SUBJECT:

Hamilton County Nursing Home,

Petitioner,

Health Care Financing Administration

The Health Care Financing Administration (HCFA) moved to dismiss Petitioner's March 31, 2000 hearing request for untimeliness.⁽¹⁾ The parties agreed to a briefing schedule. HCFA filed a memorandum of law accompanied by seven proposed exhibits. I have admitted these into evidence as HCFA Exhibits 1-7 (HCFA Exs. 1-7). Petitioner filed a memorandum in opposition (P. Br.) and 10 proposed exhibits. I have admitted these into evidence as Petitioner's Exhibits 1-10 (P. Exs. 1-10). HCFA submitted a reply brief with an affidavit of Ms. Joe Ann Hollingsworth, which I have admitted into evidence as HCFA Ex. 8. HCFA supplemented the record with an additional document consisting of a page from Ms. Hollingsworth's notes of telephone calls that was an attachment to her affidavit but was inadvertently omitted when it filed its reply memorandum. I have admitted that additional document into evidence as an attachment to HCFA Ex. 8.

After consideration of the written arguments and documentary evidence submitted by the parties, I grant HCFA's motion to dismiss. In doing so, I find that the hearing request was untimely filed and the time for filing a request for hearing has not been extended as Petitioner has not shown good cause for its failure to file a timely hearing request.

Undisputed facts

Petitioner is a skilled nursing facility in Chattanooga, Tennessee, participating in the Medicare and Medicaid programs. As a result of a survey completed on January 21, 2000, the Tennessee Department of Health, the State survey agency, notified Petitioner that based on findings of immediate jeopardy, it was recommending that HCFA impose a civil money penalty (CMP) in the sum of $10,000 per day effective January 12, 2000, termination of the facility's provider agreement, and denial of payment for new admissions. HCFA Ex. 4. On January 24, 2000, HCFA notified Petitioner by facsimile that it concurred with the recommendations of the State survey agency and was imposing a CMP and termination. HCFA Ex. 4. HCFA further informed Petitioner that if Petitioner disagreed with this determination, it may request a hearing before an administrative law judge (ALJ) and that the procedures governing this process are set out in 42 C.F.R. § 498.40, et seq. HCFA Ex. 4 at 3. Petitioner received the letter that same day. P. Br. at 2. On February 2, 2000, HCFA notified Petitioner that is was in compliance with the requirements for participation as of January 31, 2000 and that the termination remedy was rescinded. HCFA Ex. 6. Petitioner filed a letter of intent to request a hearing, but not until March 31, 2000.

Issues

The issues in this case are:

• Whether Petitioner filed a timely request for hearing; and



• Whether Petitioner has shown good cause for extending the time to file a request for hearing.
  

Applicable law and regulations

In cases involving HCFA, a party is entitled to a hearing only if that party files its request within the time limits established by 42 C.F.R. § 498.40(a)(2), unless the period for filing is extended. In order to be entitled to a hearing, a party must file its request within 60 days from receipt of a notice of a determination by HCFA to impose a remedy. Id. The date of receipt of a notice is presumed to be five days after the date on the notice unless there is a showing of actual receipt on an earlier or later date. Id.; 42 C.F.R. § 498.22(b)(3). An ALJ may extend the time within which a hearing request may be filed based on a showing of good cause to justify an extension of time. 42 C.F.R. § 498.40(c)(2). An ALJ may dismiss a request for hearing which is not timely filed. 42 C.F.R. § 498.70(c).

Findings and Discussion

I make findings of fact and conclusions of law (Findings) to support my decision to dismiss. Each finding is noted below in bold face, followed by a discussion of each Finding.

1. Petitioner did not file a timely request for hearing.

HCFA sent Petitioner the notice of deficiencies by facsimile on January 24, 2000. Petitioner does not dispute that it received HCFA's notice on that same date. P. Br. at 3. It was not until March 31, 2000, 67 days after Petitioner's receipt of HCFA's determination, that Petitioner filed a letter of intent to request a hearing before an administrative law judge.

42 C.F.R. § 498.40(a)(2) expressly provides that:

[an] affected party or its legal representative or other authorized official must file the request for hearing in writing within 60 days from the receipt of the notice of initial, reconsidered, or revised determination unless that period is extended. . . .

The filing of Petitioner's request was clearly beyond the 60 days stipulated in the regulations. Also, 42 C.F.R. § 498.22(b)(3) provides that "the receipt of the notice of [an] initial determination . . . will be presumed to be 5 days after the date of the notice unless there is a showing that it was, in fact, received earlier or later." The five-day presumption set forth at 42 C.F.R. § 498.22(b)(3) does not apply, since Petitioner admits it received HCFA's notice on the same day it was sent by facsimile. P. Br. at 3. Thus, the time for seeking a hearing before an ALJ expired on March 24, 2000.

2. Petitioner is not entitled to an extension of time to file a request for hearing.

Petitioner has not filed a request for an extension of time for filing its request for hearing pursuant to 42 C.F.R. § 498.40(c)(1). Notwithstanding, I will consider its memorandum in opposition to HCFA's motion for dismissal as an application for leave to file untimely, which I may grant only upon a showing of good cause. 42 C.F.R. § 498.40(c)(2).

Petitioner's arguments

Petitioner contends that in a phone conversation on March 9, 2000, Mr. John Strawn, the facility administrator, was told by Ms. Joe Ann Hollingsworth, an employee in the Region IV HCFA office in Atlanta, that the deadline to request a hearing in this case was April 3, 2000. Allegedly, Mr. Strawn inquired of Ms. Hollingsworth when the time for an appeal would expire because the notice of sanction provided no information in that regard. P. Br. at 4. Consequently, Petitioner argues that when Mr. Strawn filed the March 31, 2000 "request for hearing," he relied on the information conveyed to him by Ms. Hollingsworth regarding the appeal deadline. P. Br. at 6; see P. Ex. 1.

Petitioner claims that its reliance on the erroneous information provided by HCFA as to the expiration of the time to file a request for hearing constitutes good cause for the failure to make a timely appeal. Petitioner cites Hillcrest Health Facility, Inc., DAB CR489 (1997), to argue that good cause is present when any communication from HCFA or the State agency is so deficient or misleading as to cause the Petitioner not to file a hearing request timely. Petitioner also cited John Vanderhorst, DAB CR27 (1989) as support that "good cause" for failure to timely request a review may include situations where the agency gives incorrect or incomplete information about when and how to request administrative review. Finally, Petitioner argues that HCFA should be estopped to benefit from its misrepresentations. In support, it cites Office of Personnel Management v. Richmond, 496 U.S. 414 (1990), to the effect that the United States Supreme Court has rejected the application of "an across the board no estoppel rule" against the government. Moreover, Petitioner contends that the Departmental Appeals Board, has stated in dicta that "if" estoppel were to be applied against HCFA, four elements need to be established: "(1) the party to be estopped must know the facts; (2) he must intend that his conduct shall be acted on or must so act that the party asserting the estoppel has a right to believe it is so intended; (3) the latter must be ignorant of the true facts; and (4) he must rely on the former's conduct to his injury." Carmel Convalescent Hospital, DAB No. 1584 (1996) at 14. Petitioner contends that all four elements are satisfied here.

HCFA's arguments

HCFA, on the other hand, contends that Petitioner was specifically admonished to read the notice of imposition of sanctions very carefully. HCFA Ex. 4 at 1. In that notice, HCFA says, Petitioner was instructed to follow the regulatory provisions that govern hearing requests. In this regard, HCFA goes on to argue that Petitioner does not contend that circumstances beyond its control prevented it from either reading the regulations or consulting legal counsel concerning appeal requirements.

HCFA countered Petitioner's affidavit with a declaration by Ms. Joe Ann Hollingsworth, wherein she alleges having no recollection of a phone conversation with Mr. Strawn on March 9, 2000. She does have an entry in her phone call diary where it is noted that she spoke with Mr. Strawn on March 27. HCFA Ex. 8, at p. 1, ¶ 6. Ms. Hollingsworth says in her statement that she spoke over the telephone with Mr. Strawn, who was in the company of a Mr. Ray Blevins. According to her, Mr. Strawn said the facility was trying to decide whether to request or waive a hearing, and they wanted to wait the outcome of the Informal Dispute Resolution (IDR) proceedings prior to exercising their options.

Concerning the time to appeal, Ms. Hollingsworth recalls telling Mr. Strawn that the pendency of the IDR proceeding did not toll their obligation to request a hearing within 60 days of receipt of the notice of sanctions. She goes on to say that Mr. Strawn did ask for the exact date when the time to appeal would expire and she responded that she did not undertake to provide precise dates when the deadline for requesting a hearing would expire because the information from the computer in that regard was often incorrect. It was her practice to advise facilities to count 60 days from the date of the receipt of the notice of imposition. Thus, during the March 27, 2000 telephone call with Mr. Strawn, she advised him that, while the date listed in the computer program was April 3, 2000, he would need to literally count 60 days from receipt of the notice to determine the correct date with certainty. HCFA Ex. 8, at ¶¶ 9-12.

HCFA also contends that the conditions for estoppel mentioned by the Board in Carmel Convalescent Hospital, supra, are not met in this case. Furthermore, HCFA argues that in Carmel the Board recognized that it is questionable whether estoppel may ever lie against HCFA in its administration of the Medicare program. As a final point, HCFA states that although Petitioner states that the decision in Office of Personnel Management v. Richmond, supra, applies here, its holding does not support estoppel in this case.

Discussion

The fundamental issue to be decided here is whether Petitioner has shown good cause to extend the time to file a request for hearing beyond the 60 days provided in the regulations. 42 C.F.R. § 498.40(c)(1) and (2). Inasmuch as what constitutes good cause is not defined in the regulations, I must look to case law for guidance in pursuit of a definition. The Departmental Appeals Board has held that "good cause" means circumstances beyond an entity's ability to control which prevented it from making a timely request for hearing. Hospicio San Martín, DAB No. 1554 (1996) at 5.

In view of the foregoing, I examine the facts of this case to determine what circumstances, if any, beyond Petitioner's control, prevented it from filing a timely hearing request. The thrust of Petitioner's argument in addressing this issue is two pronged:

• Nowhere in HCFA's January 24, 2000, letter did HCFA inform the facility that it had until a date certain to request a hearing or that it had only 60 days from the receipt of the notice to file an appeal, and,

• HCFA specifically informed Petitioner that it had until April 3, 2000, to request a hearing.

The notice of imposition of sanctions dated January 24, 2000, states, under a heading titled, Appeal Rights, as follows:

If you disagree with this determination, you or your legal representative may request a hearing before an administrative law judge of the Department of Health and Human Services, Departmental Appeals Board. Procedures governing this process are set out in section 498.40, et seq. . . . .

HCFA Ex. 4.

Where pertinent, 42 C. F. R. § 498.40 provides as follows:

(a) Manner and timing of request. (1) An affected party entitled to a hearing under § 498.5 may file a request for hearing with HCFA. . . .

(2) The affected party or its legal representative or other authorized official must file the request in writing within 60 days from receipt of the notice. . .unless that period is extended. . . .

The inference that I draw from the cited portion of the notice letter, and the regulatory language regarding Petitioner's appeal rights, is that it did not read the information carefully enough. The notice letter of sanction unequivocally makes reference to the specific section of the regulation that establishes that Petitioner has 60 days from the receipt of the notice to appeal the Agency action. Had Petitioner read the regulation and counted 60 days from January 24, 2000, it would not have filed the request for hearing on March 31, 2000.

In addressing the second argument advanced by Petitioner, I must not depart from the core issue before me. Petitioner has to show that it was prevented from filing a timely request for hearing due to circumstances beyond its control. Hospicio San Martin, supra, at 2. Petitioner has not come forward with persuasive argument as to why it did not follow the admonition in the notice letter regarding its right to a hearing. If it read the notice and saw that the regulation required it to count 60 days from the receipt of the notice, why did it not act accordingly? It was within Petitioner's control to read and count, but it either failed to do so, or ignored the regulatory directive. Instead of coming forward with an explanation for not paying attention to the language of the regulation, Petitioner leaps to focus on its claim that Ms. Hollingsworth provided erroneous information about the appeal deadline. That misinformation, it argues, is the circumstance that made it file untimely. I disagree.

In his affidavit, Mr. John Strawn states that on March 9, 2000, Ms. Hollingsworth told him that the facility had until April 3, 2000, to request a hearing. P. Ex.1, at 3. Ms. Hollingsworth, on the other hand, contradicts this by stating that she has no recollection of a March 9 conversation, but that she has a record of a March 27 telephone call from Mr. Strawn. Attachment to HCFA Ex. 8. At that time, she states she told Mr. Strawn that, according to the computer, the time for appeal would expire on April 3. She added, however, that such information was unreliable, and that he should count 60 days from when the facility received the notice letter in order to arrive at the correct deadline. It is uncertain whether there was a phone conversation on March 9 or March 27, 2000, or on both dates. However, in view of my conclusion that no circumstances prevented Petitioner from filing a timely appeal, I need not resolve the inconsistencies in those affidavits. Nothing that HCFA's representative may have told Petitioner regarding the appeal deadline could have the effect of relieving it of the responsibility to act according to the January 24, 2000 notice letter. That notice unequivocally told Petitioner that a request for hearing had to be filed in conformity with the procedures set out in § 498.40. Those procedures require the filing of a request for hearing within 60 days of receipt of the notice of sanctions. Thus, even if Petitioner was told that an appeal did not have to be filed until April 3, 2000, it had no reasonable basis to rely on that to the detriment of what it had already been told in the notice.

Inasmuch as I have concluded that Petitioner was not ignorant or had no reasonable basis to claim ignorance of the true facts regarding its appeal rights, it is not necessary to consider whether the dicta in Carmel, supra, concerning estoppel applies here, because Petitioner's reliance on estoppel is without merit.

Conclusion

Based on the applicable law and undisputed facts, I conclude that Petitioner's hearing request was untimely filed, and good cause does not exist to extend the time for filing. HCFA's motion to dismiss is granted.

Jose A. Anglada

Administrative Law Judge

1. Petitioner did not file a request for hearing; rather, it submitted a letter indicating its intent to do so. The question of whether Petitioner's letter of March 31, 2000 constitutes a valid request for hearing has not been made an issue before me by the parties. Although I question whether Petitioner's letter of March 31^st constitutes a request for a hearing, I need not reach that issue as I find other grounds to dismiss this appeal.