CASE | DECISION | JUDGE

Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
IN THE CASE OF  


SUBJECT:

Walker Methodist Health Center,

Petitioner,

DATE: February 5, 2002
                                          
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Centers for Medicare & Medicaid Services

 

Docket No.C-01-842
Decision No. CR869
DECISION
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DECISION

I dismiss the hearing request of Petitioner, Walker Methodist Health Center. Petitioner has no right to a hearing because there is no extant determination by the Centers for Medicare & Medicaid Services (CMS) to impose remedies against Petitioner.

I. Background and undisputed facts

The participation of providers in the Medicare program, including long-term care facilities (nursing facilities and skilled nursing facilities), is governed by applicable federal statutes and regulations. The law provides for surveys of long-term care facilities to assure their compliance with participation requirements. These surveys usually are conducted by State survey agencies acting on behalf of CMS. Remedies may be imposed against a long-term care facility that is found not to be complying substantially with federal participation requirements.

The facts in this case are undisputed. These facts are set forth in the exhibits that CMS filed in support of its motion to dismiss and those that Petitioner filed in opposition to that motion. CMS filed seven exhibits (CMS Ex. 1 - CMS Ex. 7) and Petitioner filed two exhibits, along with copies of several administrative law judge decisions that it argued were applicable to this case. Petitioner's exhibits consist of the affidavit of David P. Saemrow, which I have identified as P. Ex. 1, and a copy of a facility survey report and plan of correction, which I have identified as P. Ex. 2. I am receiving into evidence CMS Ex. 1 - CMS Ex. 7 and P. Ex. 1 and P. Ex. 2.

Petitioner is a Medicare-participating long-term care facility that is located in Minneapolis, Minnesota. On March 29, 2001, Petitioner was surveyed on CMS's behalf by representatives of the Minnesota Department of Health. CMS Ex. 1; CMS Ex. 2. The surveyors found that Petitioner was not complying substantially with several participation requirements and they issued a survey report which detailed their findings of noncompliance. CMS Ex. 1.

On April 13, 2001, the Minnesota Department of Health sent a notice to Petitioner in which it transmitted the findings that were made at the March 29, 2001 survey. CMS Ex. 2. The notice advised Petitioner that, as a consequence of the findings that were made at the survey, the Minnesota Department of Health was imposing against Petitioner a remedy consisting of State monitoring of Petitioner's performance, effective April 20, 2001. Id. at 2. The notice also advised Petitioner that the CMS regional office (then known as the Health Care Financing Administration or HCFA regional office) had concurred in the Minnesota Department of Health's findings and that, effective May 3, 2001, CMS would be imposing against Petitioner the additional remedy of denial of payment for new Medicare and Medicaid admissions. Id. Additionally, Petitioner was advised of its right to have a hearing before an administrative law judge of the Departmental Appeals Board if it disagreed with the determinations that were contained in the notice.

On May 7, 2001, the Minnesota Department of Health sent an additional notice to Petitioner. CMS Ex. 3. This notice advised Petitioner that, at a revisit survey conducted on May 2, 2001, the Minnesota Department of Health's surveyors had found Petitioner to have corrected the deficiencies that were identified on March 29, 2001. Id. at 1. The notice advised Petitioner that the Minnesota Department of Health was discontinuing State monitoring of Petitioner's performance effective May 2, 2001. Id. And, it told Petitioner that, effective May 2, 2001, CMS was rescinding its determination to impose the remedy of denial of payment for new Medicare and Medicaid admissions. Id. at 2.

On June 11, 2001, Petitioner filed a request for a hearing. CMS Ex. 6. The case was assigned to me for a hearing and a decision.

II. Issue, findings of fact and conclusions of law

A. Issue

The issue in this case is whether Petitioner has a right to a hearing before me.

B. Findings of fact and conclusions of law

I make findings of fact and conclusions of law (Findings) to support my decision in this case. I set forth each Finding below as a separately numbered heading. I discuss each Finding in detail.

1. A provider has a right to a hearing to challenge a finding that it has not complied substantially with participation requirements only where CMS determines to impose a remedy or to refuse to allow the provider to participate in Medicare based on that finding

Regulations describe the circumstances under which a provider may request a hearing. 42 C.F.R. § 498.5. They also provide specifically that a long-term care facility:

. . . may appeal a certification of noncompliance leading to an enforcement remedy.

42 C.F.R. § 488.408(g). These regulations enable a provider to request a hearing to challenge noncompliance findings by CMS where CMS determines, based on those findings, to deny participation status to the provider or to impose remedies against that provider.

However, the regulations do not grant generalized hearing rights to a provider to challenge a finding of noncompliance with participation requirements where CMS has not determined to impose a remedy. See 42 C.F.R. §§ 488.408(g); 498.5. Nor does a provider have hearing rights in the situation where CMS determines to impose a remedy, but then rescinds that determination before implementing it. Lakewood Plaza Nursing Center, DAB CR691 (2000), aff'd DAB No. 1767 (2001); Schowalter Villa, DAB CR568 (1999), aff'd DAB No. 1688 (1999); Rafael Convalescent Hospital, DAB CR444 (1996), aff'd DAB No. 1616 (1997); Arcadia Acres, Inc., DAB CR424 (1996), aff'd DAB No. 1607 (1997); Fort Tryon Nursing Home, DAB CR425 (1996). Moreover, there is no right to a federal hearing where the determination to impose a remedy based on findings of noncompliance is made by a State on its independent authority and not by CMS or by a State under a delegation of authority from CMS.

2. There is no extant remedy determination in this case and, therefore, Petitioner has no right to a hearing.

The undisputed facts of this case are that the determinations to impose remedies against Petitioner were rescinded. There is no extant remedy and literally nothing for Petitioner to challenge at a hearing. Moreover, one of the two remedies that were to be imposed against Petitioner - State monitoring of Petitioner's performance - was a State remedy and not a federal remedy which gave Petitioner a right to a hearing. Therefore, Petitioner has no right to a hearing.

It was determined originally to impose two remedies against Petitioner as a consequence of the findings of noncompliance that were made at the March 29, 2001 survey. These remedies consisted of: State monitoring of Petitioner's performance as a provider; and, a denial of payment for all new Medicare admissions to be effectuated beginning May 3, 2001. CMS Ex. 2. However, the determinations to impose these remedies were rescinded effective May 2, 2001. CMS Ex. 3. Thus, there were no extant remedy determinations after that date.

The determination to deny payment for new Medicare admissions was made by the CMS regional office. The Minnesota Department of Health gave Petitioner notification of this determination and of its subsequent recission prior to the implementation date. CMS Ex. 2; CMS Ex. 3. Petitioner would have had the right to challenge this proposed remedy had it been implemented. But, the proposed remedy was never implemented and, therefore, Petitioner had no right to challenge the findings of noncompliance that led to the subsequently rescinded determination to deny payments for new Medicare admissions.

The determination to impose State monitoring was made by the Minnesota Department of Health. CMS Ex. 2. It was a State determination and not a determination that was made by CMS. Petitioner had no federal hearing right to challenge this State remedy determination. Thus, it would have had no right to a hearing before me even had the remedy determination not been rescinded. 42 C.F.R. § 498.3(d)(10)(iii).

Petitioner asserts two reasons why it should be entitled to a hearing. First, it claims that it is entitled to a hearing based on considerations of fairness. Denial of a hearing is denial of due process according to Petitioner. It contends that its reputation has been damaged by the publication of the noncompliance findings that were made in the March 29, 2001 survey report. It also contends that CMS might some day use Petitioner's compliance history as a basis for imposing remedies against Petitioner. Thus, according to Petitioner, CMS might impose remedies for some future noncompliance by Petitioner that are more stringent than would be the case had the March 29, 2001 findings not been made.

I do not find this argument to be persuasive because my authority to hear and decide cases is limited only to what has been delegated to me by applicable regulations. I do not have authority to grant a hearing to a provider on fairness grounds.

Second, Petitioner argues that the findings of noncompliance that were made on March 29, 2001 were without foundation. According to Petitioner, CMS ignored applicable legal standards and the language of governing regulations in reaching conclusions about Petitioner's compliance at the March 29, 2001 survey. And, according to Petitioner, CMS abused its discretion and exceeded its authority in interpreting and applying the regulations to Petitioner's case.

In making this argument Petitioner attempts to put the cart before the horse. A party may not challenge findings of noncompliance in the absence of a remedy determination that affects that party. Petitioner has no right to a hearing in this case because there is no remedy determination. Whether or not CMS's compliance findings are supportable is irrelevant to deciding whether Petitioner has a hearing right.

JUDGE
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Steven T. Kessel

Administrative Law Judge

 

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