SUBJECT:

Professional Home Health Care, Inc.,

Petitioner,

Centers for Medicare & Medicaid

DECISION

I decide that Petitioner, Professional Home Health Care, Inc., failed to comply substantially with two of the conditions of participation which govern a home health agency's participation in the Medicare program. I decide further that the Centers for Medicare & Medicaid Services (CMS) was authorized to terminate Petitioner's participation in Medicare as a home health agency in light of Petitioner's failure to comply with these conditions of participation.

I. Background

At all relevant times, Petitioner was a Medicare provider of home health services located in Boulder, Colorado, with branch offices in Denver, Longmont, and, initially, Greeley, Colorado. ⁽¹⁾ CMS determined, following a revisit survey completed on May 23, 2001, that Petitioner had failed to correct deficiencies related to two conditions of participation cited on a March 12, 2001 re-certification/complaint survey (Tag G122 on the statement of deficiencies which references 42 C.F.R. § 484.14, Organization, Services and Administration; and Tag G156 on the statement of deficiencies which references 42 C.F.R. § 484.18, Acceptance of Patients, Plan of Care, and Medical Supervision), as well as a number of standard-level deficiencies. Based on these deficiencies, CMS terminated Petitioner's provider agreement.

Petitioner requested a hearing to contest the termination and the case was assigned to me for a hearing and a decision. I held a hearing in the case from January 6 - 9, 2003, in Denver, Colorado. ⁽²⁾ During the hearing, I admitted CMS's exhibits (CMS Exs.) ⁽³⁾ 1 - 107, 109, 110, and 112 - 26, and Petitioner's exhibits (P. Exs.) 1 - 64 and 66. Tr. at 27, 29, 429, 430. ⁽⁴⁾

II. Applicable Law

Under the Medicare program, a home health agency is a public agency or private organization that primarily provides skilled nursing and other therapeutic services to individuals on a visiting basis in their homes. Act, sections 1861(m) and (o). Section 1861(m) of the Act describes the covered services that home health agencies provide under the Medicare program and section 1861(o) describes the statutory requirements. The Secretary of Health and Human Services (Secretary) has issued regulations at 42 C.F.R. Part 484 which govern the participation of home health agencies in the Medicare program. Specifically, the provisions contained in 42 C.F.R. §§ 484.10 - 484.55 set forth the Secretary's requirements for a home health agency's participation in Medicare by establishing conditions of participation. The regulations express these conditions of participation as broadly stated participation criteria. The regulations also state standards of participation as subsidiary components of the conditions.

The Secretary is required to determine whether a provider, including a home health agency, is complying substantially with Medicare participation requirements. Act, section 1866(b)(2). The Secretary may terminate the participation in Medicare of a provider that the Secretary finds not to be complying substantially with participation requirements. Act, section 1866(b)(2)(A). The regulations at 42 C.F.R. Part 488 cover the process and criteria for determining whether a provider is complying substantially with participation requirements. The Secretary has entered into agreements with state survey agencies to conduct periodic surveys of providers to ascertain whether they are in compliance with Medicare participation requirements. Act, section 1864(a); 42 C.F.R. §§ 488.10, 488.11, and 488.20. CMS is authorized to terminate the Medicare provider agreement of any provider if it finds that the provider no longer meets the conditions of participation. 42 C.F.R. §§ 489.53(a)(1) and (3) and 488.24(c).

To determine whether a home health agency is complying with a condition of participation, a state survey agency evaluates the manner and degree of the provider's satisfaction of the various standards within a condition. 42 C.F.R. § 488.26(b). The state survey agency documents its findings on a statement of deficiencies (Form 2567). CMS, after weighing the documented deficiencies, may terminate a home health agency's participation in Medicare when it determines, either based on the state survey agency statement of deficiencies or on its own initiative, that a provider is not complying with one or more conditions of participation. See 42 C.F.R. §§ 488.20, 488.24, and 488.26. Failure to comply with a condition of participation occurs where deficiencies, either individually or in combination, are "of such character as to substantially limit the provider's or supplier's capacity to furnish adequate care or which adversely affect the health and safety of patients . . ." 42 C.F.R. § 488.24(b).

I note that prior decisions of the Departmental Appeals Board (DAB) and DAB administrative law judges have found that termination of participation is a remedy intended to protect the health and safety of program beneficiaries, and is not a punishment. Termination should be invoked in the circumstances where a provider's deficiencies establish that the provider is substantially incapable of providing care consistent with Medicare participation requirements and should not be invoked unless the evidence proving a provider's failure to comply establishes that the provider cannot provide care consistent with that which is required by the Act and the regulations. CSM Home Health Services, Inc., DAB CR440, at 3 (1996). Where CMS determines that a deficiency exists, but that the deficiency is not severe enough to constitute a condition-level deficiency, CMS may not terminate a provider's participation without first offering a provider the opportunity to correct the deficiency. 42 C.F.R. § 488.28. However, CMS may terminate a home health agency without offering an opportunity to correct when it concludes that the documented deficiencies are of such character as to render the provider either substantially incapable of providing adequate care to patients or where it concludes that the deficiencies adversely affect patient health and safety. 42 C.F.R. § 488.24(b). CMS is not required to demonstrate actual patient harm. See National Hospital for Kids in Crisis, DAB No. 1600 (1996).

The burden of proof in this case is governed by the decision in Hillman Rehabilitation Center, DAB No. 1611 (1997), aff'd, Hillman Rehabilitation Center v. U.S. Dept. of Health and Human Services, No. 98-3798 (GEB), slip op. at 25 (D.N.J. May 13, 1999). Under Hillman, CMS bears the burden of coming forward with evidence sufficient to establish a prima facie case that Petitioner failed to comply with participation requirements. Petitioner has the burden of proving, by a preponderance of the evidence, that it complied substantially with participation requirements.

III. Issues, findings of fact and conclusions of law

A. Issues

The issues in this case are whether:

1. Petitioner failed to comply substantially with one or more conditions of participation which govern its participation in Medicare as a home health care agency; and,

2. CMS is authorized to terminate Petitioner's participation in Medicare.

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, in italics, as a separate heading. I discuss each Finding in detail.

Below, I discuss the two conditions of participation that I find to have been out of compliance. I will not address every standard-level deficiency or all the examples cited by CMS within each deficiency, as it is unnecessary for me to make findings on each such deficiency or example to support my findings that the two conditions are out of compliance. See Beechwood Sanitarium, DAB No. 1824, at 19 - 22 (2002).

1. Petitioner failed to comply substantially with conditions which govern its participation in Medicare as a home health care agency.

The Colorado Department of Public Health and Environment (State Agency) conducted a revisit survey of Petitioner from May 15 to 23, 2001. Based on a medical record review, a review of administrative and employee records, and staff interviews, the State Agency found that Petitioner failed to take adequate or effective action to correct deficient practices cited following a March 12, 2001 survey. Specifically, the State Agency found that Petitioner was out of compliance with two conditions of participation (Tag G122 (referencing 42 C.F.R. § 484.14) and Tag G156 (referencing 42 C.F.R. § 484.18)) and 10 standard-level deficiencies, as stated on the May 23, 2001 statement of deficiencies. CMS Ex. 124. I concur, as explained below.

a. Petitioner was out of compliance with the condition of participation set forth at 42 C.F.R. § 484.14, as referenced at Tags G122, 125, and 143 on the May 23, 2001 statement of deficiencies.

The condition of participation at 42 C.F.R. § 484.14 (Tag G122) governs a home health agency's organization, services, and administration. The condition requires that organization, services furnished, administrative control, and lines of authority down to the patient care level are clearly set forth in writing and are readily identifiable. Administrative and supervisory functions are not delegated to another agency or organization and all services not furnished directly, including services provided through subunits, are monitored and controlled by the parent agency. If an agency has subunits, appropriate administrative records are to be maintained for each subunit.

The State Agency found that Petitioner failed to disclose the existence of a branch office to the State Agency, failed to organize and direct ongoing functions to maintain consistent compliance with the regulations, and failed to ensure that personnel furnishing services communicated to each other so that their efforts were coordinated. Below I discuss Petitioner's failures to comply under this condition of participation. I will not discuss Petitioner's failure to organize and direct ongoing functions to maintain consistent compliance with the regulations, as set forth at Tag G133 (CMS Ex. 124, at 5 - 6), because I refer to the factual underpinnings of the deficiency in Finding 2, below.

i. Petitioner was out of compliance with the standard referenced at Tag G125 on the May 23, 2001 statement of deficiencies.

The Form 2567 states that, based on a review of agency documents, observations, and staff interview, Petitioner failed to disclose the existence of a branch office to the State Agency at the time of the revisit survey, thereby violating the requirement that it have a written and identifiable record of its organization, services furnished, administrative control, and lines of authority for the delegation of authority down to the patient care level. ⁽⁵⁾ CMS Ex. 124, at 3 - 5.

It is not disputed that, at all relevant times, Petitioner had a parent office in Boulder, Colorado, and branch offices in Longmont and Denver, Colorado. Until March 19, 2001, Petitioner also maintained a branch office in Greeley, Colorado. On March 19, 2001, Petitioner's owner and executive director, Ms. Bellinger (Tr. at 10), sent a letter to Ms. Cathy Davenport ⁽⁶⁾ of the State Agency specifically informing her that Petitioner had "temporarily" closed its Greeley branch and that responsibility for the Greeley patients had been assumed by the Longmont branch. Ms. Bellinger also stated that client charts had been moved to the Longmont branch and that Petitioner planned only to maintain a "paperwork drop box" in Greeley. CMS Ex. 77. Ms. Davenport testified that a drop box would have been acceptable to the State Agency. Tr. at 100 - 01.

On May 17, 2001, Ms. Davenport made an on-site visit to what had been Petitioner's Greeley branch office location. Ms. Davenport testified that she found that Petitioner had vacated the office space on the fifth floor of the building that had been used by Petitioner in March 2001, but she was then told by a building maintenance worker that Petitioner had moved to the seventh floor of the building. Tr. at 101; P. Ex. 78, at 1. Ms. Davenport testified that she observed the seventh floor office space and her surveyor notes confirm her testimony. Id. Ms. Davenport testified that she observed a sign with Petitioner's name on the seventh floor office space, saw the door was locked, and the space was dark. Through a window she saw a desk, computers, and a phone inside the office. In an unlocked conference room next door to the office, Ms. Davenport observed bookcases and a conference table. In an "expando" file on the table were schedules with patients' names on them and policy manuals and other forms in the bookcases. CMS Ex. 78, at 1; Tr. at 102 - 03. Ms. Davenport testified that she then called Petitioner's Longmont office and spoke to the care coordinator, "Renita" Henson (see Petitioner's Posthearing Brief (P. Br.) at 3) regarding the Greeley location. CMS Ex. 78, at 1; Tr. at 103. Ms. Davenport testified that Ms. Henson told her that Petitioner was still providing patient care services out of the office: staff were completing paperwork, using the phones, calling physicians, picking up assignments, and getting supplies which were maintained there. CMS Ex. 78, at 1; Tr. at 104. Ms. Davenport testified that this was not her understanding of what a "drop box" was and Petitioner, as far as she could tell, was still operating a fully operational, unauthorized, branch office. Tr. at 104 - 05. Ms. Davenport also testified that when a branch office has not been authorized and is still operating there is no way for the State Agency to determine whether the services provided meet the conditions of participation. Tr. at 113.

Petitioner attempts to discount Ms. Davenport's testimony regarding the expansion of its paperwork drop box site in Greeley by arguing that Ms. Davenport did not copy the allegedly confidential patient records she saw in the Greeley office and that her statements regarding her conversation with Ms. Henson were hearsay and there is no evidence of what Ms. Henson may have meant by the word "services." P. Br. at 6.

Ms. Davenport's credible testimony, amply documented by her contemporaneous surveyor notes regarding her visit to the Greeley location on May 17 and her discussion with Ms. Henson, Petitioner's Longmont care coordinator, convinces me that there is substantial evidence that Petitioner was, in fact, operating an unauthorized branch office at the Greeley location. Tr. at 101 - 04; CMS Ex. 78, at 1. Moreover, it is quite clear from Ms. Davenport's testimony and her surveyor notes that the services Ms. Henson was describing included picking up assignments, charting, and calling physicians. Tr. at 104. Petitioner did not submit an application to reopen its Greeley branch and reopening the branch had not otherwise been authorized by the State Agency. Tr. at 105, 110. Petitioner's failure to advise the State Agency regarding its operations at the Greeley location precluded the State Agency from properly surveying the branch. I agree with Ms. Davenport that, where Petitioner has effectively prevented the State Agency from properly surveying a branch office of a home health agency to evaluate whether deficient practices exist or whether patients are being properly serviced, a condition-level deficiency exists. Petitioner's failure to report this operating branch office subverts the regulatory process. There is no way to tell whether Petitioner was providing care consistent with that required by the Act and the regulations or whether deficiencies existed which could limit Petitioner's ability to furnish adequate care or could otherwise adversely affect patient health and safety. I find this deficiency alone sufficient to support a determination that this overall condition of participation is out of compliance.

ii. Petitioner was out of compliance with the standard referenced at Tag G143 on the May 23, 2001 statement of deficiencies.

The standard at 42 C.F.R. § 484.14(g) requires that all personnel furnishing services maintain liaison to ensure that their efforts are coordinated effectively and support the objectives outlined in the plan of care.

The Form 2567 dated May 23, 2001 states that, based on record reviews, Petitioner failed to make certain that personnel furnishing services maintained liaison to effectively coordinate their efforts to support and achieve the objectives outlined in two patients' plans of care. This failure included serious lapses in the monitoring of lab studies ordered by physicians to evaluate drug effectiveness or possible side effects in two cases. This failure and the consequent inappropriate monitoring of medications created a material potential for the build-up of toxic drug levels. CMS Ex. 124, at 6. Below, I discuss both patients, although I will only discuss one example of the deficiencies cited with regard to Patient 22. I find that the potential harm to each of the patients discussed was great enough that, alone, violation of this standard is severe enough to constitute a condition-level deficiency, as, in each instance, the deficiencies were of a nature to limit substantially Petitioner's capacity to furnish adequate care to these patients and could have adversely affected the patients' health and safety.

Patient 34: The 2567 reflects that Patient 34 was admitted on December 15, 2000 with multiple diagnoses. Included in the plan of care orders was an order for a blood draw every other week to obtain a white blood count to monitor the side effects of Clozaril, an anti-psychotic medication. The surveyors' review of nursing notes indicated that the nurse drew blood samples on April 23, 2001 and May 7, 2001. However, the surveyor found no evidence or documentation that the results of the studies were obtained from the laboratory and communicated to the physician. CMS Ex. 124, at 6 - 7.

Ms. Davenport testified that Patient 34's physician ordered the white blood count every other week to ensure that Patient 34 did not receive too much Clozaril, because too much Clozaril can be toxic. Tr. at 65 - 6. Ms. Davenport also testified that the results of only one blood draw could be found. Tr. at 66; CMS Ex. 105, at 11. There was a nursing note indicating that Petitioner's nurse drew blood samples on April 23 and May 7, 2001, but the documentation regarding them was not contained in the record. CMS Ex. 105. Moreover, the record contained no information that the results had been communicated to Patient 34's treating physician. Id. Thus, at the time of the survey, the record contained no evidence or documentation that the results of the laboratory studies had been obtained and communicated to Patient 34's physician. Most critically, there is no evidence that the results of these studies were communicated by Petitioner to Patient 34's physician in a situation where the testing concerned the toxicity of the drug being used.

I note P. Ex. 9, which consists of a June 4, 2001 nursing note regarding the blood draws on April 23 and May 7, 2001, as well as laboratory draws faxed to Petitioner on June 1, 2001. However, the nursing note was written on June 4, 2001, after the survey date, and the other documentation was not available at the time of the survey.

Patient 22: The 2567 reflects two examples of deficiencies with regard to this patient. I address only the deficiency cited as example 2(a). CMS Ex. 124, at 7.

Patient 22 was admitted to Petitioner's services on June 16, 2000 with multiple diagnoses, including congestive heart failure and atrial fibrillation. The surveyors' record review revealed a plan of care dated April 1, 2001 through June 11, 2001 for skilled nursing services, in which Petitioner's staff were to monitor medications, set up medications weekly and perform a monthly venipuncture to evaluate the effectiveness of Patient 22's Coumadin, an anticoagulant. CMS Ex. 124, at 7.

The first deficiency cited by the State Agency surveyors reflects that the order for Coumadin did not clearly show what dose the nurse should set up for Patient 22 to take on a daily basis. The 2567 asserts that there is no evidence that the supervising nurse clarified this medication order with Patient 22's physician to ensure appropriate dosing. Further, according to the 2567, the surveyors' review of the nursing visit reports did not reflect the dosage of Coumadin the nurse was placing in medication planners, thus creating a potential for substitute nurses to fill medication planners incorrectly. Id. The evidence submitted at hearing confirms this.

Ms. Davenport testified that a physician would monitor a patient's Coumadin intake because elevated levels of Coumadin will thin blood to much and cause hemorrhaging resulting in death, while too little Coumadin might lead to blood clots and cause a stroke. Tr. at 81. Patient 22's plan of care had contradictory entries for the administration of Coumadin. CMS Ex. 96, at 21, 39, 45; Tr. at 79 - 85. Patient 22's medication profile also contained contradictory entries for the administration of Coumadin, contrary to Petitioner's medication administration policies. CMS Ex. 118, at 6. There is no evidence that Petitioner clarified the conflicting dosage with Patient 22's physician to ensure the appropriate dosage. Moreover, the nursing visit reports do not reflect the dose of Coumadin that the nurse was placing in Patient 22's medication planners. CMS Ex. 96, at 5 - 7, 13, 14, 16 - 19, 23, 24. This confusion in the record over dosages created the potential for different nurses to fill Patient 22's medication planners incorrectly in a situation where too much or too little Coumadin could be life-threatening.

b. Petitioner was out of compliance with the condition of participation set forth at 42 C.F.R. § 484.18, as referenced at Tags G156 and 158.

Tag G156 references the condition of participation set forth at 42 C.F.R. § 484.18. This condition governs the acceptance of patients, plan of care, and medical supervision. Here CMS asserts that the nature of the standard-level deficiency set forth at Tag G158 was enough to show that Petitioner remained out of compliance with the condition. I concur. See CMS Ex. 124, at 8 - 19. Again, I do not discuss each patient incident under this deficiency, as it is unnecessary to my decision.

Section 484.18 of the regulations requires that a patient's care follow a written plan of care established and periodically reviewed by a doctor of medicine, osteopathy, or podiatric medicine. Subsection 484.18(b) requires that the total plan of care be reviewed by the attending physician and home health agency personnel as often as the severity of the patient's condition requires, but at least once every 60 days. Here, CMS alleges that Petitioner failed to implement a system to ensure that a current plan of care was present and care was provided in accordance with that plan, as Petitioner had stated it would do in its plan of correction for the survey completed on March 12, 2001. Specifically, CMS states that, based on the State Agency surveyors' review of medical records, administrative records, and staff interviews, Petitioner failed to ensure that the plans of care, which included comprehensive orders and 60-day progress summaries, were prepared and sent to physicians in a timely manner to obtain the appropriate physician's signature.

The deficiency alleged following the March 12, 2001 survey was that:

[Petitioner's] Medical record policy also required that the physician's signature was not required until 45 days after authorization of treatment orders. Additionally a policy titled "Physician Orders" indicated that the physician's signature was not required until 45 days after the order date. These policies are not conducive to obtaining the updated 485 ⁽⁷⁾ "before the start date" of the re-certification period in accordance with home care standards. The policy titled "Physician Orders" indicated the agency had a tracking log for orders sent to the physician to ensure orders were returned in a timely manner." CMS Ex. 74, at 29 - 30.

After the survey, Petitioner proposed the following plan of correction:

Nurses or Care Coordinators call the physician to obtain a verbal order to continue home care services just prior to the beginning of a new recertification period. This is documented in locator 23 of the 485 or on a verbal order form. The 485 is then copied, a copy is placed in the medical record, and the original is mailed to the MD for signature. This process can take 5 to 45 days. If the agency is allowed to continue to use this process, no new forms will be required as suggested in the Paperwork Reduction Act. If the agency is forced by the surveyors to develop and use a new form, it is proposed the attached Continuation of Care Communication Note would be implemented.

The QA Log process has been implemented to track compliance. The Office Managers, Care Coordinators, and Executive Director will use the QA Log to monitor compliance in this area.

The Care Coordinator and Office Managers were retrained on the agency's current process for obtaining and documenting physician orders and recording that in locator 23 of the 485 or on a verbal order. The Office Managers were re-educated on the QA Log process to record and track physician written plans and orders.

The QA Log process used by the southern branches has been implemented by the northern branches to monitor compliance in this area.

Id. at 28.

In April 2001, Petitioner's policy with regard to the procedure for obtaining and tracking physician orders to ensure that orders were mailed and received back in a timely manner to ensure physician review and authorization consisted of the following:

If required by law or regulation, physician orders to provide services are obtained verbally, if appropriate, then in writing.

Physician orders are documented, logged, and sent to the physician for signature as part of the Agency's order tracking process. The log is reviewed periodically and telephone calls, a facsimile, or hand-delivery is used to obtain the signature within 45 days, if possible.

Changes in physician orders are identified, documented, and sent to the physician for signature following the Agency's order tracking process.

CMS Ex. 118, at 4. Petitioner's staff provided the State Agency surveyors with copies of "PHHC Correspondence Tracking Log Form[s]." Tr. at 120; CMS Ex. 123. ⁽⁸⁾ The correspondence tracking log form included a form tracking number, client name, date mailed, discipline, order form, doctor's name, order date, due date back for signature, Fax date, date Fax received, action and date, and the date the signed 485 was received back. Id. Petitioner's staff informed Ms. Davenport that when staff communicated with the physician and changes were made, the information was entered into Petitioner's computer system, the order form was given to the office staff to log and send in the mail to the physician for signature. When the signed order was received back, the date was noted in the correspondence tracking log and the form was filed in the clinical record. Tr. at 122 - 23; see CMS Ex. 124, at 12.

Petitioner appears to argue that the correspondence tracking logs produced by its staff during the survey, as discussed above, were not the "QA Log" referred to in its plan of correction. See CMS Ex. 124, at 19. However, since Petitioner did not submit what it refers to as QA logs either at the time of the survey or at any time during the proceedings before me, I agree with CMS that the logs either did not exist at the time of the survey, in contravention of Petitioner's plan of correction, or the correspondence tracking logs discussed above were the QA logs referenced in the plan. See CMS Br. at 22.

Petitioner also represented in its plan of correction that staff responsible for orders would be trained to ensure timeliness. Petitioner did not submit any documentation either to the State Agency or in this proceeding that it had trained its staff. Tr. at 658. I note that the State Agency surveyor was told by an employee that the employee's main job responsibility was to maintain the log of orders sent to the physician. That employee was hired on March 23, 2001, yet there is no evidence in the personnel file or otherwise of record that this employee had received training regarding maintenance of the log. CMS Ex. 124, at 13.

In addition to this overall failure to fulfill its plan of correction, CMS also presented evidence concerning 16 specific instances where Petitioner failed to meet the standard. I will discuss several of them.

Patient 23: Patient 23 had a verbal order to continue care on April 19, 2001 for the period April 19 through June 19, 2001. The nurse filling out the 485 noted that another nurse had received the verbal order. CMS Ex. 97, at 8. Record review on May 22, 2001, however, revealed that a verbal order to continue home care services was prepared and sent to the physician on April 17, 2001 and signed by the physician on April 24, 2001. However, the correspondence tracking log form revealed the 485 which the nurse indicated was prepared and completed on April 19, 2001, was not sent to the physician for a signature until May 20, 2001, 31 days after the start of the certification period. CMS Ex. 23, at 122; Tr. at 129 - 30.

Patient 28: Patient 28 was discharged from Petitioner's services on March 29, 2001. CMS Ex. 100. The correspondence tracking log indicated that this verbal order was not sent to the physician until May 16, 2001 and was still unsigned as of the date of the survey, although Petitioner had alleged compliance on April 20, 2001, and it was agency policy to complete or close the record within 45 days of the discharge or transfer of a patient. CMS Ex. 123, at 120; CMS Ex. 124, at 18.

Patient 24: Patient 24 had three unsigned verbal orders (orders dated January 1 and February 6, 2001, both mailed February 27, 2001, and an order dated February 21, 2001, which was mailed on May 16, 2001 (CMS Ex. 123, at 137, 138, and 186)) without a physician's signature and all unsigned well over 60 days from the date of the orders. Although Petitioner alleged compliance on April 20, 2001, these orders were unsigned when the revisit was conducted and the clinical record was not complete.

Patient 29: Patient 29 was discharged from Petitioner's service on March 16, 2001. CMS Ex. 101. The correspondence tracking log indicated that Patient 29 had an unsigned verbal order which, as of the date of the survey, had not been signed. CMS Ex. 123, at 120. As above, although Petitioner alleged compliance on April 20, 2001, the order remained unsigned and the clinical record was not complete.

Following the March 12, 2001 survey, Petitioner alleged that it had corrected the condition set forth at Tag G156. CMS has disputed this assertion. For the reasons discussed above, I have concluded that CMS made a prima facie case that Petitioner was not in compliance. Specifically, Petitioner either had no QA log process or, if such a process existed, the correspondence tracking logs were the QA logs. In either case, Petitioner's process was inadequate to record and track physician written plans and orders to ensure that current plans of care and orders were signed and returned timely. Finally, there is no evidence to suggest that Petitioner trained its staff to use a QA log.

IV. Conclusion

CMS is authorized to terminate a home health agency when it has been determined that the home health agency is not complying with one or more conditions of participation. Here I have found that Petitioner was not complying with two conditions of participation. Moreover, I have found that Petitioner's deficiencies could limit its ability to furnish adequate care or adversely affect patient health and safety. Thus, CMS was authorized to terminate Petitioner's participation in Medicare as a home health agency.

Richard J. Smith

Administrative Law Judge

1. As of March 19, 2001, Petitioner was not approved to operate a branch office in Greeley (discussed below).

2. Throughout the duration of this case, Petitioner was represented by Jay S. Horowitz, Esq., and CMS by Sylvia J. Trujillo, Esq. During the hearing, Petitioner's owner, Sheryl Bellinger, represented Petitioner. Petitioner asserted that it elected to have Ms. Bellinger represent it and that it would not contend, post-hearing, that Ms. Bellinger was "inadequate to the task." Transcript (Tr.) at 16. I found Ms. Bellinger to competently represent Petitioner's interests at hearing.

3. CMS marked its exhibits as Respondent exhibits or "R. Ex.". However, as I note above, I refer to CMS's exhibits as "CMS Ex.".

4. I note that in its posthearing brief (P. Br.) Petitioner reserves what it terms its "contentions/defenses of law and its contentions/defenses of mixed fact and law." P. Br. at 2 - 3. I will not refer to them here, but note their reservation.

5. Pursuant to the definitions section at 42 C.F.R. § 484.2, a "subunit" of a home health agency is defined as a semi-autonomous organization that: (1) serves patients in a geographic area different from that of the parent agency; and (2) must independently meet the conditions of participation for home health agencies because it is too far from the parent to share administration, supervision, and services on a daily basis. A "branch office" of a home health agency, however, is defined as a location or site from which a home health agency provides services within a portion of the total geographic area served by the parent agency. A branch office is located sufficiently close to share administration, supervision, and services in a manner that renders it unnecessary for the branch independently to meet the conditions of participation as a home health agency.

6. At all relevant times, Ms. Davenport was employed by the State Agency (she is now employed by the Denver regional office of CMS). Tr. at 49. Ms. Davenport, a nurse, was the supervisor of the State Agency unit responsible for surveying home health agencies and was also the lead team surveyor conducting the May survey in question here. CMS Exs. 78 and 120; Tr. at 49 - 473. Petitioner has suggested that Ms. Davenport's participation in the survey was marginal and that she did not offer an "impartial" assessment of Petitioner, and that she was "obviously hostile." P. Br. at 4 - 5. I disagree. I found Ms. Davenport to be a credible and unbiased witness and her testimony to be within the scope of her employment as a State Agency surveyor. Moreover, I am persuaded that, as Ms. Davenport was the lead surveyor conducting the May survey in question here, the testimony of Ms. Rindt (the other State Agency surveyor involved in the survey) is not necessary to my decision in this case, as Ms. Davenport conducted her own document review, staff interviews and analysis, reviewed the work of Ms. Rindt, conducted the exit interview, and prepared the statement of deficiencies.

7. A 485 is a CMS form reflecting a home health agency's certification and plan of care. CMS Ex. 118, at 1.

8. CMS asserts that the book which contained the correspondence log tracking forms also contained a form entitled "Fast Track MD Order Process Job: Secretary" (Tr. at 122; CMS Ex. 107). CMS states the form depicted a specific chain of events a secretary would initiate when the secretary received physician's orders. Petitioner has denied that this was its policy and asserts that it should not be used to cite the agency for deficient practices. CMS Ex. 124, at 12; see Tr. at 652 - 55. I do not rely on this document in making my decision.