SUBJECT:

Alden Park Strathmoor,

Petitioner,

Centers for Medicare & Medicaid

DECISION

I decide that the Centers for Medicare & Medicaid Services (CMS) proved a prima facie case, which Petitioner did not rebut by the preponderance of the evidence, that Petitioner allowed one or more of its residents to be sexually abused by another resident. For this reason, I find that CMS established a basis to impose a per instance civil money penalty against Petitioner. I find not to be clearly erroneous CMS's determination that Petitioner's failure to prevent abuse constituted immediate jeopardy for residents of Petitioner's facility. I find to be reasonable the civil money penalty of $3,050 that CMS imposed in this case. I find also that, as a matter of law, the State of Illinois may not authorize Petitioner to conduct a nurse aide training and competency evaluation program (NATCEP).

I. Background

Petitioner is a skilled nursing facility in Rockford, Illinois. It participates in the Medicare program. Its participation in Medicare is governed by federal laws at sections 1818 and 1866 of the Social Security Act (Act). Additionally, its participation is governed by regulations published at 42 C.F.R. Parts 483, 488, and 498.

On August 6, 2002, Petitioner was surveyed for compliance with federal participation requirements (August survey). The surveyors concluded that Petitioner was deficient in several respects. Petitioner's alleged deficiencies included an alleged failure by Petitioner to protect four of its female residents against sexual abuse by a male resident. The surveyors concluded that this alleged deficiency was so serious that it placed Petitioner's residents at immediate jeopardy.

CMS concurred with the deficiency findings and determined to impose remedies against Petitioner. In a notice letter dated October 9, 2002, CMS advised Petitioner that these remedies included a per instance civil money penalty of $3,050 to address Petitioner's immediate jeopardy level deficiency. Additionally, CMS imposed a $1,500 per instance civil money penalty to address the non-immediate jeopardy level deficiencies that were identified at the August survey. CMS also advised Petitioner that it would lose its authority to conduct NATCEP. ⁽¹⁾

Petitioner requested a hearing. In its initial request, dated October 17, 2002, Petitioner challenged only its loss of authority to conduct NATCEP. However, on December 6, 2002, Petitioner amended its request so as to challenge the $3,050 per instance civil money penalty as well. In the December 6 letter, Petitioner did not challenge the $1,500 civil money penalty that was imposed based on the August survey findings or the several $1,500 civil money penalties that were imposed based on findings made at the July 2002 surveys.

Subsequently, the parties agreed that the case could be tried based on their written submissions. CMS submitted 29 proposed exhibits (CMS Ex. 1 - CMS Ex. 29), a witness declaration, a pre-hearing brief, a brief in support of disposition in its favor, and a reply brief. I have marked CMS's witness declaration as CMS Ex. 30. Petitioner submitted three proposed exhibits (P. Ex. 1 - P. Ex. 3), a pre-hearing brief, a brief in support of disposition in its favor, and a reply brief. Neither party objected to my receiving into evidence any of the proposed exhibits. Consequently, I receive into evidence CMS Ex. 1 - CMS Ex. 30 and P. Ex. 1 - P. Ex. 3.

II. Issues, findings of fact and conclusions of law

A. Issues

This case does not involve any of the deficiency findings that were made at surveys of Petitioner in July 2002. It involves only the immediate jeopardy level deficiency finding that was made at Tag 223 of the report of the August survey. CMS Ex. 1, at 1 - 11. The deficiency finding at Tag 223 of the report is cited at the immediate jeopardy level and is the basis for the $3,050 per instance civil money penalty and loss of authority to conduct NATCEP that is at issue in this case.

The parties' contentions and arguments about Tag 223 raise the following issues:

1. Did CMS establish a prima facie case, which Petitioner did not rebut, that Petitioner failed to protect its residents from abuse?

2. Was CMS clearly erroneous in determining that Petitioner's failure to protect its residents against abuse posed immediate jeopardy for residents?

3. Is a per instance civil money penalty of $3,050 a reasonable remedy in this case?

4. Is Petitioner's loss of the authority to conduct NATCEP a consequence that results as a matter of law from the immediate jeopardy level deficiency finding made at the August survey?

B. Findings of fact and conclusions of law

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

1. CMS established a prima facie case, which Petitioner did not rebut by a preponderance of the evidence, that Petitioner failed to protect its residents from abuse.

The allegations at Tag 223 of the August survey report are that Petitioner failed to comply with the requirements of 42 C.F.R. § 483.13(b). CMS Ex. 1, at 1 - 6. This regulation states that a resident of a facility:

has the right to be free from verbal, sexual, physical, and mental abuse . . . .

The word "abuse" is defined at 42 C.F.R. § 488.301 to mean:

the willful infliction of injury, unreasonable confinement, intimidation, or punishment with resulting physical harm, pain or mental anguish.

By reading the definition of "abuse" into 42 C.F.R. § 483.13(b), it is apparent that the regulation prohibits a facility from allowing the willfully harmful infliction of injury, unreasonable confinement, intimidation, or punishment of a verbal, sexual, physical, or mental character against any resident.

The weight of the evidence in this case is that Petitioner failed to take necessary precautions to prevent one of its residents from engaging in sexually abusive conduct towards female residents and, so, allowed such abuse to occur. Petitioner's staff knew that one of its residents had repeatedly engaged in questionable conduct involving female residents. The staff was sufficiently concerned about this resident's inappropriate behavior that they decided to place the resident under surveillance. But, the staff failed to keep a sufficiently close watch on the resident so as to prevent him from engaging in sexually abusive conduct directed against a female resident.

The specific allegations of noncompliance at Tag 223 center around the alleged conduct of a male resident, identified in the survey report as R1, towards four female residents, identified in the survey report as R2, R3, R4, and R5. Allegedly, R1 sexually abused these four female residents and Petitioner allowed the abuse to occur. The specific allegations of abuse are recited in the report of the August survey as follows:

• On June 18, 2002, R1 was found to be fondling R4 in his bed. CMS Ex. 1, at 2.

• On June 24, 2002, R1 was observed to be bringing R3 into his room. Id.

• On July 2, 2002, R1 was found to be coaxing R5 into his room. Id.

• On July 20, 2002, R1 entered a shower stall while R2 was in the stall. After R1 left the stall, Petitioner's staff found R2 to be in the stall, naked, and extremely agitated. R2 claimed that R1 had raped her. ⁽²⁾ Id.

CMS avers that each of these four episodes and, in particular, the episode involving R2, are episodes in which R1 sexually abused a female resident. I am not persuaded that the evidence offered by CMS concerning the first three of these episodes is sufficiently probative to create a prima facie case that any of them constituted sexual abuse. CMS Ex. 22, at 3. There is no evidence that the episode of fondling observed on June 18, 2002, was not consensual. The two instances in which R1 attempted to coax/bring female residents into his room are not described with sufficient particularity to allow me to conclude that they were preludes to sexual assaults on these residents or some other form of abuse.

However, although the first three episodes may not clearly have been instances in which R1 attempted to perpetrate sexual abuse against Petitioner's female residents, they certainly provided information to warn Petitioner's staff to conclude that R1 likely was a threat to abuse sexually Petitioner's female residents. These episodes made it evident that R1 was sexually interested in Petitioner's female residents and capable of engaging in sexually inappropriate behavior towards them. That Petitioner's staff knew that R1 might engage in sexually abusive behavior towards female residents is apparent from the social service progress sheet that the staff generated for the resident. CMS Ex. 22. After each of the three incidents that occurred in June and early July 2002, Petitioner's staff spoke with R1 and advised him that his conduct was inappropriate. Id. at 3. Petitioner's staff placed R1 on an informal watch because of his inappropriate sexual behavior. CMS Ex. 1, at 4.

By contrast with the first three episodes, the episode that occurred on July 20, 2002, clearly was an incident in which R1 engaged in sexually abusive behavior. The evidence relating to this episode does not support findings that R1 fondled or raped R2. But, it plainly supports an inference that R1 inappropriately observed R2 while R2 was standing naked in one of Petitioner's shower stalls. This behavior was deliberate and it caused R2 to experience great distress.

I have considered whether R1 was capable of engaging in conduct of a willfully abusive nature. In other cases, I have held that inappropriate conduct did not constitute "abuse" as is defined by 42 C.F.R. § 488.301 because evidence showed that the perpetrator lacked the mental capacity to form an intent to commit harm. But, the evidence in this case does not show that R1 was so incapacitated mentally as to lack the ability to form the intent to engage in conduct of an inappropriate sexual character. The resident is diagnosed to be suffering from schizophrenia. The resident also has been assessed to manifest short term memory deficits and moderately impaired cognitive skills for daily decisionmaking. CMS Ex. 17; CMS Ex. 19, at 3 - 5. However, the record does not show him to be so disoriented or demented as to be incapable of forming an intent to commit harmful conduct or of comprehending the consequences of his actions. Moreover, the resident acknowledged to Petitioner's staff after the incident of July 20, 2002, that he knew that his conduct was inappropriate. CMS Ex. 22, at 4.

Petitioner argues that there is no credible evidence that R1 sexually assaulted R2 in the shower. According to Petitioner, no reliable witness witnessed an assault taking place. It contends that deciding what actually occurred between R1 and R2 is, essentially, guesswork. As I discuss above, I agree with Petitioner that the evidence fails to establish a prima facie case that R1 physically assaulted R2. But, it is reasonable to say that R1 watched R2 while she was unclothed, that his behavior was uninvited by R2, and that his conduct caused R2 to suffer a great amount of emotional distress.

There is nothing in the regulations to suggest that sexual abuse is limited to intentionally harmful sexual physical contact. Observing another person while that person is undressed is abuse within the meaning of the regulations, if it is done intentionally and if mental anguish is inflicted on the victim.

2. It is unnecessary that I address CMS's alternate theory of noncompliance.

In its initial brief, CMS asserts for the first time that, in failing to protect its residents against sexual abuse by R1, Petitioner failed to comply substantially with the requirements of 42 C.F.R. § 483.25(h)(2). This regulation requires that each resident of a facility receive adequate supervision and assistive devices to prevent accidents. CMS relies on the same facts to support this new allegation as it does to support its assertion that Petitioner failed to comply with the requirements of 42 C.F.R. § 483.13(b). According to CMS, Petitioner should have provided sufficient supervision to R1 to protect other residents from the adverse consequences of the resident's sexual proclivities.

Petitioner argues that to allow CMS to amend its allegations at this late stage of the case would deny Petitioner due process. However, it is unnecessary that I decide this argument inasmuch as I conclude that Petitioner was deficient under 42 C.F.R. § 483.13(b).

3. CMS was not clearly erroneous in determining that Petitioner's failure to protect its residents against abuse posed immediate jeopardy for residents.

"Immediate jeopardy" is defined at 42 C.F.R. § 488.301 to mean:

a situation in which the provider's noncompliance with one or more requirements of participation has caused, or is likely to cause, serious injury, harm, impairment, or death to a resident.

It is a facility's burden to prove that a determination by CMS of an immediate jeopardy level deficiency is clearly erroneous. Here, CMS determined that Tag 223 was an immediate jeopardy level deficiency. I find that Petitioner did not prove this determination to be clearly erroneous.

The undisputed evidence in this case is that the encounter between R1 and R2 caused R2 to suffer a great deal of emotional distress. Petitioner's staff reported that, when they encountered R2 in the shower after the incident, the resident was very upset and asserted that she had been raped. CMS Ex. 25, at 5. This is more than sufficient evidence from which to infer that R2 suffered severe mental harm from the episode. Petitioner has offered nothing in rebuttal that would suggest that a determination of immediate jeopardy based on the evidence of R2's emotional distress is clearly erroneous.

4. A per instance civil money penalty of $3,050 is a reasonable remedy in this case.

As a matter of law, $3,050 is the minimum civil money penalty that CMS can impose for each day of immediate jeopardy level noncompliance by a facility. 42 C.F.R. § 488.438(a)(1)(i). In any case, CMS has the option of imposing a per instance civil money penalty in lieu of a daily civil money penalty and the range of such per instance penalties is from $1,000 - $10,000. 42 C.F.R. § 488.438(a)(2). The regulation governing per instance penalties draws no distinction between immediate jeopardy and non-immediate jeopardy level deficiencies. In theory, therefore, a per instance civil money penalty might be as low as $1,000 for even an immediate jeopardy level deficiency.

Here, CMS exercised its discretion to impose a per instance civil money penalty against Petitioner. The amount it determined to impose, $3,050, is the same as the minimum immediate jeopardy level daily penalty amount. I find this determination to be reasonable given that the deficiency manifested by Petitioner was at the immediate jeopardy level. In effect, CMS determined that it would penalize Petitioner at exactly the same amount as it would have imposed had it imposed the minimum daily immediate jeopardy level penalty. This is a logical outcome given that the deficiency was of a scope and severity that justifies the minimum immediate jeopardy level daily penalty and given further that the choice between imposing a daily or a per instance civil money penalty lies entirely with CMS.

Moreover, the penalty amount is justified by the regulations which govern the manner in which penalty amounts are determined. The regulations require that factors be considered in deciding a penalty amount which include the seriousness of a deficiency, a facility's compliance history, its culpability, and its financial condition. 42 C.F.R. §§ 488.438(f)(1) - (4), 488.404 (incorporated by reference into 42 C.F.R. § 488.438(f)(3)). Here, the seriousness of Petitioner's noncompliance - which is certainly at the minimal immediate jeopardy level - is sufficient to warrant a penalty of $3,050. I note that Petitioner has offered no evidence to show that its financial condition precludes payment of this penalty amount.

5. Petitioner's loss of the authority to conduct NATCEP is a consequence that results as a matter of law from the immediate jeopardy level deficiency finding made at the August survey.

Petitioner has challenged its loss of authority to conduct NATCEP. I sustain Petitioner's loss of authority because it is required as a matter of law by the finding of an immediate jeopardy level deficiency at Petitioner's facility at the August survey.

A participating facility's authorization to conduct NATCEP is governed by sections 1819(f)(2)(B) and 1919(f)(2)(B) of the Act and by regulations at 42 C.F.R. §§ 483.150 - 483.154. ⁽³⁾ The regulations provide that a State may not authorize a facility to conduct NATCEP if that facility has been subjected to an extended or partial extended survey as is described at sections 1819(g)(2)(B)(i) or 1919(g)(2)(B)(i) of the Act. 42 C.F.R. § 483.151(b)(2)(iii). An "extended survey" occurs where a facility is found to have furnished a substandard quality of care during a standard survey. 42 C.F.R. §§ 488.301, 488.310. A "partial extended survey" occurs where a facility is found to have provided care of a substandard quality at an abbreviated standard survey. 42 C.F.R. § 488.301. "Substandard quality of care" is defined at 42 C.F.R. § 488.301 to mean:

one or more deficiencies related to participation requirements under § 483.13, . . . which constitute either immediate jeopardy to resident health or safety; a pattern of or widespread actual harm that is not immediate jeopardy; or a widespread potential for more than minimal harm, but less than immediate jeopardy, with no actual harm.

Thus, a finding of an immediate jeopardy level deficiency under 42 C.F.R. § 483.13 (or other regulations that are not relevant to this case) will trigger a partial extended survey. And, a facility's NATCEP authorization must be revoked where a partial extended survey is conducted at that facility.

In this case Petitioner's loss of NATCEP authorization follows, as a matter of law, from my decision to sustain the immediate jeopardy finding at Tag 223 of the August survey report. Findings 1, 2, and 3. The immediate jeopardy level deficiency stems from Petitioner's failure to comply with the requirements of 42 C.F.R. § 483.13(b). The immediate jeopardy level deficiency triggered a partial extended survey of Petitioner and that, in turn, mandated the Illinois Department of Health, the State survey agency that conducted the August survey, to withhold Petitioner's NATCEP authorization.

Steven T. Kessel

Administrative Law Judge

1. Additionally, CMS imposed several $1,500 per instance civil money penalties to address deficiencies that were identified in surveys conducted of Petitioner's facility in July 2002.

2. The survey report contains inconsistent allegations. It alleges that R1 was observed to be leaving the shower stall and that R2 was found subsequently to be in the stall naked. CMS Ex. 1, at 2. However, it also alleges that R2 was found to be with R1 in the shower stall. Id. These inconsistent allegations reflect Petitioner's own documentation of the alleged incident.

3. Generally, section 1819 of the Act applies to a facility's participation in the Medicare program and section 1919 of the Act applies to a facility's participation in a State Medicaid program.