Schowalter Villa (Schowalter) appealed a January 25, 1999 decision by Administrative Law Judge (ALJ) Mimi Hwang Leahy to dismiss its request for hearing based on a determination that Schowalter had no right to a hearing under the applicable regulations at 42 C.F.R. Part 498. See Schowalter Villa, DAB CR568 (1999) (ALJ Decision). Schowalter had requested an evidentiary hearing before an ALJ for the purpose of challenging survey findings that Schowalter was not in substantial compliance with participation requirements for nursing homes participating in the Medicaid and/or Medicare programs and that there was immediate jeopardy to resident health and safety. The Health Care Financing Administration (HCFA) moved to dismiss Schowalter's request for a hearing on the ground that there is no right to a hearing where HCFA is not imposing any of the enforcement remedies specified in 42 C.F.R. § 488.406.

The ALJ found that even though HCFA had earlier informed Schowalter that two enforcement remedies listed in section 488.406 would be imposed, HCFA later rescinded those remedies.⁽¹⁾ The ALJ further found that, in response to HCFA's inquiry whether Schowalter wished to withdraw its hearing request in light of the rescission of the two remedies, Schowalter indicated that it was still requesting a hearing since it remained subject to a ban on nurse-aide training and was concerned about its compliance record.⁽²⁾

The ALJ Decision then states:

. . . citing the plain language of 42 C.F.R. § 498.3(b)(12), 42 C.F.R. § 498.3(d)(10)(iii), and 42 C.F.R. § 488.406, the administrative law judges and appellate panels of the Departmental Appeals Board have uniformly held that a petitioner loses its right to a hearing if HCFA rescinds the remedies it had previously imposed. In reliance on the same regulations, they have reached also the conclusion that there exists no hearing right if HCFA has not imposed one of the remedies specifically listed in 42 C.F.R. § 488.406, or if the facility seeks to challenge only the prohibition against providing a nurse-aide training program. Moreover, as the administrative decisions and the regulation at 42 C.F.R. § 498.3(b)(12) make clear, a facility does not have a right to correct its compliance record through the hearing process provided by 42 C.F.R. Part 498 if none of the remedies listed in 42 C.F.R. § 488.406 has been imposed by HCFA (or if they had been rescinded by HCFA).

ALJ Decision at 2-3.⁽³⁾ The ALJ concluded that she was therefore "without the authority to review or redress"

Schowalter's objections "to having been banned from providing a nurse-aid training program" or "to having been left with a bad compliance record . . . ." Id. at 1. Accordingly, the ALJ granted HCFA's motion to dismiss.

On appeal to this Board, Schowalter argued that an appealable initial determination under 42 C.F.R

§ 498.3(b)(13) includes a challenge to a level of noncompliance if it "would affect the range of civil monetary penalty amounts that HCFA could collect." (Emphasis added.) According to Schowalter, HCFA's decision to withdraw the CMP does not change the fact that a successful challenge by Schowalter would affect the CMP that HCFA could collect. Schowalter asserted that the cases on which the ALJ relied did not consider this argument.

The record here includes the record before the ALJ, the ALJ Decision and the parties' briefs on appeal. Our standard for review of an ALJ decision on a disputed issue of law is whether the decision is erroneous.

We conclude that the ALJ's legal conclusions are not erroneous and that Schowalter is not entitled to receive a hearing under the circumstances here for the reasons stated by the ALJ. The strained construction of 42 C.F.R. § 498.3(b)(13) offered by Schowalter is not tenable since the second sentence of that provision clearly refers to the situation where a CMP has actually been imposed. We therefore summarily affirm in its entirety the ALJ Decision dismissing Schowalter's request for a hearing. In doing so, we affirm and adopt each of the ALJ's findings of fact and conclusions of law.

1. The record reflects the following, although the ALJ did not make findings of fact to this effect. By letter dated May 12, 1998, HCFA notified Schowalter that, based on a survey completed in April 1998, HCFA was imposing a denial of payment for new admissions (DPNA) effective July 16, 1998, and a civil money penalty (CMP) effective April 1, 1998. HCFA Ex. 1. By letter dated June 5, 1998, HCFA notified Schowalter that, based on a May 27, 1998 revisit, HCFA had determined that Schowalter was in substantial compliance and that the DPNA would not be effectuated. HCFA Ex. 2. Schowalter requested a hearing by letter dated July 8, 1998. HCFA Ex. 3. By letter dated July 13, 1998, HCFA notified Schowalter that neither the DPNA nor the CMP would be effectuated. HCFA Ex. 4.

2. As HCFA advised Schowalter in its May 12, 1998 letter, any facility subject to an extended or partial extended survey is prohibited from conducting nurse aide training and competency evaluations for a two-year period. Sections 1819(f)(2)(B) and 1919(f)(2)(B) of the Social Security Act.

3. The ALJ cited, inter alia, Arcadia Acres, Inc., DAB CR424 (1996), aff'd DAB 1607 (1997); Country Club Center II, DAB CR433 (1996), aff'd DAB 1614 (1997); and Rafael Convalescent Hospital, DAB CR444 (1996), aff'd DAB 1616 (1997).