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Department of Health and Human Services
Appellate Division

SUBJECT: Park Manor Nursing Home,


DATE: June 17, 2004

             - v -


Centers for Medicare & Medicaid Services


Docket No. A-04-31
Civil Remedies CR1090
Decision No. 1926


Petitioner, Park Manor Nursing Home (Park Manor), appealed a March 31, 2003 decision by Administrative Law Judge (ALJ) Steven T. Kessel. Park Manor Nursing Home, DAB CR1090 (2003) (ALJ Decision). The ALJ Decision affirmed a $150 per day civil money penalty (CMP) imposed on Park Manor by the Centers for Medicare & Medicaid Services (CMS) for the period March 22 through June 10, 2001. In affirming the CMP, the ALJ determined that Park Manor was not in substantial compliance with 42 C.F.R. 483.10(b)(11), which requires a skilled nursing facility to consult a resident's physician when there is a "significant change" in a resident's physical, mental, or psychosocial status. The ALJ found that Park Manor had failed to consult with a physician about signs and symptoms that were, according to the ALJ, evidence of "significant changes" in Resident 20's status.

For the reasons explained below, we conclude, among other things, that 1) both the ALJ and the surveyor on whose testimony he relied misapplied the regulations in evaluating whether the resident's signs and symptoms occurring after Park Manor had consulted with the resident's physician were significant changes requiring further physician consultation; 2) the ALJ ignored undisputed evidence about changes that had occurred in the resident's status before Park Manor last consulted with the physician and about the resident's wishes for comfort measures only; 3) under the particular circumstances here, Park Manor reasonably determined it was not required to consult the physician again; and 4) in any event, CMS did not make a prima facie showing that Park Manor's failure to consult the physician about the alleged changes created the potential for more than minimal harm. Accordingly, we reverse the ALJ's determination that Park Manor was not in substantial compliance with section 483.10(b)(11) and set aside the $150 per day CMP.

Regulatory Background

Park Manor is a Wisconsin skilled nursing facility that participates in the Medicare program. Medicare's participation requirements for skilled nursing and other long-term care facilities are set forth in 42 C.F.R. Part 483, Subpart B.

Compliance with Medicare participation requirements is verified through surveys performed by state agencies under contract with CMS. The survey agency reports any "deficiencies" on a standard form called a "Statement of Deficiencies" (SOD). See 42 C.F.R. 488.325(a); CMS State Operations Manual (SOM), Appendix (App.) P, sec. IV. A "deficiency" is a failure to a meet a participation requirement in 42 C.F.R. Part 483. 42 C.F.R. 488.301. Deficiency findings are organized in the SOD under alpha-numeric "tags," with each tag corresponding to a regulatory requirement in Part 483 of the regulations. See SOM, App. P, sec. IV.

A survey agency's findings include a determination about the "seriousness" of each deficiency. See 42 C.F.R. 488.404; SOM 7400(E). "Seriousness" is largely a function of the deficiency's scope (isolated, pattern, or widespread) and of the harm that the deficiency has caused or has the potential to cause. See 42 C.F.R. 488.404(b). Seriousness is denoted in the SOD by a letter (A-L) that reflects a particular combination of scope and level of harm. See SOM 7400(E). The most serious deficiencies are ones that result in "actual harm" or that place residents in "immediate jeopardy." Id.

A facility becomes subject to remedial action when it is not in "substantial compliance" with one or more participation requirements. See 42 C.F.R. 488.400. A facility is not in substantial compliance if it has a deficiency that creates at least the "potential for more than minimal harm" to one or more residents. 42 C.F.R. 488.301. CMS may impose a CMP for the days on which the facility is in a state of noncompliance. 42 C.F.R. 488.404, 488.406 and 488.408. ("Noncompliance" is defined in 42 C.F.R. 488.301 of the regulations to mean "any deficiency that causes a facility to not be in substantial compliance.")

Case Background

On March 22, 2001, the Wisconsin Department of Health and Family Services (WDHFS) completed a standard survey (the "March 2001 survey") of Park Manor. See CMS Ex. 3. The March 2001 survey found several deficiencies, which WDHFS described in Statement of Deficiencies (SOD) number 618331. CMS Ex. 1. After revisit surveys, informal dispute resolution proceedings, and preliminary proceedings before the ALJ, the issues in dispute were substantially narrowed. The ALJ ruled that only five alleged deficiencies -- described under tags F157, F279, F309, F332, and F496 in SOD number 620504 (CMS Ex. 4) -- were at issue before him at the hearing. See Ruling on Petitioner's Motion for Summary Disposition (dated October 8, 2002), at 7.

The parties presented testimony and evidence regarding these five deficiencies. The ALJ, however, limited his factual and legal findings to CMS's allegations under tag F157, which were that Park Manor had failed to consult with a physician about significant changes in Resident 20's status.

Resident 20 was 91 years old, and his primary diagnosis was dementia. CMS Ex. 12, at 3, 12. His care plan indicated that he was a "no code" resident, meaning that he did not want aggressive measures (such as CPR) to prolong his life, and that he was to be provided "comfort measures" at the end of life. See Park Manor Ex. 1, at 3; Park Manor Ex. 68, 14. Nursing progress notes submitted by CMS show that on Friday, March 2, 2001, Resident 20 developed an elevated temperature and other symptoms of a urinary tract infection (UTI). CMS Ex. 13, at 1. A nurse called and left a message with the physician about the symptoms. Id. At approximately 5:26 p.m. on March 2, the physician phoned back with new orders for testing and treatment to address the suspected infection. Id. Thereafter, a nurse spoke with Rosemary Plant, Resident 20's guardian, in order to obtain informed consent for the testing and treatment (a urinalysis and the administration of an antibiotic). Id.; Park Manor Ex. 72, 21. At 9:46 p.m., a nurse spoke to the physician a second time to update him on Resident 20's status. CMS Ex. 13, at 1. The nurse also left a message for Plant to update her on Resident 20's condition. Id. Plant visited the facility on Sunday, March 4. (1) Park Manor did not contact the physician again until 9:30 a.m. on Monday, March 5. CMS asserted, however, that Park Manor was required to, and did not, consult immediately with the physician concerning significant changes in Resident 20's condition on Saturday, March 3, and Sunday, March 4, 2001. Resident 20 died early on March 6, 2001. CMS Ex. 4, at 2.

CMS presented testimony regarding Resident 20 only from the nurse surveyor who had drafted the deficiency finding, Wanda Hardges. CMS Ex. 54. Park Manor presented testimony from three witnesses who were personally familiar with Resident 20: Karen Haegerl (the day shift nurse on March 3 and 4); Paula Kock (Park Manor's administrator); and Rosemary Plant, Resident 20's niece and legal guardian, who had 39 years of nursing experience. See Park Manor Exs. 63, 68, and 72. (2)

Rosemary Plant and Paula Kock testified that Resident 20's physical and mental condition had been declining since at least January 2001. Park Manor Exs. 68, 12 and 72, 18-19. Plant testified that in her conversation with the nursing staff on March 2, the nurse told her "that the news [about her uncle] was not good" and that he had eaten poorly for the past two days. Park Manor Ex. 72, 21. Plant testified that the message left for her by the nursing staff at around 9:45 p.m. on March 2 was that her uncle was continuing to deteriorate and that if she wanted anything more than comfort measures she should call back. Id., 22. Plant also testified that she did not call Park Manor back "because I did not want anything more than comfort measures." Id.

Park Manor also submitted evidence that Ms. Plant had been involved in developing a written care plan for Resident 20 that provided for a "no code" order (also referred to by the ALJ as a "do not resuscitate" or "DNR" order), and that also specified that the resident was to be kept comfortable and provided only "comfort measures." Park Manor Ex. 1, at 3; Park Manor Ex. 72, 10-15, 17. The plan was based on the resident's wishes, as expressed during his 40-year relationship with Ms. Plant; she had repeatedly discussed this with the facility and how he would not have wanted any aggressive interventions to merely prolong his life. Park Manor Ex. 72, 17. She had agreed to the treatment for the UTI because she knew a UTI could cause discomfort, but would not have agreed to any intervention such as giving him oxygen or intravenous feeding, unless clearly needed to keep him comfortable. Id., 27; CMS Ex. 66, at 19, 22. She further testified that she viewed the UTI and other symptoms of which she was informed on Friday evening (including decreased appetite) as a manifestation of his overall decline (part of the final stages of his dementia). Park Manor Ex. 72, 29. She also testified that, when she visited him on March 4 (as she did every Sunday and Tuesday), he was resting peacefully and "slowly slipping away." Id., 23. She testified that she felt that he received excellent care and was kept comfortable and allowed to die with dignity and that the facility had been diligent in keeping her informed about his status. Id., 27-28, 34. She had informed the facility that she was a nurse. Id., 11.

Park Manor also submitted evidence that on Sunday, March 4, the resident had seemed to be responding to the treatment for the UTI and that, when a new nurse came onto the day shift on March 5 and evaluated all of the changes that had occurred since Sunday afternoon, she did contact the physician's office and left him a message regarding the resident's continuing deterioration. See Park Manor Ex. 68, 21; CMS Ex. 13, at 2. The physician (who also was familiar with the resident's wishes) did not order any new treatment. See CMS Ex. 13, at 2.

Based on the resident's medical records (primarily his diagnoses and his resident assessment from October 2000) and the testimony of Nurse Hardges, CMS identified a number of signs and symptoms reported on March 3 or 4 that it contended were "significant changes" that triggered Park Manor's obligation to consult with Resident 20's physician again. See CMS Post-Hearing Brief (PHB) at 2-9. These changes included: (1) a reduction in Resident 20's oxygen saturation level on March 3; (2) his decreased ability to ambulate on March 3 and March 4; (3) his "unresponsiveness" on March 4 (a condition reported by Rosemary Plant); and (4) mottling of the lower extremities on March 4. Id.

ALJ Decision

The ALJ found that a reduction in Resident 20's oxygen saturation level on March 3, coupled with his other vital signs on that day, did not necessitate immediate physician consultation. ALJ Decision at 5-6. However, the ALJ found that Resident 20's diminished ability to ambulate, unresponsiveness, and mottling were "significant changes" that Park Manor did not immediately report to the physician. Id. at 6. The ALJ found that neither the care plan nor the legal guardian directed the facility not to contact the physician. Id. at 7. The ALJ also found that Park Manor's inaction created the potential for more than minimal harm. Id. at 9. Based on these findings, the ALJ concluded that Park Manor was not in substantial compliance with 42 C.F.R. 483.10(b)(11). The ALJ found it unnecessary to address the other four alleged deficiencies because the violation of section 483.10(b)(11) was, in his estimation, sufficient to justify a $150 per day CMP. Id. at 9-11. Finally, the ALJ found that Park Manor was in a state of noncompliance from March 22 through June 10, 2001, and that CMS was authorized to collect a CMP for each day of that period. Id. at 11-12.

In reaching his findings, the ALJ did not state that he found Park Manor's witnesses not to be credible, but indicated merely that he was not persuaded by them. See ALJ Decision at 8.

Standard of Review

Our standard of review on a disputed conclusion of law is whether the ALJ decision is erroneous. Our standard of review on a disputed issue of fact is whether the ALJ decision as to that fact is supported by substantial evidence on the record as a whole. See Guidelines for Appellate Review of Decisions of Administrative Law Judges Affecting a Provider's Participation in the Medicare and Medicaid Programs (at guidelines/); South Valley Health Care Center, DAB No. 1691 (1999), aff'd, South Valley Health Care Center v. HCFA, 223 F.3d 1221 (10th Cir. 2000).

The Parties' Contentions

In its request for review (submitted on December 9, 2003, after receipt of several extensions), Park Manor contended that the ALJ's finding that it failed to comply with section 483.10(b)(11) is not supported by substantial evidence, and that it met its burden of demonstrating that it was in substantial compliance with that regulation. Request for Review (RR) at 10, 19. Park Manor emphasized that it had introduced uncontradicted expert opinions from qualified nurses that Resident 20 did not experience a significant change in status on March 3 and 4, and that nursing standards of practice did not require immediate physician notification when a guardian does not want further treatment. Id. at 9-21. Park Manor faulted the ALJ for finding the "unresponsiveness" reported by Ms. Plant to be a significant change since CMS had originally relied only on a notation regarding the resident's lethargy (which Park Manor had shown was not a change). Id. at 25-30. Park Manor also contended that it was not required to consult with the physician under the circumstances because Resident 20's guardian had made it clear that she wanted no further treatment during the weekend in question, only "comfort measures," which were in fact provided. Id. at 22-25. Citing 42 C.F.R. 483.10(a)(3) and 483.10(b)(4), Park Manor contended that it was legally and morally bound to honor the guardian's wishes not to take further action and to allow Resident 20 to die with dignity. Id. at 23-24. In addition, Park Manor contended that CMS had failed to carry its burden of proving that the alleged noncompliance with section 483.10(b)(11) created the potential for more than minimal harm. Id. at 30-32.

CMS responded that the ALJ's finding that the resident's need for assistance in ambulation, his unresponsiveness, and the mottling were significant changes was supported by substantial evidence and that the ALJ's conclusion that Park Manor was not in substantial compliance with section 483.10(b)(11) is consistent with applicable case law. Response Brief at 10-22, 24-25. CMS relied primarily on Surveyor Hardges' opinion and on selected parts of the other witnesses' testimony. Id. at 13-17. CMS also said that lethargy and unresponsiveness were essentially the same, and that Park Manor had notice that this was at issue. Id. at 17-18. CMS also contended that substantial evidence supported the ALJ's findings regarding Resident 20's plan of care and the guardian's wishes. Id. at 22-24.


The regulation at 42 C.F.R. 483.10 is titled "Resident rights." In the case of a resident "judged incompetent under the laws of a State by a court of competent jurisdiction, the rights of the resident are exercised by the person appointed under State law to act on the resident's behalf." 42 C.F.R. 483.10(a)(3). Subsection (b)(11), on notification of changes, provides that a facility must consult with the resident's physician when there is a "significant change in the resident's physical, mental, or psychosocial status (i.e., a deterioration in health, mental, or psychosocial status in either life-threatening conditions or clinical complications)." 42 C.F.R. 483.10(b)(11).

The preamble to the final rule implementing this provision responded to a request that CMS define the term "significant change." The preamble explained that the term would be defined as a "deterioration in health, mental, or psychosocial status in either life-threatening conditions (for example, heart attack, stroke) or clinical complications (for example, development of a stage II pressure sore, onset or recurrent periods of delirium)." 56 Fed. Reg. 48826, 48833 (Sept. 26, 1991)(emphasis added). (3)

The preamble also stated:

We recognize that judgment must be used in determining whether a change in the resident's condition is significant enough to warrant notification, and accept the comment that only those injuries which have the potential for needing physician intervention must be reported to the physician.

Id. (emphasis added).

A resident also has the right to refuse treatment and to formulate an advance directive. 42 C.F.R. 483.10(b)(4) and (b)(8). An advance directive is "a written instruction, such as a living will or durable power of attorney for health care, recognized under State law . . . relating to the provision of health care when the individual is incapacitated." 42 C.F.R. 489.100 and 483.10(b)(8).

Neither the surveyor's testimony on which the ALJ relied nor CMS guidance directly addresses how the regulatory definition of a "significant change" as a deterioration in status in life-threatening conditions or clinical complications applies in the context of an individual who is dying, but has requested comfort measures only. See State Operations Manual, App. PP (Surveyor Guidelines for tag F157). Indeed, the surveyor's affidavit states that a significant change is one that "could affect the physical or mental well-being of the resident," without indicating how this articulation comports with the regulatory definition. CMS Ex. 54, 12.

Based on the language of the regulation, its context, and its history, we conclude that both the ALJ and the surveyor on whose testimony he relied erred in evaluating whether the resident's signs and symptoms were significant changes requiring further physician consultation. Not only is it not clear that they were applying the regulatory definition, but, more important, neither gave appropriate consideration to the undisputed evidence about changes that had occurred in the resident's status before Park Manor last consulted with the physician or to the undisputed evidence about the resident's wishes for comfort measures only. Specifically, we conclude that--

    • CMS and the ALJ erroneously treated the resident's status as of March 2 as though his only physical problems were the UTI, a hearing loss, and edema, ignoring evidence in the record that the caregivers and the resident's legal guardian viewed the entirety of his signs and symptoms (including his profound dementia) as evidencing that this 91-year old resident was likely in the final stages of an overall physical and mental decline, including increasing periods of lethargy which the facility had tried to address through seeking changes in his medications, without success. Moreover, the resident's records show that some symptoms (such as congestion and lethargy) on which CMS relied as showing change following notification of the physician of the UTI symptoms had already appeared before the last call to the physician Friday evening, giving him an update on the resident's condition. See CMS Ex. 13. Yet, the physician did not order anything more at that time than an antibiotic for the UTI and a urinalysis.


    • The evidence in the resident's records as a whole, as well as the testimony of individuals familiar with the resident, also show that his need for assistance with ambulation and his lethargy (unresponsiveness) were consistent with his prior decline and with his having a UTI - a clinical complication for which it is undisputed that the physician was consulted on March 2. See Park Manor Ex. 68, 12, 20; Park Manor Ex. 72, 18-19.


    • The ALJ correctly recognized that it would be a physician's judgment what treatment might be needed for a particular complex of signs and symptoms constituting a significant change in a resident's physical status. But, as CMS acknowledged in the preamble to the regulation, determining whether a change is significant with respect to a particular resident involves a nursing judgment.


    • The ALJ appeared to conclude that the resident's end of life wishes were expressed only in the "no code" order, and, therefore, the physician should have been consulted to determine whether the changes that occurred on Sunday in fact signified a condition, such as cardiac arrest, for which the only treatment would have been resuscitation. The uncontroverted evidence submitted by Park Manor establishes, however, that the legal guardian (who could exercise the resident's rights on his behalf) had been involved in developing the written care plan that specified that he was to receive comfort measures only.


    • While Park Manor acknowledged that the "mottling" which the resident evidenced Sunday evening (some time between 4 p.m. and 10:23 p.m.) would have been a significant change for a resident who was "full code," Park Manor exercised reasonable nursing judgment that it was not required to notify the physician at that time since the resident did not appear to be suffering any pain or discomfort and since the legal guardian had clearly communicated that she would refuse on his behalf any treatment meant merely to prolong the resident's life. While the ALJ correctly found that the legal guardian did not specifically direct the facility not to notify the physician of any additional changes, she did testify that she had had many previous discussions with them on end of life issues, that she did not want them to notify the physician, and that she would only have wanted treatment if needed for pain or discomfort. See Park Manor Ex. 72, 17, 23-24. The right to notification is a resident right that may be exercised through a legal guardian. Here, the legal guardian was also a nurse. She was aware of his status as dying, but requested no change even after visiting the resident Sunday afternoon.


    • Requirements for consultation with a physician in circumstances of injury or need for change in treatment refer to the need for medical intervention. 42 C.F.R. 483.10(b)(11)(A-C). Thus, Park Manor could reasonably think that, if no medical intervention was needed for the resident's comfort and if the guardian would have rejected measures such as administering oxygen, consulting with the physician would have been a useless exercise and was not required.


    • When the physician (who also was familiar with the resident's wishes) was consulted early in the morning on Monday, March 5, he did not order any new treatment.


    • The outcome for this resident was what the resident wished. CMS pointed to no evidence that the resident did not receive comfort care, as desired, nor did it suggest any potential medical interventions other than oxygen and intravenous feeding, both of which the guardian had said she would refuse. See Park Manor Ex. 72, 27.


    • Even if the "mottling" on Sunday evening were considered a significant change requiring immediate notification, the less than 12-hour time lapse between the facility noting this symptom and notifying the physician did not have the consequences of the delays in other cases cited by CMS. CMS failed to make a prima facie case here that there was a potential for more than minimal harm since it did not show that the resident was in any pain or discomfort during this period or that the physician would have ordered any additional intervention if contacted sooner.

Accordingly, we reverse the ALJ's finding that Park Manor was not in substantial compliance with 42 C.F.R. 483.10(b)(11).

Having reversed the ALJ's finding of noncompliance, we must consider whether it is appropriate to set aside the CMP or to remand the case to the ALJ for further proceedings. As indicated, the ALJ concluded that $150 per day was a reasonable CMP for the one deficiency he addressed. Park Manor argued in its request for review that we should reverse the ALJ's finding of noncompliance and set aside the decision in its entirety. See RR at 9. In response, CMS did not state that, if the finding of noncompliance were reversed, the case should be remanded to the ALJ for findings on the other four alleged deficiencies for which the parties submitted evidence. Each of those alleged deficiencies was assigned a lower level of seriousness (levels D or E). None was at a level of seriousness that would have required that a CMP be imposed. In addition, we note that these other alleged deficiencies represent only a small fraction of the survey agency's original deficiency findings, many of which were overturned, modified, or effectively withdrawn by CMS during IDR and the ALJ proceedings. (4) Based on these findings, CMS had imposed a denial of payment for new admissions that was in effect from July 15 to July 23, 2001.

Given these circumstances, we do not think that further proceedings would serve the remedial purpose of the regulations, which is to provide the facility with an incentive to come into and remain in compliance. See Fairfax Nursing Home, Inc., DAB No. 1794, at 18-19 (2001), aff'd, Fairfax Nursing Home v. Dep't of Health & Human Servs., 300 F.3d 835 (7th Cir. 2002), cert. denied, 537 U.S. 1111 (2003). Accordingly, we have determined here that reversal of the CMP is more appropriate than further proceedings to address the remaining deficiencies.


For the reasons above, we reverse the ALJ's finding that Park Manor was not in substantial compliance with 42 C.F.R. 483.10(b)(11) from March 22, 2001 through June 10, 2001 and set aside the CMP imposed by CMS for that period.



Cecilia Sparks Ford

Donald F. Garrett

Judith A. Ballard
Presiding Board Member


1. The SOD alleged that, although Park Manor had consulted with a physician at 5:26 p.m. on Friday, March 2, 2001, Park Manor had not notified Resident 20's legal guardian, nor consulted with the physician again until 9:30 a.m. on the morning of Monday, March 5, 2001. See CMS Ex. 4, at 2. Before the ALJ, CMS did not dispute Park Manor's assertions and evidence that it had also consulted with the physician later on Friday evening (at 9:46 p.m.) and had also reported Resident 20's condition to the guardian, and that the legal guardian had visited the facility in the afternoon on Sunday, March 4.

2. The witnesses gave their direct testimony in writing and were cross-examined at the hearing.

3. The ALJ referred to a deterioration in status in "life-threatening conditions" or "clinical complications" as examples of changes that would be considered significant. See ALJ Decision at 4. This is inconsistent with the regulatory wording, which uses "i.e." (meaning "that is") rather than "e.g." (meaning "for example") and with the preamble explanation.

4. Following IDR, the survey agency withdrew a finding of immediate jeopardy (and the associated penalty), amended other deficiency findings, and reissued its SOD. See CMS Exs. 1, 4, 7, 61. The reissued SOD (number 620504) contained 15 deficiency findings but CMS elected to present evidence on only five. See CMS Prehearing Brief at 3-22. CMS accordingly stipulated to a reduction in the non-immediate jeopardy level CMP from $250 to $150 per day for the period prior to the June 2001 revisit survey. Id. at 3, n.3. The June 2001 revisit yielded additional deficiency findings (see CMS Ex. 6), but two of those were withdrawn during IDR, and CMS presented evidence on only one of the remaining findings. See CMS Exs. 7, 60-61; Park Manor Ex. 34; CMS Prehearing Brief, at 3, n.3. In a ruling on a motion for summary judgment, the ALJ found that this one deficiency finding had in fact been rescinded by the survey agency as the result of IDR, and that CMS lacked a basis for imposing any remedies after June 10, 2001. See Ruling on Petitioner's Motion for Summary Disposition (dated October 8, 2002) at 3.