Woodstock Care Cntr v. HHS , 80 F. App'x 962 ( 2003 )

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206 2 Woodstock Care Center v. Dept. No. 01-3889
ELECTRONIC CITATION: 2004 FED App. 0095P (6th Cir.) of Health and Human Serv.
File Name: 04a0095p.06
Before: BOGGS, Chief Judge; BATCHELDER, Circuit
Judge; and OBERDORFER, Senior District Judge.**
UNITED STATES COURT OF APPEALS
_________________
FOR THE SIXTH CIRCUIT
_________________ COUNSEL
WOODSTOCK CARE CENTER , X ARGUED: Geoffrey E. Webster, Columbus, Ohio, for
Plaintiff-Petitioner, - Petitioner. Sheila Ann Hegy, OFFICE OF THE CHIEF
- COUNSEL, Chicago, Illinois, for Respondent. ON BRIEF:
- No. 01-3889 Geoffrey E. Webster, Eric B. Hershberger, Columbus, Ohio,
v. - for Petitioner. Sheila Ann Hegy, OFFICE OF THE CHIEF
> COUNSEL, Chicago, Illinois, for Respondent.
,
TOMMY THOMPSON, -
SECRETARY , and UNITED _________________
-
STATES DEPARTMENT OF - OPINION
HEALTH AND HUMAN - _________________
SERVICES, -
Defendants-Respondents. - BOGGS, Chief Judge. Woodstock Care Center
- (“Woodstock”), in an action against United States Department
N of Health and Human Services (“HHS”) and Tommy
On Review of the Departmental Appeals Board of the Thompson, in his capacity as Secretary of the HHS, seeks
United States Department of Health and Human Services. review of a Civil Monetary Penalty (“CMP”) imposed against
No. 00-00356—Walter H. Rice, District Judge. Woodstock by the Health Care Financing Administration
(“HCFA”),1 an agency within HHS. A survey of Woodstock,
Argued: May 8, 2003 a long-term care facility for mentally disturbed residents
participating in the federal Medicare and Ohio Medicaid
Decided and Filed: November 17, 2003* programs, discovered numerous incidents in which residents
had been able to escape from the facility (referred to as
“elopement” by the parties) or to assault other residents.
**
The Honorable Louis F. Oberdorfer, Senior United States District
Judge for the District of Columbia, sitting by designation.
* 1
This decision was originally issued as an “unpublished decision” During the pend ency o f this action, HCFA was renamed the “Center
filed on November 17, 2003. On March 23, 2004, the court designated for Me dicare and Me dicaid Services.” For co nsistency, it will
the opinion as one recommended for full-text publication. nevertheless b e referred to as HCFA thro ugho ut.
1
No. 01-3889 Woodstock Care Center v. Dept. 3 4 Woodstock Care Center v. Dept. No. 01-3889
of Health and Human Serv. of Health and Human Serv.
HCFA imposed the CMP under statutory and regulatory the fence surrounding a patio area over which R11 was
authority requiring that facilities prevent accidents or risk of assumed to have fled. On January 21, R11 was noted
accidents to residents. Woodstock appealed to an attempting to climb the fence at 1 a.m., but he returned when
Administrative Law Judge (“ALJ”) and the Departmental asked. At 2 a.m., he once again attempted to scale the fence
Appeals Board (“DAB”) within HHS, both of which affirmed. but failed. At 2:40 a.m., R11 called 911 and asked the police
We affirm as well. to rescue him from Woodstock. At 4:45 a.m., he finally
managed to climb the fence and escape. At 5:30 a.m., he was
I discovered by a Woodstock staff member wandering the
streets without shoes or coat, despite the low temperatures in
Woodstock is a long-term care skilled nursing facility the January night, and was convinced to return. On February
(“SNF”) in Ohio that participates in the federal Medicare and 17 or 19, Woodstock installed an alarm on the fence, but due
the Ohio Medicaid programs. It houses forty-three residents, to lack of training of Woodstock’s staff, the alarm only
half of whom were diagnosed with dementia and more than became operational on March 15.
two-thirds of whom displayed behavioral symptoms of
dementia. On February 17, 1998, inspectors of the Ohio R11 was also violent towards other inmates. Despite
Department of Health, under delegated authority from HHS having a known history of assault, he was assigned to share
to supervise facilities like Woodstock, and acting upon a a room with a 73-year old resident with organic brain
complaint by a Woodstock employee, launched a survey of disorder. R11 assaulted his roommate on three occasions in
the facility, which concluded on March 4. The inspectors, December 1997. The first assault resulted in a scalp
registered nurses with training and extensive experience in laceration that required stapling. A later assault included R11
such surveys, conducted four more visits to Woodstock, on pulling these staples. R11 also assaulted two other residents
March 8, 11, and 15 and April 29. During their survey, they while at Woodstock. In response, R11 received counseling
noted the following incidents. and had his medication altered, but without effect. R11
received his first psychological evaluation on March 2, 1998.
Resident 112 was admitted on September 29, 1997, and On March 7, he assaulted another resident.
suffered from organic brain disorder, ethanol alcohol
dependency, and seizures. R11 wore an electronic tracking Resident 3, a 81-year old woman suffering Alzheimer’s
device, which triggered an alarm when the device passed disease and advancing dementia, was admitted on January 4,
through any door to the outside world. On January 3, 1998, 1998. Prior to her admission, she had been a frequent visitor
R11 made his first attempt at elopement. He was discovered to her husband, also a resident at Woodstock. On the day of
missing at 11:25 p.m. and was returned eighty minutes later her admission, another visitor who remembered R3 as a
after being found in a roadside ditch by a cornfield, two miles visitor held open the door for her, allowing her to escape.
away. In response, Woodstock installed a camera trained on While she was only able to walk with the aid of a walker, she
made it past a large, unfenced pond and rubble from a burned
building to a nearby busy street corner. She was found there
2 forty-five minutes later by Woodstock staff, who convinced
In compliance with federal privacy regulations, all residents are
referred to exclusively by a number (“Resid ent N” or “RN”) in all pu blic
her to return.
court do cuments.
No. 01-3889 Woodstock Care Center v. Dept. 5 6 Woodstock Care Center v. Dept. No. 01-3889
of Health and Human Serv. of Health and Human Serv.
Resident 5, a 74-year old man suffering from Alzheimer’s patients at risk and was therefore out of compliance with a
disease and dementia, was admitted on January 2, 1998. At total of eighteen administrative requirements. While the
admission, he was heavily medicated and barely aware, or underlying incidents had largely occurred before the
“snowed.” Over the following months, Woodstock staff beginning of the survey, HCFA found that the conditions that
experimented with altered dosage levels in order to allow him allowed them to occur had existed at least from March 4,
to return to a more active mental state. However, whenever when the survey concluded, through March 16, when
dosage levels sank too low, R5 became highly agitated and Woodstock took sufficient corrective measures. With respect
demanded to leave. On one occasion, on February 20, he to the most serious administrative violation, deemed to be at
became “unsnowed” unexpectedly and managed to escape the level creating immediate jeopardy to the residents, HCFA
through a long, unlocked window, opening to an unfenced concluded that a sufficient remedy was in place on March 15.
area, of the room in which Woodstock had placed him. He HCFA assessed a CMP against Woodstock of $33,650:
was returned to Woodstock, displaying scratches, thirty $3,050 for each of the eleven days there was immediate
minutes later. jeopardy to residents and $50 for each of the two remaining
days. HCFA also ordered additional monitoring of
Resident 17, a 70-year old man diagnosed with Woodstock. However, HHS eventually rejected the
schizophrenia, dementia, and Parkinson’s disease, was inspectors’ recommendations to terminate Woodstock’s
admitted on December 2, 1997. R17, who had a history of provider agreement.
verbal and physical aggression, delusions, combative
behavior, and refusal of care and medications, was on On March 30, 1998, HCFA issued to Woodstock a Notice
medication for seizures, Parkinson’s disease, and of Imposition of Remedies. Woodstock requested a hearing,
anxiety/agitation. While on medication, R17 suffered violent under 42 C.F.R. § 498.40, in front of an HHS ALJ. At the
mood swings between gentle states and extreme aggression. hearing, the three inspectors who had participated in the
While at Woodstock, he committed more than half a dozen survey and three of Woodstock’s employees testified. The
assaults against other residents. He attacked one resident four ALJ issued a decision in favor of HHS on all issues.
times, causing hematoma on multiple occasions. The Woodstock appealed to the DAB, which affirmed the ALJ’s
assaulted resident also needed 35 sutures to close a head decision in its entirety. Woodstock then filed a complaint
wound caused by R17 breaking a chair on his head. R17 also against HHS in the United States District Court for the
attacked several other residents. A total of 130 episodes of Southern District of Ohio. In it, Woodstock alleged that the
R17's verbal and physical aggressiveness and combativeness DAB’s decision was not supported by reliable, probative, and
were recorded. Nevertheless, R17 received no psychological substantial evidence, that the rationale supporting the decision
or psychiatric care. On February 19, 1998, he committed was arbitrary and capricious, that the decision was contrary to
another assault and was found wearing a belt around his neck. 42 C.F.R. § 482.25(h)(2), and that it violated Woodstock’s
Woodstock discharged him to the Veterans Administration “federal Constitutional due process rights.” The district court
the same day. concluded that the circuit courts of appeal have exclusive
jurisdiction over challenges to CMPs and therefore transferred
Based on these reports and memoranda submitted by the the case to us.
inspectors and on their recommendation, HCFA concluded
that Woodstock had allowed conditions to persist that placed
No. 01-3889 Woodstock Care Center v. Dept. 7 8 Woodstock Care Center v. Dept. No. 01-3889
of Health and Human Serv. of Health and Human Serv.
II we must defer to it.’” St. Francis, 205 F.3d at 944 (quoting
Shalala v. Guernsey Memorial Hosp., 514 U.S. 87, 94-95
Some issues, while prominent earlier in the litigation, need (1995)) (internal alterations omitted).
not concern us here. There are no substantial disputes
remaining about the underlying facts. While the parties stress Federal regulations impose significant requirements on
different facts and slight discrepancies remain on issues such SNFs, such as Woodstock, that participate in the federal
as the exact length of certain elopements, the facts as stated Medicare and state Medicaid schemes. “Each resident must
above are consistent with both accounts. Nor is there any receive and the facility must provide the necessary care and
question regarding jurisdiction. The parties also agree on the services to attain or maintain the highest practicable physical,
applicable standards of review. Woodstock has not appealed mental, and psychosocial well-being, in accordance with the
the seventeen incidents of non-compliance at levels below comprehensive assessment and plan of care.” 42 C.F.R.
those presenting immediate jeopardy to residents, so we need § 483.25. “The facility must ensure that . . . [e]ach resident
not consider the daily CMP of $50. The sole issue remaining receives adequate supervision and assistance devices to
is whether the undisputed facts constituted, as a matter of law, prevent accidents.” 42 C.F.R. § 483.25(h)(2). “Deficiency
a violation of 42 C.F.R. § 483.25 that created immediate means a [facility’s] failure to meet a participation requirement
jeopardy to the residents. specified in the Act or in [42 C.F.R. §§ 483.1-80].” 42 C.F.R.
§ 488.301. “Substandard quality of care means one or more
We have jurisdiction to review imposition of CMPs. “Any deficiencies related to participation requirements under . . .
person adversely affected by a determination of the Secretary § 483.25, . . . which constitute either immediate jeopardy to
under this section may obtain a review of such determination resident health or safety; a pattern of or widespread actual
in the United States Court of Appeals for the circuit in which harm that is not immediate jeopardy; or a widespread
the person resides.” 42 U.S.C. § 1320a-7a. “Upon such potential for more than minimal harm, but less than
filing, the court shall have jurisdiction of the proceeding and immediate jeopardy, with no actual harm.” 42 C.F.R.
of the question determined therein.” Ibid. Our standard of § 488.301. “Immediate jeopardy means a situation in which
review is highly deferential. “The findings of the Secretary the provider’s noncompliance with one or more requirements
with respect to questions of fact, if supported by substantial of participation has caused, or is likely to cause, serious
evidence on the record considered as a whole, shall be injury, harm, impairment, or death to a resident.” 42 C.F.R.
conclusive.” 42 U.S.C. § 1320a-7a. “In reviewing the § 488.301.
Secretary [of HHS]’s interpretation of regulations, courts may
overturn the Secretary’s decision only if it is ‘arbitrary, HHS is authorized to impose a CMP on a SNF that is out of
capricious, an abuse of discretion or otherwise not in compliance with § 483.25. “The Secretary may impose a
accordance with the law.’” St. Francis Health Care Ctr. v. civil money penalty in an amount not to exceed $10,000 for
Shalala, 205 F.3d 937, 943 (6th Cir. 2000) (quoting Thomas each day of noncompliance.” 42 U.S.C. § 1395i-
Jefferson Univ. v. Shalala, 512 U.S. 504, 512 (1994)). 3(h)(2)(B)(ii). “Penalties in the range of $3,050-$10,000 per
“Further, courts are to ‘give substantial deference to an day are imposed for deficiencies constituting immediate
agency’s interpretation of its own regulations.’” St. Francis, jeopardy.” 42 C.F.R. § 488.438(a)(1)(I). “The per day
205 F.3d at 943 (quoting Thomas Jefferson Univ., 512 U.S. at [CMP] may start accruing as early as the date that the facility
512). “In sum, if ‘it is a reasonable regulatory interpretation was first out of compliance, as determined by [HHS] or the
No. 01-3889 Woodstock Care Center v. Dept. 9 10 Woodstock Care Center v. Dept. No. 01-3889
of Health and Human Serv. of Health and Human Serv.
State.” 42 C.F.R. §488.440(a)(1). “The per day [CMP] is prevent accidents.” 42 C.F.R. § 483.25(h)(2). The cited
computed . . . for the number of days of noncompliance until incidents, regardless of whether they were accidents or not,
the date the facility achieves substantial compliance, as constitute valid probative evidence as to whether Woodstock
determined by [HHS] or the State.” 42 C.F.R. § 488.440(b). adequately supervised the residents. A resident so ill-
supervised that he has the opportunity to assault other
In the current case, HHS concluded that Woodstock had residents repeatedly and severely may well also be
failed to “ensure that . . . [e]ach resident receives adequate inadequately supervised to prevent accidents. More
supervision and assistance devices to prevent accidents.” 42 significantly, a resident who has eloped and wanders an
C.F.R. § 483.25(h)(2). In particular, HHS found that environment dangerous to him or her is completely without
Woodstock had not taken the relevant security precautions, any supervision. Again, this is so regardless of whether the
such as closer supervision of residents known to be violent or elopement itself can legally be characterized as an accident.
flight risks, including physical restraint where necessary,
better psychological and psychiatric counseling and Woodstock also contends that HHS, in imposing a CMP,
medication of such residents, and more effective perimeter held it to a strict liability standard and, under any standard of
security. This failure resulted in immediate jeopardy to reasonable care, it had not acted wrongly. Woodstock
residents. In particular, eloping residents suffered minor contends that the attacks and elopements were unprovoked
injuries during their escapes and suffered the risk of more and unpredictable and could not have been prevented.
serious injuries. Aggressive residents inflicted serious However, the ALJ and the DAB explicitly held that the
injuries on other residents. Next, HHS concluded that the standard Woodstock faced was not a strict liability standard.
conditions that allowed such incidents to occur existed from Rather, they found that Woodstock had failed to take all
at least March 4 through March 14. For each of these eleven reasonable precautions against residents’ accidents. The
days that the conditions were known to exist, HHS imposed question whether Woodstock took all reasonable precautions
the minimum daily CMP for conditions creating immediate is highly fact-bound and can only be answered on the basis of
jeopardy to residents, $3,050. The ALJ and the DAB expertise in nursing home management. As such, it is a
affirmed this judgment. question the resolution of which we defer to the expert
administrative agency, the HHS. But even from our inexpert
Woodstock contends that § 483.25(h)(2) is not applicable perspective, numerous actions undertaken by Woodstock
to the incidents listed because none of them were “accidents.” would appear to be negligent. For example, allowing R11 to
Rather, Woodstock argues, the elopements and assaults were continue to share a room with a helpless resident whom he
intentional acts by the residents and intentional acts cannot be had already several times severely assaulted seems to border
characterized as accidents. The ALJ rejected this argument on recklessness. So does failing to restrain R11 after several
by pointing out that the assaults were not intentional on part escape attempts in one night until he finally succeeded, as
of the victims and therefore may be regarded as accidents. well as keeping R5 in a room with a large, unlocked window,
However, we need not rule on the validity of this contention, despite the fact that he was known to be an escape risk. On
which could render practically every assault or murder an this basis, we uphold HHS’s finding that Woodstock failed to
accident, because, as the DAB recognized, the legal issue here meet the requisite standard of care.
is whether Woodstock “ensure[d] that . . . [e]ach resident
receive[d] adequate supervision and assistance devices to
No. 01-3889 Woodstock Care Center v. Dept. 11 12 Woodstock Care Center v. Dept. No. 01-3889
of Health and Human Serv. of Health and Human Serv.
Woodstock argues that at common law there was no III
presumption of negligence against nursing homes whose
residents escape and nursing homes were not the insurers of For these reasons, we AFFIRM the Department of Health
the safety of their patients but needed only exercise and Human Service’s imposition of civil monetary penalties.
reasonable care. This is only marginally relevant. In the
current case, Woodstock was not sued in tort by an injured
resident. Instead, Woodstock suffered an administrative
penalty under regulations to which it consented when it was
permitted to participate in the Medicare and Medicaid
programs. These regulations can and do set a higher standard
than the common law.
Finally, Woodstock argues that the eloping residents were
not in immediate jeopardy and that the elopements therefore
were not a valid basis for imposition of CMPs at the increased
level. “Immediate jeopardy means 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 (emphasis added). The only actual injuries in the
record caused by the elopements were the scratches suffered
by R5 and the possible aggravation of pneumonia suffered by
R11 during the hours he spent outside during a January night
without shoes or coat. The former was not a serious injury
and the latter, speculation. Nevertheless, we uphold the HHS
finding of immediate jeopardy. Given the number of
elopements at Woodstock over the course of a few months,
the vulnerable state of the residents, and the dangers of the
outside world to residents in such a state, the conclusion that,
earlier or later, the elopements would likely cause serious
injury was supported by substantial evidence. Even in the
absence of “actual harm,” a “widespread potential for more
than minimal harm” is sufficient to sustain the CMP.
42 C.F.R. § 488.301.