Federal Lawsuit Challenges Change In CMS Policy Regarding Nursing Home Civil Money Penalties

A Complaint filed on January 18, 2021 in the United States District Court for the District of Columbia alleges that the Department of Health and Human Services (HHS) and the Centers for Medicare and Medicaid Services (CMS) weakened enforcement of the Nursing Home Reform Act (NHRA) through a policy change that risks the lives of nursing home residents.

The Complaint states, “Plaintiffs bring this action to seek judicial review of an irregular and unlawful policy change by the Centers for Medicare and Medicaid Services (“CMS”), disseminated as sub-regulatory guidance, concerning the imposition of civil money penalties (“CMPs”) for past noncompliance by long-term care facilities, including nursing facilities, with required federal standards. This policy change, announced in a July 7, 2017 memorandum from CMS to state survey agency directors, makes clear that CMS regional offices—regardless of findings and recommendations from state survey agencies—will impose a CMP for past noncompliance based only on each instance of noncompliance that occurred but was corrected before the state survey is conducted. With this policy change, if a facility has corrected that noncompliance just before the survey team shows up at the facility—even if the noncompliance had lasted for many months, then the facility will evade penalties for each day of noncompliance that may be recommended and imposed under the Nursing Home Reform Act of 1987 (NHRA) to deter and punish such gross misconduct and dereliction.”

“At present, per-day CMPs range in amount, as adjusted for inflation, from $6,808 to $22,320 per day for deficiencies constituting immediate jeopardy to nursing facility residents, and from $112 to $6,695 per day for deficiencies that do not constitute immediate jeopardy but either caused actual harm or have the potential to cause more than minimal harm (“non-immediate jeopardy harm”). 42 C.F.R. § 488.438(a)(1); 45 C.F.R. § 102.3.”

“By comparison, per-instance CMPs currently range in amount, as adjusted for inflation, from $2,233 to $22,320 per instance. 42 C.F.R. § 488.438(a)(2); 45 C.F.R. § 102.3. Taking the example of a deficiency that causes non-immediate jeopardy harm, the maximum per-day CMP begins to exceed the maximum per-instance CMP whenever such a deficiency remains uncorrected for four or more days (4 x $6,695 = $26,780). Unlike a per-instance CMP, which is capped at $22,320, a per-day CMP thus punishes a nursing facility more severely the longer it has allowed a deficiency to remain uncorrected prior to a visit by the state survey team.”

The Complaint alleges that “in response to lobbying from the nursing facility industry,” CMS issued another memorandum on July 7, 2017 to all state survey agency directors stating: “Past Noncompliance: ROs will impose a per-instance CMP for past noncompliance – something occurred before the current survey, but has been fully addressed and the facility is back in compliance with that area. Per Instance CMP is the Default for Noncompliance that Existed before the Survey: CMS ROs will generally impose a Per Instance CMP retroactively for non-compliance that still exists at the time of the survey, but began earlier….”

The Complaint alleges: “The effect of this announced policy change is to nullify the discretion that the States have, under Sections 1819(h)(1) and 1919(h)(1) of the Social Security Act and 42 C.F.R. § 488.430(b), to recommend the imposition of per-day CMPs for cases of past noncompliance.”

“In announcing to state survey agency directors that its regional offices will assess CMPs only for each instance of past noncompliance and not for each day of past noncompliance, CMS’s policy change contravenes Congress’s express intent to give the States the discretion to recommend, and CMS the discretion to impose, a per-day CMP for past noncompliance. CMS’s regulations duly implementing this effective and longstanding enforcement scheme are similarly contravened. This policy change is arbitrary and capricious, an abuse of discretion, and otherwise not accordance with law. At a minimum, it should be adjudged and declared null and void because it purports to articulate a new substantive legal standard without the required notice-and-comment rulemaking, a procedure required by law.”

“The imposition of only per-instance CMPs for past noncompliance will thus encourage nursing facilities to knowingly allow deficiencies to linger, unaddressed for multiple days, weeks, or even months until the next state survey, because the penalty will be the same regardless of whether the deficiency persisted for one day, thirty days, ninety days, or nine months. As long as the facility remedies the deficiency before the next survey is conducted (and standard surveys are spaced 12 to 15 months apart), it can be fined only up to the per-instance maximum of $22,320.”

The Complaint seeks the Court to “Set aside CMS’s announced policy change in its July 7, 2017 memorandum as exceeding CMS’s statutory authority; as arbitrary, capricious, an abuse of discretion, and otherwise not in accordance with law; as lacking observance of procedure required by law; and as constituting invalid sub-regulatory guidance,” inter alia.

If you or a loved one suffered injuries (or worse) while a resident of a nursing home in the United States due to nursing home neglect, nursing home negligence, nursing home abuse, a nursing home fall, or the nursing home failing to properly care for a vulnerable adult, you should promptly find a nursing home claim lawyer in your state who may investigate your nursing home claim for you and file a nursing home case on your behalf or behalf of your loved one, if appropriate.

Visit our website to be connected with medical malpractice attorneys (nursing home claim attorneys) in your U.S. state who may assist you with your nursing home claim, or call us toll-free in the United States at 800-295-3959.

Turn to us when you don’t know where to turn.

This entry was posted on Monday, February 8th, 2021 at 5:28 am. Both comments and pings are currently closed.


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