CMS and DOH Enforcement Activities and Proactive Strategies
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1 PACAH 2017 Spring Conference April 27, 2017 CMS and DOH Enforcement Activities and Proactive Strategies Paula G. Sanders, Esquire
2 CMS Requirements of Participation (RoPs) Published October 4, 2016 (81 Fed. Reg ) available at First comprehensive update since 1991 CMS estimated cost per SNF Year 1: ~ $62,900 Subsequent years: ~$55,000 (81 Fed. Reg ) 2
3 Survey Implementation Phase 1: effective November 28, 2016 Same survey process New RoPs merged into existing F-tags, SOM, Appendix PP, Eff. March 10, 2017, available at: Certification/SurveyCertificationGenInfo/Downloads/Survey-and- Cert-Letter pdf Phase 2: effective November 28, 2017 New SOM Appendix PP with all new F-tags New survey process combines traditional and Quality Indicator Survey (QIS) 3
4 Department of Justice (DOJ) Initiatives Deputy Attorney General Yates issues memo, Individual Accountability for Wrongdoing, on corporation cooperation with identification of culpable individuals, Sept. 9, 2015 ( Yates Memo) Assistant Attorney General Caldwell outlines how criminal division compliance counsel will identify effective compliance programs, Nov. 2, 2015 DOJ hires new Compliance Counsel for Fraud Division, Hui Chen, as of Nov. 3, 2015
5 Changing Enforcement Environment DOJ launches 10 Elder Justice Task Forces including Eastern District of PA, March 30, 2016 Pursue nursing homes that provide grossly substandard care Centers for Medicare and Medicaid Services (CMS) releases new Civil Money Penalty (CMP) Analytic Tool 5
6 DOH CP Guideline 6
7 Mandatory Referrals CMS refers all civil money penalties (CMPs) to DOJ pursuant to a Memorandum of Understanding DOH is statutorily required to report immediately to the PA Attorney General (AG) or local law enforcement whenever it has reasonable cause to believe that a care dependent adult has suffered bodily injury or been unlawfully restrained See, Act 28 of 1995, Neglect of Care-Dependent Person, 18 Pa.C.S Referrals to state licensing boards 7
8 Increased Enforcement a Reality Marked increase in citations and sanctions Marked increase in CMS & DOH civil money penalties 8
9 Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 Intended to improve effectiveness of CMPs and maintain deterrent effect of CMPs Requires annual adjustment of CMPs using October Consumer Price Index for all Urban Consumers (CPI-U) First increase was in 2016; most recent increase effective February 3, 2017 (82 Fed. Reg. 9174, 2/3/2017)
10 Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 Secretary of covered agency may provide lesser CMP by less than the new formula through a rulemaking only if: Secretary finds that increasing penalty by required amount will have a negative economic impact or that the social costs outweigh the benefits and Director of the Office of Management and Budget (OMB) concurs with this analysis 10
11 Impact of Inflation Adjustment Act CMS CMPs for surveys have increased astronomically Pre-August 2016 August 1, 2016 Cat.2 Per Day $50 -$3,000 $103 - $6,188 Cat. 2 Per Instance $1,000 - $10,000 Cat. 3 Per Day $3,050 - $10,000 Cat. 3 Per Instance $1,000 - $10,000 $2,063 $20,628 $6,291 - $20,628 $2,063 $20,628 February 3, 2017 $105 $6,289 $2,097 - $20,965 $6,394 - $20,955 $2,097 - $20,965
12 Average CMS Per Diem CMP CMS Region 3 Philadelphia CMS Region 4 Atlanta CMS Region 2 New York 2014 Q1 Q2 Q3 Q4 $123,254 86,817 67, ,724 $ 71,120 82,075 59,585 64,678 $ 18,603 13,065 19,360 59, Q1 Q2 Q3 Q4 73, , , ,496 86,580 64,110 93, ,489 19,001 33,566 10,928 26, Q1 Q2 Q3 Q4 101, , , ,958 71,268 82,241 99, ,031 23, ,840 48, ,618
13 Pennsylvania Nursing Care Facility Sanctions P1 & CP P2 & CP P1 Only P2 Only P3 Only P4 Only BAN CP Only Amount Imposed $62, $176, $401, Jan.- March $570,250.00
14 Immediate Jeopardy Citations
15 Federal Scope and Severity Grid I Immediate Jeopardy To Resident Health Or Safety Actual Harm That Is Not Immediate Jeopardy Isolated Pattern Widespread PoC Required: Cat. 3 Optional: Cat. 1 Optional: Cat. 2 PoC Required: Cat. 2 Optional: Cat. 1 J G PoC Required: Cat. 3 Optional: Cat. 1 Optional: Cat. 2 PoC Required: Cat. 2 Optional: Cat. 1 K H PoC Required: Cat. 3 Optional: Cat. 1 Optional: Cat. 2 PoC Required: Cat. 2 Optional: Cat. 1 Optional: Temporary Mgmt L I No Actual Harm With Potential For More Than Minimal Harm That Is Not Immediate Jeopardy PoC Required: Cat. 1 Optional: Cat. 2 D PoC Required: Cat. 1 Optional: Cat. 2 E PoC Required: Cat. 2 Optional: Cat. 1 F No Actual Harm With Potential For Minimal Harm Substandard Quality of Care (F ; F ; F ) No PoC No remedies Commitment to Correct Not on CMS-2567 A PoC No remedies B PoC No remedies C Out of Compliance Substantial Compliance 15
16 Federal Remedies Categories Category 1 (Cat.1) Category 2 (Cat.2) Category 3 (Cat.3) Directed Plan of Correction; State Monitor; and/or Directed In-Service Training Note: If CMP >$10,4830 or SQC, automatic loss of Nurse Aide Training Competency Evaluation Program (NATCEP) Denial of Payment for New Admissions; Denial of Payment for All Individuals imposed by CMS; Termination; Temp. Mgmt and/or Civil Money Penalties: Old: $50 - $3,000/day $1,000 - $10,000/ instance New: * $105 - $6,289/day $2,097 - $20,628/ instance Temp. Mgmt.; Termination; Civil money penalties Old: 3,050-$10,000/day $1,000 - $10,000/ instance New:* $6,394 - $20,965/day $2,097 - $20,965/ instance * Updated effective Feb. 3,
17 Mandatory Immediate Imposition of Federal Remedies Immediate Jeopardy (IJ) on the current survey SQC deficiencies on current surrey G level at 42 CFR (Resident Behavior and Facility Practices); 42 CFR (Quality of Life); or 42 CFR (Quality of Care) CMS S&C NH: Mandatory Immediate Jeopardy of Federal Remedies and Assessment Factors Used to Determine the Seriousness of Deficiencies for Nursing Homes, (July 2016) 17
18 Mandatory Immediate Imposition of Federal Remedies Actual harm or above on current survey and deficiencies of actual harm or above on the previous standard health or LSC survey OR deficiencies of actual harm or above on any type of survey between the current survey and the last standard survey surveys must be separated by a period of compliance (i.e., from different noncompliance cycles) Special Focus Facility (SFF) has a deficiency citation at level F or higher on its current survey 18
19 Mandatory Criteria for Immediate Imposition of Federal Remedies Mandatory Criteria for Immediate Imposition of Federal Remedies Remedy(ies) considered for immediate imposition by CMS in addition to the CMPs when IJ is cited, mandatory 3 month DPNA for new admissions or mandatory 6 month termination, as required. NOTE: Multiple remedies may be imposed Immediate Jeopardy on current survey Termination CMPs must be imposed immediately DDPNA Temp. Mgmt. State Monitoring Directed Plan of Correction Directed In-service Denial of Payment for ALL Individuals Deficiencies of SQC that are not IJ on current survey Termination CMPs DDPNA Directed Plan of Correction Directed In-service Training Denial of Payment for All Individuals 19 Any G level deficiency on current survey in , , Termination CMPs DDPNA Directed Plan of Correction Directed In-service Training Denial of Payment for All Individuals Deficiencies of actual harm on current survey AND IJ OR actual harm on any survey between current survey and last standard survey Termination CMPs DDPNA Temp. Mgmt. State Monitoring Directed Plan of Correction Directed Inservice Denial of Payment for All Individuals Special Focus Facility AND F level or higher on current survey Termination CMPs DDPNA Temp. Mgmt. State Monitoring Directed Plan of Correction Directed Inservice Denial of Payment for All Individuals
20 Financial Hardship Requests Possible reduction of CMPs or 12 month repayment plan Analytic tool options: facility s documentation proves that: (1) the facility lacks sufficient assets to pay the CMP without having to go out of business, or (2) the facility does not lack sufficient assets to pay the CMP without having to go out of business. 20
21 Financial Hardship Requests [N]ot CMS's intent to impose CMPs that could, in and of themselves, put providers out of business. Providers can file compelling evidence of financial hardship, which CMS is willing, in the interest of the Medicare and Medicaid programs and their beneficiaries, to consider. Must be filed within 15 days of CMS CMP letter 21
22 Areas of Potential Substandard Quality Of Care Major Expansion Resident Rights Resident Rights Exercise of Rights Respect and Dignity Self-Determination Safe Environment F Tags F F F
23 New CMS CMP Analytic Tool New approach to federal per day (PD) Civil Money Penalties (CMPs) Begin CMP on 1 st day noncompliance is documented, even if that date precedes the first day of the current survey Unless facility can demonstrate that it corrected the noncompliance prior to the current survey (past noncompliance) CMS Survey & Certification Memo, Civil Money Penalty (CMP) Analytic Tool and Submission of CMP Tool Cases, S&C: NH (Dec. 19, 2014) 23
24 Starting the PD CMP Calculate the start date for the proposed CMP with the first supportable date of noncompliance, as determined by the evidence documented by surveyors in the statement of deficiencies (CMS form 2567) Surveyors instructed to determine the earliest date for which supportable evidence shows that the non-compliant practice began 24
25 Ambiguity About Start of Deficient Practice CMS analysts will contact state agency if start date is ambiguous or not clearly identified and supportable, to see if start date can be determined CMS analysts required to document their discussions and conclusion with the state agency 25
26 If Start Date Not Determinable If start date cannot be determined, then PD CMP would start on 1 st day during the survey on which the survey team identified the noncompliant practice If the team cannot document the first day of noncompliance, then the CMP should start on the day the noncompliance was observed and documented at the time of the current survey 26
27 CMS: Past Noncompliance Reduce a CMP by 50% if: (i) self-reported noncompliance to CMS or State before it was otherwise identified by or reported to CMS or State; and (ii) correction of the self-reported noncompliance occurred within 15 days of the incident. 42 C.F.R
28 Get Credit for Correcting Past Noncompliance Treat any incident that results in reporting to DOH as you would if it was on your 2567 Develop corrective action and document monitoring and auditing for ongoing compliance Give evidence to surveyors at the time of the survey that a monitoring plan was implemented and maintained to assure continued compliance.
29 CMS: Past Noncompliance Hypo Conflicting information about what staff/ departments were responsible for evaluating residents transfer status Under facility protocol, the nursing staff was responsible Interview with nurse indicated that rehabilitation therapy department was responsible for performing resident assessments for transfers and/or use of lifts 29
30 Past Noncompliance Hypo (cont.) During onsite survey, clear that staff did not have a consistent understanding of facility s protocol for assessing appropriate transfer status Facility failed to implement a mechanism(s) for ongoing monitoring to assure that residents were being transferred in accordance with their needs/assessment in order to ensure their safety Facility failed to demonstrate that they implemented adequate corrective measures to address this event, after the incident occurred and before DOH s survey 30
31 Critical Timeline 10 Days 60 Days 10 Days to File IIDR Day 1 Survey 2567 Rec d POC Due IDR Due Day 90 DPNA Day 180 Termination CMS Remedies Letter Rec d CMS Appeal Or Waiver of Appeal Right 31
32 How to Read the 2567 What are the deficiencies? What are the regulatory violations? Federal State What is the best way to respond? 32
33 Know Your Regulators
34 Sanction Letters DOH imposes state sanctions against license and recommends federal sanctions to CMS CMS imposes sanctions against certification, often after time for state IDR has passed CMS not required to follow DOH recommendation Challenges to federal CMP must include escrow of CMP 34
35 POC Disclaimer Language Preparation and submission of this POC is required by state and federal law. This POC does not constitute an admission for purposes of general liability, professional malpractice or any other court proceeding. 35
36 Required POC Elements What corrective action(s) will be accomplished for residents affected by the deficient practice? How will you identify other residents having the potential to be affected by the same deficient practice and corrective actions? What measures will be put in place or system changes will you make to ensure that the deficient practice does not recur? 36
37 Required POC Elements How will the corrective action be monitored to ensure the deficient practice will not recur, i.e., what quality assurance programs will be established? Dates when the corrective action will be completed. 37
38 Strategies for Preparing Effective POCs Less is more Read the F Tags and the state tags Don t be afraid to have your POC rejected Be responsive and responsible Don t overpromise Don t admit liability 38
39 Strategies for Preparing Effective POCs Don t go overboard with policies, procedures and plans of correction Keep your date of compliance as short as possible Begin implementing corrective action during the survey and document corrections (e.g., inservicing of staff) 39
40 Post Survey Revisit Nature of deficiency dictates scope of revisit Required whenever S/S F-L level deficiencies exist 3 rd Revisit subject to CMS Regional Office (RO) approval 4 th Revisit subject to CMS Central Office (CO) approval 40
41 Survey Strategy Reevaluate how you approach survey Surveyors may reject any documents not provided at time of survey Where are your critical documents What do your medical records look like How up to date is your filing Review 2567 carefully and prepare IDRs for any factual inaccuracies 41
42 Prepare Now Review and implement new ROPs focus on grievances, resident rights, policies and procedures Ongoing review of MDS accuracy Engage your medical director and attending physicians Reevaluate wound care protocol and scope of practice issues 42
43 Change Your Mock Survey Process Interview residents Interview families Interview staff Prepare direct care staff for better surveyor interaction What do you say when you are not sure of the answer? 43
44 QA and QAPI Make better use of your Quality Assurance (QA) and/or Quality Assurance & Process Improvement (QAPI) committee DOH expects to see evidence of investigations Multiple issues should be documented separately Make certain electronic record reports (e.g., call bells) part of QAPI if they are used such purposes 44
45 Potential repayment Collateral Issues Obligation to repay within 60 days of identification of known overpayment PA Preventable Serious Adverse Events (PSAE) Act DOH has been filing reports with Department of Human Services (DHS, formerly Department of Public Welfare) 45
46 DOH Surveys: What Happened? Kaiser Family Foundation: about 40 percent of PA nursing homes have relatively low 5-star ratings, of 1 or 2-stars (May 2015) See also: Community Legal Services of Philadelphia (CLS) report CARELESS: How the Pennsylvania Department of Health has Risked the Lives of Elderly and Disabled Nursing Home Residents (June 2015) 46
47 CLS Recommendations to Gov. Wolf Conduct thorough investigation into why DOH has failed to properly investigate nursing homes and enforce regulations Implement system-wide changes within DOH to ensure enforcement of regulations Require all DOH nursing home investigators be retrained on an ongoing basis to ensure patient safety 47
48 CLS Recommendations to Gov. Wolf Require DOH to provide better transparency to public regarding investigations & characterization of harm Provide better information to public about SNFs so prospective SNF residents and families can make informed decisions about care 48
49 DOH Surveys: What Happened? ProPublica reports PA cited fewest serious deficiencies of any state, tied with HI and DE (.02) Inconsistent Penalties Across the States, updated July 2015 PA Attorney General staffing investigations 49
50 PA Attorney General (AG) Staffing Investigations 7 companies targeted in contingency fee contract between AG and private law firm (Cohen Milstein) April 2015: Declaratory judgment case to AG s authority to: Hire contingency fee counsel; and Investigate staffing using Unfair Trade Practice and Consumer Protection laws Dec. 2016: SNFs declaratory judgment action ultimately dismissed 50
51 PA AG Staffing Investigations July 2015: AG files lawsuit against Golden Living Oct. 2016: Reliant settlement $2 million Nov. 2016: AG files suit against Grane Healthcare- Mar. 2017: Commonwealth Court dismisses AG lawsuit April 2017: AG appeals to PA Supreme Ct. 51
52 DOH Response Accelerate efforts to evaluate regulatory process to determine what additional measures can be taken to ensure enhance quality Engage Auditor General to audit DOH policies and procedures to recommend ways to improve how DOH enforces its statutory enforcement authority Form task force charged with identifying ways DOH can advance quality improvement 52
53 More Scrutiny of DOH PA Auditor General Performance Audit Report: Pennsylvania Department of Health, issued July 26, 2016 Generated extensive media coverage Failing the Frail: Bad care leads to dozens of avoidable deaths in Pa. Nursing Homes. * Senator Casey requests CMS investigation of PA DOH * (Aug 2, 2016) 53
54 OPTIONS FOR REFUTING NEGATIVE SURVEY FINDINGS 54
55 Informal Dispute Resolution Does not toll the federal appeals timetable or delay enforcement action Successful IDR expunges deficiency from CMS 2567 and provides for rescission of enforcement action predicated on withdrawn deficiency CMS findings of noncompliance can overrule state s conclusions 55
56 State IDR v. IIDR Tags Disputed Deleted Revised Upheld Withdrawn 2013 IDR 69 19% (13) 7% (5) 72% (50) IIDR % (1) 86% (12) 7% (1) 2014 IDR 60 15% (9) 20% (12) 63% (38) 2% (1) 2014 IIDR 24 25% (6) 0 75% (18) IDR % (33) 11% (15) 63% (82) 1% (1) 2015 IIDR 30 20% (6) 10% (3) 70% (21) 0 Jan-Oct IDR % (47) 11% (18) 60% (104) 2% (3) Jan-Oct IIDR 42 17% (7) 7% (3) 69% (29) 7% (3)
57 Sanction Letters Ability to file federal IIDR within 10 days of receipt of CMS CMP letter (often sent by certified or regular mail keep envelope) Federal IIDR will often include contact of affected residents Waiver of appeal rights gets 35% reduction of CMP File written notice within 60 days 57
58 Federal Appeals Departmental Appeals Board (DAB) U.S. District Court U.S. Court of Appeals Beyond? 58
59 State Appeals Administrative hearings Court appeals 59
60 Questions Paula G. Sanders, Esquire Principal & Co-Chair, Health Care Practice Group Post & Schell, PC
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