Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of: Renaissance Care Center, Inc., Petitioner,
- v. -
Health Care Financing Administration.
DATE: September 25, 1997
Docket No. C-97-313
Decision No. CR497
DECISION
Below, I explain my reasons for dismissing this case pursuant to
42 C.F.R. § 498.70(c).
This case was originally assigned to Administrative Law Judge
Mimi Hwang Leahy and, subsequently, reassigned to me. A
prehearing conference was held with counsel for the parties by
telephone on June 4, 1997, at which time there was some
discussion as to whether this case should be consolidated with a
similar case involving the parties (Docket No. C-97-008). It was
agreed by the parties at that time that the cases should not be
consolidated, as there were different facts, issues, and
witnesses involved in the two cases. Counsel for the Health Care
Financing Administration (HCFA) indicated at that time that it
might be filing a motion with respect to this case which could be
dispositive of the issues, and both parties asked that I not set
a hearing date until the status of the second case could be
clarified. I agreed, but did set a second telephone prehearing
conference date of September 5, 1997, with the intention of
ruling on the motion which was to be forthcoming at that time,
and establishing a hearing date if the case was to go forward. I
have since determined, for the reasons set forth below, that a
second prehearing conference is not required.
On July 11, 1997, HCFA filed a Motion to Dismiss Petitioner's
hearing request, and a memorandum in support thereof, contending
that Petitioner's hearing request was not timely filed pursuant
to the regulations. Petitioner filed its response in opposition
on August 30, 1997. Having carefully considered the record
before me, as well as the arguments of counsel for the parties, I
must concur with the argument advanced by HCFA. 1/
FINDINGS OF FACT AND CONCLUSIONS OF LAW (FFCLs)
1. At all times relevant hereto, Petitioner was and is a
provider of medical and related services and participates in the
Medicare and Medicaid programs. HCFA Ex. 2 at 1.
2. On January 15, 1997, an inspection was conducted at
Renaissance Care Center (Petitioner herein) by staff of the
Illinois Department of Public Health to determine Petitioner's
compliance with federal certification requirements for nursing
homes participating in the Medicare and Medicaid programs. HCFA
Ex. 1 at 1.
3. By notice dated January 17, 1997, the Illinois Department of
Public Health (State agency) advised Petitioner that, as a result
of the inspection, it was determined that Petitioner's facility
was not in substantial compliance with regulatory requirements.
The State agency included a copy of HCFA form 2567-L setting
forth those deficiencies with specificity. The State agency
found that some of the deficiencies posed "immediate jeopardy" to
resident health and safety. The State agency further advised
Petitioner that, as a result of its findings, it was recommending
to HCFA that HCFA: impose a civil money penalty (CMP) of
$3050.00 per day until the "immediate jeopardy" was abated,
effective January 3, 1997; deny payment for new admissions,
effective January 27, 1997; impose State monitoring, effective
January 21, 1997; and terminate Petitioner from the programs,
effective February 7, 1997. HCFA Ex. 1.
4. By letter and notice dated January 24, 1997, HCFA advised
Petitioner that, based on the State agency's recommendation in
response to the survey, it was imposing all of the recommended
remedies. HCFA further advised Petitioner that, if it disagreed
with HCFA's determination, Petitioner had the right to request a
hearing before an administrative law judge of the Department of
Health and Human Services, Departmental Appeals Board, but that
such request must be filed no later than 60 days from the date of
receipt of said notice. HCFA Ex. 2.
5. 42 C.F.R. § 498.3(b)(12) provides, in part, that with respect
to a nursing facility or skilled nursing facility, a finding of
noncompliance that results in the imposition of a remedy
specified in 42 C.F.R. § 488.406, except the State monitoring and
loss of approval for a nurse-aide training program remedies, is
an initial determination.
6. Termination, denial of payment for new admissions, and CMPs,
are all remedies listed in 42 C.F.R. § 488.406, and, accordingly,
HCFA's letter and notice dated January 24, 1997, was an initial
determination within the meaning of the regulations.
7. 42 C.F.R. § 498.40(a) provides, in pertinent part, that the
affected party or its authorized representative must file a
request for hearing within 60 days from receipt of the notice of
initial, reconsidered, or revised determination.
8. As stated aforesaid, HCFA rendered its initial determination
on January 24, 1997. The parties agree, and the record
indicates, that Petitioner did not file its request for hearing
until April 18, 1997, and did not file its request for hearing
within 60 days from receipt of the notice of initial
determination.
9. Petitioner did not file a request to extend the time for
filing its request for hearing pursuant to 42 C.F.R. § 498.42(c).
10. By notice dated February 20, 1997, HCFA advised Petitioner
that, as a result of a revisit to the facility on February 5,
1997, the State agency had recommended, and HCFA had concurred
with, a revision to the previously imposed enforcement remedies.
The remedy of termination was rescinded, and the CMP was reduced
from $3,050 per day to $50 per day, effective January 17, 1997.
HCFA Ex. 3.
11. By letter dated April 30, 1997, HCFA notified Petitioner
that the remedies imposed on January 24, 1997, were discontinued,
effective March 12, 1997, and that the total amount of the CMP
assessed to Petitioner was $45,400. HCFA Motion to Dismiss; HCFA
Br. at 3.
12. Neither the notice of February 20, 1997, nor the letter of
April 30, 1997, gave Petitioner appeal rights, as neither
document issued new findings of noncompliance. Instead, these
documents merely modified the remedies HCFA had decided to
impose. HCFA Br. at 6.
13. 42 C.F.R. § 488.408(g) provides that a facility may appeal
the finding of noncompliance that results in the imposition of
[remedies] but may not appeal the choice of remedy. Since the
finding of noncompliance which resulted in the imposition of
remedies was issued by HCFA on January 24, 1997, it is from the
date of notice of that finding that the appeal period runs, and
not from subsequent amendments and revisions to the remedy, as
HCFA's choice of remedy, under the regulations, is not an
appealable issue.
14. Petitioner does not contend that HCFA made any new findings
of noncompliance subsequent to its initial determination of
January 24, 1997, but contends that HCFA's regulation denying it
the right to contest HCFA's choice of remedies is an
unconstitutional deprivation of its right to due process.
15. An administrative law judge derives his limited authority
from the statute and the implementing regulations. In
adjudicating claims, he or she is bound by the governing
regulations. It is not within the scope of an administrative law
judge's authority to declare the regulations through which he or
she obtains jurisdiction unconstitutional, and, accordingly, this
Administrative Law Judge makes no finding on the issues of
constitutionality raised by Petitioner.
16. Petitioner's request for hearing was not timely filed, no
extension of the time for filing was either requested or granted,
and, accordingly, this matter must be dismissed. 42 C.F.R. §
498.70(c).
DISCUSSION
I. Agreement of the Parties as to the Facts
A reading of the pleadings filed with respect to this matter
indicates that the parties are in complete agreement as to those
Findings of Fact and Conclusions of Law (FFCLs) set forth as
numbers 1 through 12 above. Of primary importance is the fact
that HCFA rendered an initial determination on January 24, 1997,
finding that Petitioner was not in substantial compliance with
participation requirements, and notifying Petitioner of several
remedies, including a CMP in the amount of $3050 per day,
effective January 3, 1997. P. Br. at 1; HCFA Br. at 2.
The parties further agree that on February 20, 1997, HCFA issued
a notice revising and modifying the remedies it had initially
imposed, but did not change, revise, or modify the basis upon
which those remedies were imposed. HCFA noted that "[It]
certified no new findings of noncompliance but instead referenced
two repeat findings . . . [and] also indicated that its letter of
February 20, 1997 did not toll the time in which the Petitioner
had to request a hearing or waive its right to a hearing and
still receive a 35 percent reduction of the CMP." HCFA Br. at 3;
HCFA Ex. 3. Petitioner does not dispute this fact, and, in fact,
indicates its agreement by noting that "On February 20, 1997,
based upon [the State agency] recommendations regarding the
February 5, 1997 survey, HCFA revised its remedies . . .
(Emphasis Added). P. Br. at 2.
HCFA issued an additional notice on April 30, 1997, advising
Petitioner that the remedies imposed on January 24, 1997, were
being discontinued. HCFA Br. at 3; P. Br. at 3. Neither side
contends that this notice did anything except notify Petitioner
of HCFA's final decision with respect to the remedies imposed.
There was no revision or modification to the initial findings of
noncompliance upon which the remedies were based.
Finally, of critical importance herein, both parties agree that
Petitioner did not file its request for hearing until April 18,
1997, some 84 days after HCFA's initial determination. HCFA Br.
at 3; P. Br. at 3.
II. Applicable Law
42 C.F.R. § 498.70 provides, in pertinent part, that an affected
party must file its request for hearing within 60 days from
receipt of its notice of an initial, reconsidered, or revised
determination, unless that period is extended by the
administrative law judge upon written request of the affected
party and for good cause shown. In this case, Petitioner did not
file a written request seeking an extension of its time to file.
There is no evidence to show that HCFA issued either a
reconsidered or revised determination in this case. While HCFA
did issue notices revising the remedies it elected to impose,
those notices did not constitute reconsidered or revised
determinations within the meaning of 42 C.F.R. §§ 498.24
(reconsidered determination) or 498.32 (revised determination).
Pursuant to the aforesaid regulations, a reconsidered
determination occurs following a formal request for same, upon
which HCFA considers the initial determination, the findings on
which it was made, and new evidence the affected party might wish
to submit. HCFA then issues a formal reconsidered determination
affirming or modifying the initial determination and the findings
on which it was based. Here, there is nothing to indicate, and
indeed Petitioner does not contend, that a formal request for a
reconsidered determination was made, or, indeed, that such a
determination was issued.
A revised determination is one in which HCFA gives the affected
party notice that it is reopening the initial determination and
revising same.
In the instance of either a reconsidered or revised
determination, HCFA is obligated under the aforesaid regulations
to extend the right of appeal for 60 days following issuance of
notice. HCFA did not extend the right of appeal in this case
because there was no request for reconsideration, and HCFA did
not on its own reopen and revise its initial determination.
Because there was neither a reconsidered nor revised
determination as defined by the regulations, Petitioner could
only appeal the initial determination, which in this case was
rendered on January 24, 1997. Pursuant to 42 C.F.R. §
498.3(b)(12), an initial determination with respect to a skilled
nursing facility (SNF) or nursing facility (NF), such as
Petitioner herein, is "a finding of noncompliance that results in
the imposition of a remedy specified in § 488.406 of this
chapter, except the State monitoring remedy, and the loss of the
approval for a nurse-aide training program." In this instance,
HCFA made findings of noncompliance (HCFA Ex. 1) and those
findings led to the imposition of remedies specified in 42 C.F.R.
§ 488.406, namely termination, CMP, and denial of payment for new
admissions.
It is important to note that 42 C.F.R. § 498.3(b)(12) states that
it is the "finding of noncompliance" which is the initial
determination, not the remedy which is imposed. It is,
accordingly, the "finding of noncompliance" which must be
appealed and not HCFA's choice of remedy. The regulations make
this conclusion absolutely clear. For example, 42 C.F.R. §
498.3(d)(11) provides that the choice of an alternative sanction
or remedy to be imposed on a provider or supplier is an
administrative action which is NOT an initial determination.
Similarly, 42 C.F.R. § 488.408(g) provides that: "(1) A facility
may appeal a certification of noncompliance leading to an
enforcement remedy. (2) A facility may not appeal the choice of
remedy, including the factors considered by HCFA or the State in
selecting the remedy, specified in § 488.404." Finally, with
respect to civil money penalties, 42 C.F.R. § 488.432 provides
that "[a] facility must request a hearing on the determination of
the noncompliance that is the basis for imposition of the civil
money penalty . . . .(emphasis added). In reviewing that
penalty, 42 C.F.R. § 488.438 provides that an administrative law
judge must determine whether or not the basis for imposition of
the penalty exists. Under that regulation, the administrative
law judge can review the amount of the penalty with certain
qualifications, but he cannot review the selection of that remedy
(penalty) itself.
All of the aforesaid regulations are consistent with the
conclusion that the Secretary of the Department of Health and
Human Services (Secretary) specifically limited facilities to an
appeal of the findings of deficiency leading to the imposition of
a remedy, and not to an appeal of the remedy itself. Similarly,
the Secretary specifically limited an administrative law judge's
authority and jurisdiction to a consideration of HCFA's findings
of deficiency, leaving the selection of remedy within the
discretion of HCFA.
III. Constitutionality of HCFA's Regulations.
It is clear from Petitioner's response to HCFA's motion to
dismiss that it does not contend that HCFA failed to follow the
regulations. Rather, it contends that those regulations violate
the due process clause of the fifth and fourteenth amendments to
the United States Constitution. P. Br. at 3. Specifically,
Petitioner seeks to challenge the selection of remedies imposed
by HCFA in its notice of February 20, 1997, and argues that the
regulations discussed above, which prohibit Petitioner from
contesting the choice of remedy, or, it argues, from contesting
the scope and severity of deficiencies, are unconstitutional.
An administrative law judge, unlike a federal judge in the
judicial branch of our government, does not derive his or her
authority directly from the Constitution. Instead, the
administrative law judge is a creation of Congress, housed in the
executive branch of the government, and is vested with only such
authority as the Congress by statute, or the Executive by
regulation and delegation of authority, chooses to impart.
Neither Congress nor the Executive have conferred upon
administrative law judges the authority to rule on the
Constitutionality of the statutes and regulations under which the
administrative law judge presides. Indeed, the administrative
law judge is duty bound to uphold and enforce those statutes and
regulations while they remain in force and effect. The
administrative law judge must assume that the laws and
regulations over which he or she presides are lawful.
Accordingly, as the arguments advanced by Petitioner are beyond
the scope of my authority as an administrative law judge, I
decline to rule on them. The Petitioner's right to appeal this
decision and to raise his constitutional argument is preserved.
IV. Conclusion
I conclude that, in this case, HCFA rendered its initial
determination on January 24, 1997. I conclude further that
Petitioner's request for hearing, filed on April 18, 1997, was
untimely filed and was beyond the 60 day time limit as provided
by 42 C.F.R. § 498.40(a)(2). I conclude finally that no request
to extend that time limit was made, nor was any extension granted
for good cause shown. Accordingly, this matter should be, and
is, HEREBY DISMISSED pursuant to 42 C.F.R. § 498.70(c).
________________________
Stephen J. Ahlgren
Administrative Law Judge
* * * Footnotes * * *
1. With their briefs, the parties have filed various
proposed exhibits, to which there has been no objection. I
hereby admit HCFA Exhibits (HCFA Ex.) 1 through 3 into the
record. Similarly, I hereby admit Petitioner's Exhibits (P. Ex.)
1 through 4 into the record. References herein to HCFA's brief
shall be denoted as (HCFA Br.), and to Petitioner's Brief as (P.
Br.).