STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

RECOMMENDED ORDER

A formal hearing was conducted in this case on April 21, 2008, in Ocala, Florida, before Suzanne F. Hood, Administrative Law Judge with the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Michael O. Mathis, Esquire

Agency for Health Care Administration Fort Knox, Building 3

Suite 3431

2727 Mahan Drive

Tallahassee, Florida 32308

For Respondent: Peter J. Molinelli, Esquire

Sheila K. Nicholson, Esquire Thomas W. Caufman, Esquire

Quintairos, Prieto, Wood & Boyer, P.A. 4905 W. Laurel Street

Suite 200

Tampa, Florida 33607 STATEMENT OF THE ISSUES

The issues for consideration are: (1) whether Petitioner Agency for Health Care Administration (AHCA) should impose an administrative fine for a Class I violation and a survey fee on

Respondent New Horizon, NH, LLC d/b/a New Horizon Rehabilitation Center (Respondent), and if so, in what amount; and (2) whether AHCA should assign conditional licensure status to the facility, and if so, for what time frame.

PRELIMINARY STATEMENT

On or about January 3, 2007, AHCA issued an Administrative Complaint against Respondent. Said Complaint alleged that Respondent had one Class I deficiency during a complaint investigation on November 7, 2006.

Specifically, Count I of the Complaint alleged that Respondent failed to insure that an employee's reported incident of possible abuse, neglect or exploitation was immediately investigated as required. Count I cites Sections 400.147(1), 400.19(3), 400.23 (7), and 400.23(8)(a), Florida Statutes (2006),

as the statutes that Respondent violated and that warranted the imposition of an administrative fine in the amount of $15,000.

Count II of the Complaint alleged that the Class I deficiency required Respondent to pay a six-month survey fee in the amount of $6,000, pursuant to Section 400.19(3), Florida Statutes (2006).

On or about January 18, 2007, Respondent filed a Petition for Formal Administrative Hearing to contest the imposition of a fine, a conditional licensure rating, a survey fee, and a six- month survey cycle. On February 5, 2007, AHCA referred the matter to the Division of Administrative Hearings.

A Notice of Hearing dated February 14, 2007, scheduled the hearing for April 19, 2007. On March 30, 2007, Respondent filed an uncontested Motion for Continuance. By order dated April 9, 2007, the undersigned granted the continuance and rescheduled the hearing for June 18, 2007.

On June 4, 2007, Respondent filed an uncontested Motion for Continuance. On June 5, 2007, the undersigned issued an Order Granting Continuance and Rescheduling Hearing for August 16, 2007.

On July 11, 2007, AHCA filed an Agreed on Motion for Continuance. On July 12, 2007, the undersigned issued an Order Granting Continuance and Rescheduling Hearing for October 16, 2007.

On September 24, 2007, Respondent filed a Motion for Continuance. On September 27, 2007, the Respondent filed a Joint Motion for Case Management Conference, indicating that companion criminal and professional licensure discipline cases caused a problem securing the testimony of key witnesses for the final hearing in this case. On January 14, 2008, the undersigned entered an Order Granting Continuance and Placing Case in Abeyance.

On February 14, 2008, the parties filed a Joint Status Report. On February 18, 2008, the undersigned issued an Order Re-scheduling Hearing for April 8, 2008.

On February 19, 2008, the parties filed a Joint Motion to

Reschedule Hearing. On February 26, 2008, the undersigned issued an Order Granting a Continuance and Rescheduling Hearing for April 21, 2008.

During the one-day hearing on April 21, 2008, AHCA presented the testimony of four witnesses in its case-in-chief. AHCA offered no rebuttal witnesses. AHCA offered three exhibits that were accepted as record evidence.

Respondent presented the testimony of two witnesses.

Respondent offered one composite exhibit which was accepted as record evidence.

The court reporter filed the transcript on May 7, 2006. The parties filed Proposed Recommended Orders on June 6, 2008.

FINDINGS OF FACT

1. AHCA is the agency that is responsible for licensing nursing homes and for enforcing Chapter 400, Part II, Florida Statutes.

2. Respondent operates the facility, a 159-bed skilled- nursing facility located in Ocala, Florida. The facility operates under License No. SNF1637096.

3. At all times material hereto, the facility was licensed under AHCA’s authority. Accordingly, the facility was required to comply with all applicable statutes, rules, and regulations.

4. AHCA has the statutory authority and mandated duty, pursuant to Section 400.23(7), Florida Statutes (2006), to evaluate all nursing home facilities periodically (at least every

   15 months). AHCA has statutory authority to impose administrative fines on, and change the licensure status of, nursing home facilities in the event certain deficiencies are determined to exist.

5. On or about November 7, 2006, AHCA conducted a complaint survey at the facility. As a result of the survey, AHCA cited the facility for a Class I deficiency.

6. AHCA assigned conditional licensure status to the facility for the period November 7, 2006, to December 8, 2006. AHCA also seeks to impose an administrative fine in the amount of

   $15,000 for the deficiency and a survey fee of $6,000.

   
   

7. The undisputed testimony of the Respondent’s Regional Director, Bobby Crooms, was that Respondent had an internal risk manager. Administrator Sandy Sternfeld was designated as the Internal Risk Manager and he delegated responsibility to Registered Nurse Maria Schmidt, who was the Staff Development Coordinator. The undisputed testimony of Mr. Crooms also was that Respondent had a quality assurance program in place prior to the November 7, 2006, survey.

8. Respondent’s quality assurance program assessed resident care practices, reviewed facility quality indicators such as wounds, impactions and falls, reviewed incident reports, reviewed deficiencies cited by AHCA, and corrected and responded to deficiencies cited by AHCA. Respondent also had a program to review resident grievances through the Social Service Director

   who then passed it to the appropriate department of the nursing home. Respondent's quality assurance committee reviewed resident grievances on a monthly basis.

9. Respondent had guidelines for investigation of abuse. It also had protocols related to abuse allegations that required such allegations to be reported immediately to local and corporate administrative staff and to various authorities, including Adult Protective Services (1-800-96ABUSE), AHCA's Local Area Office, and the local police or Ombudsman if indicated. The protocol requires immediate suspension of all staff members involved in the incident, pending an investigation. It also requires immediate notification of family members if a resident is the victim.

10. Respondent provides in-service training to all employees upon orientation and on an annual basis. Staff Development Coordinator Maria Schmidt was responsible for doing the in-service training as of November 4, 2006.

11. The training includes prevention of abuse and neglect and what to do in the event there is suspicion or an obvious case of abuse, neglect or exploitation. In fact, abuse, neglect and exploitation is the number one topic of training.

12. Joshua Hutchinson and Roberto Vera were contracted housekeepers for Respondent. Their duties included cleaning resident rooms, bathrooms and common areas throughout the facility. Debra Morris, LPN, was a unit charge nurse at the

    facility. Mr. Vera, Mr. Hutchinson and, most importantly, Nurse Morris all completed training on abuse reporting in 2006.

13. Ms Schmidt considered Nurse Morris an “in-service queen” because she liked participating in in-service classes. Nurse Morris participated in the abuse training on June 29, 2006, and an additional orientation on March 2, 2006, on a voluntary basis.

14. On November 4, 2006, Mr. Hutchinson allegedly reported to Nurse Morris that he had observed Mr. Vera committing some sort of inappropriate sexual behavior toward a nursing home resident. The exact behavior of Mr. Vera is unknown and immaterial to this case.

15. On November 5, 2006, Mr. Vera worked at the facility on his regular 7:00 a.m. to 3:00 shift.

16. Nurse Morris failed to report Mr. Hutchinson’s allegations to administrative staff or state officials until the morning of November 6, 2006, when she told then Administrator Sandy Sternfeld. By 8:25 a.m., Director of Nursing (DON) Bill Rose had relayed the allegation to Ms. Schmidt who immediately conducted a thorough investigation into the allegations.

17. The resident alleged to be involved in the incident was

    
    

    50 years old and blind, deaf and mute. She is independent in her activities of daily living and is able to communicate to staff through tactile and other non-verbal means.

18. Upon learning of the incident on November 6, 2006, the

    facility had a psychologist examine the resident. Respondent called the resident’s sister who serves as her guardian. When the resident's sister arrived at the facility later that day, Ms. Schmidt examined the resident in her presence and found no signs of emotional distress or trauma to the genital area. The resident still resides at NEW HORIZON.

19. On November 6, 2006, Respondent's staff conducted a reenactment of the allegation. During the reenactment, the resident's low bed was surrounded by a privacy curtain. Based on the configuration of the room and the height of Mr. Hutchinson and Mr. Vera, Respondent's staff did not believe it was possible for the allegation to have occurred as reported by

    Mr. Hutchinson.

    
    

20. Mr. Hutchinson allegedly reported that he came through a shared bathroom between two resident rooms and found Mr. Vera with his hands between the resident’s legs. Because the resident’s bed was only four inches from the floor, Mr. Vera would have had to be on his hands and knees. Such a position would have been too low for Mr. Hutchinson to see, given the height of the privacy curtain, if the curtain was in fact pulled all the way around the resident's bed.

21. Respondent called the Florida Department of Children and Families (DCF) and AHCA on Monday, November 6, 2006. No one called the police until AHCA's surveyor arrived at the facility on November 7, to investigate the complaint.

22. As Respondent's risk management designee, Ms. Schmidt routinely checked the floors doing quality checks. She participated in the quality-assurance meetings and the morning stand-up meetings.

23. Respondent had signs throughout the facility directing staff and visitors to report abuse. The signs were placed on the walls and at the time clock. In addition, employees carried cards with reporting instructions on the back in their employee identification badges.

24. Upon learning of the allegations of alleged resident abuse on November 6, 2006, at 8:15 or 8:20 in the morning,

    Ms. Schmidt immediately took action to protect the resident by making sure Mr. Vera, the alleged perpetrator, was not in the building or on the grounds. Because he was not present, she called his supervisor to insure he did not come back to work, as he was on immediate suspension.

25. On November 6, 2006, Ms. Schmidt first interviewed Mr. Hutchinson who made the accusations. Mr. Hutchinson allegedly recounted to Ms. Schmidt that he had seen Mr. Vera inappropriately touching the resident in her pubic area and stated that he had reported the incident to Nurse Morris.

26. Next, Ms. Schmidt interviewed Mr. Vera, the alleged perpetrator of the abuse. Mr. Vera, a two-year employee, denied the allegations. Respondent subsequently terminated Mr. Vera's employment.

27. Ms. Schmidt then interviewed Nurse Morris, who confirmed that she received word from Mr. Hutchinson that an inappropriate touching occurred. Nurse Morris further explained that she did not report it immediately because she did not believe the allegation. Nurse Morris thought the allegation was nonsense.

28. Nurse Morris indicated to Ms. Schmidt that she understood her duty to report suspected abuse. Nurse Morris stated that she checked the alleged victim throughout November 4, 2006, to make sure she was okay and that she kept a watchful eye on Mr. Vera who was by then working in a different area of the facility.

29. Nurse Morris’ failure to report the abuse immediately was not consistent with facility policy. Respondent subsequently terminated Nurse Morris' employment.

30. On November 6, 2006, Ms. Schmidt began re-instructing all employees using Respondent's in-service training program on abuse, neglect, and exploitation. She completed the task within ten days.

31. On November 7, 2006, Respondent had someone from Braille Services come in to assist with communication with the alleged victim, who denied that anyone had tried to hurt her. That same day, Respondent instituted 15-minute observation checks to look for any change in behavior on the part of the alleged victim.

32. On November 7, 2006, Respondent's Medical Director, Dr. Murphy, recommended that the resident be sent to the local hospital for an evaluation by her personal physician. The police accompanied the resident to the emergency room for the examination.

33. Within 24 hours of learning about the suspected abuse, Respondent questioned all other female residents to determine whether they had been exposed to or witnessed any type of sexual or other abuse. None of the resident’s indicated they had been exposed to such activity.

34. The AHCA surveyor arrived on November 7, 2006, despite receiving the call on November 6, 2006. The surveyor cited Respondent for Tag 914 on AHCA's Form 3020-001, noting that the survey reflected only those deficient practices under state statutes and regulations. On the Department of Health and Human Services Centers for Medicare and Medicaid's Form CMS-2567, the surveyor found deficiencies for violating 42 CFR 483.13(c) for Tag F225, and Tag F226, and 42 CFR 483.75 for Tag F490. The surveyor determined that Immediate Jeopardy existed on

    November 4, 2006, but that it had abated by November 7, 2006, because Respondent implemented immediate corrective action.

35. The AHCA surveyor reviewed Respondent's policies involving abuse prevention, investigation, and reporting. He reviewed Mr. Vera's time card and employee record, as well as the resident's medical record and the Federal Immediate report dated

    November 6, 2006.

    
    

36. The surveyor interviewed administrative staff and randomly spoke to five staff members, who confirmed that they knew about the facility’s abuse policy and the need to report abuse, actual or suspected. There is no evidence that any employee was not aware of Respondent's policies regarding immediate reporting of any type of abuse.

37. The facts found indicate that Respondent had adequate policies and procedures to prevent abuse and require reporting of suspected abuse.

    CONCLUSIONS OF LAW

    
    

38. The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of this proceeding pursuant to Sections 120.569 and 120.57(1), Florida Statutes (2006).

39. AHCA has the burden of proving the following by clear and convincing evidence: (a) that Respondent violated Section 400.147, Florida Statutes (2006), by failing to have an internal risk management and quality assurance program in place to ensure the proper investigation and reporting of abuse; (b) that Respondent should be given conditional license status pursuant to Section 400.23(7), Florida Statutes (2006); (c) that Respondent should be fined $15,000 for a widespread deficiency pursuant to Section 400.23(8), Florida Statutes (2006); and (d) that Respondent should be required to pay $6,000 fee for a six-month

    survey cycle pursuant to Section 400.19(3), Florida Statutes (2006). See Department of Banking and Finance, Division of Securities and Investor Protection v. Osborne Stern Company, 670 So.2d 932 (Fla. 1996). AHCA has not met its burden.

    COUNT I

    
    

40. In Count I of the Complaint, AHCA alleges that Respondent violated Section 400.147, Florida Statutes (2006), which states as follows in relevant part:

    400.147 Internal risk management and quality assurance program.

    1. Every facility shall, as part of its administrative functions, establish an internal risk management and quality assurance program, the purpose of which is to assess resident care practices; review facility quality indicators, facility incident reports, deficiencies cited by the agency and resident grievances; and develop plans of action to correct and respond quickly to identify quality deficiencies.

       The program must include:

       1. A designated person to serve as risk manager, who is responsible for implementation and oversight of the facility's risk management and quality assurance program as required by this section.

       2. A risk management and quality assurance committee consisting of the facility risk manager, the administrator, the director of nursing, the medical director, and at least three other members of the facility staff. The risk management and quality assurance committee shall meet at least monthly.

       3. Policies and procedures to implement the internal risk management and quality assurance program, which must include the investigation and analysis of the frequency and causes of general categories and specific types of adverse incidents to residents.

       4. The development and implementation of an incident reporting system based upon the affirmative duty of all health care providers and all agents and employees of the licensed health care facility to report adverse incidents to the risk manager, or to his or her designee, within 3 business days after their occurrence.

       5. The development of appropriate measures to minimize the risk of adverse incidents to residents, including but not limited to, education and training in risk management and risk prevention for all non- physician personnel . . . .

          
          

41. If Respondent is guilty of a Class I deficiency for violating Section 400.147, Florida Statutes (2006), then AHCA could impose a conditional license and an administrative fine pursuant to Section 400.23, Florida Statutes (2006), which states as follows in relevant part:

    1. The agency shall, at least every 15 months, evaluate all nursing home facilities and make a determination as to the degree of compliance by each licensee with the established rules adopted under this part as a basis for assigning a licensure status to that facility. The agency shall based its evaluation on the most recent inspection report, taking into consideration finding from other official reports, surveys, interview, investigations, and inspections. The agency shall assign a licensure status of standard or conditional to each nursing home.

       1. A standard licensure status means that a facility has no class I or class II deficiencies and has corrected all class III deficiencies within the time established by the agency.

       2. A conditional licensure status means that a facility, due to the presence of one or more class I or class II deficiencies, or class III deficiencies not corrected within the time established by the agency, is not in substantial compliance at the time of the survey with criteria established under

          this part or with rules adopted by the agency. If the facility has no class I, or class II, or class III deficiencies at the time of the following survey a standard licensure status may be assigned.

          
          

          * * *

          
          

    2. The agency shall adopt rules to provide that, when the criteria established under subsection (2) are not met, such deficiencies shall be classified according to the nature and scope of the deficiency. The scope shall be cited as isolated, patterned, or widespread. An isolated deficiency is a deficiency affecting one or a very limited number of residents, or involving one or a very limited number of staff, or a situation that occurred only occasionally or in a very limited number of locations. A patterned deficiency is a deficiency where more than a very limited number of residents are affected, or more than a very limited number of staff are involved, or the situation has occurred in several location, or the same resident or residents have been affected by repeated occurrences of the same deficient practice but the effect of the deficient practice is not found to be pervasive throughout the facility. A widespread deficiency is a deficiency in which the problems causing the deficiency are pervasive in the facility or represent systemic failure that has affected or has the potential to affect a large portion of the facility's residents. The agency shall indicate the classification on the face of the notice of deficiencies as follows:

       1. A class I deficiency is a deficiency that the agency determines presents a situation in which immediate corrective action is necessary because the facility's noncompliance has caused, or is likely to cause, serious injury, harm, impairment, or death to a resident receiving care in a facility. The condition or practice constituting a class I violation shall be abated or eliminated immediately, unless a fixed period of time, as determined by the agency, is required for correction. A

    class I deficiency is subject to a civil penalty of $10,000 for an isolated deficiency, $12,500 for a patterned deficiency, and $15,000 for a widespread deficiency. The fine amount shall be doubled for each deficiency if the facility was previously cited for one or more class I or class II deficiencies during the last annual inspection or any inspection or complaint investigation since the last annual inspection. A fine must be levied notwithstanding the correction of the deficiency.

    
    

42. AHCA did not charge Respondent with violating 42 CFR 483.13(c) as alleged in the surveyor's Form CMS-2567. In pertinent part, that section requires the following: (a) a facility must ensure that all alleged violations involving abuse are reported immediately to the administrator of the facility and to other officials in accordance with State law as set forth in

    42 CFR 483.13(c)(2); (b) a facility must perform and document an investigation and must prevent further abuse while the investigation proceeds as set forth in 42 CFR 483.13(c)(3); and

    (c) a facility must develop and implement written policies and procedures that prohibit abuse as set forth in 42 CFR 483.13(c).

43. AHCA did not charge Respondent with violating 42 CFR

    
    

    483.75 as alleged in the surveyor's Form CMS-2567. That section requires a facility to use its resources to maintain the highest practicable physical, mental, and psychological well-being of each resident. See 42 CFR 483.75.

44. In this case, Nurse Morris intentionally failed to call the abuse hotline immediately and to report any alleged abuse to

    the facility administrator immediately. Moreover, neither the facility administrator nor his designated risk manager,

    Ms. Schmidt, called the police until November 7, 2006. Clearly, Respondent's abuse-reporting policies and procedures were not followed in a timely manner. However, by November 7, 2006, Respondent had performed an investigation; taken steps to protect the residents; made all necessary reports; and implemented a corrective action plan, well within three business days of the alleged incident.

45. Respondent had an internal risk management and quality assurance program that complied with the requirements of Section 400.147, Florida Statutes (2006). AHCA presented no evidence related to Respondent's internal risk management or quality assurance programs. The programs were in place. Respondent provided extensive training to its staff. All employees had badges with abuse-reporting instructions. Respondent reacted swiftly to prevent a re-occurrence of the alleged abuse once management learned of the allegations.

46. Because Respondent was in compliance with Section 400.147, Florida Statutes (2006), and no other statutory or rule violation was charged, Respondent cannot be guilty of a Class I deficiency. It follows that Respondent cannot be subjected to a conditional license pursuant to Section 400.23(7), Florida Statutes (2006), or fined $15,000 for a widespread deficiency pursuant to Section 400.23(8), Florida Statutes (2006).

    
    

    COUNT II

    
    

47. Count II of the Complaint alleged that Respondent is subject to a six-month survey fee in the amount of $6,000 pursuant to Section 400.19(3), Florida Statutes (2006), which states in pertinent part as follows:

    (3) The agency shall every 15 months conduct at least one unannounced inspection to determine compliance by the licensee with statutes, and with rules promulgated under the provision of those statutes, governing minimum standards construction, quality and adequacy of care, and rights of residents. The survey shall be conducted every 6 months for the next 2-year period if the facility has been cited for a class I deficiency, has been cited for two or more class II deficiencies arising from separate surveys or investigation within a 60-day period, or has had three or more substantiated complaints within a 6-month period, each resulting in a least one class I or class II deficiency. In addition to any other fees or fines in this part, the agency shall assess a fine for each facility that is subject to the 6-month survey cycle. The fine of the 2-year period shall be $6,000, one half to be paid at the completion of each survey. The agency may adjust this fine by the change in the Consumer Price Index, based on the 12 months immediately preceding the increase, to cover the cost of the additional surveys. . . .

    
    

48. As stated above, Respondent had an adequate internal risk management and quality assurance program. It is not guilty of a Class I deficiency, and therefore, is not subject to the

$6,000 fee for the six-month survey cycle pursuant to Section 400.19(3), Florida Statutes (2006).

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is

RECOMMENDED:

That AHCA enter a final order dismissing the Administrative Complaint.

DONE AND ENTERED this 2nd day of July, 2008, in Tallahassee, Leon County, Florida.

S

SUZANNE F. HOOD

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847 www.doah.state.fl.us

Filed with the Clerk of the Division of Administrative Hearings this 2nd day of July, 2008.

COPIES FURNISHED:

Michael O. Mathis, Esquire

Agency for Health Care Administration Fort Knox Building III, Suite 3431 2727 Mahan Drive

Tallahassee, Florida 32308

Peter J. Molinelli, Esquire Quintairos, Prieto, Wood & Boyd, P.A. 4905 West Laurel Street, Suite 200

Tampa, Florida 33607

Richard J. Shoop, Agency Clerk

Agency for Health Care Administration 2727 Mahan Drive, Mail Station 3

Tallahassee, Florida 32308

Craig H. Smith, General Counsel Agency for Health Care Administration Fort Knox Building III, Suite 3431 2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

Holly Benson, Secretary

Fort Knox Building III, Suite 3116 2727 Mahan Drive

Tallahassee, Florida 32308

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within 15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the Final Order in this case.

Docket for Case No: 07-000621

Orders for Case No: 07-000621