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CASE | DECISION | ANALYSIS | JUDGE | FOOTNOTES

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


SUBJECT: Royal Manor,

Petitioner,

DATE: July 28, 2005

             - v -

 

Centers for Medicare & Medicaid Services

 

Docket No. A-04-141
Civil Remedies CR1185
Decision No. 1990
DECISION
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FINAL DECISION ON REVIEW OF
ADMINISTRATIVE LAW JUDGE D
ECISION

On July 30, 2004, Royal Manor appealed the decision of Administrative Law Judge (ALJ) Steven T. Kessel sustaining the imposition by the Centers for Medicare & Medicaid Services (CMS) of civil money penalties (CMPs) of $7,500 per day for the period of May 14 through May 16, 2002. Royal Manor, DAB CR1185 (2004) (ALJ Decision). The total CMPs of $22,500 were based on a finding of immediate jeopardy arising from an incident in which facility staff allegedly failed to provide needed suctioning and performed cardiopulmonary resuscitation (CPR) improperly on a resident choking and in respiratory distress who ultimately died. Royal Manor contends that the record demonstrates a lack of substantial evidence supporting the ALJ's factual findings and that the ALJ's analysis amounts to imposing strict liability. We conclude below that the evidence in the record as a whole amply supports the ALJ's conclusions that conditions at the facility presented immediate jeopardy to its residents justifying the CMP of $7,500 per day (which he reduced from $10,000 per day initially imposed by CMS).

Royal Manor also argues that the ALJ had denied it a full opportunity to present its case as a result of various alleged procedural errors. We conclude below that the ALJ acted within his discretion in the challenged rulings, especially viewed in light of Royal Manor's repeated failure to comply with his orders. Further, the outcome in this matter would not have been altered even had Royal Manor prevailed in its procedural and evidentiary motions. Royal Manor failed to make any proffer of evidence relating to witness testimony not permitted by the ALJ that would have contradicted factual findings necessary to the outcome.

Thus, and for the reasons explained more fully below, we find no merit to Royal Manor's contentions. Therefore, we uphold the ALJ Decision in its entirety.

BACKGROUND

Royal Manor is a skilled nursing facility (SNF) in Kentucky that participates in the Medicare program. A complaint survey of the facility conducted on May 13 and 14, 2002, resulted in noncompliance findings, one of which was at the level of immediate jeopardy. The allegations underlying this finding under Tag F 309 related to events surrounding the death of an elderly woman, referred to here as Resident 1, on May 6, 2002. Based on its acceptance of the finding that the facility staff's response to Resident 1's situation evidenced a condition in the facility that posed an immediate jeopardy to the health and safety of its residents, CMS imposed a CMP of $10,000 per day (the maximum permissible amount). The CMP ran from May 14, 2002, the last day of the survey, through May 16, 2002, at which point CMS concluded that the immediate jeopardy condition had been corrected.

Royal Manor sought informal dispute resolution (IDR) which was held before a State panel that reviewed the survey findings. As a result of the IDR proceedings, the State agency removed one deficiency finding (under Tag F 225) and reduced the level of severity of the Tag F 309 deficiency below immediate jeopardy. CMS accepted the State's removal of the Tag F 225 deficiency finding but rejected the change to the severity level of the Tag F 309, reinstating for federal purposes the immediate jeopardy finding.

Royal Manor requested a federal ALJ hearing on July 12, 2002, which was ultimately held, after several delays for reasons discussed below, on January 14, 2004. The ALJ issued the decision appealed here on May 28, 2004.

The ALJ made two numbered Findings of Fact and Conclusions of Law (FFCLs) which are set out below:

1. Petitioner manifested an immediate jeopardy level failure to comply with the requirements of 42 C.F.R. § 483.25 during the period that ran from May 14 - May 16, 2002.

2. Civil money penalties of $10,000 per day for each day of the May 14 - 16, 2002 period are not reasonable. Civil money penalties of $7,500 per day for each day of the period are reasonable.

Royal Manor's notice of appeal does not identify by number the FFCLs to which it excepts but the context of its briefing made clear that Royal Manor excepts to both FFCLs.

APPLICABLE LEGAL AUTHORITY

SNFs participating in the Medicare program are subject to survey and enforcement procedures set out in 42 C.F.R. Part 488, Subpart E, to determine if they are in substantial compliance with applicable program requirements which appear at 42 C.F.R. Part 483, Subpart B. "Substantial compliance" means a level of compliance such that "any identified deficiencies pose no greater risk to resident health or safety than the potential for causing minimal harm." 42 C.F.R. § 488.301. "Noncompliance," in turn, is defined as "any deficiency that causes a facility to not be in substantial compliance." 42 C.F.R. § 488.301.

Deficiencies are evaluated on a scale that considers scope (whether the deficiency is isolated, pattern, or widespread) and severity (how great a harm, or potential for harm, is presented by the deficiency). 42 C.F.R. § 488.404. Deficiencies which pose "immediate jeopardy" are the most severe. "Immediate jeopardy" is defined as "a situation in which the provider's noncompliance with one or more requirements of participation has caused, or is likely to cause, serious injury, harm, impairment or death to a resident." 42 C.F.R. § 488.301.

A per day CMP must be in the range of $3,050-$10,000 per day for one or more deficiencies that constitute "immediate jeopardy" and $50-$3,000 for one or more non-immediate jeopardy deficiencies. 42 C.F.R. § 488.438(b). A facility has a right to appeal a finding of noncompliance that results in imposition of specific remedies, including CMPs. 42 C.F.R. § 498.3(b)(13). A facility may appeal the level of noncompliance found by CMS (1) if a successful challenge would affect the range of CMP amounts that CMS could collect (where CMS imposes a per day CMP) or (2) if a finding of substandard quality of care results in the loss of approval of the facility's nurse aide training program. 42 C.F.R. § 498.3(b)(14). Review by an ALJ of the amount of a CMP is limited, however. An ALJ may consider only whether the amount of the CMP is reasonable based on the factors specified in 42 C.F.R. § 488.438(f). 42 C.F.R. § 488.438(e)(3); Capitol Hill Community Rehabilitation and Specialty Care Center, DAB No. 1629 (1997). A finding by CMS that a facility's noncompliance has placed residents in immediate jeopardy "must be upheld unless it is clearly erroneous." 42 C.F.R. § 498.60(c)(2); Woodstock Care Center, DAB No. 1726, at 9, 38 (2000), aff'd, Woodstock Care Center v. Thompson, 363 F.3d 583 (6th Cir. 2003).

The regulatory requirements for long-term care facilities that participate in Medicare or Medicaid are set forth at 42 C.F.R. Part 483. The regulation under which immediate jeopardy was found to exist provides that "[e]ach resident must receive and the facility must provide the necessary care and services to attain or maintain the highest practicable physical, mental, and psychosocial well-being, in accordance with the comprehensive assessment and plan of care." 42 C.F.R. § 483.25. The Board has, in past decisions, upheld ALJ decisions that imposed remedies under this section where the care provided did not meet "professional standards of quality," since the regulations elsewhere require that the services provided or arranged by the facility must meet such standards. Spring Meadows Health Care Center, DAB No. 1966 (2005)(citing 42 C.F.R. §§ 483.25, 483.75).

STANDARD OF REVIEW

Our standard of review on a disputed finding of fact is whether the ALJ Decision is supported by substantial evidence on the record as a whole. Our standard of review on a disputed conclusion of law is whether the ALJ Decision is erroneous. Guidelines for Appellate Review of Decisions of Administrative Law Judges Affecting a Provider's Participation in the Medicare and Medicaid Programs; see also Lake Cook Terrace Nursing Center, DAB No. 1745 (2000); 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). When the Board finds a procedural error, the Board will reverse or remand only if the procedural error was prejudicial. Spring Meadows Health Care Center, DAB No. 1966 (2005).

ANALYSIS
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1. Substantial evidence supports the ALJ's findings.

A. Factual overview

The undisputed facts before us on appeal relating to the events at issue include the following: (1) Resident 1 was an 89-year old woman with multiple diagnoses, among them dysphagia (swallowing difficulties), with a medical history of aspiration pneumonias. ALJ Decision at 4; CMS Ex. 3, at 6. The resident's bed was elevated at a 45 degree angle as one of the measures taken to reduce the risk of aspiration. On the evening of May 6, 2002, her roommate noticed that something was wrong and called for assistance. Staff members, including certified nursing assistants (CNAs) Roy Burnett and Vivian Thomas, responded. The charge nurse, licensed practical nurse (LPN) Jean Couch, was summoned. LPN Donna Edwards, who was in charge of Resident 1's care that night, decided Resident 1 had aspirated and called a "code." LPN Denise VanBerge left to place a call for emergency services. Altogether, five nursing staff members were present in Resident 1's room at some point during the course of the episode. Resident 1 was determined to be "full code," that is, that she should be resuscitated if possible. An Ambu-bag device was used on her in an attempt to perform artificial respirations. Chest compressions were initiated as part of a CPR response but were then stopped.

A 911 call was placed from the facility, and the emergency service records show that the caller reported that Resident 1 was choking on vomit. CMS Ex. 25, at 5. Paramedics responded within minutes. The paramedic on the scene recorded that he found Resident 1 "supine in bed, airway open, no breathing." P. Ex. 2, at 2. He determined not to begin CPR based on what he saw and the information he was given. A large amount of dark material described as coffee-ground emesis was on the bed beside Resident 1.

The facility performed an investigation of the circumstances of Resident 1's death and took statements from the staff members involved. The investigation resulted in discipline of several employees and reports to nursing regulatory authorities.

Apart from these undisputed facts, the parties diverge sharply as to exactly what happened on May 6, 2002, and as to what significance and interpretation should be placed on the various accounts. We discuss these disputes and the ALJ's resolution of them below. In so doing, we defer to the ALJ's assessments of credibility, and we do not reweigh the evidence de novo, but rather ask whether the ALJ's findings are based on substantial evidence in the record as a whole. The ALJ found that evidence that CMS presented as to which he found that Royal Manor offered no meaningful rebuttal established at a minimum that Royal Manor's staff's "efforts at resuscitation were performed incompetently" and that this evidence "forms the critical mass of CMS's case." ALJ Decision at 10.

We conclude that the ALJ's findings were supported by substantial evidence in the record. We also agree with the ALJ that the "critical mass" of the case against Royal Manor was not meaningfully rebutted. Furthermore, as will become clear in our discussion below, even on the undisputed facts set out above and the evidence submitted by Royal Manor itself, the care provided to Resident 1 fell below professionally recognized standards of care in many respects. Given these conclusions on propositions uncontested in the record, even were we to accept all of Royal Manor's evidentiary and procedural challenges (which we do not), the outcome of this case would be unaltered.

B. Failure to meet professional standards of care

Unrebutted professional nursing standards in evidence establish that health care providers dealing with a patient in respiratory distress are to assess need, call 911, and begin the sequence of CPR resuscitation quickly when confronted with a patient with absent or inadequate breathing. CMS Ex. 26, at 8. Yet, substantial evidence in the record supported the ALJ's finding that the staff delayed beginning CPR on Resident 1 while trying to ascertain the resident's "code status," i.e., whether or not a "do not resuscitate" order existed for her. ALJ Decision at 10. (2)

Unrebutted professional nursing standards in evidence establish that a nurse who begins to administer CPR is not permitted to abandon the effort unless physically unable to continue or instructed by a physician to discontinue further efforts. CMS Ex. 22, at 19. Yet, the licensed practical nurse, Ms. Couch, began CPR and quickly gave the effort up as futile. CMS Ex. 6, at 3, 10, 17. Although Royal Manor made perfunctory denials before the ALJ that CMS had proven that CPR was initiated and abandoned, this fact is evident in the facility's own exhibits. ALJ Decision at 9-10; P. Exs. 1, at 1, and 16, at 20. Royal Manor does not reiterate the denials on appeal to us, explicitly admitting in its brief that an Ambu-bag was used to attempt artificial respiration and that chest compressions were performed. Royal Manor Br. at 3.

It was not disputed that professionally recognized standards also require that a patient receiving CPR be positioned flat on a hard surface. (3) CMS Exs. 22, at 17-18; 23, at 13; and 26, at 6. Royal Manor did not proffer any testimony that Resident 1 was placed in such a position before CPR was attempted. On the contrary, a CNA, Vivian Thomas, specifically stated that a CPR backboard remained unused on the floor and her bed remained upright. CMS Exs. 22 and 23.

When the paramedic arrived shortly after, Ms. Couch told him that the resident had been found lifeless after an unknown length of time and failed to inform him that any CPR had been initiated. Tr. at 85-86; CMS Ex. 25, at 2. In reliance on this inaccurate report, the paramedic did not attempt any resuscitation, eliminating any residual chance of saving the resident's life. Tr. at 90. Royal Manor does not identify any standard of care or facility policy that could support giving inaccurate information to an emergency medical technician in a life-threatening emergency of this kind.

Incompetence would be a charitable description of this collective picture of the conduct of Royal Manor's staff faced with a patient in terminal distress. In fact, the evaluation of its staff's performance by the facility investigators was even more critical. Jason Faith, R.N., the Regional Director for the facility's parent group concluded as follows: "In my professional opinion, the actions of the three nursing personnel constituted poor nursing judgment and inappropriate nursing practice based upon generally accepted standards of care and facility policy." Faith Affidavit at 1. The facility administrator made the identical statement in his affidavit. Boso Affidavit at 1. The director of nursing, Robin Ferraro, told surveyors that the nurses failed to comply with nursing practice standards by delaying initiation of CPR, by failing to clear the resident's airway before attempting artificial respiration, and by abandoning the CPR efforts once begun. CMS Ex. 22, at ¶16; CMS Ex. 23, at ¶ 13. Dr. Craig Enlow, Resident 1's treating physician as well as the facility's medical director, described the nurses' failure to suction Resident 1 as "stupid." CMS Ex. 22, at ¶15. (4)

Both Dr. Enlow and Mr. Faith opined that the poor nursing practices nevertheless did not cause or contribute to the death of Resident 1. Faith Affidavit at 1; Enlow Affidavit at 2. These opinions, however, even if completely accurate, do not detract from the seriousness of the episode in highlighting conditions for residents of the facility. The incompetent managing of Resident 1's crisis might not have altered the outcome for that resident, in the sense that it might not have been possible to save her - although no one can be certain of that. Regardless, the demonstrated incompetence of the facility's response in this case exposed any resident who might be in need of life-saving intervention in a similar emergency to the likelihood of facing such mishandling. Therein lies the immediate jeopardy.

C. Additional arguments by Royal Manor

We have considered all additional contentions that Royal Manor raises to respond to this disturbing picture and found them to be similarly irrelevant to the outcome, focused on peripheral details, and/or lacking in evidentiary support.

For example, the parties disputed whether Resident 1 needed to have her airway suctioned to clear it before artificial respiration was attempted; and, if so, why suctioning was not performed. Dr. Enlow assigned the resident's cause of death as aspiration secondary to her Parkinson's disease, which would be consistent with the account presented by CMS that her airway should have been cleared before CPR. Dr. Enlow later stated that, in so doing, he relied on information from the nurses. Enlow Affidavit at 1. Dr. Enlow never retracted his conclusion on the cause of death, so it is not clear whether his comment that he relied on the nurses' reports was meant to imply that he now believes that they misled him into believing that aspiration due to vomiting had occurred. If so, such further evidence of the unreliability of its staff's reports to medical professionals would hardly be exonerating. Dr. Enlow also suggested in the affidavit that the emesis that came up during CPR was the result of the mechanical pressure of chest compression and not an indicator of active vomiting. Assuming that to be true, the suggestion does not explain the 911 call report that the resident was vomiting, which would have been before CPR was begun. It is possible to read Dr. Enlow's statements together in a manner that is internally consistent as portraying a resident who had vomited and aspirated, but who was no longer actively vomiting by the time chest compressions were begun. This is in accord with other statements made by Dr. Enlow to the effect that suctioning would have been futile because the Resident 1 could not have been resuscitated. (5) Dr. Enlow's retrospective opinion about the need for suctioning, however valid, does not change the fact that staff present at the time thought that the observations they made called for suctioning and tried unsuccessfully to obtain the equipment to provide it. For this same reason, we agree with the ALJ that it was not necessary to determine whether Resident 1 actually would have benefitted from suctioning or not. It is enough that her situation was clearly urgent, and that at least some of the staff present indisputably sought suctioning equipment but were unsuccessful in obtaining a functional machine, to establish the likelihood of serious harm to any resident who might in fact require suctioning.

Royal Manor also insists that the ALJ was obligated to resolve whether the problem with the suction machine resulted from the facility's failure to maintain the equipment or its failure to train its staff to use it. Royal Manor Br. at 14. LPN VanBerge brought the crash cart to Resident 1's room. The surveyors reported that suctioning was not begun because LPN VanBerge told the others that some of the necessary tubing was missing. CMS Exs. 22, at ¶¶8-11, and 23, at ¶¶8-10. We agree with the ALJ that it does not alter the analysis whether the tubing for the suction machine was unavailable because it was not there or because the staff members involved did not know how to find or use it. ALJ Decision at 8. The fact that staff members could not assemble and operate the suctioning equipment when they tried suffices to demonstrate that any resident in need of emergency suctioning was likely at risk. Id. The inability to promptly obtain operable equipment when sought in an emergency exposes the danger to the next resident whose life might indeed depend on prompt suctioning.

Royal Manor also argues that its quality assistance program records document checks of the crash cart suction machines on May 1 and May 7, 2002, finding them in working order with all parts present. Royal Manor Br. at 14; P. Exs. 6 and 7. Even assuming this to be true, it does not establish that the cart was fully stocked on May 6, 2002, or that the staff present were able to use it. A registered nurse at the facility at the time of the survey, Beverly Switzer, told the surveyors that she was not instructed in the use of the suction machine nor aware of the location of the tubing until an in-servicing provided after the incident in question, and confirmed this at the hearing. CMS Ex. 22, at 19; Tr. at 168. This unrebutted evidence suggests that, even if the cart had been properly stocked, facility staff would not necessarily have known where the tubing was kept on the crash cart or how to use the machine if needed.

Royal Manor also cites the report of the emergency medical technician (EMT) who responded to the scene, Jerry P. Domidion, to show that Resident 1 did not need suctioning. Royal Manor Br. at 3. Mr. Domidion wrote that Resident 1's airway was open or "patent," when he examined her. P. Ex. 2, at 1. Royal Manor notes that Mr. Domidion did not then provide any services to Resident 1. Royal Manor Br. at 3. The fact that Mr. Domidion did not find the resident's airway blocked when he arrived lacks significance, however, in light of the statements of staff members, credited by the ALJ, that the resident had been turned after the CPR attempt and quantities of material had then fallen out of her mouth. CMS Exs. 22, at ¶11, and 23, at ¶10. The effect of this may have been to belatedly clear the blockage, at least as far as the paramedic could see, from her mouth. Therefore, the EMT's finding is consistent with the account of events accepted by the ALJ.

The EMT averred that he did not provide any services because he relied on information given to him by facility staff about the course of the resident's treatment before his arrival, stating that the resident was found dead after an unknown period of time and that no CPR had been attempted. CMS Ex. 25, at 2-3. Royal Manor discounts this statement on the grounds that Mr. Domidion did not "identify any person as giving him false or misleading information" and did not "indicate that his EMS report was incorrect." Royal Manor Br. at 3-4. It is not clear why Mr. Domidion would have indicated that his report was in error, since it accurately recorded what he saw, did, and was told. As for who provided him with the information about CPR not being provided, Mr. Domidion testified that he assumed them to be nurses who were standing at the scene, although he does not "ask for their certification." Tr. at 85-86. It was the responsibility of the facility staff to provide accurate information to the emergency rescue personnel. The facility staff present, both nurses and supporting personnel, failed to do so. This failure is not ameliorated by pointing to the EMT's failure to verify the name or professional rank of his informants. Royal Manor proffered no testimony that any of its staff claimed (during the facility investigation, the survey, or the hearing) to have actually told the EMT the truth about the abortive CPR attempt.

Where faced with conflicting evidence, the ALJ's role as the finder of fact was to determine which testimony he believed, what weight to give the various items of evidence, and which permissible inferences to draw. We find reasonable the ALJ's evaluation of which evidence to believe or what inferences to draw therefrom. We will therefore not disturb his resolution of the disputed points about the events involving Resident 1's death.

Royal Manor also seeks to defend against the allegations of its mishandling of Resident 1's medical crisis by arguing that it was not responsible for the professional judgment (or presumably lack thereof) exercised by licensed staff within the scope of their practice. Royal Manor Br. at 20. Royal Manor attacks the ALJ's contrary conclusion as amounting to the imposition of strict liability on the facility when it had no "authority to override" the actions of the nursing personnel which violated facility policies or procedures. (6) Id. This argument is unpersuasive. The facility acts through its staff, and is correspondingly responsible for their actions as employees. As the Board explained in a prior case, when a nurse acts within the scope of her employment, the "employer cannot disown the consequences of the inadequacy of the care provided by the simple expedient of pointing the finger at her fault, since she was the agent of her employer empowered to make and carry out daily care decisions." Emerald Oaks, DAB No. 1800, at 7, n.3 (2001). It is the facility that executes a provider agreement and undertakes to provide services of the quality mandated by the participation requirements. If the professional staff hired by the facility is, as proved to be the case here, not adequately skilled, trained, or equipped to provide those services, the facility must answer for, and correct, that failure through the survey and certification process, no matter what other disciplinary actions may also appropriately be taken (as they were here) against the individual staff members.

We conclude that the ALJ's finding that Royal Manor manifested an immediate jeopardy level failure to comply with the cited requirements is amply supported by evidence in the record as a whole, even after considering all conflicting evidence to which Royal Manor pointed on appeal. We therefore sustain FFCL 1.

2. Royal Manor's procedural arguments are without merit.

A. Summary of Royal Manor's procedural objections

Royal Manor argues that it was denied its due process right to "an opportunity to be heard at a meaningful time and in a meaningful manner," as a result of a number of the ALJ's evidentiary and procedural rulings. Royal Manor Br. at 14, citing Mathews v. Eldridge, 424 U.S. 319, 333 (1976). Royal Manor's first objection in this regard is that the ALJ erred in failing to grant it a continuance of the hearing in light of Royal Manor's "inability to serve subpoenas." Id. Royal Manor pointed to the lapse of four months between its request for the subpoenas and their ultimate issuance a week before the final hearing dates. Royal Manor asserts that the short time frame did not suffice to have the sheriff's offices serve the subpoenas on out-of-town witnesses. Royal Manor's next objection is that the ALJ refused Royal Manor's request for subpoenas for two witnesses, Kathleen Kindred and Ora Mae Roark, who were members of the Informal Dispute Resolution (IDR) Panel. Royal Manor also objects to the ALJ's determinations to limit testimony by two witnesses who appeared at the hearing, not to permit Royal Manor to offer additional direct evidence in the form of a "rebuttal" case, and to exclude a post-hearing affidavit from LPN Couch proffered by Royal Manor.

The deficiency finding in this case arose largely from interviews conducted by the surveyors with facility staff who were present during the events at issue, memorialized in signed statements. The surveyors were not present to make firsthand observations of the actual course of events and the value of a record review was limited for most of the disputed points. Obviously in such instances, evaluating the reliability of information the interviews provided and a fair opportunity for the petitioner to challenge adverse information are important. We therefore take seriously the concerns expressed by Royal Manor about whether its opportunity to confront the interviewees as witnesses at the hearing was unfairly curtailed by the ALJ's actions. We review carefully the requests made by Royal Manor before, during, and after the hearing; the context and content of the ALJ's specific determination; Royal Manor's conduct in response to the ALJ's orders and rulings; and the merits of the contested actions. For the reasons we explain below, we find all of the determinations, rulings and actions taken by the ALJ were within his discretion and did not constitute prejudicial error. We also note that, collectively, the adverse rulings did not affect the substantive outcome of the case because the existence of non-compliance at the immediate jeopardy level was sufficiently established, as discussed above, on the undisputed facts and the evidence presented by Royal Manor and nothing Royal Manor unsuccessfully sought to present was shown to undercut any of those factual findings or evidence.

B. Pre-hearing context of procedural disputes

Evaluating the ALJ's decisions on the procedural matters about which Royal Manor complains requires first recognizing the context of those decisions. We therefore review the events in the development of the case before the ALJ. Most importantly, the record makes clear that the ALJ considered Royal Manor to have repeatedly and intentionally failed to comply with requirements set out in his prehearing order. Hence, we must consider whether the ALJ acted within his discretion and authority, including the authority to sanction a party that is noncompliant with such orders. The ALJ did not specify in each instance whether his rulings were specifically meant as a sanction, but, in the context of the multiple opportunities he offered to Royal Manor to address his underlying concerns, we consider all of the rulings to be clearly reasonable exercises of his authority to manage orderly proceedings as well.

The ALJ issued an Initial Prehearing Order on August 6, 2002, (Order) instructing the parties on "what they must do in order to prepare for, and conduct, the evidentiary hearing." Order at 1. Both parties were required to exchange and file with the ALJ a list of proposed exhibits (explicitly including in "exhibits" the "written direct testimony of each proposed witness") along with copies of those exhibits, a witness list and copies of any prior written statements by those witnesses, and a pre-hearing brief. Id. at 1-2. Royal Manor's submission was due by January 3, 2003 (one month after CMS's submission). Id. The Order further specified that a "party must exchange as a proposed exhibit the complete written direct testimony of any proposed witness," which would generally serve "as a statement in lieu of in-person testimony." Id. at 2. The order warned that neither party could supplement this pre-hearing exchange as of right and that any motion to amend would require a showing of good cause and absence of prejudice to the opposing party. Id. In addition, the Order informed the parties that they could request subpoenas on or after their pre-hearing exchange date and that, while the ALJ would try to give one month's notice of a hearing date, the parties should be aware that the notice might be as little as ten days. Finally, the ALJ made clear that he might "impose sanctions pursuant to section 1128A(c)(4) of the Social Security Act (Act) for a party's failure to comply with any order including this order." (7) Id. at 4.

CMS's pre-hearing exchange included declarations from four witnesses. Royal Manor submitted affidavits for three witnesses - Jason Faith, R.N. (Royal Manor Regional Director); Bill Boso (facility administrator); and Craig Enlow, M.D. (facility medical director). Both parties submitted witness lists that referred to "reserving the right to request subpoenas" for the same nine individuals, most of whom were directly involved in or witnessed the events at issue: Donna Edwards, L.P.N.; Denise VanBerge, L.P.N.; Jean Couch, L.P.N.; Beverly Switzer, R.N.; Anna Wainscott, L.P.N.; Robin Ferraro, R.N.; Roy Burnett, C.N.A.; Vivian Thomas, C.N.A.; and Judy Cross, laundry worker. (8)

The ALJ first scheduled a hearing for August 5, 2003. Letter from Tina L. Wesson (paralegal writing for the ALJ), dated February 3, 2002. Royal Manor requested that the hearing be rescheduled for sometime after September 15, 2003 due to personal health issues of one of its attorneys. Request to Continue and Reschedule Hearing, dated April 29, 2003. The hearing was then rescheduled for October 8, 2003. Letter from Kevin Detherage (staff attorney writing for the ALJ), dated May 7, 2003.

Royal Manor again sought to reschedule the hearing, based on the pendency of a state action against the facility. Request to Continue and Reschedule Hearing, dated September 23, 2003. (9) Royal Manor also filed a request dated September 25, 2003, for nine subpoenas to compel testimony at the October 8, 2003, hearing. The subpoenas were for six of the nine individuals mentioned above - Ms. VanBerge, Ms. Couch, Ms. Switzer, Ms. Wainscott, Ms. Edwards, and Mr. Burnett - as well as two IDR Panel members and an administrator of another nursing home. CMS opposed the second request for rescheduling.

The ALJ held a pre-hearing conference on October 2, 2003, to resolve this dispute and rescheduled the hearing again to January 13, 2004. Pre-Hearing Conference Order at 1 (October 3, 2003). The order noted that specific information on the details of the hearing arrangements would be provided at a later date. Id. On December 16, 2003, Kevin Detherage sent an e-mail to counsel for Royal Manor asking the status of the matter, and stating that absent contrary information, the ALJ would assume the hearing would go forward as scheduled. No response appears in the record. By letter dated December 22, 2003, Mr. Detherage advised counsel that the ALJ would conduct a pre-hearing telephone conference on January 5, 2004. On January 6, 2004, the day after the telephone conference, the ALJ granted Royal Manor's request for subpoenas for the six named individuals (without mentioning the other three requested subpoenas) and set a specific location for the hearing in a courthouse in Lexington, Kentucky. Each of the subpoenas commanded the witness's appearance at that courthouse at 9 AM on January 13, 2004.

Royal Manor again sought to reschedule the hearing, on the grounds that it had not had sufficient time to serve the subpoenas issued and that the ALJ should have issued the subpoenas for the State officials. Request to Continue and Reschedule Hearing, dated January 12, 2004. The ALJ stated, in a ruling issued January 12, 2004, denying the request, that Royal Manor had failed to explain its inability to serve the subpoenas between their issuances on January 6, 2004, and the hearing date. ALJ Ruling at 1. The ALJ stated that Royal Manor failed to provide any "particularized explanation of the efforts that were made to locate" and serve each subpoenaed witness. Id. In particular, the ALJ expressed skepticism that none of the subpoenas could be served, "absent some explicit proof of why that would be so." Id. In conclusion, the ALJ declined to postpone the hearing again, but offered that he might keep the record open to take testimony of witnesses at a later date "if counsel is able to satisfy me at the hearing that she has been diligent in attempting to serve the subpoenaed witnesses and has been unable to do so." Id. at 2. He also left open the possibility of subpoenaing the State IDR Panel members "if counsel persuades me that . . . [they] have direct knowledge of substantive events . . . ." Id. (No further mention was made of the remaining subpoena addressed to the administrator of another facility.)

C. ALJ rulings on witnesses at the hearing

At the start of the hearing, the ALJ again explained the basis for his requirement that direct testimony be provided in writing in advance of the hearing, but noted that counsel for Royal Manor asserted at the prehearing conference that the witnesses for which no direct testimony was provided were "hostile and unwilling to provide their direct testimony." Tr. at 24. Counsel for Royal Manor stated that three of those witnesses were in fact present at the hearing: Beverly Switzer, Roy Burnett, and Donna Edwards.

The ALJ initially stated that, before any such witnesses would be allowed to testify, the ALJ would inquire when the witness was first contacted by counsel by way of determining whether Royal Manor had in fact attempted to obtain written direct testimony pursuant to the pre-hearing orders. Id. The ALJ warned that any witnesses whose testimony indicated that they were not contacted prior to service of a subpoena or that no opportunity was provided to them to prepare written direct testimony might be excluded. Tr. at 25. Counsel for Royal Manor argued that handwritten statements gathered from these witnesses during the facility investigation and exchanged with CMS prior to the hearing should suffice in place of written direct testimony. Tr. at 25-26. The ALJ accepted these prior statements as sufficient to meet his concerns about providing direct testimony to the opposing party in advance and ruled that Royal Manor could then present those witnesses. Their direct testimony at the hearing would be limited to determining whether they adopted their prior written statements as true, in which case those statements would be accepted as their direct testimony. Tr. at 26, 144-46. He also indicated that he would also accept later signed declarations from other subpoenaed witnesses adopting their prior handwritten statements as their written direct testimony, if Royal Manor obtained them after the hearing, permitting CMS to cross-examine them by telephone upon request. Tr. at 34. Ultimately, CMS waived cross-examination of the witnesses who were present and those whose handwritten statements were thereafter treated as their direct testimony, as well as of the three witnesses for which Royal Manor had presented formal written direct testimony. Tr. at 148.

In addition to accepting the prior statements as direct testimony, the ALJ afforded counsel for Royal Manor multiple opportunities to demonstrate that diligent efforts were indeed made to locate and/or serve the witnesses Royal Manor sought to subpoena, either before or after the subpoenas for the actual hearing date were issued. Tr. at 33-34. The ALJ expressly found that use of sheriffs' offices to serve the subpoenas was not required and was an inadequate explanation for not serving a subpoena within six days on witnesses who were within, at most, a three-hour drive. Tr. at 34. Further, the ALJ noted that, even were the subpoenas served, he would exclude the witnesses if no written statements from them appeared in the record, in light of Royal Manor's failure to justify its noncompliance with the requirement for written direct testimony. Id.

Besides the three subpoenaed witnesses who appeared for Royal Manor (Switzer, Burnett, and Edwards), counsel for Royal Manor announced at the beginning of the hearing that it might present a witness named Marketa Pointer Hazlett, who did not appear on any witness list and for whom no prior statement had been provided. Counsel asserted that he reserved the right to call this witness in "rebuttal." Tr. at 21.

In regard to the two members of the IDR panel for whom Royal Manor had sought subpoenas, CMS had both individuals available at the hearing. The ALJ permitted Royal Manor's counsel to make a showing, after cross-examining the surveyor, that the IDR witnesses' testimony would be relevant to assessing the credibility of the surveyor, as Royal Manor contended. Tr. at 78-81. After hearing argument, the ALJ ruled that the IDR witnesses' testimony would be irrelevant as a matter of law because the federal hearing was a de novo review of what occurred at the facility and not an appellate review of what happened at the IDR panel hearing. Tr. at 81; see also Tr. at 137. He found that Royal Manor had made no showing that either witness could present relevant testimony going to either the events at issue or the credibility of the surveyor in the present proceeding. On that basis, he excused both witnesses. Tr. at 81.

At the close of CMS's case, the ALJ permitted Royal Manor to make an opening statement for its case. Tr. at 129. When CMS then announced that it waived cross-examination of all of Royal Manor's witnesses, the ALJ prepared to close the hearing. Counsel for Royal Manor objected that it had two additional witnesses present whose testimony it still wished to present: Beverly Switzer and Donna Edwards. Tr. at 148-49. As to Donna Edwards, counsel represented that she "was not an employee at the time that we in fact did the pre-filing" and that counsel believed that she would "testify significantly differently than what the surveyor has said in her statement" about what Ms. Edwards stated during her interview. Tr. at 149. As to Beverly Switzer, Royal Manor contended that she was an adverse witness for whom no written direct testimony was prepared because she was being offered solely to rebut statements of the surveyor. Id. Counsel requested to call each "as if they were under cross examination." Id.

The ALJ excluded any testimony from Donna Edwards after learning that counsel had failed to speak to her or seek her cooperation prior to the hearing despite the fact that she had been rehired by Royal Manor four months before the hearing. Tr. at 153-54. Despite Royal Manor's failure to show any specific efforts to obtain a prior voluntary statement from Ms. Switzer, the ALJ permitted her to testify as to comments attributed to her in the surveyor notes, which Royal Manor had indicated she would disown. Tr. at 154-172. As it turned out, however, her testimony did not undercut anything reported about her interview by the surveyor. Compare id. with CMS Exs. 22, at ¶8, and 23, at ¶8.

Counsel for Royal Manor then asserted that she was unable to serve two subpoenas - for Ms. Couch and Ms. VanBerge - and still wished to pursue their testimony. The ALJ agreed to hold the hearing open for two weeks to allow further attempts to contact Ms. Couch and Ms. VanBerge and to arrange for their testimony to be taken if Royal Manor made an offer of proof that either one had relevant testimony to offer. Tr. at 174-75.

Finally, counsel for Royal Manor noted an objection that while "CMS certainly doesn't have to cross examine any witnesses, we were prepared to introduce significant rebuttal testimony." Tr. at 175-76. The ALJ inquired into what evidence Royal Manor had reserved to present in "rebuttal" rather than as part of its own direct case. Since, as counsel acknowledged, CMS was not obliged to cross-examine Royal Manor's witnesses, and potentially open the door to a need for re-direct or rebuttal to new material raised in cross-examination, the ALJ also inquired whether the proposed rebuttal addressed any new material raised as a result of Royal Manor's cross-examination of CMS witnesses. After these inquiries, the ALJ found that none of the proposed "rebuttal" witnesses were presented in response to any matter raised at the hearing that was not set out in CMS's written direct testimony. Tr. at 176-80.

Royal Manor was not able to contact Ms. VanBerge but did submit a statement from Ms. Couch on January 27, 2004, pursuant to the ALJ's ruling holding the hearing open for that purpose. Royal Manor Br., Att. 9. On February 24, 2004, the ALJ issued a ruling closing the record and excluding the proffered statement from Ms. Couch. The ALJ concluded that Royal Manor had failed to show good cause for not providing her written testimony in a timely manner. He noted that Ms. Couch's statement indicated that she left Royal Manor's employ only a month before the deadline to exchange written direct testimony (and four weeks after the ALJ's prehearing order was issued). The ALJ found Royal Manor's assertion that its counsel tried to contact Ms. Couch at home and was told by "some unnamed individual" that she would not speak with counsel inadequate, absent more detail, to establish that counsel diligently sought her voluntary, timely cooperation and was refused.

D. ALJ evidentiary rulings within scope of his discretion and authority, especially in the face of Royal Manor's repeated failure to comply with orders

We have reviewed in some detail above the procedural history of this matter before the ALJ and the background of his evidentiary rulings in order to clarify the context for the due process challenges raised on appeal. This history elucidates several critical overarching points:

(1) Royal Manor plainly did not comply with the pre-hearing orders to present direct testimony in written form prior to the in-person hearing date;

(2) Royal Manor was warned within the Initial Pre-hearing Order itself that it might be subject to sanctions for non-compliance with ALJ orders;

(3) despite repeated requests from the ALJ to do so, Royal Manor declined to make any particularized showing that it attempted to produce written direct testimony from its witnesses but could not obtain voluntary cooperation; and

(4) the ALJ was skeptical about Royal Manor's efforts and concerned that Royal Manor was attempting a tactical end-run around his orders under the guise of reserving its substantive testimony as rebuttal, but nevertheless provided multiple opportunities for Royal Manor to lay a foundation to produce witness testimony.

Given this context, the ALJ had discretion to take reasonable steps to conduct an orderly hearing and authority to sanction noncompliance with his orders. Section 1128(c)(A)(4); 42 C.F.R. § 498.60(b)(3). With this in mind, we turn to Royal Manor's specific procedural fairness complaints.

First, Royal Manor argues that the ALJ denied it due process by failing to grant a further continuance of the hearing because of Royal Manor's inability to serve the subpoenas. Royal Manor Br. at 14. Royal Manor points out that its subpoenas were initially requested in September 2003 but not issued until four months later, a week before the actual hearing. Id. at 15. Hence, Royal Manor contends that the ALJ unfairly compromised its ability to make its presentation at the hearing. This argument is without merit for several reasons. First, there was nothing improper about the timing of the subpoena issuance. Second, Royal Manor showed no prejudice from the denial of the additional continuance. Third, the ALJ held the hearing open to permit additional testimony if Royal Manor was able to serve additional subpoenas with more time and then made an appropriate showing.

As far as the timing of the release of the subpoenas, Royal Manor offers no basis to consider a week before the hearing date an unreasonable time frame on its face for the service of subpoenas. (10) The hearing regulations provide that a party may request subpoenas up to five days before the date set for the hearing. 42 C.F.R. § 498.58(b). The regulations do not specify how long after a request the ALJ may issue subpoenas, but implicit in the cited section is the expectation that something less than five days is at least minimally adequate for service of subpoenas. Royal Manor itself originally requested subpoenas on September 25 for an October 8th hearing. Apparently, Royal Manor believed that it could serve subpoenas in a short time frame since it could hardly assume that it would receive the subpoenas on the day it dated and mailed its request. Furthermore, contrary to Royal Manor's implication that subpoenas could or should have been issued at any time between that initial request and the actual hearing date, we recognize that, as a practical matter, subpoenas for attendance at a hearing can only be issued when a specific time and place for the hearing has been settled. Therefore, no subpoena could be issued until the rescheduled hearing date was set and the availability of a hearing facility was confirmed. (11) Regulations require that the ALJ give 10 days notice of the time and place scheduled for the hearing, suggesting that the time frame in which the ALJ issued the subpoenas was reasonable. 42 C.F.R. § 498.52(a).

Even if the one-week turnaround were unreasonable, or at any rate, proved impossible to meet, Royal Manor has not shown any harm from the ALJ's unwillingness to grant it a third postponement of the hearing on short notice. Two of the witnesses for whom the ALJ issued subpoenas were in fact present at the hearing. As to those witnesses, and any other subpoenaed witnesses that might have appeared on a later date, Royal Manor still faced the obstacle of having failed to show any real effort to obtain pre-hearing, written direct testimony. Furthermore, the ALJ held open the hearing record to allow Royal Manor additional time to obtain testimony from the other two witnesses it sought to present. Royal Manor never located one and the testimony of the other was excluded on grounds that would have been just as applicable at the in-person hearing had she appeared there.

Moreover, the ALJ found that counsel failed to make a factual showing that service was not possible in the time allowed. Counsel for Royal Manor simply related that it relied on county sheriffs to serve the subpoenas and that the sheriff's offices were not able to do so in time. Royal Manor was not required to use this method and does not explain why service by other means was not feasible given that the individuals were not located more than 100 miles from counsel's offices. While Royal Manor contends that the ALJ improperly "chastised" counsel by inquiring into these matters, it does not appear unreasonable to expect Royal Manor to show that it made all feasible efforts to comply with the established time before considering a third request to continue the hearing. For example, Royal Manor does not show that its counsel could not have sent a staff member, used certified mail, employed a private process server, or even simply tried to call the individuals to inform them of the subpoena and seek voluntary compliance.

Royal Manor's next procedural objection was to the ALJ's denial of subpoenas for "two adverse witnesses who would have provided expert testimony in Petitioner's favor." Royal Manor Br. at 16. By this description, Royal Manor is referring to two members of the IDR Panel, Kathleen Kindred and Ora Mae Roark. Royal Manor's actual objection is moot since both witnesses in fact attended the hearing, so the denial of subpoenas for them had no effect.

To the extent that Royal Manor is challenging the ALJ's refusal to permit Royal Manor to call these witnesses as part of its presentation, we find no error. A party seeking a subpoena is required to specify the "pertinent facts" the witness is expected to establish and why those facts cannot be "established without the use of a subpoena." 42 C.F.R. § 498.58(c)(3). The ALJ repeatedly asked, both in adjudicating the subpoena request and again at the hearing, for Royal Manor to offer some indication of what relevant evidence it could hope to elicit from these witnesses. Counsel for Royal Manor proffered at the hearing that the surveyor's declarations submitted by CMS contained information that the surveyors obtained during the IDR process which resulted in changes to the statement of deficiencies and further that Royal Manor "would like to be able to discuss with the IDR panel members some of their decisions and things that they made as a result of that." Tr. at 36. Royal Manor's counsel made no proffer of any relevant expertise that the IDR Panel members might possess. The ALJ noted that what occurred at the IDR proceedings and the resulting decision were not relevant to his de novo findings about the events at Royal Manor, but nevertheless offered Royal Manor a further opportunity to make a showing of relevance after cross-examining a surveyor. Tr. at 37. After the surveyor's testimony, Royal Manor's counsel simply reiterated her position that the surveyor "expanded her testimony based on the IDR proceedings" and asked that "the panel members be able to give us some information as far as what happened in that proceeding, because it is pertinent to this situation" with no further specificity about its relevance. Tr. at 80. At that point, the ALJ reasonably ruled that whether or not the focus of the surveyors shifted (for example, from the failure to suction to the failure to perform CPR properly) after the IDR proceedings made no difference to the issue. Tr. at 80-81. The ALJ concluded that Royal Manor had ample notice before the hearing that CMS's allegations included both failure to suction and inadequate CPR and that CMS was not limited to specific findings set out in the statement of deficiencies. Id. We find no error in the ALJ's conclusion that Royal Manor did not show that the IDR Panel members had any relevant testimony to offer.

Royal Manor also objected to the ALJ's "refusal to allow Petitioner to test hearsay information through cross-examination." Royal Manor Reply Br. at 6. This issue related to CNA Burnett. He was present during the incident in question and made a number of statements to facility investigators and state surveyors which Royal Manor characterizes as "inherently unreliable, not credible as well as inconsistent with other more highly trained facility staff." Royal Manor Br. at 13. Royal Manor claims, for example, that Mr. Burnett's assertion that he detected a carotid pulse was somehow inconsistent with his report that chest compressions were performed. Id. Mr. Burnett was present at the hearing as a result of one of the subpoenas issued by the ALJ at Royal Manor's request. Tr. at 20-21. With all of the subpoenaed witnesses, the ALJ asked Royal Manor to show that it made some effort to contact the witnesses directly to determine their testimony and give notice to CMS. Tr. at 25. He stated that he would exclude testimony of witnesses who "were not given an opportunity" to provide such written direct. Id. Royal Manor is incorrect in asserting, however, that the ALJ said he would not permit Mr. Burnett's testimony as cross-examination "because it was not prefiled as a direct witness statement." Royal Manor Br. at 12. It is clear that the ALJ ordered that a real attempt be made to obtain a voluntary written direct statement from each witness, but did not require that the attempt succeed as a condition of permitting Royal Manor to question the witness. Royal Manor itself sought to cure its failure to try to obtain a written statement from Mr. Burnett by asking the ALJ to treat the signed statement in Mr. Burnett's own handwriting taken a few days after the incident as his direct written testimony." (12) Tr. at 25. The ALJ acceded to this request on the condition that the witness would then not be permitted to testify beyond the scope of that statement.

At the close of the hearing, Royal Manor pressed a request to question two of the subpoenaed witnesses as if they were under cross-examination to test the contents of their statements. Tr. at 148-49. Mr. Burnett was not one of the two witnesses then named by Royal Manor, even though he was present at the hearing. The ALJ permitted Royal Manor to call Ms. Spitzer for cross-examination on the specific points which Royal Manor challenged. (13) Tr. at 162-63. Thus, Royal Manor did not, in fact, seek to cross-examine Mr. Burnett at the appropriate time. We cannot assume that the ALJ would have denied this request, despite his clear concern that Royal Manor was ignoring his instructions, because he did nevertheless grant the same request when made in relation to Ms. Spitzer. (14)

Even if we had agreed that the ALJ should have allowed Royal Manor to call Mr. Burnett to the stand, which we do not, we would find the error harmless. While some of the ALJ's detailed findings about the course of events in the resident's room drew on information from Mr. Burnett's statement, nothing in his statement was necessary for what the ALJ described as the "critical mass" of the case. We might nevertheless be concerned if the ALJ's determination as to the reasonableness of the amount of the CMP depended in part on this witness' statement or might have been altered by a successful cross-examination of the witness. That is manifestly not the case, however, as we discuss in the next section.

Royal Manor also complains that it was not permitted an opportunity to present a rebuttal case. This contention reflects a complete misunderstanding by Royal Manor of the nature of the proceedings before the ALJ, despite the ALJ's repeated explanations. Before the ALJ, a facility must prove substantial compliance by the preponderance of the evidence, once CMS has established a prima facie case that the facility was not in substantial compliance with relevant statutory or regulatory provisions. See Batavia Nursing and Convalescent Center, DAB No. 1904 (2004); Batavia Nursing and Convalescent Inn, DAB No. 1911 (2004). CMS presented its prima facie case on all the disputed allegations here by submitting written direct testimony of its witnesses along with its documentary evidence, prior to the date of the in-person hearing. By the date set in the ALJ's pre-hearing order, Royal Manor was required to submit its own written direct testimony and documentary evidence to rebut that prima facie case or to establish any affirmative defense with its own written direct testimony and documentary evidence bearing on its compliance and on the reasonableness of the amount of the CMP. The in-person hearing was primarily an opportunity for each party to cross-examine the witnesses whose direct testimony was submitted by the opposing party. As explained elsewhere, the ALJ also permitted presentation of subpoenaed witnesses upon a showing that their direct testimony could not have been obtained otherwise. Royal Manor did cross-examine CMS's witnesses; CMS waived cross-examination of Royal Manor's witnesses.

Normally, the hearing would close at this point. Evidently, however, CMS's decision not to cross-examine Royal Manor's witnesses, such as Jason Faith and Dr. Enlow, disrupted Royal Manor's strategic plan for presenting its case by eliciting testimony from them on re-direct beyond that included in their written direct statements. While, as noted above, acknowledging that CMS was not obliged to cross-examine its witnesses, Royal Manor argued that it was placed at a "tremendous disadvantage" because it was "prepared to introduce significant rebuttal testimony." Tr. at 176. Responding to the ALJ's question of what Royal Manor meant by "rebuttal testimony" in this context, counsel for Royal Manor stated that it meant "testimony that in fact rebuts the conclusions that are contained in the CMS statements. While we were not going to offer it in direct testimony, we had planned and intended to offer it as rebuttal, specific rebuttal testimony based upon what was testified in cross examination from these witnesses." Id. But if the testimony went to contest material contained in CMS's witnesses' written direct statements, it is precisely what Royal Manor had been ordered to provide in its own written direct testimony prior to the in-person portion of the hearing. True rebuttal testimony at the hearing would instead go to rebut material that emerged unexpectedly at the hearing itself, since the normal purpose of rebuttal at a hearing is to refute evidence presented there. See, e.g., McCormick on Evidence (2003) § 4 (The Order of Presenting Evidence at the Trial).

Despite the inadequacy of this proffer by Royal Manor, the ALJ proceeded to explore whether any testimony proffered as rebuttal might in fact respond to new material raised by CMS's witnesses during their cross-examination. Asked for an example, counsel for Royal Manor stated that Jason Faith would have been called to "testify extensively" about statements made by the surveyors about what is appropriate in CPR, the angle of the head of the bed, the symptoms of and nursing standards relating to aspiration and "significant things like that." Tr. at 176-77. In particular, counsel for Royal Manor proffered that Mr. Faith would testify that the resident's care plan called for the head of her bed to be propped at a 45-degree angle to forestall aspiration. Tr. at 178. The ALJ found that these topics were fully developed prior to the hearing in CMS's written direct statements. He noted that CMS was required to provide its written direct testimony to Royal Manor one month before Royal Manor had to submit statements from its own witnesses, so ample time was provided for Royal Manor to respond to the points which the surveyors made in their written direct testimony. (15) Tr. at 179. While he allowed that limited rebuttal might be appropriate in some circumstances, the ALJ found no such circumstances present in this case. Id. He emphasized that his prehearing order "made it crystal clear to the parties that we're not going to allow either side to present extensive direct testimony that was not contained in written statements." Tr. at 180. While Royal Manor reiterated for the record it was prepared to introduce rebuttal evidence "based upon information that was testified to in cross-examination," counsel declined to offer any single example of any new statement made in cross-examination as to which it proffered relevant rebuttal testimony. We therefore find no error in the ALJ's ruling on rebuttal testimony.

Royal Manor also argues that the ALJ violated its rights by ultimately excluding the statement of LPN Couch which Royal Manor provided after the hearing. Royal Manor Br. at 16-18. CMS opposed admission of the statement because it did not indicate, as the ALJ had ordered, that she had been unavailable or unwilling to provide timely, written direct testimony nor did anything in the statement suggest that she was a witness hostile to the facility in any respect. Letter from Donald J. Calder, dated January 27, 2004. The ALJ agreed and excluded the statement by ruling dated February 24, 2004, for violation of his orders. He noted that Ms. Couch was in Royal Manor's employ for a month after the Initial Pre-hearing Order was issued, allowing time for a statement to have been obtained. Further, he found that counsel for Royal Manor failed to accompany the statement with any specifics beyond vague assertions as to efforts made thereafter to contact Ms. Couch and obtain her cooperation. We find the ruling to be within the ALJ's discretion given the violations of his orders.

In any case, Royal Manor attached Ms. Couch's statement to its appellate brief, and a review of it establishes that nothing in it would alter our substantive analysis. Royal Manor Br., Att.9. Ms. Couch disagreed with Mr. Burnett about whether the resident had a pulse when Ms. Couch arrived and stated that Mr. Burnett had no authority to determine whether to start or stop CPR. No allegation is made that Mr. Burnett made any determination about starting or stopping CPR; it hardly matters if Mr. Burnett was mistaken in thinking he detected a pulse. Ms. Couch admitted that she did start chest compressions so it appears clear that she did not detect a pulse. Id. at ¶5. She attested that Mr. Burnett used an Ambu-bag which had the effect of pushing emesis "back into the Resident's throat," confirming the presence of material in the resident's mouth at the time CPR was attempted. Id. at ¶6. Ms. Couch further acknowledged that Ms. Edwards "brought the suction machine to the Resident's room but stated that the machine had no tubing or catheter on it," and that she did not herself try to set it up or suction the patient, "[r]elying upon Ms. Edward's comments." Id. at ¶7. This testimony further confirms that the unavailability of a functional suction machine which staff knew how to use was the reason that no attempt was made to suction Resident 1. She admitted in her statement that she "did inform EMS that the Resident was found without vital signs," while insisting that she did not, as some of the other staff's statements alleged, "instruct anyone to tell EMS that CPR was not started." Id. at ¶13. She disputed the estimated number of minutes which were taken to start CPR and for the EMT to arrive and denied that the resident made any choking or gurgling sounds in her presence. Id. at ¶16. The exact number of minutes spent ascertaining the resident's code status before CPR was started is not central to the result in this case. The reports of sounds made by the resident came from staff members who were in the room before Ms. Couch arrived, so it does not necessarily contradict them if she did not hear such sounds. If anything, Ms. Couch's statement overall substantiates further the core of the case against Royal Manor, so that its exclusion, even had it been error, could not have been prejudicial error.

Finally, Royal Manor contends that the ALJ demonstrated bias against it by permitting CMS to even address the issues relating to the provision of CPR to Resident 1. Royal Manor Br. at 18-19. Royal Manor took the position throughout the proceedings before the ALJ that the statement of deficiencies focused only on the question of failure to suction and that any allegations relating to the performance of CPR were beyond the citation. See CMS Ex. 2; Tr. at 42. The essence of Royal Manor's interest in questioning the IDR Panel witnesses related to whether the concentration on CPR shifted as reaction to those proceedings. See Tr. at 76-77. The ALJ concluded that it was irrelevant whether the statement of deficiencies spelled out the improper CPR procedures or whether that focus emerged from the IDR proceedings, because Royal Manor had ample notice that it was an issue long before the de novo hearing which he conducted. Tr. at 15-18, 77-80. This conclusion is in accord with Board precedent. Pacific Regency Arvin, DAB No. 1823 (2002).

After our review of all the alleged procedural errors raised by Royal Manor, we conclude that Royal Manor received a fair hearing before the ALJ and that no prejudicial procedural error has been shown. Each of the ALJ's rulings, whether specifically intended as a sanction or not, was reasonable and well within his authority and discretion.

3. Substantial evidence supports the ALJ's imposition of a CMP in the amount of $7,500 per day.

Royal Manor challenged before the ALJ CMS's imposition of a CMP in the amount of $10,000 per day. In reviewing the amount of the CMP, the ALJ explained why he considered the seriousness of the deficiency findings so egregious as to justify this maximum daily CMP:

The people who reside in Petitioner's facility - indeed, in any skilled nursing facility - are by definition so sick as to be helpless when it comes to providing for their own medical care. Petitioner knew that its residents were utterly dependent on it for their care and well-being. Yet, Petitioner failed to provide its residents with necessary emergency equipment or with staff that was competently trained in a basic life-saving procedure.

Moreover, the evidence supports the conclusion that these shortcomings were a consequence of Petitioner's indifference to basic life-saving measures. A competently operated facility would have made sure that the equipment on its crash carts was well maintained and that staff knew how to use that equipment. And, a competently operated facility would have made certain that its staff was so well versed in basic life-saving techniques that it could provide them even under the pressure of an emergency. Petitioner did not do that in this case. It neglected the needs of Resident # 1. But, more importantly, in neglecting the needs of Resident # 1 it demonstrated that there were woeful inadequacies present in its overall approach to residents' welfare.

ALJ Decision at 12. (16) Nevertheless, the ALJ reduced the daily amount to $7,500 because he found that, by the time CMS set the CMP to begin on May 14, 2002, Royal Manor had taken some steps to reduce its culpability. Id. at 12-13. Specifically, Royal Manor had conducted an internal investigation, taken disciplinary actions, and provided in-service training to its staff. The total CMP imposed by the ALJ was $22,500.

On appeal to the Board, Royal Manor argues that the ALJ's determination that the amount of the $7,500 per day CMP was reasonable was arbitrary, in violation of the applicable regulation, and unsupported by the record. Royal Manor Br. at 21-22. In light of our full discussion of the evidentiary record above, it is clear that we do not agree with Royal Manor's claim that "any CMP issued is unreasonable" because no substantial evidence supports the ALJ Decision. In fact, we find the ALJ's characterization of the deficiency here as egregious enough to justify the maximum CMP to be eminently well-supported.

Royal Manor also argues, however, that the ALJ failed to consider all the factors which the regulations direct an ALJ to consider in reviewing the penalty assessed. Id.; 42 C.F.R. § 488.438(e)(3); 42 C.F.R. § 488.404(c)(1)-(2). Instead, according to Royal Manor, the ALJ focused on one factor, the facility's degree of culpability, to the exclusion of the others, which include the facility's history of noncompliance and financial condition and the relationship among deficiencies. The ALJ stated that he reviews all evidence relating to any of the regulatory factors de novo to determine what the record "says, objectively, about the facility's compliance and need for a remedy." ALJ Decision at 11. He then stated that, in a particular case, evidence relating to one of the regulatory factors may be so strong as to suffice to allow him to decide what is reasonable, especially "if the facility's noncompliance is extremely serious." Id. He then explained, as quoted above, why he considered the facility's failure here to go the heart of its duty to frail, dependent residents and to justify the CMP imposed. Id. at 11-12. Royal Manor pointed to no evidence which it proffered as to its history of noncompliance and prior deficiencies, its financial condition, or the relationship of the immediate jeopardy findings to other deficiency findings to demonstrate that those factors should have altered the ALJ's determination.

Royal Manor also argues that the remedy imposed upon it was out of line with the CMPs imposed in prior similar situations. Royal Manor Br. at 21. The ALJ stated that, while consistency in setting remedies in CMP cases is appropriate, he does not "employ a mechanical approach" and that "what is an appropriate remedy in a particular case should not be decided based on what may or may not have been done in another case." ALJ Decision at 11. Royal Manor pointed to three ALJ decisions and one Board decision to demonstrate its claim that the amount of penalty imposed on it was inconsistent. We have reviewed these cases and do not find anything about them that persuades us that the penalty amount here is unreasonable in relation to the actions taken in those cases.

We therefore sustain FFCL 2.

CONCLUSION

For the reasons explained above, we affirm the ALJ Decision in its entirety and sustain both numbered FFCLs therein.

JUDGE
...TO TOP

Judith A. Ballard

Cecilia Sparks Ford

Donald F. Garrett
Presiding Board Member

FOOTNOTES
...TO TOP

1. The following background information is drawn from the ALJ Decision and the record before the ALJ and summarized here for the convenience of the reader, but should not be treated as new findings. Facts disputed before the ALJ but no longer in dispute on appeal are included here.

2. Royal Manor challenges the ALJ's reliance on statements made by some of the facility staff reporting this delay, because Royal Manor was not able to obtain the attendance of those former staff members at the hearing to cross-examine them. Royal Manor Br. at 12, 15, 20-21. We find later in this decision that the ALJ did not commit prejudicial error in this regard. In any case, the premature abandonment of CPR once begun is now undisputed and suffices to show inadequate quality of care regardless of how long it took to begin CPR.

3. Royal Manor argues that the ALJ demonstrated ignorance of medical information relevant to the case because his decision stated that the resident should have been "prone" before CPR was administered. Royal Manor Br. at 12. Obviously, the patient would have to be supine (lying on her back) to permit CPR. It is clear that the ALJ intended to refer to this requirement because he also stated that there should be "a hard surface under the patient's back." ALJ Decision at 7.

4. The surveyor, Ms. Ellis, reported this comment and, even though he provided direct testimony on behalf of Royal Manor, Dr. Enlow did not dispute having made the statement.

5. Royal Manor also argues that no "medical evidence" supported the conclusion that the resident "was choking when the nurse responding to the call [from the Resident's roommate] entered the room" and found her "unresponsive, without a pulse and not breathing." Royal Manor Br. at 11. Royal Manor ignores the reports of the roommate and of facility staff who entered the room earlier than Nurse Couch and who reported signs that Resident 1 was vomiting and choking, such as gurgling sounds and changes in her color. See CMS Exs. 22, at ¶¶9-16, and 23, at ¶¶9-13; P. Ex. 16, at 15. Royal Manor's position generally is that any such observations were outweighed by the medical opinion of Dr. Enlow that the resident did not need suctioning because she had died already. He also opined that any gurgling or gasping sounds merely represented "agonal breaths," not signs of ongoing aspiration. Royal Manor Br. at 11. ("Agonal" refers to events "occurring at the time just before death," according to Dorland's Illustrated Medical Dictionary, 28th Edition.)

6. Along the same lines, Royal Manor repeatedly asserts that the ALJ had ignored all the medical evidence of record by making any findings that exceeded the scope of the nurses' note about the resident's death. But it is undisputed that Ms. Couch failed to record many of the events that occurred, including her own abandoned attempt at CPR, in the nurses' note, so that the ALJ had good reason to look beyond the face of that note to ascertain the facts.

7. This provision is applicable to these proceedings. Sections 1128A(c) and 1819(h) of the Act; 42 C.F.R. §§ 488.408(g), 498.3(b)(13).

8. Royal Manor also named several other individuals it might seek to subpoena and asserted that it reserved the "right to amend its witness list as it continues to prepare for the hearing" despite the ALJ's instructions that the lists could not be amended as of right. Royal Manor Witness List at 2.

9. Oddly, Royal Manor in its brief on appeal omitted mention of this request and referred to the second continuation of the hearing date as a "unilateral" rescheduling by the ALJ. Cf. Royal Manor Br. at 7.

10. In its reply brief, Royal Manor reformulates its contention to assert that the ALJ denied it due process by "failing to timely issue" subpoenas. Royal Manor Reply Br. at 4. Royal Manor relies on the Administrative Procedure Act provision at 5 U.S.C. § 555(d)(2004) authorizing ALJs to issue subpoenas "upon request of a party" to infer a requirement that issuance be within a reasonable time. Accepting this proposed inference would still beg the question of what constitutes a "reasonable" time. As discussed above, we see nothing about the time frame here that is inherently unreasonable. Royal Manor also cites two decisions, each more than twenty years old, from administrative boards in other agencies. Gracey v. Mintz, 1984 NTSB LEXIS 1999 (1984) is cited for the proposition that among the rights of parties in an ALJ hearing is "having witnesses and other relevant evidence subpoenaed." Royal Manor Reply Br. at 4. But the ALJ did grant Royal Manor's request for subpoenas to obtain witnesses shown to possess relevant evidence. Royal Manor asserts that In re Wanda P. Chocallo, 1 M.S.P.R. 605, 1980 MSPB LEXIS 512 (1980) demonstrated that continuances were granted in previous administrative cases. Id. at 5. It would not follow from the granting of a continuance in a Merit Systems Protection Board case that the ALJ here abused his discretion by denying yet another continuance under the circumstances of this case. In fact, however, the cited MSPB case says nothing on the subject of appropriate grounds for continuances.

11. We note that the hearing was held in Lexington, Kentucky. The Departmental Appeals Board does not have hearing facilities in that location, necessitating arranging for access to hearing rooms owned by another entity, in this case the Fayette County Courthouse. The record does not reflect how long it took to confirm these arrangements.

12. By using this device to try to cure its failure to request voluntary cooperation before seeking subpoenas, Royal Manor created another layer of complexity, however. Royal Manor became in some sense the proponent of the very statements it wished to undercut. The result was that the ALJ later offered counsel for CMS the opportunity to cross-examine the witnesses on these statements as their written direct testimony. Tr. at 146. CMS declined to do so. Tr. at 148.

13. As noted earlier, Ms. Edwards' testimony was excluded when the ALJ learned that she had been re-employed at Royal Manor for several months before the hearing and yet no effort was made to request her written testimony despite the ALJ's explicit order.

14. The ALJ made clear that he considered excluding the subpoenaed witnesses altogether as a sanction, because he was "not satisfied that [counsel for Royal Manor] complied with [his] pre-hearing order in this case." Tr. at 146. He did not, in fact, impose this sanction, and did permit examination of Ms. Spitzer.

15. Furthermore, regarding the one specific topic raised by Royal Manor, the ALJ stated that the care plan provision for keeping the resident in a sitting position was not disputed and did not relate to the issue of whether nursing standards for applying CPR to the resident in extremis required her to be flat. Tr. at 179.

16. Notably, the ALJ here relied on what was earlier described as the "critical mass" of the case against Royal Manor, not on any of the minor disputed details of the events drawn from the statements of witnesses about whom Royal Manor raised the due process concerns resolved above.

CASE | DECISION | ANALYSIS | JUDGE | FOOTNOTES