$05:Civil Money Penalty
Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of:
Excelsior Health Care Services, Inc.,
Petitioner,
- v. -
Health Care Financing Administration.
DATE: January 17, 1995
Docket No. C-94-009
Decision No. CR352
DECISION
On July 16, 1993, the Health Care Financing Administration (HCFA)
notified Petitioner that it had determined that Petitioner no
longer met the requirements for participation as a provider of
services under Medicare. HCFA told Petitioner that it based its
determination on the results of a complaint investigation survey
which was conducted on HCFA's behalf from April 23, 1993 through
June 2, 1993, by the Service Facility Regulation Administration,
District of Columbia Department of Consumer and Regulatory Affairs
(D.C. survey agency). HCFA informed Petitioner that it concurred
with a D.C. survey agency finding that Petitioner had failed to
comply with a condition of participation in Medicare.
Specifically, Petitioner was found not to have met a condition
requiring it to protect and promote patient rights. Petitioner was
told that HCFA had determined to terminate Petitioner's
participation in Medicare based on this finding and in light of
Petitioner's history of failing to comply with federal requirements
for participating in Medicare.
Petitioner requested a hearing. The case was assigned to
Administrative Law Judge Charles E. Stratton for a hearing and a
decision. On March 8 and 9, 1994, Judge Stratton conducted an
in-person hearing in Washington, D.C. The parties filed
post-hearing briefs with Judge Stratton. Unfortunately, Judge
Stratton died before he could issue a decision in the case. The
case was reassigned to me.
I afforded the parties the option of having a new hearing. I
informed the parties that, if they accepted this option, I would
not consider any of the exhibits or testimony received by Judge
Stratton. Alternatively, I afforded the parties the option of my
deciding the case based on the record created at the hearing
conducted by Judge Stratton, including the transcript of that
hearing, and any exhibits received into evidence at the hearing.
As an element of this option, I gave the parties the opportunity to
propose to supplement the record with additional exhibits. The
parties accepted this alternative option. HCFA has not offered
additional exhibits. Petitioner offered additional exhibits, P.
Ex. 8 - 12. 1/ I have admitted them into evidence in addition to
those exhibits admitted by Judge Stratton. 2/
I have considered the evidence, the applicable law, and the
parties' arguments. I conclude that HCFA's termination of
Petitioner's participation in Medicare is supported by a
preponderance of the evidence and by the law and I sustain it.
I. Issues, findings of fact, and conclusions of law
There are three issues in this case. In resolving these issues, I
make findings of fact and conclusions of law. After each finding
or conclusion, I cite to the pages of this Decision at which I
discuss the finding or conclusion in detail.
A. Did Petitioner fail to comply with a Medicare condition of
participation?
1. As a condition of participation in Medicare, Petitioner
was obligated to inform patients of their rights and to protect and
promote the exercise of those rights. Pages 4 - 5.
2. Petitioner failed to comply with this condition in that it
failed to inform a patient, E.R., of her rights, failed to protect
her rights, and failed to document the manner in which her rights
were being protected. Pages 7 - 14.
B. Was HCFA authorized to terminate Petitioner's
participation in Medicare based on Petitioner's failure to comply
with the condition of participation concerning patient rights?
3. HCFA may terminate a provider's participation in Medicare
where that provider fails to comply with a condition of
participation. Pages 5 - 7.
4. HCFA is not required to afford a provider the opportunity
to correct its failure to comply with a condition of participation
before terminating that provider. Pages 5 - 7.
5. HCFA was authorized to terminate Petitioner's
participation in Medicare based on Petitioner's failure to comply
with the condition of participation concerning patient rights.
Page 14.
C. Did HCFA violate its obligation to give Petitioner notice
of its determination to terminate Petitioner's participation in
Medicare?
6. HCFA is required to give a provider 15 days' notice of a
determination to terminate that provider's participation in
Medicare. Page 15.
7. In this case, HCFA gave Petitioner approximately 30 days'
notice of its determination to terminate Petitioner's participation
in Medicare. Page 15.
8. HCFA did not violate its obligation to give Petitioner
notice of its determination to terminate Petitioner's participation
in Medicare. Pages 14 - 15.
II. Discussion
A. Background facts
The background facts of this case are not disputed. Petitioner has
participated in the Medicare program as a Home Health Agency (HHA)
under the provisions of sections 1861(o) and 1891 of the Social
Security Act (Act) and under regulations contained in 42 C.F.R.
Part 484. As an HHA, Petitioner has acted as a provider that is
"primarily engaged in providing skilled nursing services and other
therapeutic services" to Medicare beneficiaries in their homes.
Act, section 1861(o)(1). At all times relevant to this case,
Petitioner's place of business has been Washington, D.C.
On June 1, 1989, Petitioner was certified by HCFA to participate in
Medicare. HCFA Ex. 1, page 1. Certification included acceptance
by HCFA of a provider agreement executed by Petitioner's President,
Jane V. Graham. Id. at 2.
Prior to the events which led up to Petitioner's termination from
participation in Medicare, Petitioner had been found out of
compliance with Medicare conditions of participation during annual
surveys conducted by the D.C. survey agency in 1991, 1992, and
1993. Petitioner came into compliance with Medicare conditions of
participation only after being threatened with termination as a
Medicare provider. Tr. 42, 53 - 55; HCFA Ex. 2 - 3, 10 - 19.
B. Governing law and regulations
1. Criteria for participation in Medicare by an HHA
The Act establishes requirements that an HHA must satisfy in order
to be certified as a Medicare provider. Act, sections 1861(o)(6),
1891. The Act gives the Secretary of the United States Department
of Health and Human Services (Secretary) authority to establish
requirements for participation in Medicare by an HHA, in addition
to those specified by the Act, which are related to the health and
safety of patients. Act, section 1861(o)(6). Regulations
published by the Secretary implement the statutory requirements for
participation by an HHA in Medicare. 42 C.F.R. Part 484.
The statutory requirements for participation include specific
requirements designed to protect and promote the rights of
patients. Act, section 1891(a)(1)(A) - (G). Patients who are
cared for by an HHA are entitled to be fully informed in advance
about the care and treatment that the HHA intends to provide and
about any changes that the HHA may implement in such care and
treatment. Act, section 1891(a)(1)(A). Patients of an HHA are
entitled to participate in planning their care and treatment, or
any changes in their care and treatment. Id. 3/ Patients of an
HHA are entitled to have their property treated with respect by the
HHA. Act, section 1891(a)(1)(D). Patients of an HHA are entitled,
in advance of coming under the HHA's care, to be fully informed,
both orally and in writing, of: (i) all items and services
furnished by (or under arrangements with) the HHA for which payment
may be made under Medicare; (ii) the coverage available under
Medicare, Medicaid, or any other federal program of which the HHA
is reasonably aware; (iii) the HHA's charges for any items or
services which it provides which are not covered under Medicare,
and any charges that patients may have to pay to the HHA for items
or services furnished to them by the HHA; and (iv) any changes in
the charges or items and services provided by the HHA. Act,
section 1891(a)(1)(E).
The Act provides also that the Secretary has the duty and
responsibility to assure that the conditions for an HHA's
participation in Medicare are enforced adequately to protect the
health and safety of patients. Act, section 1891(b). Regulations
published by the Secretary are intended to implement this duty and
responsibility. The regulations emphasize the responsibility of an
HHA, as a prerequisite to participating in Medicare, to protect and
promote the rights of patients. They state that, as a condition of
participation, an HHA has the duty to inform patients of their
rights and to protect and promote the exercise of those rights. 42
C.F.R. 484.10. Standards for protecting patients' rights
contained in the regulations restate the requirements for
protection of patients' rights stated in the Act. 42 C.F.R.
484.10; see Act, section 1891(a)(1)(A) - (G).
2. Circumstances under which HCFA may terminate an HHA's
participation in Medicare
The Act provides that the Secretary may terminate a participation
agreement with an HHA where the Secretary finds that the HHA is not
complying with the requirements for participation in Medicare.
Act, section 1891(e). The Secretary is mandated to take either
immediate action to correct a deficiency, or to terminate
participation, where she finds that an HHA's failure to comply with
participation requirements immediately jeopardizes the health and
safety of patients. Act, section 1891(e)(1). 4/
The Act provides further that, where the Secretary determines that
an HHA is no longer complying with requirements for participation
and that the failure to comply does not pose immediate jeopardy to
the health and safety of patients, then the Secretary may impose
intermediate sanctions on the HHA in lieu of terminating the HHA's
participation in Medicare. Act, section 1891(e)(2); see Act,
section 1891(f). The Secretary must terminate an HHA's
participation in Medicare where intermediate sanctions do not
correct that HHA's failure to comply with participation
requirements. Act, section 1891(e)(2).
Petitioner argues that HCFA should have given it the opportunity to
comply with participation requirements before it terminated
Petitioner's participation in Medicare, inasmuch as HCFA made no
finding that Petitioner's failure to comply with participation
requirements posed immediate jeopardy to the health and safety of
patients. I interpret Petitioner's argument as being an assertion
that HCFA could not terminate Petitioner's participation in
Medicare without first imposing intermediate sanctions and
evaluating Petitioner's compliance with participation requirements
under those sanctions.
The Act plainly permits the Secretary (or HCFA) to terminate an
HHA's participation in Medicare based on a finding that the HHA
fails to comply with participation requirements and where there is
also a finding that this failure poses immediate jeopardy to the
health and safety of patients. However, the Act is not so clear in
addressing the circumstance where there is a finding that an HHA
has failed to comply with a participation requirement, but where
there is no finding that the HHA's failure to comply with that
requirement poses immediate jeopardy to the health and safety of
patients. The language in section 1891(e)(2) authorizing the
Secretary (or HCFA) to impose intermediate sanctions in such a case
"in lieu" of termination might be read to require the imposition of
such sanctions as a prerequisite to terminating an HHA's
participation in Medicare. It might be read also to give the
Secretary (or HCFA) the option
of terminating a provider's participation in Medicare without first
imposing intermediate sanctions against that provider.
However, it would be inappropriate for me to interpret the relevant
statutory language, as the Secretary has established her
interpretation of the Act by regulation. The applicable regulation
authorizes HCFA to terminate a provider's participation in Medicare
based only on a finding by HCFA that the provider is not complying
with participation requirements. 42 C.F.R. 489.53(a)(1). I am
bound by that regulation.
The regulation states, in relevant part, that HCFA may terminate a
provider's participation in Medicare where the provider is:
not complying with the provisions of title XVIII [Medicare]
and the applicable regulations of this chapter or with the
provisions of the [provider] agreement.
42 C.F.R. 489.53(a)(1). This regulation thus authorizes HCFA to
terminate a provider's participation in Medicare based on HCFA's
determination that the provider is not complying with participation
requirements in the Act and regulations. The authority given to
HCFA by the regulation to terminate a provider's participation in
Medicare is not contingent on a finding by HCFA that the provider's
failure to comply with certification requirements poses immediate
jeopardy to the health and safety of patients. There is no
requirement in the regulation that HCFA impose intermediate
sanctions against a provider as a prerequisite to terminating that
provider's participation in Medicare. 5/
C. Petitioner's failure to comply with a condition governing
its participation in Medicare
HCFA asserts that Petitioner failed to comply with the condition of
participation stated both in the Act and in the implementing
regulations requiring that Petitioner protect and promote the
rights of patients under its care. This assertion is amply
supported by the evidence in this case. The essentially unrebutted
evidence is that Petitioner failed, in several ways, to respect the
rights of a patient, E.R. Petitioner's failures to respect E.R.'s
rights constitute violations of standards of care established by
the regulation (42 C.F.R. 484.10) which implements section
1891(a)(1) of the Act. I conclude that, when considered
individually and collectively, these violations are so serious as
to constitute a violation of the condition of participation that an
HHA protect and promote patient rights.
1. The investigation by the D.C. survey agency and its
findings
E.R., an elderly, female, Medicaid recipient, was admitted to
Petitioner's care on November 15, 1991 and remained under
Petitioner's care until April 23, 1993. Tr. at 125, 146, 154, 382;
HCFA Ex. 8, page 1; HCFA Ex. 23, page 1. During this period, E.R.
lived alone and was totally dependent on Petitioner for her care.
On April 22, 1993, a social worker from the Adult Protective
Services of the District of Columbia Department of Human Services
filed a complaint against Petitioner, alleging that Petitioner's
President exercised undue influence over E.R. Tr. at 378; HCFA Ex.
24.
Between April 23 and June 2, 1993, the D.C. survey agency
investigated the complaint. HCFA Ex. 8, page 1. The principal
investigator for the D.C. survey agency was Ms. Ellen Yung-Fatah.
Tr. at 107, 263.
During the investigation, Ms. Yung-Fatah and her staff reviewed
E.R.'s medical records, the clinical records Petitioner maintained
on E.R., records of personnel assigned by Petitioner to care for
E.R., and records of E.R.'s expenditures, i.e., cancelled checks
and receipts made available by Petitioner. Either Ms. Yung-Fatah
or her staff interviewed Ms. Graham, E.R., four home health aides,
E.R.'s former physicians, social workers from Adult Protective
Services and In-Home Support Services, the chief of the Home Care
Services Bureau of the District of Columbia Department of Human
Services, a homemaker, and the manager of a homemaker agency from
which E.R. received services prior to her admission by Petitioner.
HCFA Ex. 8, pages 1 - 2.
At the hearing of this case, Petitioner called Ms. Yung-Fatah as
its principal witness to support the findings HCFA made based on
the extensive investigation which Ms. Yung-Fatah conducted. Tr. at
84 - 322. HCFA buttressed Ms. Yung-Fatah's testimony with
exhibits, which included documents which Ms. Yung-Fatah obtained
during the course of the investigation, and Ms. Yung-Fatah's
investigative report, which memorialized the results of the
investigation. HCFA Ex. 4, 8. I find that Ms. Yung-Fatah
testified credibly, and that her testimony is supported by the
exhibits. 6/
Petitioner challenges Ms. Yung-Fatah's credibility and denies that
her investigative findings are accurate. Petitioner's assertions
include the allegation that Ms. Yung-Fatah committed perjury during
her testimony at the hearing. However, Petitioner has not offered
any evidence which contradicts significantly the findings made by
Ms. Yung-Fatah or her testimony. 7/ There is nothing in the record
to support Petitioner's argument that Ms. Yung-Fatah testified
untruthfully. 8/
Petitioner attacks the evidence obtained by Ms. Yung-Fatah by
arguing also that she did not conduct her investigation
professionally and that she was prejudiced against Petitioner.
Petitioner's assertions include allegations that Ms. Yung-Fatah
pressured Petitioner's staff unreasonably, causing employees to
resign, and that she failed to keep Petitioner informed about the
progress of her investigation. I find no support in the record of
this case for these assertions. Even if it is true that Ms.
Yung-Fatah may have been aggressive in pursuing her investigation
into the
allegations concerning E.R., that is not a basis for finding the
results of her investigation, or her testimony, to be less than
credible.
The findings made by the D.C. survey agency, which I conclude are
substantiated by the preponderance of the evidence, are as follows:
On eleven occasions, E.R. made checks payable to an
employee of Petitioner, totalling $690. HCFA Ex. 4, pages 32 - 33.
Two of these checks were for sums in excess of $100. Id.; Tr. at
166. There is no evidence to show that Petitioner ever authorized
its employee to accept checks from E.R. Petitioner did not
maintain records documenting the purpose of the checks. 9/ When
Petitioner learned that its employee had accepted checks from E.R.,
it discharged the employee. Tr. at 169. However, Petitioner did
not reimburse E.R. for the checks which E.R. had written to
Petitioner's employee. Id. Nor did Petitioner document that it
had learned that its employee had accepted checks from E.R., or
that it had discharged the employee. Tr. at 177 - 178.
Between November 1992 and April 1993, Petitioner
arranged to have persons live in Petitioner's home without paying
rent to E.R. HCFA Ex. 4, pages 9 - 13. Petitioner's decision to
have persons reside in E.R.'s home was motivated by its conclusion
that Petitioner was unable to care for her needs without
around-the-clock assistance. Tr. at 122 - 125. Petitioner did not
obtain written permission from E.R. for persons to reside in her
home. Tr. at 123 - 124. 10/ It did not obtain instructions from
a physician to have persons reside in E.R.'s home. Tr. at 122 -
125. In at least one
instance, Petitioner did not document the arrangement it made with
an individual to reside in E.R.'s home. HCFA Ex. 4, page 12; Tr.
at 232 - 239.
Petitioner did not supervise the activities of the
persons whom it authorized to reside in E.R.'s home. HCFA Ex. 4,
pages 11 - 12.
Occasionally, Ms. Graham, Petitioner's President, would
bring E.R. to her home to reside on weekends. HCFA Ex. 4, page 11.
Petitioner did not obtain written permission from E.R. to remove
her from her home.
E.R. complained to an employee of Petitioner that other
employees of Petitioner were eating her food. Although Petitioner
was aware of this complaint, there is no documentation showing that
Petitioner investigated it. HCFA Ex. 4, pages 11 - 12; Tr. at 112
- 113, 175 - 180.
On several occasions, changes were made by Petitioner
in the manner in which it provided care to E.R. Tr. at 194 - 247;
HCFA Ex. 23, pages 9, 11, 13, 15, 17, 19, 21, 23. For example,
Petitioner did not: 1) document that it informed E.R. that her
physician had ordered additional HHA services; 2) document that it
informed E.R. what HHA services were ordered; and 3) document that
it informed E.R. concerning what the cost of the additional HHA
services would be to her. Tr. 194 - 197; HCFA Ex. 23, page 9.
Petitioner did not inform E.R. about the changes in the care it was
providing. Tr. 194 - 247. Moreover, there is no evidence that
Petitioner solicited E.R.'s advice or consent concerning the
changes it was implementing in her care.
Petitioner did not provide E.R. with notice in advance
of the charges for some of the services which it was providing to
her. Tr. at 196 - 197.
I do not infer from the investigation conducted by the D.C. survey
agency, or from the evidence which HCFA offered in this case, that
Petitioner was exploiting its relationship with E.R. for financial
gain. It may be, as Petitioner asserts, that its actions with
respect to E.R. were motivated by concern for her well-being.
However, the record of this case portrays a relationship between
Petitioner and E.R. which was, to say the least, unprofessional.
Petitioner's President, Ms. Graham, appears to have treated E.R.
more like an aged relative in need of care than as a patient. The
arrangements which Petitioner made to care for E.R. were informal,
undocumented, and verged at times on a conflict of interest.
Additional examples of this informal relationship include: 1) Ms.
Graham's taking E.R. out of her house and into her own home on
weekends; 2) Ms. Graham obtaining a power of attorney from E.R.
which gave her authority to manage E.R.'s assets. HCFA Ex. 4,
pages 25 - 27; 3) Ms. Graham arranging to have signing authority on
E.R.'s checking account. HCFA Ex. 4, pages 30 - 31; Tr. at 135 -
136; and 4) Ms. Graham writing checks on this account payable to
Petitioner's employees. HCFA Ex. 4, page 30.
2. Petitioner's failure to protect and promote E.R.'s
rights
As I find above, the regulation which requires an HHA to protect
and promote the rights of patients implements an identical
statutory requirement. 42 C.F.R. 484.10; see Act, section
1891(a)(1). The importance of this requirement is apparent when it
is considered in the context of the functions performed by HHAs.
An HHA is entrusted with the unique responsibility of caring for
aged and ill Medicare beneficiaries in their homes. The
individuals who are under the care of an HHA may be frail and
dependent on the HHA to protect their rights and property. They
are especially vulnerable to exploitation. Where, as in this case,
the patient lives alone, that patient is not only dependent on the
HHA for care, but is utterly at the mercy of the HHA and its
employees.
I find that, in providing care to E.R., Petitioner contravened the
requirement that it protect and promote E.R.'s rights in several
significant respects. Petitioner failed to treat E.R.'s property
with respect. It failed to investigate and document complaints
voiced by E.R. concerning alleged misuse of her property. It
failed to apprise her of changes in her treatment, or to obtain her
consent before implementing changes in her treatment. It failed to
document the care which it was providing to E.R.
The regulation which mandates that an HHA protect and promote
patient rights establishes as a standard that the patient has the
right to exercise his or her rights as a patient of the HHA. 42
C.F.R. 484.10(b). One element of this standard is that the
patient has the right to have his or her property treated with
respect. 42 C.F.R. 484.10(b)(3). Another element of this
standard is that an HHA is obligated to investigate complaints by
a patient regarding any alleged failure to respect that patient's
property. 42 C.F.R. 484.10(b)(5). This element requires an HHA
that receives a complaint concerning the abuse of a patient's
property to document specifically the complaint and its resolution.
Id.
The evidence establishes plainly that Petitioner failed to comply
with the elements cited above and with the standard that protected
E.R.'s right to exercise her rights as a patient. Petitioner's
decision to authorize persons to reside in E.R.'s home without
obtaining E.R.'s written consent constituted a violation of the
element requiring that it treat a patient's property with respect.
Petitioner's knowledge of its employee's acceptance of 11 checks
from E.R. is an additional violation of this element, insofar as
Petitioner failed to document the facts of the incident or that it
conducted any investigation of the incident. Petitioner's failure
to document the expenditures made by its employees with checks
written by E.R. constitutes another violation of this element.
Furthermore, Petitioner's failure to investigate and document
E.R.'s complaint that its employees were eating her food is a
violation of the element requiring it to investigate complaints
from a patient regarding alleged failures to respect that patient's
property.
The regulation specifies as an additional standard that a patient
of an HHA has a right to be informed, in advance, of the care to be
furnished by an HHA and of any changes in that care. 42 C.F.R.
484.10(c). A specific element in this standard requires an HHA to
advise a patient in advance of implementing a change in the
patient's care. 42 C.F.R. 484.10(c)(1). Another element
provides that a patient has a right to participate in the planning
of his or her care. 42 C.F.R. 484.10(c)(2). Petitioner failed
to comply with this standard by implementing changes in E.R.'s care
without providing her with notice and without obtaining her
participation in decisions to change her care. This is
particularly evident in Petitioner's decision to authorize persons
to reside in E.R.'s home.
The regulation provides as a standard also that an HHA has an
obligation to provide a patient, in advance of the initiation of
care, with information on the extent to which payment for the care
may be expected from Medicare or other sources, and the extent to
which payment for the care may be expected from the patient. 42
C.F.R. 484.10(e). Petitioner contravened this standard by
failing to advise E.R., in advance of the implementation of care,
as to what the charges for her care would be.
The regulation governing patient rights does not state specifically
under what circumstances violations of standards or elements of
standards may constitute a violation of the condition of
participation requiring an HHA to protect and promote patient
rights. However, it is apparent that where, as is the case here,
an HHA violates multiple elements or standards of a condition,
these violations in the aggregate constitute a failure to comply
with the condition. I conclude that Petitioner's casual regard for
E.R.'s rights
was so egregious as to constitute a violation of the condition of
participation requiring it to protect and promote patient rights.
D. HCFA's authority to terminate Petitioner's participation
in Medicare
As I found at Part B of this discussion, HCFA may terminate an
HHA's participation in Medicare where it is established that the
HHA is not complying with the requirements of Title XVIII and
regulations governing its participation. 42 C.F.R.
489.53(a)(1). HCFA is not obligated to afford the HHA an
opportunity to correct its deficiency before terminating the HHA's
participation.
Here, Petitioner engaged in conduct which materially violated both
the requirement of the Act and the regulations that it protect and
promote patient rights. Thus, Petitioner has failed to comply with
a statutory condition of participation in Medicare. On that basis,
HCFA is authorized to terminate Petitioner's participation in
Medicare.
HCFA cites, as an additional basis for terminating Petitioner's
participation, Petitioner's history of failing to comply with
conditions of participation. HCFA asserts that, based on
Petitioner's poor performance as a provider, it is not required to
afford it now with the opportunity to correct its deficiencies.
Although this may be a legitimate policy basis for HCFA's
determination to terminate Petitioner's participation at this
juncture, it is not a legal prerequisite. The regulation which
authorizes HCFA to terminate an HHA's participation for failure to
comply with the requirements of the Act and the regulations does
not require HCFA to prove a history of noncompliance as a
prerequisite to terminating an HHA's participation in Medicare.
E. HCFA's compliance with notice requirements
Petitioner argues that HCFA failed to provide it with adequate
notice of the findings of the D.C. survey agency's investigation
and HCFA's determination to terminate Petitioner's participation in
Medicare. 11/ In its argument, Petitioner focuses on the alleged
failure of Ms. Yung-Fatah to discuss with Petitioner the
conclusions of the D.C. survey agency's complaint investigation.
Petitioner's Post-Hearing Brief at 15.
Ms. Yung-Fatah contradicts this assertion. She testified that, on
June 2, 1993, she informed Ms. Graham, Petitioner's President, of
the results of the complaint investigation. Tr. at 160. However,
it is not necessary for me to decide whether Ms. Yung-Fatah
discussed the results of the investigation with Ms. Graham. HCFA
was under no obligation to provide Petitioner with such information
where, as is the case here, HCFA determined to terminate
Petitioner's participation in Medicare.
The regulation which governs termination of a provider's
participation in Medicare imposes no obligation on HCFA to discuss
investigative findings with a provider before communicating to the
provider its determination to terminate that provider's
participation in Medicare. The regulation states only that HCFA
must give a provider at least 15 days' notice before terminating
its participation in Medicare. 42 C.F.R. 489.53(c)(1). The
notice of termination which HCFA sent to Petitioner on July 16,
1993 advised Petitioner that its participation in Medicare would
terminate on August 15,
1993, 30 days from the date of the notice. 12/ HCFA Ex. 7, page 2.
Thus, Petitioner received the notice to which it was entitled under
the regulation. 13/
III. Conclusion
I conclude that Petitioner failed to comply with the Medicare
condition of participation requiring it to protect and promote the
rights of patients. HCFA was justified in terminating Petitioner's
participation in Medicare, and I sustain HCFA's determination to do
so.
________________________
Steven T. Kessel
Administrative Law Judge
1. I refer to Petitioner's exhibits as P. Ex. (number), (page
number); I refer to the Health Care Financing Administration's
exhibits as HCFA Ex. (number), (page number); I refer to the
transcript of the hearing in this case as Tr. at (page).
2. HCFA objected to the admission into evidence of these
exhibits, arguing that they contained hearsay and were, thus,
prejudicial to HCFA. Response of the Health Care Financing
Administration to Petitioner's Proposed Posthearing Exhibits,
December 20, 1994. I overrule these objections. Hearsay is
admitted routinely in administrative hearings, and the fact that
these exhibits contain hearsay is not in and of itself a basis to
deny their admission. I do not agree with HCFA's assertion that it
is prejudiced by the admission of these exhibits. HCFA had the
opportunity to offer exhibits or other evidence to rebut the
exhibits. I would have afforded HCFA the opportunity to
cross-examine the declarants in Petitioner's exhibits had HCFA
requested that opportunity.
3. An exception exists in the case where a patient is adjudged
to be incompetent. Id.
4. HCFA has not alleged that Petitioner's failure to comply
with the condition of participation governing patient rights placed
the health and safety of patients in immediate jeopardy.
5. In this case, HCFA avers that its determination to terminate
Petitioner's participation in Medicare without first affording
Petitioner the chance to comply with participation requirements was
justified by Petitioner's history of non-compliance with
participation requirements. However, under 42 C.F.R. 489.53,
HCFA may terminate a provider's participation in Medicare without
regard to that provider's compliance history, if HCFA determines
that the provider is not complying with a condition governing that
provider's participation in Medicare.
6. I was not present at the hearing conducted on March 8 - 9,
1994. Therefore, I make no findings as to Ms. Yung-Fatah's
credibility based on her demeanor as a witness. My finding that
Ms. Yung-Fatah testified credibly is based solely on a review of
the transcript and the exhibits. I would note, however, that
Petitioner has not argued that Ms. Yung-Fatah's credibility was
impeached by her demeanor as a witness. Furthermore, I offered
Petitioner the opportunity to have a new hearing in this case and
Petitioner decided not to proceed in this manner.
7. In its posthearing brief, Petitioner makes a number of
allegations concerning E.R. and the manner in which she was treated
by Petitioner. These allegations are intermingled with
Petitioner's arguments that it did not contravene standards
governing its duty to protect and promote patients' rights.
Petitioner's Post-Hearing Brief at 2 - 13. These allegations are
not supported by exhibits or by testimony.
8. The gravamen of Petitioner's assertion that Ms. Yung-Fatah
committed perjury is that Ms. Yung-Fatah gave inconsistent
testimony concerning the statements made to her by E.R.
Petitioner's Post-Hearing Brief at 7 - 8. I am not persuaded that
Ms. Yung-Fatah's testimony is materially inconsistent.
Furthermore, Ms. Yung-Fatah made it plain in her testimony that
E.R. was a confused individual who at times made inconsistent
statements to Ms. Yung-Fatah. The inconsistencies asserted by
Petitioner appear to be inconsistent statements made by E.R. and
not by Ms. Yung-Fatah.
9. Seven of the checks on their face were labeled "food" and
one check on its face was labeled "cab fare." HCFA Ex. 4, pages 32
- 33. Although the record does contain copies of food store
receipts purporting to be for food purchased for E.R. (HCFA Ex. 25,
pages 1 - 7, 9 - 10), Petitioner did not maintain records
documenting that this money was used for the purpose indicated on
the face of the checks or for the food indicated by the receipts.
Thus, there is no way to tell whether the funds represented by
these checks were used for the purposes indicated.
10. In an affidavit, E.R. states that the arrangement to have
individuals reside in her home was made with her consent. P. Ex.
7. However, I find this statement to be of little probative value,
because E.R. had been determined to be incompetent at a date
earlier than the date of her affidavit. Tr. at 381 - 382.
11. I note that the D.C. survey agency attempted to notify
Petitioner, by certified letter dated July 9, 1993, that it was
recommending to HCFA that Petitioner be terminated. This letter
enclosed the statement of deficiencies for the complaint
investigation (as well as the statement of deficiencies for the
June 1993 follow-up survey). The letter was sent to Petitioner's
correct address. However, Petitioner did not pick up the letter at
the post office, and the letter was returned to the D.C. survey
agency. HCFA Ex. 6. Had Petitioner picked up this letter, it
would have received notice of the D.C. survey agency's
recommendation prior to receiving HCFA's notice of termination.
12. Petitioner does not deny receiving the notice.
13. HCFA's Regional Office Manual suggests that HCFA employ a
process which covers a 90-day period, from the conclusion of an
initial survey of a provider to termination of that provider's
participation in Medicare, in a case where termination may be an
appropriate remedy. HCFA Ex. 21, pages 3 - 4. This process is
applicable to the case where HCFA seeks to have a provider remedy
a deficiency, in lieu of terminating the provider's participation
in Medicare. The Regional Office Manual does not mandate a 90-day
process in the case where, based on the outcome of a survey or
investigation, HCFA determines that termination of a provider's
participation is appropriate and that no attempts should be made to
remedy the deficiency prior to termination. Indeed, the Regional
Office Manual states specifically that termination may be
accomplished in less than 90 days, so long as the requirements of
the regulations are met. Id. Equally, the State Operations Manual
referenced by Petitioner (P. Ex. 12) contemplates a 90-day
termination process only in the case where a State survey agency
seeks to have a provider remedy a deficiency.