SUBJECT:

St. Andrews Place, Inc.,

Petitioner,

Centers for Medicare & Medicaid

DECISION

For the reasons set forth below, I dismiss as untimely the hearing request filed by Petitioner, St. Andrews Place, Inc. (hereafter Petitioner or facility). Moreover, I find that even if Petitioner had timely filed or satisfied the criteria for extending the time for filing, the Centers for Medicare and Medicaid Services (CMS) would nevertheless be entitled to summary judgment for those findings that Petitioner did not appeal.

I. Background

To participate in the Medicare and Medicaid programs, facilities periodically undergo surveys to determine whether they comply with applicable statutory and regulatory requirements for Medicare (skilled nursing facilities (SNFs)) and/or Medicaid (nursing facilities (NFs)). The Secretary of Health and Human Services (Secretary) contracts with state survey agencies to conduct those surveys. Social Security Act (Act), section 1864(a); 42 C.F.R. § 488.20. The regulations require that each facility be surveyed at least once every 12 months and more often, if necessary, to ensure that identified deficiencies are corrected. 42 C.F.R. § 488.20(a).

In this case, on October 4, 2000 the Arkansas Department of Human Services (State Agency) completed a complaint investigation survey, and concluded that the facility was not in substantial compliance with federal requirements for nursing home participation in the Medicare and Medicaid programs. Specifically, the State Agency found eight deficiencies under the following regulations: 42 C.F.R. § 483.13 (Resident behavior/facility practices), 42 C.F.R. § 483.25 (Quality of care), 42 C.F.R. § 483.75 (Administration), and 42 C.F.R. § 483.60 (Pharmacy services). CMS agreed and in a letter, dated October 26, 2000, advised the facility that it was not in substantial compliance with program requirements. Therefore, based on its noncompliance, CMS: 1) would terminate the facility's provider agreement effective January 2, 2001; 2) was imposing a $5,000 per instance civil money penalty (CMP); and 3) would deny payment for new admissions (DPNA) effective November 10, 2000. The letter also set forth appeal rights:

If you disagree with the determination of noncompliance, you or your legal representative may request a hearing before an administrative law judge of the Department of Health and Human Services, Departmental Appeals Board. Procedures governing this process are set out in 42 C.F.R. § 498.40 et seq. You may appeal the finding of noncompliance which led to an enforcement action, but not the enforcement action or remedy itself. A written request must be filed no later than December 25, 2000 (60 days from receipt of this letter via fax.)

* * * *

A request for hearing should identify the specific issues, and the findings of fact and conclusions with which you disagree. It should also specify the basis for contending that the findings and conclusions are incorrect.

CMS Ex. 1, at 2 (emphasis in original).

The State Agency completed another inspection survey on October 20, 2000, and determined that the facility was still out of compliance with one program requirement, 42 C.F.R. § 483.25 (Quality of care). CMS agreed and by letter, dated November 8, 2000, advised the facility that its enforcement actions remained unchanged. The letter also advised the facility that, if it disagreed with the determination, it could request a hearing, and the hearing request "must be filed no later than January 7, 2001 (60 days from the date of receipt of this letter via fax)." CMS Ex. 2.

Thereafter, in a letter dated December 12, 2000, CMS advised the facility that its deficiencies had been corrected and that it had achieved substantial compliance with program requirements. The termination action was rescinded; payment for new admissions would resume effective December 1, 2000, although the $5,000 CMP remained in effect. CMS Ex. 3.

In a letter dated January 5, 2001, received by CMS on January 9, 2001, Petitioner requested an ALJ hearing, seeking to appeal some, but not all, of the deficiencies cited in the October 4 survey. CMS Ex. 4. CMS has filed a motion to dismiss, arguing that Petitioner's hearing request was not timely filed. In the alternative, CMS asks for partial summary judgment arguing that, by themselves, the deficiencies that Petitioner did not appeal justify imposition of the DPNA and the CMP.

Petitioner concedes its timely receipt of the October 26 notice letter. However, Petitioner points to the subsequent letters - the November 8 letter which set forth a January 7 filing deadline and the December 12 letter which contained no filing deadline - and asserts its belief that the January 7 appeal date superseded the December 25 deadline. In the alternative, Petitioner asked that it not be penalized because of its "misinterpretation of the notice letter."

II. Discussion

I make findings of fact and conclusions of law to support my decision. I set forth each finding below, in italics, as a separate heading.

A. Petitioner is not entitled to a hearing because it did not file a timely hearing request.

Section 1866(h) of the Act authorizes administrative review of determinations that a provider fails to comply substantially with the program requirements "to the same extent as is provided in section 205(b) [of the Act]." Under section 205(b), the Secretary must provide reasonable notice and opportunity for a hearing "upon request by [the affected party] who makes a showing in writing that his or her rights may be prejudiced" by the Secretary's decision. The hearing request "must be filed within sixty days" after receipt of the notice of CMS's determination. Act, section 205(b) (emphasis added). The 60-day time limit is thus a statutory requirement. See Cary Health and Rehabilitation Center, DAB No. 1771, at 8 - 9 (2001).

Similarly, the regulations mandate that the affected party "file the request in writing within 60 days from receipt of the notice . . . unless that period is extended . . . ." 42 C.F.R. § 498.40(a). On motion of a party, or on his or her own motion, the administrative law judge (ALJ) may dismiss a hearing request where that request was not timely filed and the time for filing was not extended. 42 C.F.R. § 498.70(c). Under sections 498.40(a)(2) and 498.22(b)(3), receipt is "presumed to be 5 days after the date on the notice unless there is a showing that it was, in fact, received earlier or later."

Here, the notice language in the October 26 letter is clear and unconditional: the facility's appeal of the findings of noncompliance stemming from the October 4 survey had to be filed on or before December 25. As I discuss in more detail below, nothing in the subsequent letters suggests any alteration of that deadline. Petitioner does not dispute its timely receipt of that letter, and admits that it did not file its hearing request within 60 days of its receipt. Thus, on its face, the hearing request is untimely and dismissal is appropriate. I next consider whether Petitioner has demonstrated good cause for me to extend the time for filing.

B. Petitioner has not established good cause for extending the time to file its hearing request.

If a hearing request is not filed within 60 days, the affected party may file with the ALJ a written request for an extension of time stating the reasons why the request was not filed timely. Upon a showing of good cause, the ALJ may extend the time for filing. 42 C.F.R. § 498.40(c). No statute or regulation defines "good cause." However, good cause has been held to mean a circumstance or circumstances that would prevent a party from requesting a hearing timely and which is beyond a party's ability to control. Hammonds Lane Center, DAB CR913 (2002); Sunchase Nursing Center, DAB CR717 (2000); Cary Health and Rehabilitation Center, DAB CR685 (2000), aff'd, DAB No. 1771 (2001); Hospicio San Martin, DAB CR387, aff'd, DAB No. 1554 (1996); Mathis Nursing Home, DAB CR461 (1997).

Petitioner justifies its failure to file a timely appeal by its purported confusion created by CMS's subsequent notice letters. I do not find such confusion reasonable. The October 26 letter plainly refers to deficiencies cited during the October 4 survey, and explicitly states that a request for hearing "must be filed no later than December 25, 2000 (60 days from the date of receipt of this letter via fax)." CMS Ex. 1. The November 8 letter plainly refers to the October 20 survey findings, and sets a deadline for appeal of those findings. CMS Ex. 2. The December 12 letter provides no additional right to appeal, and sets forth no additional deadlines.

Appellate panels of the Departmental Appeals Board (Board) have repeatedly reviewed notices containing virtually identical language, and found it "explicit" and "unambiguous," rendering "unpersuasive the facility's claim to have been confused by CMS's action." Concourse Nursing Home, DAB No. 1856 (2002); Nursing Inn of Menlo Park, DAB No. 1812 (2002); Cary Health and Rehabilitation Center, DAB No. 1771 (2001). Inaction in filing a request for hearing is not justified where the regulatory time frame for appeal was clear, and the notice letter spelled out in detail the facility's appeal rights. Id.

C. CMS's determination on two unchallenged deficiencies is final and binding.

Even if Petitioner had timely filed its appeal, my review would be limited. The applicable regulations dictate that CMS mail notice of an initial determination to the affected party, setting forth the basis for its initial determination, the effects of the determination, and the party's right to hearing. The initial determination is final and binding unless reversed or modified by a hearing decision, or under other circumstances not applicable here. 42 CFR § 498.20(b). Here, the facility did not and does not contest CMS's determination of deficiencies under Tags F314 (pressure sores), and F324 (prevention of accidents), ⁽¹⁾ so CMS's determination on those two tags is final and binding.

I next consider what consequences flow from that final and binding determination.

D. The two uncontested deficiencies alone provide a sufficient basis for imposing a CMP.

A long-term care facility participating in the Medicare and Medicaid programs must be in substantial compliance with relevant Medicare requirements. Hillman Rehabilitation Center, DAB No. 1611 (1997), aff'd, Hillman Rehabilitation Center v. United States, Department of Health and Human Services, Health Care Financing Administration, No. 98-3789 (GEB), slip op. at 25 (D.N.J. May 13, 1999).]. "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. If a facility is not in substantial compliance with program requirements, CMS has the discretion to impose one or more of the enforcement remedies listed in 42 C.F.R. § 488.406, which include denial of payment for new admissions, and imposing a CMP. 42 C.F.R. § 488.402; see Act, section 1819(h). CMS may impose the CMP for each instance of noncompliance and, whether or not it finds immediate jeopardy, penalties will be in the range of $1,000 to $10,000. 42 C.F.R. § 488.438(a)(2). At $5,000, the CMP here is mid-range.

We have a final and binding determination that the facility was out of compliance with the requirements assessed under Tags F314 and F324. Tag F314 addresses the requirements of 42 C.F.R. § 483.25(c), which mandates that the facility ensure that a resident who enters the facility without pressure sores does not develop them unless unavoidable, and that a resident with pressure sores receives necessary treatment and services to promote healing, prevent infection, and prevent new sores from developing. According to the unchallenged survey findings, Resident # 7 was admitted to the facility on April 7, 2000, without pressure sores. The facility identified her as having "potential for skin breakdowns" and, as part of her care plan, required staff to turn and reposition her every two hours, as needed. An October 3, 2000 body audit identified a Stage II pressure sore on her right buttock. The resident complained that she had been left sitting in her wheel chair for 5 hours, and her medical record contained no documentation that she was turned and repositioned as prescribed in her care plan. CMS Ex. 7, at 3.

Tag F324 cites deficiencies under 42 C.F.R. § 483.25(h)(2) which requires that each resident receive adequate supervision and assistive devices to prevent accidents. Again, the facility has not challenged survey findings that it failed to meet this requirement. On July 22, 2000, a nurse attempting unsuccessfully to draw Resident # 7's blood sought assistance, leaving the resident with a butterfly needle in her arm. When the assisting nurse entered the room, she found Resident # 7 with a butterfly needle in her right hand, a tourniquet still on her arm, and her hand purple. CMS Ex. 7, at 5.

The surveyors categorized each of these deficiencies at a scope and severity level of D, posing no actual harm with the potential for more than minimal harm. Petitioner has not challenged this determination. I agree that these deficiencies, by themselves, demonstrate the potential for more than minimal harm. CMS thus made what has become a final and binding determination that the facility was not in substantial compliance with program requirements and, under 42 C.F.R. § 488.402, has the authority to impose both DPNA and a CMP.

E. I have no authority to review CMS's decision to impose either the DPNA or the CMP, and the amount of the CMP must be at least $1,000.

Having determined that a basis exists for imposition of remedies, the regulations limit my authority to review CMS's selection of remedies. I may not review CMS's discretion to impose the DPNA nor the CMP. 42 C.F.R. § 488.408(g)(2). The regulations at 42 C.F.R. § 488.438(a)(2) prescribe that "when penalties are imposed for an instance of noncompliance, the penalties will be in the range of $1,000 through $10,000 per instance." Further, I may review the amount of the CMP, but may not set a penalty of zero, nor reduce the penalty to zero. 42 C.F.R. § 488.438(e). Petitioner, however, asserts that it is not concerned about payments, only with "clearing the record with regard to the cited deficiencies for which [it] has appealed." Petitioner's Response at 3.

III. Conclusion

Because Petitioner's hearing request was untimely, I exercise my authority under 42 C.F.R. § 498.70 and dismiss this case. Even if the facility had timely filed its appeal, it did not dispute two deficiencies which, by themselves, constitute substantial noncompliance. Inasmuch as I have no authority to review CMS's selection of remedies, and Petitioner does not challenge the amount of the CMP, nothing remains for my review.

Carolyn Cozad Hughes

Administrative Law Judge

1. Although in its hearing request, Petitioner does not mention specifically Tag F332 (Medication errors), the facts supporting that alleged deficiency closely parallel those supporting Tags F426, F490, and F521 (Pharmacy services). Inasmuch as Petitioner's hearing request specifically challenges the facts underlying the F332 deficiencies, I consider that the hearing request preserves petitioner's appeal of that deficiency finding.