SUBJECT:

Manor Care of Largo, Inc.,

Petitioner,

Health Care Financing Administration

I. Applicable law

Medicare, a federally subsidized health insurance program for the elderly and disabled, was established under Title XVIII of the Social Security Act (Act). Medicare provides reimbursement for certain services rendered by providers, such as a skilled nursing facility (SNF) like Petitioner, who participate in the Medicare program under "provider agreements" with the United States Department of Health and Human Services (DHHS). In order to enter into such an agreement, SNFs must meet certain requirements imposed by applicable statute and regulations. Section 1819 of the Act [42 U.S.C. § 1395i - 3]; 42 C.F.R. Parts 483, 488, and 489. The requirements for participation in Medicare by SNFs are set forth at 42 C.F.R. Part 483. A SNF is subject to the survey, certification, and remedies provisions of 42 C.F.R. Part 488, and to the provisions governing provider agreements at 42 C.F.R. Part 489.

The survey process is the means by which DHHS (through HCFA) assesses providers' compliance with participation requirements. State survey agencies, under agreements with HCFA, perform the surveys of SNFs and make recommendations to HCFA as to whether such facilities meet federal requirements for Medicare participation. Act, section 1864(a); 42 C.F.R. §§ 488.10, 488.11, and 488.20. The results of these surveys are used by HCFA as the basis for its decisions regarding a SNF's initial or continued participation in Medicare. HCFA, not a State survey agency, makes the determination as to whether a facility is eligible to participate or remain in Medicare. Id.

The regulations define "substantial compliance" as "a level of compliance with the requirements of participation such that any identified deficiencies pose no greater risk to resident health or safety than the potential for causing minimal harm." 42 C.F.R. § 488.301. HCFA terminates a SNF's provider agreement if the SNF is not in substantial compliance within six months from the last day of a survey from which it was found to be out of substantial compliance. 42 C.F.R. § 488.412. See also 42 C.F.R. § 488.412(a). If the deficiencies are not in the immediate jeopardy range and the facility is not in substantial compliance, HCFA may allow the facility to continue participation for no longer than six months from the last day of the survey, if certain requirements are met. Id. However, HCFA is authorized to terminate the participation of a SNF which it determines is out in substantial compliance with participation requirements even if it has not been out of substantial compliance for six months. 42 C.F.R. §§ 488.412, 488.456(b)(i), and 489.53(a)(3).

The regulations define "noncompliance" as "any deficiency which causes a facility to not be in substantial compliance." 42 C.F.R. § 488.301. A deficiency is "a skilled nursing facility's failure to meet a participation requirement." Id.

The burden of proof is governed by the decision of an appellate panel of the Departmental Appeals Board in the case of Hillman Rehabilitation Center, DAB No. 1611 (1997), aff'd sub nom, Hillman Rehabilitation Center v. United States, Department of Health and Human Services, Health Care Financing Administration, No. 98-3789 (GEB), slip op. at 25 (D.N.J. May 13, 1999). Under Hillman, HCFA bears the burden of coming forward with evidence sufficient to establish a prima facie case that Petitioner was not in substantial compliance with a participation requirement at issue.

Once HCFA has established a prima facie case, Petitioner has the ultimate burden of persuasion: to prevail, Petitioner must prove by a preponderance of the evidence that it was in substantial compliance with the requirement.

II. Background

Petitioner operates a 130-bed SNF located in Largo, Maryland. Petitioner was certified to participate in the federal Medicare program. Initially, HCFA found that Petitioner was not in substantial compliance with Medicare participation requirements based on a survey conducted on February 16-18, 1999 by the Maryland Department of Health and Mental Hygiene (State survey agency). Subsequently, HCFA found that Petitioner remained out of compliance with Medicare participation requirements following revisit surveys conducted on June 14-17, 1999 and August 24-27, 1999. By letter dated October 27, 1999, HCFA notified Petitioner that its Medicare agreement would be terminated, effective November 15, 1999. HCFA Ex. 20. Petitioner timely requested a hearing. The hearing was held on May 1-2, 1999, May 8-11, 1999, and June 1-2, 1999 in Washington, D.C.

Based upon the evidence of record, the applicable law, and in light of the parties' arguments, I determine that Petitioner was not in substantial compliance with Medicare participation requirements at the time of the February, June, and August 1999 surveys.

III. Issues

The issue is whether Petitioner was in substantial compliance with Medicare participation requirements at the times of the February, June, and August 1999 surveys.

IV. Findings of fact and conclusions of law

The findings of fact and conclusions of law, identified here, are discussed in detail in section V below, the Discussion section.

1. Petitioner was not in substantial compliance with Medicare participation requirements as to F Tag 314 at the time of the February 1999 survey. Section A of Discussion below.

2. Petitioner was in substantial compliance with Medicare participation requirements as to F Tag 325 at the time of the February 1999 survey. Id.

3. Petitioner was not in substantial compliance with Medicare participation requirements at the time of the June 1999 survey. Section B of Discussion below.

4. Petitioner was not in substantial compliance with Medicare participation requirements at the time of the August 1999 survey. Section C of Discussion below.

5. HCFA's failure to provide a Statement of Deficiencies to Petitioner within 10 days of the completion of each of the aforementioned surveys does not invalidate the survey findings or the termination. Section D of Discussion below.

6. An Administrative Law Judge (ALJ) has no authority to grant Petitioner any relief based on HCFA's failure to present the Statement of Deficiencies within 10 days following the survey. Section D of Discussion below.

7. HCFA was authorized to terminate Petitioner's Medicare provider agreement. Section E of Discussion below.

V. Discussion

A. Petitioner was not in substantial compliance with participation requirements at the time of the February 1999 survey.

Following the February 1999 survey, HCFA cited Petitioner with a deficiency, specifically the subsection of the regulations concerning Quality of Care - Pressure Sores, 42 C.F.R. § 483.25(c), which requires that with respect to pressure sores:

Based on the comprehensive assessment of a resident, the facility must ensure that -

(1) A resident who enters the facility without pressure sores does not develop pressure sores unless the individual's clinical condition demonstrates that they were unavoidable; and

(2) A resident having pressure sores receives the necessary treatment and services to promote healing, prevent infection, and prevent new sores from developing.

42 C.F.R. § 483.25(c); HCFA Ex. 12 at 3.

In the same survey, Petitioner was also cited with a deficiency, specifically the subsection of the regulations concerning Quality of Care - Nutrition, 42 C.F.R. § 483.25(i)(1), which states:

(i) Nutrition. Based on a resident's comprehensive assessment, the facility must ensure that a resident -

(1) Maintains acceptable parameters of nutritional status, such as body weight and protein levels, unless the resident's clinical condition demonstrates that this is not possible . . . .

42 C.F.R. § 483.25(i)(1).

To support the allegations that the provider failed to comply with these requirements, the situation of Resident 1 is detailed at F Tag 314, and the situations of Residents 1, 2, and 3 are detailed at F Tag 325 on the HCFA 2567. HCFA Ex. F-3 at 7. The specific allegations are that Petitioner failed to provide the necessary treatment for the avoidance of pressure sores in Resident 1, and Petitioner failed to adequately monitor in a timely manner the weights of three residents who experienced unplanned weight loss. Id. at 2, 5.

1. F Tag 314

Resident 1 was a 93-year-old female, who had diagnoses of senile dementia, hypertension (HTN), congestive heart failure (CHF), sick sinus syndrome, status post pacemaker, leg edema secondary to venous insufficiency and congestive heart failure, osteoporosis, arteriosclerotic cardiovascular disease (ASCVD), a history of cellulitis in the left hand and glaucoma. P. Ex. 2 at 1; HCFA Ex. F-5 at 7.

Prior to her transfer to Petitioner's facility, Resident 1 was a resident at a facility in Greenbelt, Maryland, from November 26, 1997 through January 12, 1999. HCFA Ex. 11 at 8; P. Ex. 2 at 1. On January 13, 1999, Resident 1 was transferred to Petitioner's facility. Id. The diagnosis of Resident 1's medical condition was the same in both facilities. HCFA Ex. 11 at 8; HCFA Ex. F-5 at 7. According to the resident's medical file, at the time of her admission to Petitioner's facility, there were no indications of pressure sores or open skin areas. Id. at 10, 41; Tr. at 732.

HCFA alleges that Petitioner could have avoided the development of pressure sores by providing timely preventative care and that the lack of timely care resulted in the development of pressure sores. This condition ultimately resulted in the hospitalization of the resident for surgical debridement of a Stage IV decubitus ulcer. HCFA Br. at 9.

In response to the allegations, Petitioner argues that the HCFA 2567 fails to specify what portions of the participation requirement were not met. They further argue that the standard encompassed by F Tag 314, which dictates that "a facility is deficient under the regulations if a resident develops a pressure sore within 23 days of admission" is an inaccurate standard. P. Br. at 31. Petitioner goes on to assert that 42 C.F.R. § 483.25(c) requires HCFA to prove how and why a pressure sore is avoidable based upon the resident's clinical status, and therefore, based upon this standard, a deficiency occurs only in the presence of such evidence. Id. at 6.

I do not agree with Petitioner's interpretation of the applicable standard. It has previously been determined that where a resident is admitted into a facility without pressure sores and such sores develop while the resident is in the care of the facility, the burden is on the provider to "prove by a preponderance of the evidence [that it is more likely than not] that the resident's clinical condition made the pressure sores unavoidable." Koester Pavilion, DAB CR650 (2000), aff'd, DAB No. 1750 (2000).

For the sake of clarity, HCFA erred in its assessment that, prior to Resident 1's admission to Petitioner's facility, she had no pressure sores. HCFA Br. at 11. To be accurate, the record reflects that Resident 1 had, in fact, had skin tears while a resident at the Greenbelt facility. HCFA Ex. F-5 at 3, 4. However, at the time of her transfer to Petitioner's facility, those pressure sores were non-existent. Id. at 41. With this information contained in her record, it was Petitioner's obligation to take preventative measures to ensure that new pressure sores would not develop. Preventative measures would include, among other things, rotation and repositioning of an immobile resident.

Based upon the evidence and testimony presented at hearing, I am not convinced by Petitioner's contention that Resident 1's pressure sores were the result of her clinical condition, thereby making their development unavoidable. On January 13, 1999, a treatment order was entered directing the nursing staff to, among other things, "turn and rotate Q2; document each shift." HCFA Ex. F-5 at 11. Terry Lawrence, Director of Nursing during the relevant period, testified that notations in the nurse's notes reflecting rotation and repositioning would be indicated by the notation "q. shift." Tr. at 741, 812. The order for turning and repositioning of residents every two hours is in accordance with the Clinical Practice Guidelines. HCFA Ex. O-13 at 13.

There is no evidence in the record which would indicate that the treatment orders regarding repositioning of the resident were implemented prior to January 19, 1999. A nurse's note on the resident's day of admission indicates that Resident 1 "picks at diaper." HCFA Ex. F-5 at 41. Another notation on January 14^th reads "Pt noted to have picked her diaper apart." Id. at 42. These would be common sense indications of some type of irritation in the diaper area. A subsequent nurse's note indicates that the resident, while sitting in her wheel chair, repeatedly slid from an upright position. Id. at 43. The note further states that the resident's niece, who was visiting that particular day and witnessed the incident, suggested that a wedge be placed in the wheelchair to hold the resident upright. Id. The first notation of any "q shift" is dated January 19, 1999. Id. at 44. So, according to the nurse's notes, the routine rotation procedure was not implemented until five days after Resident 1's admission. On January 22^nd, scratches to the resident's right hip in the sacral area was noted. Id. at 45. It is at this time that a second "q shift" is noted for itching and diaper rash, and a treatment ointment was ordered and applied. Id. Two days later, on January 24^th, an open sacral area on the resident's right hip is noted. Id. at 46. A nurse's note is entered instructing a position change every two hours to prevent further skin breakdown. Id.

Petitioner argues, and I agree, that Resident 1 received nutritional and mineral supplements beyond those ordinarily administered. The record is resplendent with such documentation. Tr. at 327, 339-40; HCFA Ex. F-5 at 6, 11. It is evident that Petitioner took reasonable measures to ensure the sufficiency of Resident 1's nutritional levels. However, the same cannot be said for the other preventative measures Petitioner failed to initiate. It is apparent from the evidence that Petitioner failed to implement the rotation order in a timely and effective manner. Petitioner asserts that the testimony of the surveyor, Joyce Battle, concedes that the resident was in fact rotated every two hours. P. Br. at 34-35. The line of questioning on this issue was as follows:

Q: You said this morning that there was no documentation that Resident No. 1 was turned every two hours. That what you found was a documentation each shift.

A: Yes.

Q: . . . . I'd like you to look at Exhibit 2, page 21. And in the left hand column, look down to the last block of handwriting and the first line says, "Turn and reposition every two hours," do you see that?

A: Yes.

Q: And what does it say after that?

A: "Document in shifts."

Q: Okay, that's fine. So the facility followed that order, didn't it?

A: Yes.

Q: So the documentation that you saw at Largo on February 17 and 18 showed that the resident was turned according to the order every two hours, and it was documented every shift, wasn't it?

A:Yes.

Tr. at 322.

This line of questioning is somewhat misleading. "Exhibit 2, page 21," which was referenced in the testimony, refers to Petitioner's Exhibit 2 at page 21. This is the medication/treatment order dated January 13, 1999, the date of Resident 1's admission to Petitioner facility. That document merely shows that the order was made for the resident to be repositioned every 2 hours. This document does not validate the conclusion that these measures were in fact implemented. The next document relied upon by Petitioner to support the assertion that Petitioner followed the reposition orders is Petitioner's treatment record. See P. Ex. 2 at 66. Based upon the notations in the treatment record, it was conceded and concluded that Petitioner followed preventative measures as to the pressure sores. What was omitted from the testimony was that this treatment record is reflective only for the month of February. There is nothing in the records which purports to be a treatment record for the month of January. In fact, as previously discussed, there is nothing in any document which shows the reposition and rotation being implemented prior to January 19^th. By this time, notations relating to the resident's apparent discomfort from the diapers had been noted. Within 48 hours of the first rotation note, scratches in Resident 1's right hip sacral area had been noted.

Petitioner did not take sufficient preventative measures to ensure that Resident 1 did not develop pressure sores. According to the record, there was a six-day lag time between the resident's admission and the implementation of the rotation process. This lag-time was strictly contrary to the orders of the attending physician dated January 13, 1999. Petitioner has not met its burden of proving by a preponderance of the evidence that it was in substantial compliance with the requirements of 42 C.F.R. § 483.25(c) insofar as Resident 1 is concerned.

2. F Tag 325

With regard to F Tag 325, Petitioner asserts that the surveyor identified three of the oldest, sickest residents in the facility for review, and without consideration of their clinical conditions, cited Petitioner for unintended weight loss. P. Br. at 37.

The surveyor alleged that the facility failed to follow its own policy for weight loss, which provided that a resident should be re-weighed immediately in the event of a change in weight. HCFA Ex. F-3 at 5.

HCFA asserted that Petitioner's failure to stringently monitor Resident 1's weight loss contributed to the development of the pressure sores discussed at F Tag 314. See Section A(1) of Discussion above; HCFA Ex. F-3 at 5-6.

Petitioner contests HCFA's attempt to argue, at the hearing, alternative bases for this deficiency citation which were not alleged in the HCFA 2567. P. Br. at 39. Petitioner argues that the deficiency cited was for its failure to follow the facility's internal policy regarding weight monitoring. Petitioner avers that the evidence presented at the hearing was to prove that Resident 1's weight loss was due to circumstances other than the lack of consistent monitoring (i.e., the administration of Lasix and not being sufficiently fed). Id. at 39, 40.

On this point, I agree with Petitioner's argument. I find that the only question at issue is whether, by failure to implement their own internal policy with respect to weight monitoring, Petitioner failed to maintain acceptable parameters for, among other things, body weight.

HCFA makes some valid assertions with regard to the standard of care Petitioner should have utilized with regard to monitoring the weight of Resident 1. Knowing that the resident had difficulty maintaining her weight (HCFA Ex. F-5 at 1), and having assessed through their own examination that the resident had poor oral intake (Id. at 7), Petitioner should have weighed Resident 1 more than just the three times that it actually did. Unfortunately, HCFA has not cited to any rule or regulation which dictates that failure of a facility to comply with internal policy and procedure is basis for a deficiency citation under F Tag 325.

An analogous case, Lake City Extended Care Center, DAB CR494 (1997), addresses this point. This case involved deficiency citations for, among other things, failure to adequately monitor and report changes or variations in a resident's temperature. The ALJ determined that:

Failure by Petitioner to follow the [internal] protocol would be significant here only . . . . if the protocol stated a federal participation requirement for a long-term care facility.

DAB CR494 at 16.

I agree with Petitioner's assertion that the regulations do not require a facility to weigh residents at specific intervals. Petitioner's internal policy mandated that residents would be weighed once a month on the same day. HCFA Ex. F-4 at 4. The policy further stipulates that in the event of a noted weight change (gain or loss), the resident will be reweighed immediately and only the reweight documented. Id. The Vital Statistic Flow Sheet shows that Resident 1 weighed in on January 13^th at 92 pounds; then on February 10^th at 74.75 pounds, and on February 18^th at 83.3 pounds. P. Ex. 2 at 32. Based upon the record, it is apparent that Petitioner did follow its policy with regard to the schedule for weight monitoring. However, it fell short in the reweight process. An 18 pound weight loss should have been visually obvious. Therefore, Petitioner should have reweighed Resident 1 prior to February 10^th. As previously stated, this failure to adhere to internal policy is not, in itself, a failure to comply with federal participation requirements. In the language of the regulation, it must be shown that, due to a resident's clinical condition, the maintenance of her weight is not possible. In this instance, the facts demonstrate that, even in spite of an 18 pound weight loss, Resident 1 was able to gain 9 pounds in 8 days. P. Ex. 2 at 32. On February 10^th and again on February 15th, the dietician revised Resident 1's nutritional regimen presumably in response to the changes in the resident's physical condition. P. Ex. 2 at 44-45, 46. Apparently, the revision of Resident 1's nutritional regimen added in the resulting weight gain.

The basis for the surveyor's deficiency citation on the HCFA 2567 was that Petitioner failed to comply with its internal policy regarding resident weight management. Had the surveyor determined that the cite was predicated on Petitioner's failure to monitor and maintain the resident's weight, then I would find that Petitioner was not in substantial compliance in this particular instance. However, this was not the basis for the deficiency under F Tag 325. Therefore, based on the arguments and evidence advanced, I find that Petitioner was in substantial compliance with the federal participation requirements of 42 C.F.R. § 483.25(i)(1) as it pertains to Resident 1.

Like Resident 1 discussed in detail above, Residents 2 and 3 experienced unplanned weight loss while in the care of Petitioner's facility. Petitioner was cited with a violation of F Tag 325 with regard to these two residents as well as Resident 1. HCFA Ex. F-3 at 6-7. Both parties assert the same arguments presented for Resident 1. In addition, Petitioner contends that HCFA presented no evidence at the hearing to support their allegations with regard to Residents 2 and 3. P. Br. at 41, 42. It should also be noted that HCFA failed to even argue the F Tag 325 citation or the rationale behind the citation in its post-hearing brief.

Therefore, for the reasons set forth as to Resident 1, I find that Petitioner was in substantial compliance with the requirements of 42 C.F.R. § 483.25(i)(1) as it pertains to Residents 2 and 3.

B. Petitioner was not in substantial compliance with Medicare participation requirements at the time of the June 1999 survey.

Following the June 1999 survey, HCFA cited Petitioner with one deficiency, specifically the section of the regulations concerning Quality of Care, 42 C.F.R. § 483.25, which states:

Each resident must receive and the facility must provide the necessary care and services to attain or maintain the highest practicable physical, mental, and psychosocial well-being, in accordance with the comprehensive assessment and plan of care.

42 C.F.R. § 483.25; HCFA Ex. 15.

To support the allegation that the provider failed to comply with this requirement, the situation of Resident 19 is detailed at F Tag 309 on the HCFA 2567. HCFA Ex. J-2 at 3-8. The preponderance of the evidence shows that Petitioner failed to provide the care and services necessary to treat/circumvent Resident 19's dehydrated state, thereby manifesting Petitioner's noncompliance with participation requirements in respect to F Tag 309.

From March 4, 1999 through May 6, 1999, Resident 19, a 95-year-old female, was hospitalized for extensive surgical treatment of a large infected sacral decubitus ulcer. HCFA Ex. J-8 at 13, 16. On May 6, 1999, Resident 19 was transferred to Petitioner. Id. at 16. At the time of the resident's transfer to Petitioner's facility, the sacral decubitus ulcer was determined to be healed. Id. at 17. Resident 19 resided at Petitioner's facility from May 6, 1999 to May 19, 1999. At the time of admission to Petitioner's facility, the nurse's assessment report indicated, among other things, that Resident 19 weighed 132 lbs., was alert, unable to speak, regular respiratory functions, showed no signs of edema, skin turgor was good, and the report did not make any notations regarding the presence of pressure sores. Id. at 26-27. See also, id. at 32. Petitioner's Plan of Care notes that, among other medications, 40 mg of Lasix was prescribed, and the resident's diet would consist of a pureed diet with Ensure supplements. Id. at 24. Lasix, a diuretic, is a drug which is prescribed for the treatment of high blood pressure. A diuretic, when administered, will reduce the fluid volume in a patient. Tr. at 121. When a diuretic is administered to a patient who is experiencing dehydration, that patient will become more dehydrated. Id. When dehydration occurs in elderly patients, there is an increased risk of skin breakdown and low blood pressure which, in extreme cases, may cause a patient to go into shock and eventually death. Id. at 121-122. Laboratory findings which are indicative of dehydration are tests of the blood uria nitrogen (BUN) and the creatinine. Id. at 118. The numeric range for a normal BUN level is between 8 and 28. Anything finding over 28 is a clear indicator of dehydration. However, in rare instances, a low reading of 8 can indicate dehydration as well. Id. at 121. At the time of admission, a Nursing Physical Assessment report was conducted for Resident 19. In that assessment, the attending nurse noted that Resident 19 had a clear urine output and that she had moist mucous membranes, both indicators of good hydration. Tr. at 124; HCFA Ex. J-8 at 26-27. Additionally, the nursing notes for May 6, 1999 indicated that Resident 19's blood pressure was 118 over 66. HCFA Ex. J-8 at 32. A laboratory work-up of the resident's body chemistry was ordered and conducted on May 10, 1999, which was four days after her admission to Petitioner facility. The results of the lab tests indicated that, since admission, Resident 19's BUN level increased to 50 and her creatinine level was 1.4. Tr. at 126; HCFA Ex. J-7 at 12.

Petitioner contends that the surveyor's reason for the deficiency cite was inappropriate. Specifically, Petitioner argues that they were cited with the Quality of Care deficiency because an accurate assessment evaluation had not been assembled nor had a plan of care been implemented by Petitioner, which resulted in their inability to meet the needs of Resident 19. P. Br. at 44. In fact, Petitioner does not dispute the essence of the deficiency, i.e., that Resident 19 suffered from dehydration and that dehydration was avoidable. Petitioner asserts that:

. . . . unless there is an obvious error, it is the doctor's responsibility to evaluate all diagnoses of the patient and to plot out a course of treatment that weigh the risks and benefits of treating what may be a complex set of problems . . . . The nurses can only exercise their nursing judgement [sic] and in this instance, it would be inappropriate for the nurses to disregard the physician's orders.

Id. at 44-45.

First, I disagree with the assertion that Petitioner was cited for this deficiency solely because of its failure to have a completed assessment evaluation or to have a plan of care in place. Based upon the surveyor's testimony, it is clear that the deficiency citation was based on Petitioner's failure to provide the necessary monitoring of Resident 19's condition, which resulted in a deterioration of her condition. Secondly, I agree with Petitioner's general premise of the distinction between a physician and nurse's responsibility for treatment. However, I do not agree with the application of that distinction to the facts in this case. I agree that it is a doctor's, and not a nurse's, responsibility to make the ultimate judgment calls with regard to a patient's course of treatment. However, if a physician is not provided with or is unaware of all of the information related to a particular patient's condition, he is unable to make an informed decision as to the appropriate course of treatment. The record is quite clear that, not only did the treating physician fall short of his duty to provide the necessary care and treatment to Resident 19, in many instances he was unaware of the resident's condition because the nursing staff failed to contact him or provide him with full information of Resident 19's condition.

With respect to Petitioner's second asserted defense, the weight of the evidence clearly shows that Petitioner failed to provide the resident with the necessary care required to ensure the "highest practicable physical, mental and psycho social well-being in accordance with a comprehensive assessment and plan of care" as prescribed in section 483.25. On May 10, 1999, the results of Resident 19's laboratory work up showed the elevated BUN level of 50. The attending physician was advised by the nursing staff of this result and the physician directed that the Lasix dose be suspended for one day, to be resumed the following day, and that follow-up lab tests should be conducted in two weeks. HCFA Ex. J-8 at 22. Mr. Kirwan, a surveyor and a registered nurse since 1984, testified that withholding the administration of the Lasix as instructed by the attending physician was appropriate. However, being trained medical professionals, the nursing staff should have questioned resuming the Lasix doses the following day without knowing whether Resident 19's BUN level was diminished or that the dehydration issue had been resolved. Tr. at 129, 130, 132. Mr. Kirwan further testified that, based upon his review of Petitioner's records, there is no indication that prior to resuming the Lasix doses, the nursing staff attempted to contact the attending physician for clarification of this course of treatment. Id. at 133. In its brief, Petitioner asserts that it is not the job of a nurse to countermand a physician's orders. They can "only exercise their nursing judgment." P. Br. at 45. I agree with this argument. And in this instance, it is obvious that the nursing staff did not use their nursing judgment when it came to resuming the Lasix. I agree with the conclusions of the witness. Where a nurse has a question as to physician orders they are to carry out, that question should be brought to the physician's attention if nothing more than for instructional clarification. I am persuaded by HCFA's assertion that Petitioner's argument on this point is contradicted by the nursing staffs own actions in a related matter. HCFA Reply Br. at 15.

I therefore find that Petitioner was not in substantial compliance with Medicare participation requirements under 42 C.F.R. § 483.25.

C. Petitioner was not in substantial compliance with Medicare participation requirements at the time of the August 1999 survey.

Following the August 1999 survey, HCFA cited Petitioner with four deficiencies, specifically the subsection of the regulations concerning Notice of Rights and Services, 42 C.F.R. § 483.10(b)(3); Quality of Care, 42 C.F.R. § 25; Quality of Care - Unnecessary Drugs, 42 C.F.R. § 25(l)(1); and Pharmacy Services - Drug Regimen Review, 42 C.F.R. § 60(c)(2).

To support the allegations that the provider failed to comply with these requirements, the situation of Resident 9 is detailed at F Tags 154, 309, 329, and 429 on the HCFA 2567. HCFA Ex. A-5 at 4-16. The specific allegations are that:

1. Petitioner failed to discuss available treatment options with Resident 9 until the surveyor intervened. HCFA Ex. A-5 at 5;

2. Petitioner failed to provide Resident 9 with the necessary care and services. Id;

3. Petitioner failed to assure that the drug regimen of Resident 9 was free from unnecessary drugs. Id. at 15-16; and

4. The consultant pharmacist failed to note and act upon a drug irregularity involving Resident 9. Id. at 16.

Resident 9 was a 73-year-old female. She was diagnosed with diabetes mellitus, congestive heart failure, peripheral vascular disease, anemia, bladder cancer, diabetic retinopathy, macular degeneration and a history of a left "below the knee" amputation. HCFA Ex. A-11 at 10.

On July 9, 1999, Resident 9 was admitted to Petitioner's facility. Based upon the evidence, there is a question as to whether Resident 9 was admitted to Petitioner's facility from her home (HCFA Ex. A-11 at 28-29, 99) or from an acute care hospital (id. at 7, 13). HCFA Ex. A-11 at 28-29, 99. She was described as alert and oriented, and the record indicates that she could direct and actively participate in her care. HCFA Ex. A-11 at 31, 50. The purpose for her admission into Petitioner's facility was for refit and replacement of an ill fitting prosthesis on her lower left leg. HCFA Exs. A-11 at 28, 29, 31. The resident's current prosthesis no longer fit appropriately due to weight loss. Id. at 25, 28, 29. She was to receive training in the use of the new prosthesis and therapy to improve her strength. HCFA Ex. A-11 at 31, 33, 106, 142. Upon completion of Resident 19's refit and rehabilitative therapy, she was to be returned to her home. Id. at 50, 94. During the course of what was to be a short-term stay, Resident 19's physical condition began to deteriorate with the change in her body chemistry readings, and the development of edema in her lower right leg, and a hypertensive episode.

1. F Tag 154

As a result of the August 1999 survey, Petitioner was cited with a deficiency in the Notice of Rights and Services category. 42 C.F.R. § 483.10(b)(3) states:

The resident has a right to a dignified existence, self-determination, and communication with access to persons and services inside and outside the facility. A facility must protect and promote the rights of each resident, including each of the following rights:

. . . .

(b)(3) The resident has the right to be fully informed in language that he or she can understand of his or her total health status, including but not limited to, his or her medical condition.

Specifically, the surveyor alleged at F Tag 154 of the August 1999 survey that Petitioner failed to comply with the requirements of 42 C.F.R. § 483.10(b)(3) in that Resident 9 was not advised by the attending physician of the treatment options available. HCFA Ex. A-11 at 5.

HCFA asserts that Dr. Suresh Patel, the attending physician for Resident 9, did not discuss the applicable courses of treatment for her various ailments.

Petitioner contends that, although the regulations require that a resident be informed of total health status, there is nothing in the regulations to suggest that this information be communicated by a physician. P. Br. at 46. Petitioner further asserts that it is standard practice in the SNF environment for the nursing staff to provide a resident with information regarding treatment options and health status. Id.

Where this may be the standard operating practice in the long-term care setting, there is nothing in the record to indicate that even the nursing staff discussed treatment options or provided regular updates to Resident 9 as to the status of her health.

The nurse's admit notes for July 13, 1999 reflect that Resident 9 was alert and oriented as to person, place, and time. HCFA Ex. A-11 at 50. She was verbally able to express her needs. Id. The nurse's notes also indicated that the resident advised that she wanted to be "DNR" or Do Not Resuscitate, she wanted no cardiopulmonary resuscitation (CPR), and she did not want 911 to be called. Id. A DNR statement was ordered by Dr. Patel on July 15, 1999. Id. at 3.

At admission, Resident 9's sole purpose for being in the Petitioner's facility was for a refit of her prosthesis and therapy associated with the prosthesis replacement. HCFA Ex. A-11 at 28, 29, 31. On July 9, 1999, a complete blood culture (CBC) was ordered for Resident 9. Id. at 43. On July 13, 1999, Dr. Patel examined Resident 9. Id. at 51. At that time, he ordered a follow-up CBC to be conducted in three weeks, as well as ordered medication for the treatment of the resident's groin rash. Id. On July 14, 1999, the nursing staff noted edema to the resident's lower leg, foot, and both hands. The nursing staff also noted the draining of blood tinged urine from Resident 9's Foley catheter. Id. at 52. Dr. Patel was advised of the edema and prescribed Diazide to counteract the swelling.⁽¹⁾

At all times in the nurse's notes, Resident 9 is described as being alert and verbally responsive to stimuli. Id. at 52, 53, 54, 55, 56.

On July 25, 1999, the nurse's notes indicate increasing concern for Resident 9's health status. She is producing less of a urine output, what is being excreted contained moderate blood clots, and the resident indicated that with the passage of water, she was relieved of abdominal discomfort. Id. at 58. Dr. Ramanon, Dr. Patel's partner and the physician covering for him during this time, was made aware of the resident's current condition. Id. He advised that Dr. Lynch, Resident 9's attending urologist, should be consulted for a bladder irrigation. Id. Dr. Lynch was made aware of the resident's condition and ordered a STAT CBC and chemistry profile. He further instructed that he was to be notified immediately upon receipt of the test results. Id. at 59. The CBC results were received by the nursing staff on July 26^th. Id. The lab results indicated, among other things, an elevated potassium level (5.8), a decreased sodium level (123), an elevated glucose of 156, a low chloride of 91, a low hematocrit and hemoglobin count, and an electrolyte imbalance. Id. at 59. Dr. Lynch was advised by the nursing staff. He indicated, on July 26^th, that he would provide Dr. Patel with the laboratory results. Id. at 60. The nursing staff did not communicate with Dr. Patel on this matter until the morning of July 27^th, at which time he asked if the resident was "DNR" and ordered that the current course of treatment remain the same. Id. at 61. During this period, Resident 9 also continued to experience edema in her extremities. On July 29^th, Dr. Patel ordered that the Diazide be discontinued and that Lasix (another diuretic) be administered in its place. Id. at 39. In addition, Dr. Patel ordered that K-Dur supplements be given to Resident 9 as well. Id. K-Dur is a potassium supplement.

It was not until August 3, 1999 that Resident 9 was advised of any information relating to the nature of her health. The nursing staff noted that the resident had produced no urine output for an 8-hour period and, upon advising Dr. Lynch, were directed to admit the resident to the Prince George's County Emergency Room if there continued to be no urine output. Id. at 65. Upon receipt of these orders from Dr. Lynch, Resident 9 was then made aware of Dr. Lynch's orders. Id.

In accordance with orders previously given by Dr. Patel, a complete CBC was conducted and the results received on August 11, 1999. Id. at 67. The results indicated that Resident 9's hematocrit level had decreased to 24.6 (compared to 29.6 on July 25^th), and her hemoglobin count had dropped to 8.1. Id. at 67. Two calls were placed to Dr. Patel to advise him of the lab results. At that time, Dr. Patel informed the nursing staff that he would not treat the resident to counteract the current test findings. The nursing staff informed Dr. Patel of the resident's complaints regarding lower abdominal pain and that she is still passing blood in her urine. Id. at 68. Dr. Patel stated the resident was DNR, and since her vital statistics were stable and she registered no new complaints, he would not treat her current maladies. Id. Resident 19 continued to experience edema and lower abdominal pains.

There is no indication in the record that either Dr. Patel or the nursing staff spoke with Resident 9 regarding the current course of events until August 26^th when the question of a blood transfusion became an issue. Id. at 83. In each instance where Petitioner initiated communications with Resident 9 regarding her health and any prospective course of treatment, the necessity for action became immediate. Resident 9 should have been consulted as to the state of her health, regardless of the fact that she had terminal bladder cancer by this time. Preliminary measures could have been initiated prior to the necessity, for example, for a blood transfusion. In fact, remedial measures could have been taken to avoid the changes in the resident's physiology. However, the attending physician opted not to take any preventive measures, supposedly based upon the resident's DNR status.

In light of the evidence presented, I find that Petitioner was not in substantial compliance with participation requirements specified in 42 C.F.R. § 483.10(b)(3) regarding disclosure of the nature and state of Resident 9's medical condition.

2. F Tag 309

As a result of the August 1999 survey, Petitioner was cited a deficiency in the Quality of Care category. The requirements of 42 C.F.R. § 483.25 have been previously discussed in section V(B) above.

Specifically, at F Tag 309 of the August 1999 survey, it was determined that Petitioner failed to provide the necessary care and services to Resident 9 through various means. HCFA Ex. A-11 at 5. The surveyor utilizes the events and circumstances discussed at section V(C)(1) above as his rationale for the deficiency citation presently at issue.

Petitioner contends that the deficiencies were cited, not because Petitioner provided inadequate care to Resident 9, because the surveyor substituted the medical judgment of the treating physicians with his own judgment. P. Br. at 45. I do not agree with Petitioner's supposition.

The surveyor, William Vaughan, testified that the purpose for the revisit survey was to ascertain whether the F Tag 309 deficiency, cited in the June 1999 survey, had been corrected. Tr. at 419. In accomplishing this goal, Resident 9's patient records were just one record of 13 reviewed for this purpose. However, it was these records in particular which raised questions as to potential deficiencies. HCFA Ex. A-11 at 5.

Based on the factual discussion and analysis addressed above, I find that Petitioner was not in substantial compliance with the participation requirements under 42 C.F.R. § 483.25.

It is evident from the resulting dehydration and other related ailments which manifested in Resident 9 that Petitioner did not provide the "highest practicable physical well-being in accordance with a comprehensive assessment . . . ." 42 C.F.R. § 483.25. Based on the record, the only treatment Resident 9 refused was any sort of resuscitative measures. This is clear from the DNR order signed by the resident and made effective as of July 17, 1999. HCFA Ex. A-11 at 3; see also, id. at 8; id. at 50 (7/13/99 Nurse's Note - "She said she wanted to be DNR no CPR and did not want 911 called."). In addition, the surveyor, Mr. Vaughan, testified that the resident advised him on August 26^th that the only treatment she declined was CPR. Tr. at 506-507. This evidence is contrary to Dr. Patel's repeated assertions that he was informed of the resident's wishes to be "comfort care only." Tr. at 515, 1837. The evidence also contradicts the references in the nurse's notes that, after inquiries by Dr. Patel as to the resident's DNR status, he took no revised or additional measures to address Resident 9's increasing medical issues, e.g., dehydration status. HCFA Ex. A-11 at 61, 68. Mr. Vaughan further testified that, upon questioning the facility staff and officials during the survey, he was able to conclude that not one of the individuals interviewed was aware that Resident 9 was "comfort care only." Tr. 511-515; HCFA Ex. A-10 at 5.

At the hearing, Dr. Patel was unclear as to his source for the above-referenced information. He testified at one point that the information was derived from the nursing staff. Tr. at 1852. In another instance, he stated that the information was obtained from Dr. Lynch, the attending urologist. Tr. at 1856. He also testified that he spoke with the resident on July 30^th. However, he did not document her wishes for comfort care. Tr. at 1854-55. Whatever the source of his knowledge, Dr. Patel did not speak with Resident 9 as to her treatment wishes prior to July 30th.

Grounded on inaccurate presumptions as to the resident's wishes as to acceptable courses of treatment, it is easy to conclude that these misperceptions caused Dr. Patel to withhold certain treatment which, if administered sooner, may have circumvented the resident's dehydrational decline.

3. F Tag 329

As a result of the August 1999 survey, Petitioner was cited with a second deficiency in the Quality of Care category. 42 C.F.R. § 483.25(l)(1) states:

(l) Unnecessary drugs.

(1) General. Each resident's drug regimen must be free from unnecessary drugs. An unnecessary drug is any drug when used:

(i) In excessive dose (including duplicate drug therapy); or

(ii) For excessive duration; or

(iii) Without adequate duration; or

(iv) Without adequate indications for its use; or

(v) In the presence of adverse consequences which indicate the dose should be reduced or discontinued; or

(vi) Any combinations of the reasons above.

To support the allegation that Petitioner failed to comply with this requirement, the situation of Resident 9 is detailed at F Tag 329 on the HCFA 2567. HCFA Ex. A-5 at 15-16.

The preponderance of the evidence shows that Petitioner was not in substantial compliance with participation requirements specified in 42 C.F.R. § 483.25(l)(1), regarding unnecessary drugs, at the time of the August 1999 survey.

The essence of this alleged deficiency is that the attending physician prescribed a potassium supplement (K-Dur) to a resident with a known elevated potassium level and failed to order subsequent monitoring of the resident's potassium level. Id. at 16. The surveyor further asserted that there was a failure by the nursing staff to question this course of action, and a failure by the pharmacist to intervene when a drug regimen review has been conducted. Id.

Petitioner contended that potassium is not a drug; that it is an unprescribed mineral that can be acquired at any grocery or health food store. P. Br. at 56. Petitioner goes further to assert that, even if potassium is considered a drug, it is not a drug covered by F Tag 329. Id. Petitioner argues that the types of drugs covered under F Tag 329 are pharmacological in nature, or drugs of a type used to control and treat behavioral problems. Id.

I am not persuaded by Petitioner's assertions. They have not proven to my satisfaction that, for these purposes, potassium would not be considered a drug. I accept Dr. Levinson's explanation of what constitutes a "drug." Further, in being one of the contributors to the drafting of the Guidance to Surveyors, in particular the section related to "unnecessary drugs," Dr. Levinson is in a better position to provide insight as to the intent in the drafting of this particular section of the Guidelines. In addition, there is the testimony of Dr. Judy Curtis, a skilled pharmacist, to support the testimony of Dr. Levinson.

Petitioner attempts to paint a picture in which Dr. Levinson's testimony supposedly indicated that everything, with the exception of water, would be considered a drug by his definition. P. Br. at 56, fn. 5. Petitioner's interpretation is overly broad. Dr. Levinson testified that:

[a potassium supplement is a drug] because whether one wants to call it a supplement or a drug it is affecting physiological function and balance. So a drug is a substance you introduce into the body which has an impact on physiological function, balance, or it can cause other things to happen.

Tr. at 1787.

Dr. Curtis later testified that K-Dur, the substance prescribed by Dr. Patel on July 29th, which is indeed a potassium supplement is one which is considered to be a prescribed drug. Tr. at 1938-39.

Having determined that potassium, in this instance, is a drug, I find that in having ordered the potassium to be administered to Resident 9, monitoring of the potassium level should have been ordered whether her level at that particular time was moderate or excessive.

Petitioner's argument concerning the issue of monitoring the potassium level goes strictly to the premise that a deficiency under F Tag 329 is applicable only when residents are needlessly prescribed medication. However, to the contrary, 42 C.F.R. § 483.25(l)(1) specifically dictates that:

an unnecessary drug is any drug when used . . . . [w]ithout adequate monitoring; or . . . . [i]n the presence of adverse consequences which indicate the dose should be reduced or discontinued; or . . . . any combination of reasons above.

42 C.F.R. §§ 483.25 (l)(1)(iii), (v), and (vi).

On the admission assessment report, the nursing staff noted that Resident 9's potassium level was 4.1 which, utilizing the scale used by the facility lab, is within the normal range (3.6-5.0). HCFA Ex. A-11 at 25. To counteract the edema Resident 9 was experiencing in her extremities, Dr. Patel prescribed Diazide on July 14^th. Id. at 35. Also during this period, Resident 9 was experiencing a decreased urine output and consistently producing blood in that output. Id. at 51-54, 56-58; Tr. at 696. This condition, if not corrected, will ultimately result in volume depletion. Volume depletion increases the possibility of elevated potassium levels. Tr. at 1764. Diuretics are also known to contribute to volume depletion. Id. at 121. There is nothing in the nurse's notes to indicate that instructions were given by Dr. Patel to monitor Resident 9 in light of her constant bleeding and the commencement of the diuretic. Because of the ongoing presence of blood in Resident 9's urine, Dr. Lynch ordered a STAT CBC on July 25^th . HCFA Ex. A-11 at 59. The test results were reported to the nursing staff on July 26^th. Id. Among other things, the lab tests showed an increased potassium level of 5.8. Id. Dr. Lynch was advised of the results and informed the nursing staff that he would contact "the primary care physician." Id. at 60. On July 27^th, Dr. Patel contacted the nursing staff regarding the lab results. Id. at 61. He inquired whether the resident was "DNR" and ordered that the current course of treatment remain the same. Id. at 61. When asked why he took no action at this time, Dr. Patel testified that he wanted to observe. Tr. at 1839. He went further to admit that the cause of the elevated potassium level could have been one of the diuretics or medications Resident 9 was being administered at that time. Id. It wasn't until two days later, on July 29^th, that the Diazide was ordered discontinued and substituted with Lasix (another diuretic) and K-Dur (a potassium supplement). HCFA Ex. A-11 at 39. After the commencement of the new medication regimen, Dr. Patel did not order monitoring or any further testing of Resident 9's potassium level. Dr. Patel testified that he did not consider 5.8 to be a life-threatening condition and therefore immediate action was not required. Tr. at 1840.

I am not persuaded by the proposition set forth by Petitioner. It is apparent that Resident 9 suffered from bladder cancer. This information was known to the facility and Dr. Patel very early on. HCFA Ex. A-11 at 10, 13, 24, 25, 29, 32; Tr. at 1831, 1832. Dr. Patel was aware of the blood present in Resident 9's urine and that this was the result of the bladder cancer, and therefore concluded that nothing more could be done to treat the bladder cancer. HCFA Ex. A-11 at 68, 71. Whereas this conclusion may have been accurate with regard to the cancer, I am not convinced that there was nothing to be done as far as preemptive measures in dealing with the medical conditions occurring as a result of the cancer and medication regimen. At best, in light of the changing state of Resident 9's condition and the altering of her body chemistry since her admission to the facility, monitoring could have been ordered and alternate measures taken to address the potassium increase. Furthermore, Dr. Patel testified that, during this period of time although he may have been aware of Resident 9's cancer, he did not know how far it had progressed. Tr. at 1834. This was the rationale for the July 30^th notation where a question mark was written before the entry relating to the bladder cancer. Id. at 1834; See also HCFA Ex. A-11 at 32. If Dr. Patel was unaware of the progression of the bladder cancer, how was he able to conclude that there was no course of action available to counteract, among other things, the potassium increase? It appears that Dr. Patel's conclusions were premature and further measures should have been taken.

Based on the evidence elucidated at hearing, I find that Petitioner failed to prove that it was in substantial compliance with the requirements of 42 C.F.R. § 483.25(l)(1).

4. F Tag 429

As a result of the August 1999 survey, Petitioner was cited with a deficiency, specifically subsection of the regulations concerning Pharmacy Services - Drug Regimen Review, which states:

(2) The pharmacist must report any irregularities to the attending physician and the director of nursing, and these reports must be acted upon.

42 C.F.R. § 483.60(c)(2).

To support the allegations that Petitioner failed to comply with the requirements, the situation of Resident 9 is detailed at F Tag 429 on the HCFA 2567. HCFA Ex. A-11 at 16.

The preponderance of the evidence shows that Petitioner was not in substantial compliance with participation requirements, specified at 42 C.F.R. § 483.60(c)(2) at the time of the August 1999 survey.

The surveyor determined that at the time of the drug regimen review, conducted on August 23, 1999, the pharmacist failed to act upon or note that Resident 9 was still being administered K-Dur (potassium) supplements even though:

1. the diuretic Lasix had been discontinued as of August 21, 1999;

2. the records indicated that Resident 9 had an elevated potassium level of 5.8 more than 3 weeks prior to the review; and

3. the omission of any order to monitor the resident's potassium level.

HCFA Ex. A-11 at 16.

Petitioner contends that, since potassium is not a "drug," F Tag 429 is therefore inapplicable. P. Br. at 59. Petitioner further asserts that the reference to Resident 9's elevated potassium level on July 25, 1999 is irrelevant to the issue of her potassium level on August 21, 1999. Id. Lastly, Petitioner asserts that the federal regulations only require monitoring within 30 days following the commencement of "diuretic therapy," and based upon this supposition, Petitioner was therefore in compliance with this standard. Id.

However, if this is the position Petitioner seeks to assert, no affirmative evidence was put forward in support of this contention. The only evidence Petitioner attempts to utilize on its behalf is the testimony of Dr. Karen Babos. Dr. Babos, the Senior Medical Director of HCR Manor Care, concluded that:

it would not be unreasonable for a pharmacist to assume that the physician continued potassium supplements for some short period after the discontinuation of Lasix.

P. Br. at 60, (citing Tr. at 683 (sic)⁽²⁾).

However the testimony of Dr. Judy Curtis, a pharmacological expert witness, rebutted this presumption and established that:

a pharmacist has an obligation to inform the physician that [an] individual had a high potassium level, was on potassium supplementation, that they had not been monitored beyond that, that they should have been monitored at that point. They should have had a potassium level drawn to determine what this woman's status was.

Tr. at 1939.

I am persuaded by this testimony and agree that, under the circumstances, some further inquiry should have been made by the pharmacist. There was nothing in the record to indicate that Resident 9's potassium level had been checked since July 25th. Additionally, no indication was in the record as to whether, by the August 23^rd regimen review, the potassium level had increased or decreased. These factors should have raised a question in the pharmacist's mind and a note in the medical record or even follow-up questions to the attending physician should have been put forth.

D. HCFA was not in violation of the 10-day notice requirement.

Petitioner argues that HCFA lacked the authority to terminate their Medicare provider agreement. This contention is based upon the premise that, due to HCFA's delay in providing the Statement of Deficiency within 10 days of the conclusion of each survey conducted, there was not a six-month period of noncompliance from the date of the February 1999 survey. P. Br. at 28. Petitioner avers that pursuant to 42 C.F.R. § 488.110(j), "the Secretary must inform the facility of Statement of Deficiencies no later than 10 calendar days following the survey." Id.

Petitioner stated that it did not receive the Statement of Deficiencies for 32 days after the February survey, 49 days after the June survey, and 13 days after the August survey. Id. at 27. Petitioner contends that these lapses of time should be subtracted from the six-month period to get an accurate accounting of the period of alleged noncompliance. Id. at 28-29. Petitioner states that, therefore, the termination must be reversed as a matter of law. Id. at 29.

The argument Petitioner seeks to assert is an equitable one. The relief sought is beyond the authority granted to me. Furthermore, the regulation Petitioner has referenced contains no sanctions for instances where HCFA fails to provide a statement of deficiencies within 10 days of the conclusion of a survey. Section 488.110(j) provides that:

. . . In accordance with your Agency's policy, present the Statement of Deficiencies, form HCFA 2567, on site or after supervisory review, no later than 10 days following the survey.

As previously affirmed by prior case law, the nursing home provisions of the Omnibus Budget Reduction Act of 1987 have effectively made inoperative Subpart C of 42 C.F.R. Part 488, of which 42 C.F.R. § 488.110(j) is a part. See Golden State Manor Nursing and Rehabilitation Center, DAB CR412 (1996). Therefore, I find that 42 C.F.R. § 488.110(j) is irrelevant to my determination.

E. HCFA was authorized to terminate Petitioner's Medicare agreement.

Even though HCFA had found Petitioner to be out of compliance with Medicare participation requirements, HCFA did not take immediate steps to impose the remedy of termination. On two occasions, including the period following the August 1999 survey, HCFA allowed Petitioner to pursue Informal Dispute Resolution. See HCFA Exs. 12, 18. The choice to allow alternate means of resolution was within HCFA's discretion. 42 C.F.R. § 488.412. However, when a facility is not in substantial compliance within six months from the last day of a survey from which it was found to be out of compliance, HCFA will terminate the facility's provider agreement. Id.

terminate the facility's provider agreement or may allow the facility to continue to participate for no longer than 6 months from the last day of the survey if . . . . [t]he State survey agency finds that it is more appropriate to impose alternative remedies than to terminate the facility's provider agreement . . . . [t]he State has submitted a plan and timetable for corrective action approved by HCFA . . . .

42 C.F.R. § 488.412(a)(1) and (2). That choice is within HCFA's discretion. Petitioner was noncompliant from the time of the February 1999 survey. Six months later, in August 1999, Petitioner remained noncompliant with participation requirements. Petitioner has assumed that I would find HCFA authorized to terminate Petitioner's Medicare agreement only if Petitioner remained out of substantial compliance continuously for six months. Petitioner presented evidence to support its contention that, based on HCFA's failure to provide Petitioner with statements of deficiencies within 10 days of the completion of each survey, there was not a continuous six-month period of noncompliance. This is an incorrect assumption. HCFA's termination letter dated October 27, 1999 notified Petitioner that its Medicare agreement was be terminated because it:

. . . . no longer meets the requirements for participation as a provider of services in the Health Insurance Program for the aged and Disabled (Medicare), established under Title XVIII of the Social Security Act (the Act), or Medicaid, Title XIX of the Act.

HCFA Ex. 20 at 1. HCFA's termination letter does not allege that the basis for termination is Petitioner's failure to come within substantial compliance within a six-month period. I find that the reference at the end of the October 27^th letter is merely a recitation of the applicable law under which HCFA will terminate the participation of any facility not found to be in substantial compliance with Medicare participation requirements. Under such conditions, HCFA is authorized to terminate Petitioner's Medicare agreement. 42 C.F.R. §§ 488.456(b)(i) and 489.53(a)(3). Petitioner was not in substantial compliance with participation requirements at the time of the February, June, and August 1999 surveys. Consequently, HCFA is authorized to terminate Petitioner's Medicare agreement.

VI. Conclusion

Petitioner was not in substantial compliance with Medicare participation requirements at the time of the February, June, and August 1999 surveys. Therefore, HCFA was authorized to terminate Petitioner's Medicare agreement.

Jill S. Clifton

Administrative Law Judge

1. Diazide is a potassium-sparing diuretic.

2. In its brief, Petitioner mistakenly cited "Tr. at 683." The correct citation is Tr. at 647.