the fall (CMS Ex. 27, at 48-49)); the resident had self-toileted

within the two hours preceding the event using her bedside commode; there was an
incontinent pad on the anti-skid mat to the right of the bed; the resident’s unsteady gait,
impaired cognition, hypertension, psychoactive drugs, steroids, cardiovascular drugs,
analgesics, and narcotics may have contributed to the event. The resident was noted to be
noncompliant because she self-transfers without the assistance of staff, and it is noted that
she had not liked to ask for assistance since August 21, 2006. CMS Ex. 27, at 45-46, 48.
Petitioner added the following interventions: use of a winged mattress, thirty-minute
checks, offering assistance if awake, and a bed and chair alarm. CMS Ex. 27, at 46, 47,
51, 53, 57-58. Subsequently the alarms were removed as they were distressing to the
resident. CMS Ex. 27, at 59, 60. However, the effectiveness of the alarm was clearly
demonstrated as evidenced by the Alarm Assessment Tool which shows that on
December 24, 2007 there were four instances between 4:00 p.m. and 8:45 p.m. when the
alarm sounded when the resident attempted to self-transfer. CMS Ex. 27, at 60. The
effectiveness of the thirty minute checks is shown by the assessment tool which shows
three instances between Noon and 10:30 p.m. on December 22, 2007, when the resident
self-transferred without calling for assistance. CMS Ex. 27, at 62-64.

b. Analysis

The question before me is whether Petitioner was in substantial compliance with the
requirement of 42 C.F.R. § 483.25(h), which requires that a resident receive adequate
supervision and assistive devices to prevent accidents.

The general quality of care regulation, 42 C.F.R. § 483.25, requires that a facility ensure
that each resident receives necessary care and services to attain or maintain the resident’s

° Administrator Applegate testified that Resident 164 later recanted her statement that
she was on the way to the bathroom to get a glass of water. Tr. at 275. Testimony was
presented that a glass of water was already at Resident 164’s bedside. Ms. Applegate
testified that the facility never determined the circumstances of the December 22, 2007
fall. Tr. at 276.

7 Resident 164 subsequently became confused and was transferred to the hospital where
she was found to have a scalp hematoma and a questionable non-displaced fracture of the
nose. CMS Ex. 27, at 54-57.
10

highest practicable physical, mental, and psychosocial well-being, in accordance with the
resident’s comprehensive assessment and plan of care developed by the resident’s care
planning team in accordance with 42 C.F.R. § 483.20. The quality of care regulations
impose specific obligations upon a facility related to accident hazards and accidents.

The facility must ensure that —
(1) The resident environment remains as free of
accident hazards as is possible; and
(2) Each resident receives adequate supervision and
assistance devices to prevent accidents

42 C.F.R. § 483.25(h). The State Operations Manual (SOM), CMS’s guidance to
surveyors, instructs surveyors that the intent of 42 C.F.R. § 483.25(h)(1) and (2) 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. SOM, app. PP,
Guidance to Surveyors Long Term Care Facilities, F323, Quality of Care (Rev. 27; eff.
Aug. 17, 2007).

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

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) (emphasis added).
11

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 6-7 (2010); Eastwood
Convalescent Ctr., DAB No. 2088 (2007); Liberty Commons Nursing and Rehab. -
Alamance, DAB No. 2070 (2007); Century Care of Crystal Coast, DAB No. 2076
(2007), aff'd, 281 F. App’x 180 (4th Cir. 2008); 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). Section 483.25(h)(2) 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 (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 the resident’s
ability to protect himself 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 event that can cause a resident bodily injury, excluding adverse outcomes
associated as a direct consequence of treatment or care (e.g., drug side effects or
reactions). SOM, app. PP, Tag F323; Woodstock Care Ctr., DAB No. 1726, at 4.

The surveyors allege in the Statement of Deficiencies (SOD) based upon a review of the
clinical record of Resident 164 that Petitioner failed to provide adequate supervision to
prevent repeated falls and that Resident 164 suffered actual harm as a result. CMS Ex.
25, at 1. The surveyors allege violation of this regulation based on the four falls of
Resident 164 between November 5, 2007 and December 22, 2007 and Petitioner’s failure
to implement adequate interventions to minimize the risk for harm to the resident due to
accidental injury related to the falls.

Based upon my review of the evidence as summarized above, I conclude that CMS has
made a prima facie showing that Petitioner was in violation of 42 C.F.R. § 483.25(h)
with regard to Resident 3 as early as November 9, 2007. November 9, 2007 is the date
on which Resident 164 refused to agree to use the call light and wait for the assistance of
staff with transferring. CMS Ex. 27, at 43. On November 9, 2007, the evidence shows
that Petitioner had assessed Resident 164 as at risk for falls (CMS Ex. 27, at 7, 31);
Petitioner knew that Resident 164 required assistance with transfers; and Resident 164
was capable of using the call bell and would do so but refused to wait for staff to respond
to provide assistance. Resident 164’s refusal to use the call bell and then wait for
assistance was the accident hazard with the potential for accidental injury that Petitioner
needed to mitigate or eliminate. Resident 164’s refusal to use the call bell and wait for
12

assistance was clearly foreseeable as of November 9, 2007. Petitioner was clearly on
notice by Resident 164’s responses to the contract and her continued self-transfers and
self-toileting. Resident 164’s express refusal to use the call bell and wait for assistance
rendered ineffective Petitioner’s inventions of reminders and encouragement to use the
call bell as of November 9, 2007. Therefore, Petitioner clearly was on notice as early as
November 9, 2007, that the care planning team needed to develop and implement
interventions to provide closer supervision of Resident 164 to ensure that she did not
engage in unassisted transfers or, when she attempted to do so, staff was alerted to render
assistance to reduce the potential for accidental injury of the resident. Petitioner failed to
develop adequate interventions to ensure adequate supervision as early as November 9,
2007, and thereby violated 42 C.F.R. § 483.25. When Petitioner finally implemented the
use of alarms and thirty-minute checks after the fourth fall, the evidence shows they were
effective.* I conclude that Petitioner has failed to rebut the prima facie showing or to
establish an affirmative defense. I further conclude that Petitioner has not presented
evidence to show that it returned to substantial compliance with 42 C.F.R. § 483.25 until
January 18, 2008.

Petitioner argues that Resident 164 had the cognitive ability to understand and comply
with instructions and visual reminders to use her call bell. P. Br. at 7. I do not have the
entire clinical record to assess whether Petitioner’s assertion is supported by the
resident’s medical records. However, even if I accept that Resident 164’s cognitive
ability was intact, it simply supports my conclusion that Resident 164 was clear in her
communication to staff that she would not comply with requests to use her call bell and
that Petitioner had notice that Resident 164 required increased supervision to prevent
accidental injury due to self-transfers. I note however, that if Resident 164 was
cognitively intact, there is nevertheless a significant question about her safety awareness
and ability to exercise judgment for her own protection that is not addressed by either
CMS or Petitioner. Whether Resident 164’s refusal to comply with the request that she
use the call bell and wait for staff assistance is due to some cognitive impairment or a
lack of safety awareness, is not an issue I need resolve. Petitioner does not dispute that
the resident was assessed as a fall risk, that she had poor balance, that she fatigued easily,
and that she continued to self-transfer after November 9, 2007, demonstrating that mere
requests and visual cues not to transfer without assistance were not effective
interventions.

* There was testimony at hearing that other interventions might also have been effective
to ensure adequate supervision such as moving the resident to a room closer to the nurse's
station. I do not have sufficient evidence to evaluate the feasibility or potential
effectiveness of all the possible interventions that the care plan team might have devised
and implemented. In this case, it is sufficient that there is evidence of two interventions
that could have been effective.
13

Petitioner argues that use of an alarm was not appropriate because Resident 164 was
competent and did not want an alarm; and because the standard of care and the right to
self-determination support Petitioner’s decision not to use an alarm. P. Br. at 7-8.
Resident 164 refused to comply with Petitioner’s request that she use the call bell and
wait for staff assistance for any transfers. I am not convinced on these facts that
balancing a resident’s rights against a resident’s safety does not tip the scale in favor of
using an alarm. However, as the evidence shows Petitioner had alternative interventions
such as increasing direct visual observation to every thirty minutes or every fifteen
minutes or imposing one-on-one supervision. Petitioner does not address why it did not
implement increased observation on November 9, 2007, when it was on notice Resident
164 was going to continue to be noncompliant.

Petitioner argues that its safety interventions were effective for the first three falls
because there were no injuries. Petitioner also argues that the falls were not really
accidents because they were not unplanned as the facility planned to safely accommodate
the possibility the resident would fall. P. Br. at 8-9. The regulation obliges Petitioner to
provide supervision and assistive devices to prevent accidents, such as falls, not just
prevent injuries from accidents. As already discussed, I conclude Petitioner violated the
regulation because Petitioner did not take all reasonable steps to ensure that Resident 164
had the supervision necessary to prevent her from falling. The fact that Petitioner
implemented interventions to minimize the risk of injury in the event of a fall is good, but
not a defense to a violation of the regulation in this case.

Petitioner argues that the use of the bedside commode for toileting, blood pressure
monitoring, and medication monitoring were all appropriate interventions. P. Br. at 9-10.
Whether or not these were appropriate interventions, does not address why Petitioner did
not increase supervision of Resident 164 after November 9, 2007. Petitioner also argues
that the surveyor cited the deficiency, at least partly, due to call bell response times. P.
Br. at 10-11. My review is de novo. Whether the surveyor considered call bell response
times as a fact in support of citing the deficiency does not impact my decision in this
case. Rather, my decision turns upon the facts that show that: (1) Petitioner was on
notice on November 9, 2007 that Resident 164 was going to continue to be noncompliant
with requests that she use her call bell and wait for assistance with transfers; and (2)
Petitioner failed to increase supervision to minimize the risk for falls.

Accordingly, I conclude that Petitioner violated 42 C.F.R. § 483.25(h) and the violation
caused actual harm to Resident 164.

2. Petitioner did not violate 42 C.F.R. § 483.75(0) (Tag F520).

Every long-term care facility is required to establish a functioning quality assessment and
assurance (QA) committee. The regulation requires:

(1) A facility must maintain a quality assessment and
assurance committee consisting of —
14

(i) The director of nursing services;
(ii) A physician designated by the facility; and
(ii) At least 3 other members of the facility’s staff.

(2) The quality assessment and assurance committee—

(i) Meets at least quarterly to identify issues with respect
to which quality assessment and assurance activities are
necessary; and

(ii) Develops and implements appropriate plans of action
to correct identified quality deficiencies.

42 CFR. § 483.75(0).

Surveyor Darin Ambosie admitted that Petitioner had established a QA committee but
cited the facility on the theory that the committee was not effective based upon the
deficiency under Tag F323 related to Resident 164. Tr. at 108-12. Mary Rose
Applegate, Petitioner’s Administrator, testified that the facility had a QA committee that
included the Administrator, Medical Director, and Director of Nursing and that the
committee met quarterly to consider problems and solutions. Tr. at 226-33.

I find that Petitioner had the required committee and that the committee met as required
for the required purpose. I will not infer that the QA committee was not effective in
fulfilling its regulatory purpose based upon the facts related to the deficiency I have
found under Tag F323. I further note that the allegations related to Resident 164 and Tag
F323 relate to the plan of care for the resident and not to the development and
implementation of a plan of action to correct identified quality deficiencies as required by
the regulation.

Accordingly, I conclude that Petitioner did not violate 42 C.F.R. § 483.75(0) (Tag F520).

3. Petitioner did not return to substantial compliance on November 30,
2007.

4. Petitioner returned to substantial compliance on January 18, 2008.

Based on the violation of 42 C.F.R. § 483.25(h) as discussed above, I conclude Petitioner
did not return to substantial compliance on November 30, 2007, the date Petitioner
alleged it returned to substantial compliance on the Plan of Correction after the
November 2, 2007 survey. CMS Exs. 2, at 1; 23, at 1. The date reflected on the Plan of
Correction to the January 4, 2008 revisit survey by the facility is January 18, 2008. CMS
Ex. 25, at 1. I determined above that Petitioner remained out of compliance during the
January 4, 2008 revisit survey. Petitioner has the burden to demonstrate by a
preponderance of the evidence that it returned to substantial compliance on a date earlier
15

than the completion date alleged in the Plan of Correction that Petitioner prepared and
submitted to the agency. Petitioner has not offered evidence to show it corrected by
November 30, 2007, the noncompliance cited by the November 2, 2007 survey and
admitted in open court by Petitioner. Petitioner has also not offered evidence that it
corrected before January 18, 2008, the deficiency under Tag F323 cited by the survey
completed on January 4, 2008.

Petitioner was not in substantial compliance with the requirements of 42 C.F.R. §
483.25(h) in the case of Resident 164 as of November 9, 2007. Petitioner did not correct
the deficiency related to Resident 164 prior to January 18, 2007, the date alleged by
Petitioner in its plan of correction and the date of substantial compliance found by CMS.
CMS Ex. 5; CMS Ex. 25, at 1.

5. Petitioner’s objections to my consideration of evidence based upon a
“Quality Assurance Privilege” are without merit.

6. Petitioner’s objection to my consideration of evidence based upon
Equal Protection principals is without merit in this forum.

CMS offered as evidence CMS exhibits 1 through 37. Tr. at 30. Petitioner objected to
CMS Ex. 25, pages 2-6; CMS Ex. 27, pages 5-8, 14, 15, 20, 21, 25-27, 29, 30, 32, 35, 39,
41, 45, 46, 48, 49, 53, 59; and CMS Ex. 28.° Petitioner reasserts its objections to pages
from CMS Exs. 25 and 27 in its post-hearing brief. P. Br. at 1-2.

CMS Ex. 25 is the Statement of Deficiencies (CMS form 2567) (SOD) for the January 4,
2008 revisit survey. In CMS Ex. 25, Petitioner specifically objected to my consideration

° Petitioner objected to CMS Ex. 28 on grounds that it is an Informal Dispute Resolution
(IDR) document, IDR is similar to a settlement discussion, and evidence related to
settlement discussions is not admissible under the Federal Rules of Evidence. I overruled
the objection and admitted CMS Ex. 28 for reasons stated on the record. Tr. at 31-40.
Petitioner did not renew the objection in post-hearing briefing and my prior ruling stands.
The regulations require that a state agency offer a facility an opportunity for IDR to
dispute survey findings upon receipt of the SOD. Ifa provider successfully shows that a
deficiency should not have been cited, the regulation requires that the deficiency and any
related enforcement remedy be rescinded. 42 C.F.R. § 488.331. IDR is more akin to an
informal adjudication than a settlement process. I further note that the Federal Rules of
Evidence do not apply in this proceeding but are referred to for guidance. Authentic and
relevant evidence is generally admissible and there is no question that CMS Ex. 28 is
both authentic and relevant.
16

of the plan of correction (POC) prepared by Petitioner that appears in the right column
on pages two through six of the document and the last three paragraphs on the left side of
CMS Ex. 25, page 2. Petitioner objected to my consideration of any part of the pages of
CMS Ex. 27 to which it objected. Petitioner’s objection is based upon the theory that the
POC, the documents summarized in the SOD on page 2 of CMS Ex. 25, and the
documents reflected by the pages of CMS Ex. 27, are all subject to a “Quality Assurance
Privileges” that Petitioner argues is created by 42 C.F.R. § 483.75(0). Petitioner argues
that the regulation precludes the Secretary from requiring disclosure of quality assurance
documents or from using a facility’s good faith efforts to correct deficiencies as the basis
for imposing sanctions. Tr. at 26, 40-43. I denied the objection and admitted the
evidence for the reasons stated on the record at hearing. Tr. at 48-61.

Petitioner offers no new argument in its post-hearing brief and my ruling at hearing is not
disturbed. In Jewish Home of Eastern Pennsylvania, DAB No. 2254 (2009), another case
involving the same Petitioner, an appellate panel of the Board commented that the Act
and regulations do not create an evidentiary privilege rather, they establish disclosure and
use restrictions applicable to records of a QA committee. /d. at 6 n. 3. The Board
analyzed the documents to which the objection was interposed in that case to determine
whether they were subject to the disclosure and use restrictions under 42 C.F.R. §
483.75(0). The Board considered whether a particular document appeared to be in the
“nature of records of a QA Committee.” Jd. at 9. The Board concluded that event reports
and interview statements that appear on their face to be of the type normally generated by
a facility incident investigation are not subject to 42 C.F.R. § 493.75(0). The Board
discussed that the fact that incident reports and patient care records may be considered by
a QA committee as part of its function, does not cause such records to become QA
records subject to the restrictions of 42 C.F.R. § 493.75(0). Jd. at 11-12; 42 C.F.R. §
483.13(c)(2), (3), and (4).

Applying the Board’s approach to the documents before me, my conclusion that
Petitioner’s objection was unfounded is unchanged. The POC is required by 42 C.F.R. §
488.402(d) as a response to an alleged deficiency and it is not a document prepared by or
for the QA committee as part of its function but rather a required response to the state
agency and CMS allegations of deficiencies. The investigation reports to which
Petitioner objects are required by 42 C.F.R. §§ 483.13(c)(3) and (4) (investigations of
alleged abuse, neglect, mistreatment, and injuries of unknown source), 483.20(k)
(documentation to show the care plan was executed and that care meets professional
standards of care), 483.25 (to establish delivery of necessary care and services), and/or

'° ‘A facility notified that it has deficiencies with respect to program participation
requirements must submit a plan of correct for approval by either CMS or the state
agency, unless the deficiency is isolated and has no potential for causing more than
minimal harm. 42 C.F.R. § 488.402(d).
17

483.75(1) (required clinical records). The documents to which Petitioner objects were not
prepared for the QA committee to fulfill a QA function but rather were necessary for
Petitioner to document that it delivered necessary care and services in compliance with
participation requirements.'' Indeed, if Petitioner was successful with its objection, it
would deprive itself of the evidence it needs to satisfy its burden of persuasion in a case
of this type. Finally, I consider no action of Petitioner’s QA committee as evidence of a
deficiency or as the basis for an enforcement remedy.

Petitioner objected to my consideration of any evidence offered by CMS on grounds that
I may not receive or consider evidence gathered by the government in violation of equal
protection principles. Tr. at 66-67. Petitioner renewed its objection in its post-hearing
brief. P. Br. at 1-2. Petitioner’s theory is that the state survey agency gathered
documents, conducted the survey and found deficiencies in this case in violation of the
Petitioner’s right to equal protection. Petitioner argues that this case involves selective
enforcement. Petitioner claims that Petitioner was treated differently than similarly
situated facilities because of religious bias in that factually similar behavior in other
facilities led to citation of a scope and severity level that was lower than the scope and
severity level cited for Petitioner’s facility. In short, Petitioner argues that it was cited for
no reason other than that it is a Jewish facility. Tr. at 66-76.

The level of noncompliance assigned to a particular deficiency by CMS and the choice of
remedies imposed by CMS, when there is a basis for imposition of a remedy, are matters
that are not subject to my review. 42 C.F.R. §§ 488.438(e)(2), 488.408(g)(2),
498.3(b)(14) and (d)(10)(ii); Jewish Home, DAB No. 2254 at 14. I do not have the
authority to conduct investigations of the conduct of state or federal agencies. I do not
have the authority to adjudicate constitutional questions. I do not have authority to
fashion a remedy for a constitutional violation or resulting harm. My narrow authority is
limited to adjudicating matters subject to applicable statutes and regulations and
determining whether Petitioner was in substantial compliance with the applicable law.
Further, the hearing before an ALJ is a de novo proceeding on the issues of whether there
is a basis for imposition of an enforcement remedy and whether the remedy is reasonable.
My de novo evaluation of the evidence related to both issues, insulates a facility from the
effect of any perceived disparate treatment or bias on the part of the state survey agency
or CMS. [also ascertained at the hearing that Petitioner does not have any specific

'' Thave carefully considered the opinion of Barry Fogel, MD, that Petitioner’s event
reports are Quality Assurance documents in their entirety and confidential because they
are used by the QA Committee. CMS Ex. 6. I find his opinion is not weighty as it is
based upon the false legal premise that the regulations establish an evidentiary privilege
that extends to all QA documents. I also find his opinion is not persuasive as he fails to
address the apparent inconsistency between the alleged privilege and the requirement for
the facility to show that it is in substantial compliance with program participation
requirements and for CMS to ensure compliance by program participants.
18

evidence of bias on the part of the surveyor that participated in the January 4, 2008
survey that would impact the credibility of the surveyor’s testimony. Tr. at 69-70.

7. A CMP of $600 per day from November 2, 2007 through January
17, 2008 is reasonable.

The only enforcement remedy at issue is the CMP of $600 per day from November 2,
2007 through January 17, 2008. The issue is whether the CMP is reasonable considering
the factors listed in 42 C.F.R. § 488.438(f): (1) the facility’s history of noncompliance;
(2) the facility’s financial condition; (3) factors specified in 42 C.F.R. § 488.404; and (4)
the facility’s degree of culpability, which includes neglect, indifference, or disregard for
resident care, comfort, or safety. The regulation provides that the absence of culpability
is not a mitigating factor. The factors of 42 C.F.R. § 488.404 are: (1) the scope and
severity of the deficiency; (2) the relationship of the deficiency to other deficiencies
resulting in noncompliance; and (3) the facility’s prior history of noncompliance in
general and specifically with reference to the cited deficiencies.

In reaching a decision on the reasonableness of the CMP, I consider whether the evidence
supports a finding that the amount of the CMP is at a level reasonably related to an effort
to produce corrective action by a provider with the kind of deficiencies found, and in
light of the above factors. I am neither bound to defer to CMS’s factual assertions, nor
free to make a wholly independent choice of remedies without regard for CMS’s
discretion. Barn Hill Care Ctr., DAB No. 1848, at 21 (2002); Cmty. Nursing Home,
DAB No. 1807, at 22 (2002); Emerald Oaks, DAB No. 1800, at 9 (2001); CarePlex of
Silver Spring, DAB No. 1638, at 8 (1999).

Petitioner has a history of noncompliance in the area of accidents, particularly falls.
Petitioner was previously found to have violated 42 C.F.R. § 483.25(h) from December 9,
2005 through January 26, 2006 and a CMP of $350 per day was imposed and affirmed on
review through the Board. Petitioner was also found in violation of 42 C.F.R. §
483.25(h) from October 16, 2006 through November 16, 2006 and a CMP of $400 per
day was imposed and approved on review through the Board. Jewish Home of Eastern
Pennsylvania, DAB No. 2254, at 1. Petitioner also conceded the violation of 42 C.F.R. §
483.25(h) cited by the November 2, 2007 survey that resulted in actual harm. Petitioner
has not offered evidence to show it is unable to pay the CMP. Petitioner was culpable in
the case of Resident 164. The violation of 42 C.F.R. § 483.25(h) was a serious
deficiency that resulted in actual harm to the resident. I also note that a CMP of $600 per
day is in the lower third of authorized CMPs for non-immediate jeopardy level
deficiencies. I conclude that a CMP of $600 per day from November 2, 2007 through
January 17, 2008 is reasonable based upon the violation of 42 C.F.R. § 483.25(h) and the
admitted deficiencies from the November 2007 survey.

Petitioner argues that the Secretary could not impose a CMP against Petitioner without
authority of the Attorney General, citing section 1128A(c)(1) of the Act (42 U.S.C. §
1320a-7a(c)(1). P. Br. at 2. Section 1128A(c)(1) of the Act requires that the Attorney
19

General and the Secretary agree upon procedures for the imposition of CMPs,
assessments, and exclusions. Section 1128A(c)(1) of the Act is applicable to CMPs that
the Secretary and her delegate, CMS, may impose as an enforcement remedy against a
SNF pursuant to section 1819(h)(2)(B)(ii) of the Act. Pursuant to sections 1102 and 1871
of the Act, the Secretary has promulgated regulations governing the imposition of CMPs
pursuant to the authority of the Act. Contrary to the suggestion of Petitioner in this case,
section 1128A(c)(1) does not require that the Attorney General authorize the imposition
of CMPs against SNFs in individual cases. Furthermore, the provisions of the Act
authorizing the imposition of CMPs against individual SNFs, as implemented by the
Secretary’s regulations, do not require that the Attorney General authorize the imposition
of CMPs in individual cases. 42 C.F.R. Part 402; 63 Fed. Reg. 68,690 (Dec. 14, 1998).
Thus, I conclude that Petitioner’s argument is without merit.

Petitioner argues that the Secretary erred by imposing a CMP without considering
mitigating factors in arriving at the reasonable CMP. P. Br. at 3. I conclude that
Petitioner’s argument is without merit. Petitioner misconstrues the application of the
language of 42 C.F.R. § 488.438(f)(4), which provides that the “absence of culpability is
not a mitigating circumstance in reducing the amount of the penalty.” The provision has
no application in this case as Petitioner was clearly culpable in its failure to develop and
implement appropriate interventions to fulfill its regulatory obligation to ensure that
Resident 164 had adequate supervision to prevent falls. However, in assessing the
reasonableness of the $600 per day CMP, I have specifically considered Petitioner’s
culpability. I have specifically considered the degree or amount of Petitioner’s
culpability given Petitioner’s failing or neglect of its regulatory obligation vis-a-vis the
efforts made toward care planning actually undertaken and implemented, i.e. there was
not a complete failure to care plan for falls as evidenced by the placement of mats, the
use of a low bed, and the other interventions listed on Resident 164’s care plan. My
review of the reasonableness of the CMP is de novo and I do not review whether or how
CMS considered the regulatory factors when selecting the amount of the CMP.

Il. Conclusion

For the foregoing reasons, Petitioner was not in substantial compliance with program
participation requirements from November 2, 2007 through January 17, 2008. There is a
basis for the imposition of an enforcement remedy. A CMP of $600 per day from
November 2, 2007 through January 17, 2008 is reasonable.

/s/
Keith W. Sickendick
Administrative Law Judge