SUBJECT:

Forest Glen Skilled Nursing and Rehabilitation Center,

Petitioner,

Centers for Medicare & Medicaid Services.

DECISION

I decide based on the undisputed material facts of this case that the effective date of participation in the Medicare program of Petitioner, Forest Glen Skilled Nursing and Rehabilitation Center, was January 28, 2002.

I. Background and undisputed material facts

Petitioner filed a hearing request in which it challenged its effective date of participation in Medicare. Petitioner asserted that it should be certified to participate in Medicare effective in October 2001 rather than January 28, 2002, the date when the Centers for Medicare & Medicaid Services (CMS) determined that Petitioner was certified to participate. CMS then filed a motion for summary disposition. Petitioner opposed the motion. In its opposition to the motion Petitioner suggests that it should have been certified to participate in Medicare on or about October 14, 2001.

The parties do not dispute the following facts. Petitioner is a skilled nursing facility that is located in Maryland. Formerly, it was known as Sylvan Manor Health Care Center, LLC, d/b/a Forest Glen Skilled Nursing and Rehabilitation Center, and it participated in the Medicare program pursuant to a provider agreement that was entered into between CMS and an entity known as Care Matrix/Forest Glen.

On November 9, 2000, Care Matrix/Forest Glen filed for Chapter 11 bankruptcy in the United States Bankruptcy Court for the District of Delaware. On June 20, 2001, the bankruptcy court approved a transfer of Petitioner from Care Matrix/Forest Glen to Rosen Management, Inc. (Rosen Management).

Rosen Management had the option of continuing to operate Petitioner pursuant to the Care Matrix/Forest Glen Medicare provider agreement with CMS. However, it elected not to do that. Rather, Rosen Management elected to apply to CMS for a new provider agreement.

During the period between October 2001 and January 28, 2002 there was considerable confusion as to whether the transfer of Petitioner from Care Matrix/Forest Glen to Rosen Management had been completed. Rosen Management contended that the closing of the transfer occurred on October 1, 2001. I note that CMS does not now contend that this is an incorrect statement, although it asserts that the first notice that it had from Petitioner which included a representation from Care Matrix/Forest Glen that the closing had occurred on October 1, 2001, was in a fax which CMS received on January 14, 2002.

On or about October 11, 2001, a survey was made of Petitioner in order to determine whether it was complying with Medicare participation requirements. The survey addressed Petitioner's compliance with requirements that are stated at 42 C.F.R. Part 483. However, no survey was performed on that date to determine Petitioner's compliance with the requirements of the Life Safety Code. A Life Safety Code survey was not completed until January 28, 2002. CMS certified Petitioner to participate in Medicare effective January 28, 2002.

CMS offered 14 exhibits in support of its motion for summary disposition (CMS Ex. 1 - CMS Ex. 14). Petitioner has not offered any exhibits in opposition to CMS' motion. I am receiving CMS Ex. 1- CMS Ex. 14 for purposes of completing the record in this case.

II. Issues, findings of fact and conclusions of law

A. Issues

The issues in this case are whether:

1. Summary disposition is appropriate in this case;

2. Petitioner became eligible to participate in Medicare on January 28, 2002 or on some earlier date;

3. I have authority under governing law to waive a requirement in the regulations that a skilled nursing facility may not be certified to participate in Medicare earlier than the date when it completes a survey for Life Safety Code compliance; and,

4. I have authority based on equitable principles to order CMS to certify Petitioner to participate in Medicare on a date prior to January 28, 2002.

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 of my Findings below as a separate heading. I discuss each Finding in detail.

1. Summary disposition is appropriate in this case.

Summary disposition is appropriate in a case where there are no disputed issues of material fact. See Fed. R. Civ. P, 56. I find summary disposition to be appropriate here. Petitioner has accepted CMS's statement of the facts of this case although it has advocated some additional facts which it contends are material. Petitioner's response to motion for summary disposition at 1. I have accepted as true for purposes of deciding this motion the additional facts that are alleged by Petitioner. See Finding 4, below.

2. Petitioner became eligible to participate in Medicare on January 28, 2002, the date when it completed surveys establishing that it met all participation requirements, including the requirements of the Life Safety Code.

The undisputed material facts of this case establish that it was not until January 28, 2002, that Petitioner completed surveys which established that it complied with Medicare participation requirements that are stated at 42 C.F.R. Part 483 and with Life Safety Code requirements. Two surveys were made of Petitioner in order to determine its compliance status. The first survey, completed on or about October 11, 2001, addressed Petitioner's compliance with the participation requirements that are stated at 42 C.F.R. Part 483. Evidently, the Maryland State survey agency found that Petitioner was complying with all of these requirements as of October 11, 2001. However, the October 11, 2001 survey failed to address the issue of Petitioner's compliance with the requirements of the Life Safety Code. A second survey was conducted of Petitioner to determine its compliance with Life Safety Code requirements and that survey was not completed until January 28, 2002. As of that date Petitioner was determined to be complying with Life Safety Code requirements.

The process by which a provider is certified to participate in Medicare is governed by regulations that are set forth at 42 C.F.R. Part 489. The regulations provide, with exceptions that are not relevant to this case, that the earliest date when a provider may be found to qualify for participation in Medicare is the date when a survey or surveys of that provider are completed which establish that the provider meets all federal participation requirements. 42 C.F.R. § 489.13(b). The term "Federal requirements" is specifically defined to include compliance with the Life Safety Code, if applicable to a provider. Id. Life Safety Code requirements are applicable to skilled nursing facilities such as Petitioner. Social Security Act (Act), section 1819(d)(2)(B)(i).

Thus, the earliest date when Petitioner could have been certified to participate in Medicare was the date when surveys were completed of Petitioner that established its compliance with both Medicare participation requirements at 42 C.F.R. Part 483 and Life Safety Code requirements. The date when surveys of Petitioner were completed was January 28, 2002. Therefore, the CMS-determined certification date of January 28, 2002 is the appropriate certification date.

3. I have no authority to order CMS to waive the requirements of 42 C.F.R. § 489.13(b) and to order that it certify Petitioner to participate at a date that is earlier than January 28, 2002.

Petitioner argues that I have statutory authority to compel CMS to certify Petitioner to participate in October 2001. I do not find Petitioner's argument to be persuasive.

Petitioner cites as authority for its argument the provisions of section 1819(d)(2)(B)(i) of the Act (cited by Petitioner as 42 U.S.C. § 1395i-3(d)(2)(B)(i)). According to Petitioner, the section authorizes me to order CMS to waive the requirement that Petitioner be surveyed for Life Safety Code compliance prior to certification. This section states that a skilled nursing facility, such as Petitioner, must meet the provisions of the Life Safety Code that are applicable to nursing facilities. However, it also provides that:

[T]he Secretary [of Health and Human Services] may waive, for such periods as he deems appropriate, specific provisions of such Code which if rigidly applied would result in unreasonable hardship upon a facility, but only if such waiver would not adversely affect the health and safety of residents or personnel . . . .

Petitioner's argument might arguably have some merit if the Secretary had not expressed his views about compliance with the Life Safety Code. But, that is not the case. The regulations, at 42 C.F.R. § 489.13(b) provide unequivocally that a facility must be surveyed for Life Safety Code compliance as a prerequisite for certification. This regulation does not allow for waiver of this requirement and Petitioner has pointed to no other language in the regulations which might arguably allow for a waiver.

The regulations are the Secretary's statement as to how he wants the Act to be interpreted and applied. I am charged with applying these regulations. I conclude that the categorical requirement in 42 C.F.R. § 489.13(b) that a facility comply with Life Safety Code requirements as a prerequisite to certification and the absence of any language in the regulations allowing for waiver of that requirement means that the Secretary has opted not to allow for such a waiver. And, given that, I am without authority to order CMS to waive the requirements.

4. I have no authority to order that Petitioner be certified to participate in Medicare before January 28, 2002 based on equitable considerations.

Petitioner argues that there are equitable grounds to justify certifying it to participate prior to January 28, 2002. First, according to Petitioner, the State of Maryland has supported its request that it be certified before January 28, 2002. Second, Petitioner asserts that the delay in conducting a Life Safety Code survey was not its fault. Arguably, the survey was delayed as a result of CMS' misunderstanding as to when the transfer of Petitioner from Care Matrix/Forest Glen to Rosen Management took place.

Petitioner argues that there is an equitable principle stated in the Act itself that undue hardship should not be caused by overly rigid interpretations and applications of the Act. Petitioner's response to CMS' motion for summary disposition at 4. According to Petitioner, it will suffer an undue hardship if it is not certified to participate effective in October 2001 for reasons that are not its fault.

I accept as true for purposes of this decision all of Petitioner's assertions of fact. However, I find that I have no authority to order that Petitioner be certified to participate in Medicare on any date prior to January 28, 2002, the date when the Life Safety Code survey was completed. The regulations governing certification do not authorize me to order certification based on principles of estoppel or fairness at a date that is earlier than that which the regulations permit. Snowden at Fredricksburg and Mary Washington Hospital, DAB CR486 (1997), at 14. Nor do I have the authority to decide that a policy that is embodied in a regulation - as is the case here - is an "overly rigid" interpretation and/or application of the Act.

Steven T. Kessel

Administrative Law Judge