Rehabilitation Center at Hollywood Hills, LLC, DAB CR5328 (2019)

DECISION

I sustain the determination of the Inspector General (IG) to exclude Petitioner, Rehabilitation Center at Hollywood Hills, from participating in Medicare, State Medicaid programs, and other federally funded health care programs until Petitioner is reinstated by the State of Florida, Agency for Health Care Administration (AHCA).

I.  Background

Petitioner challenges the IG’s determination to exclude it pursuant to the authority conferred by section 1128(b)(5) of the Social Security Act (Act).  This section authorizes the Secretary of Health and Human Services, and his agent, the IG, to exclude any individual or entity that has been suspended or excluded from participation, or otherwise sanctioned under a State health care program for reasons bearing on that individual or entity’s professional competence, professional performance, or financial integrity.

The IG filed a brief and a reply brief in support of his determination to exclude Petitioner.  The IG filed five exhibits (Exs.) in support of his determination and identified them as IG Ex. 1-IG Ex. 5.  Petitioner filed a brief in opposition and five exhibits that it identified as P. Ex. 1-P. Ex. 5.  It also objected to my receiving IG Ex. 4 and IG Ex. 5 into evidence.

I receive IG Ex. 1-IG Ex. 4 and P. Ex. 1-P. Ex. 5 into evidence.

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Petitioner objected to my receiving IG Ex. 4 into evidence, asserting that it contains inadmissible hearsay.  I overrule the objection.  The Federal Rules of Evidence do not govern here and I normally do not exclude hearsay.  Moreover, the document would appear to be a business record of actions taken by AHCA and would be admissible even if it contained hearsay.  Finally, Petitioner has not offered evidence showing that any of the actions recorded by the exhibit are not true.

I do not receive IG Ex. 5 into evidence.  The exhibit is a declaration from Kelly Ann Bennett, an AHCA employee.  In her declaration, Ms. Bennett affirms that AHCA’s suspension of Petitioner’s participation in Florida’s Medicaid program remains in effect, noting that Petitioner has not applied for reinstatement into that program.  Ms. Bennett’s assertions are not controversial and, in fact, Petitioner has not offered any evidence that would challenge them.  However, I find the declaration to be unnecessary.  As I discuss below, Petitioner’s suspension continues until it applies for reinstatement and proves that it has corrected the problems that led to its suspension.  Petitioner offered no evidence to prove that it has applied for reinstatement or that it has been reinstated.

II.  Issues, Findings of Fact and Conclusions of Law

A. Issues

The issues are whether the IG may exclude Petitioner pursuant to section 1128(b)(5) of the Act, and whether the length of the exclusion – coterminous with Petitioner’s suspension from Florida’s Medicaid program – is reasonable as a matter of law.

B. Findings of Fact and Conclusions of Law

On September 14, 2017, AHCA suspended Petitioner from participating in Florida’s Medicaid program.  IG Ex. 3.  The reasons for the suspension included findings by AHCA that:  Petitioner’s facility presented a threat to the health, safety or welfare of its residents; that it presented a threat to the health, safety or welfare of a client (a Medicaid recipient); that it posed an immediate and serious danger to public health, safety, and welfare; and that it presented an immediate or direct threat to the health, safety, or welfare, of its residents.  Id.  There is no evidence that AHCA subsequently reinstated Petitioner’s Medicaid participation.  The record contains no evidence showing that Petitioner currently participates in Medicaid.  See IG Ex. 4.

This suspension justifies the IG’s exclusion determination.  AHCA suspended Petitioner from participating in Florida’s Medicaid program, a state health care program, and did so for reasons that plainly bore on Petitioner’s professional competence and performance.  There is an obvious nexus between AHCA’s findings that Petitioner’s facility posed a threat to health, safety, and the welfare of its residents, among other things and the Act’s

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requirement that a suspension of participation be related to an individual’s professional competence or performance. The length of the exclusion – coterminous with the suspension of Petitioner’s Medicaid participation – is justified as a matter of law.  Act § 1128(c)(3)(E).

Petitioner makes several arguments in opposition to the IG’s exclusion determination.  I find all of these arguments to be unavailing.

Principally, Petitioner contends that it is not “presently suspended from the Florida Medicaid program.”  Informal Brief of Petitioner (Petitioner’s brief) at 2, 5-10.  It contends that the suspension expired after twelve months by operation of law.  Id.  From this assertion Petitioner contends that no authority presently exists to exclude it, because, it reasons, the suspension that AHCA imposed against it has lapsed.

Petitioner’s assertion notwithstanding, Petitioner remains suspended and it has not been reinstated to Florida’s Medicaid program.  It is true, as Petitioner contends, that the term of its suspension was for one year, running from September 17, 2017 until September 18, 2018.  See IG Ex. 3; Fla. Admin. Code Ann. r. 59G-9.070(3)(o) (2017).  However, the one-year term of suspension imposed against Petitioner is not self-limiting.  Rather, it defines only the minimum period of time during which Petitioner is suspended from Medicaid participation.  Petitioner became eligible to reapply for reinstatement at the end of one year.  Reinstatement is not automatic under Florida law.  See Fla. Admin. Code Ann. r. 59G-9.070(6)(a)(2) (2017).  In order to be reinstated a suspended entity must:  (1) apply for reinstatement; and (2) demonstrate that it has remedied the violations that are the basis for the suspension.  Id.  A suspended entity remains suspended unless and until it is reinstated.

Petitioner offered no proof that it applied for reinstatement nor did it offer proof that it has been reinstated.

Petitioner argues also that AHCA is “judicially estopped” from suspending Petitioner’s Medicaid participation for more than one year.  It predicates this argument on a Florida State decision, Zeeuw v. BFI Waste Sys. of N. Am., Inc., 997 So. 2d 1218, 1220 (Fla. 2d DCA 2008), which, Petitioner contends, holds that litigants may not take inconsistent positions in separate judicial or quasi-judicial proceedings.  But, there is nothing inconsistent in AHCA’s suspension determination and any subsequent actions that AHCA may have taken with respect to Petitioner.  Petitioner cites to nothing showing that AHCA ever offered Petitioner automatic reinstatement after a year’s suspension.  Nor does Petitioner demonstrate that Florida law permits automatic reinstatement.  As I have explained, the one-year suspension of Petitioner’s participation means only that Petitioner is eligible to apply for reinstatement after a year, and nothing more than that.

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Petitioner argues that AHCA’s suspension determination is invalid because, allegedly, AHCA denied Petitioner a fair hearing of the allegations that were the basis for the suspension determination.  It asserts that it challenges AHCA’s action in a court appeal.  Petitioner’s brief at 2-3.  It contends that AHCA’s findings are “demonstrably incorrect.”  Id. at 3.  It contends that its judicial appeal of the AHCA suspension determination is still pending and, thus, is not final.

These arguments, foremost, are a collateral attack on the AHCA suspension.  Essentially, Petitioner asserts that the IG lacks authority to exclude it because of alleged flaws and errors in the AHCA suspension determination.

Petitioner’s collateral attack on the AHCA suspension does not constitute a valid argument against the IG’s exclusion determination.  Whatever might be the merits of Petitioner’s arguments about flaws in the state process, it may not avail itself of those arguments here.  42 C.F.R. § 1001.2007(d).  The IG’s authority to exclude Petitioner pursuant to section 1128(b)(5) derives from an administratively final state action, in this case the AHCA suspension of Petitioner’s Medicaid participation.  While Petitioner certainly may challenge the AHCA suspension in the appropriate forum, that suspension is dispositive grounds for the IG’s exclusion determination unless overturned on appeal.

Moreover, the fact that Petitioner presently appeals the AHCA suspension in a Florida court provides it with no ground to challenge the exclusion determination.  There is nothing in the Act or implementing regulations that suggests that an appeal in process of an administratively final state action stays or defeats the IG’s exclusion determination.  As I have stated, the authority to exclude pursuant to section 1128(b)(5) derives from an administratively final state suspension.  That is precisely the case here and the fact that Petitioner presently appeals the suspension neither stays the suspension nor does it vitiate the IG’s derivative exclusion authority.

Petitioner argues that I should address the merits of the events that led to the suspension of its Medicaid participation, contending that the “[e]vidence will show that there was no violation of any state or federal statutes and that . . . [Petitioner] acted reasonably to keep its residents safe during and in the immediate aftermath of Hurricane Irma.”  Petitioner’s brief at 4.  Petitioner seeks to incorporate by reference the docket of what it contends to be a related case, Rehabilitation Center at Hollywood Hills, DAB CR5232 (2019).  Furthermore, it seeks to offer in this proceeding all of the evidence that it offered in the allegedly related case, including the testimony of witnesses.  I take notice that the case alluded to by Petitioner addresses findings of substantial noncompliance with regulations governing skilled nursing facilities participating in Medicare.

The findings and evidence offered in CR5232 are irrelevant to the matter before me and I do not address them.  Neither do I accept into the record of this case anything offered by the parties in CR5232.  Petitioner’s assertion that I must revisit the merits of that case in

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the context of the IG’s exclusion determination amount to another attempt to attack collaterally the AHCA suspension.  As I have explained, there exists no basis to examine the merits of the suspension here inasmuch as the IG’s exclusion authority derives from the administratively final suspension and not from the merits of the allegations that form the basis for the suspension.