Category Archives: Skilled Nursing Facility

AHCA Preliminary Decisions on Skilled Nursing Facilities

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AHCA has issued its State Agency Action Reports announcing the preliminary results on CON Applications submitted for Skilled Nursing Facilities. Below is a summary of the winners and losers listed by Sub-district. For a summary of the process for challenging AHCA’s preliminary decisions, please see our prior Newsletter Article attached.

Sub-district 1-1

Approved Application:

NF Bay, LLC/NF Bay, LLC Establish a new 90-bed community nursing home

Denied Application:

PruittHealth – Escambia County, LLC/PruittHealth – Escambia County, LLC Establish a new 90-bed community nursing home

Sub-district 3-1

Approved Application:

SF Brevard, LLC/SF Brevard, LLC Establish a new 113- bed community nursing home

Withdrawn Application:

Terrace Enterprises, LLC/Terrace Enterprises, LLC Establish a new community nursing home of up to 120 beds

Sub-district 3-2

Approved Applications:

Oak Hammock at the University of Florida, Inc./Oak Hammock at the University of Florida Add 17 community nursing home beds through the conversion of 17 sheltered nursing home beds
Palm Garden of Gainesville, LLC/Palm Garden of Gainesville, LLC Add 30 community nursing home beds

Withdrawn Application:

Innovative Medical Management Solutions, LLC/Innovative Medical Management Solutions, LLC Establish a new 47-bed community nursing home

Sub-district 3-3

Approved Application:

Crestwood Nursing Center, Inc./Crestwood Nursing Center Add 29 community nursing home beds

Sub-district 4-1

No Approved Applications

Denied Application:

Innovative Medical Management Solutions, LLC/Innovative Medical Management Solutions, LLC Establish a new 14-bed community nursing home

Sub-district 7-2

Approved Applications:

Presbyterian Retirement Communities, Inc./Westminster Towers Add 30 community nursing home beds through the conversion of 30 sheltered nursing home beds
Presbyterian Retirement Communities, Inc./Westminster Winter Park Add 17 community nursing home beds through the conversion of 17 sheltered nursing home beds

Denied Applications:

MF Orange, LLC/MF Orange, LLC Establish a new 90-bed community nursing home
Orange SNF, LLC/Orange SNF, LLC Establish a new 118-bed community nursing home

Sub-district 7-4

Approved Application:

Lifespace Communities, Inc./Village on the Green Add 30 community nursing home beds through the conversion of 30 sheltered nursing home beds

Withdrawn Application:

Innovative Medical Management Solutions, LLC/Innovative Medical Management Solutions, LLC Establish a new 33-bed community nursing home

Sub-district 8-2

Denied Application:

Pelican Bay Retirement Services/Premier Place at the Glenview Add 14 community nursing home beds through the conversion of 14 sheltered nursing home beds

Sub-district 9-1

Approved Application:

Palm Garden of Vero Beach, LLC/Palm Garden of Vero Beach, LLC Add nine community nursing home beds

Sub-district 11-1

Approved Application:

Florida Medical Systems, LLC/Florida Medical Systems, LLC Add 45 community nursing home beds

Denied Application:

Palm Garden of Aventura, LLC/Palm Garden of Aventura, LLC Add 45 community nursing home beds

Geoffrey D. Smith is a shareholder in the law firm of Smith & Associates, and has practiced in the area of health care law for over 20 years.

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Defending Alleged Survey Deficiencies at Assisted Living Facilities (ALFs) and Skilled Nursing Facilities (SNFs)

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You have probably seen the full page newspaper advertisements by certain law firms trying to solicit Plaintiffs to sue your ALF or nursing home, and placing your recent Survey Deficiencies in big bold print for all the world to see.   These tactics highlight the importance of knowing your rights as an ALF or SNF operator.  Whether to challenge a statement of deficiencies or an Administrative Complaint by the Agency for Health Care Administration is an important decision with far reaching consequences.  You should know your rights and make an informed decision.

Inspections and Survey Deficiencies: Know Your Rights

Assisted Living Facilities (“ALFs”) (governed by Chapter 429, Part I, Florida Statutes, in addition to Chapter 408, Florida Statutes) and Skilled Nursing Facilities (“SNFs”) (governed by Chapter 400, Part II, Florida Statutes, in addition to Chapter 408, Florida Statutes) need to be aware of their legal rights and responsibilities regarding Agency for Health Care Administration (AHCA or Agency) inspections, surveys, and enforcement actions.

With regard to inspections, pursuant to Florida Statutes, AHCA may conduct unannounced inspections of ALFs and SNFs1. If faced with an inspection, an ALF/SNF operator has no legal right to refuse to allow the inspectors access to the facility2.  During the inspection, AHCA is entitled to have access to copies of all provider records required during the inspection3.  An ALF/SNF operator may request that an Administrator  or  other  designated  representative  accompany  the  inspectors  while  at  the facility.  It is advisable that the ALF/SNF operator immediately consult with legal counsel if an unannounced AHCA inspection is made.  During an exit interview, the AHCA representatives should explain their findings, including any alleged deficiencies that were found.

Subsequent to an inspection, AHCA will provide the ALF/SNF Administrator with a survey report that provides a detailed written explanation of the findings made during an inspection. If a violation of a regulation is found during an inspection or investigation, it is cited as a deficiency on the Statement of Deficiencies.  Any deficiency must be corrected within 30 calendar days after the provider is notified of inspection results unless an alternative timeframe is approved by the agency4. The ALF/SNF will be given 10 calendar days in which to present a Plan of Correction5.  ALFs/SNFs must maintain for a three-year period, and make available upon request, records of all inspection reports pertaining to that provider that have been filed by the agency unless such reports are exempt from public disclosure6.

Although seldom asserted, an ALF/SNF operator may assert a legal right to challenge a survey report and petition for a formal administrative hearing pursuant to Section 120.569 and 120.57(1), Florida Statutes, if the provider believes that there were in fact no deficiencies that should result in a Plan of Correction being submitted.  However, in most instances, the results of a licensure or complaint survey can be resolved through submission and implementation of a Plan of Correction.

Statutory Framework Regarding AHCA’s Issuance of Deficiencies

Emergency License Suspension Orders

In the event of alleged severe deficiencies which AHCA claims threaten the health, safety or welfare of an ALF/SNF resident, AHCA can impose an immediate moratorium on admissions or an emergency order of license suspension7.   However, the right to take such emergency action is limited, and  such orders can be challenged legally.  AHCA is required by Section 120.60(6), Florida Statutes, to make specific findings that document the existence of the emergency situation, and may take only such action as is required to address the emergency. An improper Emergency Suspension Order or Moratorium may be immediately appealed to the District Court of Appeal, and there are numerous decisions where Agency action that is not based on a true emergency is reversed and set aside.

Further, AHCA must also provide an ALF/SNF operator faced with an emergency moratorium, or suspension order, or any other effort to suspend or revoke a license with the opportunity to file a Petition for Formal Administrative Hearings to challenge the validity of AHCA’s action or proposed action on the license8.  Hearings on license proceedings are held before an independent administrative law judge at the Division of Administrative Hearings.  Such hearings are an opportunity to prove that the true facts do not support a moratorium, suspension or revocation of the ALF/SNF license.

In addition to or in lieu of taking direct action against an ALF/SNF operator’s license, AHCA may also seek imposition of civil penalties for alleged violation of licensure rules and standards.

Administrative Fines and Classification of Deficiencies

AHCA imposes administrative fines for violations according to a classification system in statute, based on the nature of the violation and the gravity of its probable effect on facility residents.  The agency shall indicate the classification on the written notice of the violation9.   In addition, the scope of the violation may be cited as an isolated deficiency (affecting a very limited number of clients), a patterned deficiency (repeated violations affecting more than a limited number of clients), or a widespread deficiency (pervasive or systemic failures that have the potential to affect a large portion of clients)10.

Assisted Living Facilities (ALFs) and Chapter 429, Florida Statutes

Pursuant to sections 408.813 (AHCA’s “Core Licensure Act”) and 429.19, Florida Statutes (which governs the operations of an ALF), the “classifications” assigned to the alleged violation and the attendant administrative fines are as follows:

Class I violations: present an imminent danger to clients or a substantial probability that death or serious physical or emotional harm would result.  These violations must be corrected within 24 hours.  Imposition of a fine is mandatory in an amount not less than $5,000 and not exceeding $10,000 per violation, even if the violation is corrected11.

Class II violations:  directly threaten the physical or emotional health, safety or security of clients (other than Class I).  Imposition of a fine is mandatory in an amount not less than $1,000 and not exceeding $5,000 per violation, even if the violation is corrected12.

Class III violations: indirectly or potentially threaten the physical or emotional health, safety or security of clients (other than Class I or Class II).   AHCA shall impose a fine in an amount not less than $500 and not exceeding $1,000 per violation, unless the violation is corrected within the time specified for correction in the citation13. [Note: ALF statute (Ch. 429) provides that fines are mandatory for Class III and Class IV violations, but the core licensure statute (Ch.  408) says that the fine will not be imposed if corrected within a specified time, see discussion below.]

Class IV violations:  pertain to reports, forms or documents that do not have the potential of negatively affecting clients (purely paperwork type violations).  These violations are those that AHCA has determined do not threaten the health, safety, or security of clients.  AHCA shall impose a fine in the amount not less than $100 and not exceeding $200 per violation, unless the violation is corrected within the time specified for correction in the citation14.

Section 408.813, Florida Statutes, expressly provides that no fines shall be imposed for timely corrected Class III and Class IV violations.  However, AHCA has been known to take a contrary view, and the specific fine amounts for violation of ALF licensure standards are stated in mandatory language in Chapter 429, Florida Statutes.  Section 408.832, Florida Statutes, provides that when the AHCA Core Licensing Act conflicts with the specific facility governing statutes (such as the ALF statute) then the Core Licensure Act should prevail.  Applying that principle, then no fines should be imposed for minor Class III and IV violations when they are timely corrected by the ALF.  If AHCA were to impose fines for Class III and Class IV violations, the ALF would have appropriate grounds for challenging such fines.

In determining if a penalty is to be imposed and in fixing the amount of the fine, AHCA shall consider the following factors:

  • the severity of the violation and the extent to which the provision of the applicable laws were violated,
  • actions taken by the ALF administrator to correct violations,
  • previous violations,
  • the financial benefit to the facility of committing the violation, and
  • the licensed capacity of the facility15.

Additionally, each day of continuing violation after the date determined by AHCA for termination of the violation, constitutes an additional, separate, and distinct violation16.

Because AHCA considers previous violations when imposing penalties, it is important that ALF Administrators ensure that they quickly address and resolve all minor violations so that these will not later serve as a basis for imposing more severe sanctions.  Additionally, ALF administrators shall document in writing all actions to correct violations and these shall be verified through AHCA follow up visits.  AHCA may impose a fine, and in some instances, revoke or deny a facility’s license when a facility administrator fraudulently misrepresents action taken to correct a violation17.

Additionally, AHCA may impose administrative fines in an amount not to exceed $500 per violation for violations that are not designated as Class I, II, III, or IV violations. Unclassified violations include, but are not limited to: violating a condition of the license, violating statutes or rules, exceeding license capacity, and providing services beyond the scope of the license.

Skilled Nursing Facilities (SNFs) and Chapter 400, Florida Statutes

Skilled Nursing Facilities (SNFs) are governed by Chapter 400, Part II, Florida Statutes, as well as Chapter 408, Part II, Florida Statutes.  In accordance with section 400.23(7), Florida Statutes, AHCA shall, at least every 15 months, evaluate all nursing home facilities and make a determination as to the degree of compliance.  The agency’s determination shall be based on the most recent inspection report, as well as findings from other reports and investigations.  In addition to the license classification categories authorized under part II of chapter 408 (discussed above), AHCA shall assign either a “standard licensure status” or a “conditional licensure status” to each nursing home18. 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.  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 survey19.

The current licensure status of each facility shall be indicated in bold print on the face of the facility’s license, and a list of the deficiencies of the facility shall be posted in a prominent place that is in clear and unobstructed public view at or near the place where residents are being admitted to that facility20.

Licensees receiving a conditional licensure status for a facility shall prepare, within 10 working days after receiving notice of deficiencies, a plan for correction of all deficiencies and shall submit the plan to the agency for approval21.

An operator has the right to challenge a Conditional license rating through the filing of a Petition for Formal Administrative Hearing and a trial before an independent Administrative Law Judge.

Classification and Civil Penalties/Administrative Penalties

The “classification” system and attendant penalties for SNF deficiencies are found in section 400.23(8), Florida Statutes, and outlined below.  The classifications are similar to that of ALFs, though not identical, and the attendant penalties are quite different.  Of note, the SNF statute expressly provides for different levels of fines depending on the whether the deficiency was isolated, patterned, or widespread.  Moreover, for Class I, II, and III deficiencies, section 400.23(8), Florida Statutes, provides that “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 licensure inspection.”

Class I deficiency: a deficiency requiring immediate corrective action 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. 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 licensure inspection or any inspection or complaint investigation since the last licensure inspection. A fine must be levied notwithstanding the correction of the deficiency22.

Class II deficiency: a deficiency that the agency determines has compromised the resident’s ability to maintain or reach his or her highest practicable physical, mental, and psychosocial well-being. A class II deficiency is subject to a civil penalty of $2,500 for an isolated deficiency, $5,000 for a patterned deficiency, and $7,500 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 licensure inspection or any inspection or complaint investigation since the last licensure inspection. A fine shall be levied notwithstanding the correction of the deficiency23.

Class III deficiency: a deficiency that the agency determines will result in no more than minimal physical, mental, or psychosocial discomfort to the resident. A class III deficiency is subject to a civil penalty of $1,000 for an isolated deficiency, $2,000 for a patterned deficiency, and $3,000 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 licensure inspection or any inspection or complaint investigation since the last licensure inspection. If a class III deficiency is corrected within the time specified, a civil penalty may not be imposed24.

Class IV deficiency: a deficiency that the agency determines has the potential for causing no more than a minor negative impact on the resident. If the class IV deficiency is isolated, no plan of correction is required25.

In addition to the above, section 400.121, Florida Statutes, provides for the denial, suspension, or revocation of nursing home and related health care facility licenses, and also provides for administrative fines.  In accordance with section 400.121(1), Florida Statutes, AHCA may revoke or suspend a license, or impose administrative fines not to exceed $500 per violation per day.  Section 400.121(2), Florida Statutes, states:

“Except as provided in 400.23(8), a $500 fine shall be imposed for each violation.  Each day a violation of this part or part II of chapter 408 occurs constitutes a separate violation and is subject to a separate fine, but in no event may any fine aggregate more than $5,000.”

This section further provides:

“A fine may be levied pursuant to this section in lieu of and notwithstanding the provisions of s. 400.23.”26

Thus, the statutes governing administrative fines for skilled nursing facilities appear to be inconsistent and afford the agency significant discretion.  On the one hand, it states that “except as provided in 400.23(8), a $500 fine shall be imposed,” but, on the other hand, it also appears to state that the $500 per day fine not to exceed the $5,000 in aggregate may be imposed in lieu of the fines provided for in Section 400.23(8) above.  An experienced health care attorney can help to navigate these somewhat confusing and contradictory statutes, and seek to have them interpreted and applied in a manner most beneficial to the provider.

Revocation and Suspension:  With respect to revoking a SNF license, AHCA may revoke a license where the facility: has had two moratoria issued for substandard care within any 30-month period; is conditionally licensed for 180 continuous days; is cited for two unrelated Class I deficiencies during the same survey; or is cited for two Class I deficiencies arising from separate surveys within a 30-month period.27  If AHCA has placed a moratorium on a facility two times within a 7-year period, AHCA may suspend the nursing home license.  The licensee may present factors in mitigation of revocation, and AHCA may determine not to revoke the license based upon the facility’s mitigating factors.

Any action to suspend or revoke a facility’s license under Chapters 400 or 408 shall be heard by the Division of Administrative Hearings within 60 days after the assignment of an administrative law judge (ALJ), unless the time limitation is waived by both parties, and the ALJ shall render a decision with 30 days after receipt of the proposed recommended order.28  Agency action may be overcome by the licensee upon a showing by a preponderance of evidence to the contrary.29

Challenging a Statement of Deficiencies

Existing case law allows a provider to challenge the issuance of Statement of Deficiencies prior to AHCA filing an Administrative Complaint. See e.g., W. Frank Wells Nursing Home v. Ag. for Health Care Admin., 27 So. 3d 73, 74 (Fla. 1st DCA 2009) (holding that a statement of deficiencies constituted agency action and could be challenged in an administrative hearing).  However, the decision to file a petition to challenge a Statement of Deficiencies has significant implications on the burden of proof at hearing.  AHCA Final Orders have indicated that a party challenging a Statement of Deficiencies has the burden to show that no violations occurred by a preponderance of the evidence. See Water’s Edge Extended Care v. Ag. For Health Care Admin., DOAH 12-2188, 2013 WL 4080436, at *3 (Aug. 2, 2013) (“Here, the Agency issued a document known as a statement of deficiencies. It imposed no penalty on the Petitioner. Nor did it alter Petitioner’s licensure status in any way. Thus, it did not meet the definition of an administrative complaint found in Rule 28-106.2015(1), Florida Administrative Code. Therefore, Petitioner should have born the burden of proof by a preponderance of the evidence.”).  In contrast, if AHCA files an Administrative Complaint, then AHCA has the burden to prove the violation by clear and convincing evidence.30

Because the burden on AHCA to prove the violation is much greater when it brings an Administrative Complaint (as compared to when a facility challenges a Statement of Deficiencies), ALFs/SNFs need to seriously consider the pros and cons of challenging a Statement of Deficiencies.  In most instances, the best course of action is to challenge the Administrative Complaint, rather than challenging the Statement of Deficiencies.  However, the following are circumstances where it may be prudent for a facility to challenge the Statement of Deficiencies:

  • When AHCA is requiring some immediate corrective action that the provider believes is unwarranted under the circumstances and that would be unduly burdensome on the provider;
  • When the facility reasonably believes that the Statement of Deficiencies will result in a negative stigma affecting its business operations if it fails to challenge the alleged deficiency;
  • When the facility reasonably believes that certain payors may take adverse action based on the Statement of Deficiencies being filed and unchallenged.

It should be noted that although administrative case law in certain Final Orders has indicated that the burden on the provider is much greater when it challenges a Statement of Deficiencies, there have been no appellate decisions on this issue to date.

Case Law Examples: Recent Reported Final Orders

ALF Final Order Examples

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION v. ANGEL AIDES CENTER, INC. d/b/a BOYNTON BEACH ASSISTED LIVING FACILITY, 2014 WL 7385342 (December 17, 2014), DOAH NO. 13-1258

Action to revoke the ALF’s license and impose $5,000 fine and $500 survey fee.  Agency cited the facility for two Class II deficiencies as a result of complaint investigation surveys.  Based on the surveys it was determined that the facility failed to ensure that residents met the residency requirements (several residents required medical and psychological supervision exceeding the residency criteria) and failed to provide supervision to the residents.  Specifically, during the investigation it was revealed that one of the residents who did not meet the residency requirement (as he required medical supervision due to antisocial behavior) had sexually assaulted another resident several months prior. Pursuant to section 429.14 (1) (e), Florida Statutes, the Agency sought to revoke the license since it had previously cited the facility for four Class II deficiencies.

Holding/Fine: ALF license was revoked, and respondent was required to pay the Agency $5,500.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Petitioner v. DAYSPRING VILLAGE, INC., 2014 WL 2624256 (June 3, 2014); DOAH CASE NO. 13-1451

Administrative Complaint sought to impose an administrative fine of $2,000 based on two Class II deficiencies discovered during a complaint inspection of Dayspring Village’s assisted living facility (“ALF”), as well as a $185.00 survey fee. Specifically, the complaint alleged that the facility failed to provide adequate and appropriate health care consistent with established and recognized standards within the community by allowing diabetic residents to use the same glucometer without disinfecting or cleaning the glucometer device in between resident usage, and failed to properly supervise residents taking their medication.

Holding: The Final Order concluded that AHCA proved its violations by clear and convincing evidence and imposed an administrative fine of $2,000 and a survey fee of $185.50 on Dayspring Village, Inc.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Petitioner v. PINE TREE MANOR, INC. d/b/a PINE TREE MANOR, Respondent, 2014 WL 554674 (February 5, 2014) DOAH CASE NOS. 13-2011, 13-2397

AHCA charged Pine Tree Manor with two Class I violations and sought to revoke its license for two separate deficiencies.  The first alleged Class I violation concerned the facility’s failure to remain generally aware of one of its residents whereabouts.  Specifically, a resident wandered off from the facility and the facility did not seek to locate him until the next morning.  They were unable to locate him, and he was found, deceased, several days later.  The Final Order held that AHCA had not proved by clear and convincing evidence that the facility was on notice the resident was in “imminent danger of death or serious physical harm” to substantiate a Class I, and held that it was a Class II violation, and imposed a $5,500 fine.  The second alleged violation concerned the facility’s failure to properly respond to an emergency situation where a resident stopped breathing and ultimately died.  The employee failed to immediately call 911 and provide CPR.  The Final Order held this was a Class I violation, revoked respondent’s license, and imposed an $8,000 fine.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Petitioner v. STEPHENS MEMORIAL HOME, INC. d/b/a STEPHENS MEMORIAL HOME, 2013 WL 3490616 (July 8, 2013), DOAH CASE NO. 13-0368

AHCA conducted an unannounced biennial licensure and complaint survey that gave rise to the Administrative Complaint.  The Administrative Complaint alleged a widespread class II deficiency and sought the imposition of an administrative fine of $1,000 against Respondent. Specifically, the Administrative Complaint alleged that Stephens Memorial failed to insure that one of four sampled residents was free of physical restraints in violation of Florida Statutes because that resident had an activity board attached to his wheelchair that appeared to prevent the resident from getting up from his wheelchair.

Holding: The Final Order held that the resident was able to remove the activity board and that it was prescribed for therapeutic purposes and thus did not meet the definition of a “restraint” and the Administrative Complaint was dismissed.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Petitioner v. DOS OF CRYSTAL RIVER ALF, LLC d/b/a CRYSTAL GEM ALF, 2013 WL 595490 (February 7, 2013);  DOAH CASE No. 12-2306

Administrative Complaint alleged a Class III violation for facility’s failure to have a properly completed Residential Health Assessment form for each resident, and Class I violation for failure to provide appropriate supervision to prevent elopement.

Holding: Held that while violations did occur in that the forms were not properly completed, they did not constitute Class III violations because there was no threat to the physical or emotional health of the residents, and thus it was reduced to a Class IV violation with a fine of $100.  With regard to the alleged Class I violation regarding elopement, the Final Order held that the Agency did not prove, by clear and convincing evidence, that the facility violated Florida Statutes with respect to the provision of care and supervision of its residents.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Petitioner v. ALLAN V. COMRIE d/b/a PREMIER ADULT CARE; ALLAN V. COMRIE d/b/a FIRST CLASS PHASE II; and ALLAN V. COMRIE d/b/a FIRST CLASS ADULT FAMILY CARE and JAM, 2012 WL 5705633 (November 8, 2012);  DOAH CASE NO. 12-0102

AHCA alleged that Respondent had advertised and operated a facility without first obtaining licensure for that program, had misrepresented the licensure status of the home, had failed to comply with rules governing facilities, and had failed to cooperate with authorities with regard to the facility. As to all alleged violations, Respondent maintained it was not required to hold a license for the subject property as its operation was exempt as a matter of law. Additionally, Respondent averred that any incorrect advertising was merely a clerical error and not an intentional misrepresentation of the licensure status of the facility.

Holding: Although the Administrative Law Judge did not recommend revocation, AHCA entered a Final Order and imposed a $7,000 fine and revoked Respondent’s license.   The operator elected not to appeal to the District Court of Appeal.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION v. AVALON’S ASSISTED LIVING, LLC d/b/a AVALON’S ASSISTED LIVING and d/b/a AVALON’S ASSISTED LIVING AT AVALON PARK; and AVALON’S ASSISTED LIVING II, LLC, 2011 WL 860551 (March 9, 2011)

Action to revoke the facilities’ licenses due to Class II deficiencies regarding: 1) failure to provide required employee training and falsified training certifications, and 2) the failure to provide residents with appropriate pain medication and required care. The evidence established that the violations posed a direct threat to the physical and emotional health of the residents.  License revocation was an appropriate penalty pursuant to section 429.14(1)(e)(2), Florida Statutes, regarding revocation where there are three or more cited class II deficiencies.

Holding/Fine: The licenses of the facilities were revoked and an administrative fine of $3,000 was imposed.

SNF Final Order Examples

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Petitioner v. TALLAHASSEE FACILITY OPERATIONS. LLC d/b/a CONSULATE HEALTHCARE OF TALLAHASSEE, Respondent, 2015 WL 510385 (February 2, 2015), DOAH CASE NO. 14-0436

Administrative Complaint sought to impose an administrative fine in the amount of $1,000 and conditional licensure status based on one uncorrected Class III deficiency discovered during a revisit survey inspection conducted on August 12, 2013. AHCA conducted a survey of the facility in July 2013 and found a Class III deficiency for failure to follow physician orders that patient be bathed daily.  Respondent submitted a corrective action plan which was approved by AHCA.  AHCA re-surveyed respondent in August 2013, and found additional Class III violations regarding failure to follow physician orders concerning PICC-dressing changes in violation of rule 59A-4.107(5).  AHCA alleged the August violation constituted an uncorrected violation of the earlier failure to follow physician orders.

Respondent argued that the August violation was different than the July violation, and thus the August violation should not be construed as an “uncorrected violation.” AHCA argued that both violations concerned the failure to follow physician orders and thus the second violation was an “uncorrected violation.” AHCA further argued that its acceptance of the corrective action plan did not  absolve Respondent from its responsibility to correct every area in which it was found out of compliance.

Holding: AHCA demonstrated by clear and convincing evidence that Respondent committed an uncorrected Class III deficiency. Final Order imposed a fine of $1,000 and further imposed conditional licensure on Respondent for the period from August 13, 2013 through September 30, 2014.

WATER’S EDGE EXTENDED CARE, Petitioner v. STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Respondent, 2013 WL 4080436 (August 02, 2013), DOAH 12-2188

AHCA conducted a complaint survey and issued a statement of deficiencies for alleged violation of section 400.0255, Florida Statutes, regarding transfers or discharges initiated by nursing homes.  The statement of deficiencies was challenged by petitioner and the matter was referred to DOAH.  The ALJ found that section 400.0255, Florida Statutes, was inapplicable to the circumstances, as the physician initiated the Baker Act transfer, not the nursing home.

Holding: The Final Order found that the Agency failed to establish that respondent violated section 400.0255, Florida Statutes, by improperly discharging or transferring the resident, and they Agency withdrew its Statement of Deficiencies.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Petitioner v. GREENBRIAR NH, LLC d/b/a GREENBRIAR REHABILITATION AND NURSING CENTER, Respondent, 2012 WL 2191285 (June 7, 2012) DOAH CASE NO. 11-4379

Administrative Complaint alleged that Respondent failed to comply with background screenings and alleged a Class II deficiency.

Holding: the Respondent failed to comply with the relevant law regarding background screenings as well as its own policies and procedures when it hired new employee. However, the Petitioner failed to prove that these failures constituted a Class II deficiency.  The Final Order dismissed the Administrative Complaint and replaced the Conditional License with a Standard License for the time period in question.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION, Petitioner v. SA-PG SUN CITY CENTER, LLC d/b/a PALM GARDEN OF SUN CITY, Respondent, 2011 WL 379931 (January 1, 2011), DOAH CASE NO. 10-4740

Administrative Complaint alleged that Respondent failed to follow established and recognized practice standards regarding care to its residents; and failed to comply with the rules governing skilled nursing facilities adopted by AHCA.

Holding: There is no competent and substantial evidence that Respondent failed to follow established practice standards that resulted in harm to its residents and failed to comply with rules governing skilled nursing facilities, or that otherwise warrants a fine or Conditional rating. Respondent was marginally deficient in two minor areas concerning their own policies, but neither violation is a Class II deficiency, nor warrants imposition of a sanction.

Conclusion

Preventative measures are the best way to protect against survey deficiencies.  ALF/SNF administrators should develop and implement trainings and staff education to ensure compliance with Florida Statutes and rules.  Qualified health care consulting firms and health care attorneys can assist with developing compliant materials and compliance programs.  An ounce of prevention in this respect will be well worth avoiding the costs of a bad survey or inspection by AHCA.

However, even with a good education and compliance program in place, AHCA may still seek to suspend or revoke a license, or impose a moratorium on admissions or levy substantial fines.  In order to assess penalties, AHCA is required to file an Administrative Complaint.  ALFs/SNFs have the right to demand a formal hearing to challenge the facts, and to challenge the amount or appropriateness of the fines being imposed.

ALF/SNF administrators in such situations should consult and retain experienced legal counsel to contest and defend against such actions by filing a Petition for Formal Administrative Hearing pursuant to Chapter 120.  The timeframe for responding to an Administrative Complaint is 21 days from receipt of the Complaint, and failure to timely file a petition may result in an admission of the facts alleged in the Complaint and entry of a Final Order by the agency.  ALF/SNF administrators need to be aware of their legal rights prior to receiving an Administrative Complaint and need to be sure to consult with counsel prior to inadvertently waiving any rights.  Hiring experienced legal counsel is crucial in any challenge to an Administrative Complaint.  Experienced counsel can not only help to protect your due process rights, but can also ensure that the State is required to prove its case by clear and convincing evidence.

Geoffrey D. Smith is a shareholder in the law firm of Smith & Associates, and has practiced in the area of health care law for over 20 years.

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1 §408.811 (1), Fla.  Stat., §429.34 (1), Fla.  Stat., §400.19, Fla.  Stat.

2 §408.811 (1), Fla.  Stat.

3 §408.811 (3), Fla.  Stat.

4 §408.811 (4), Fla.  Stat.

5 §408.811 (5), Fla.  Stat.

6 §408.811 (6), Fla.  Stat.

7 §408.814 (1), Fla.  Stat.

8 §120.60 (7), Fla.  Stat.

9 §429.19 (2), Fla.  Stat.

10 §408.813(2), Fla.  Stat.

11 §408.813(2)(a), Fla.  Stat.; §429.19(2)(a), Fla.  Stat.

12 §408.813(2)(b), Fla.  Stat.; §429.19(2)(b), Fla.  Stat.

13 §408.813(2)(c), Fla.  Stat.; §429.19(2)(c), Fla.  Stat.

14 §408.813(2)(d), Fla.  Stat.; §429.19(2)(d), Fla.  Stat.

15 §429.19(3), Fla.  Stat.

16 §429.19(4), Fla.  Stat.

17 §429.19(5), Fla.  Stat.

18 §400.23(7), Fla.  Stat.

19 §400.23(7)(a) and (b), Fla.  Stat.

20 §400.23(7)(d), Fla.  Stat.

21 §400.23(7)(d), Fla.  Stat.

22 §400.23(8), Fla.  Stat.

23 §400.23(8), Fla.  Stat.

24 §400.23(8), Fla.  Stat.

25 §400.23(8), Fla.  Stat.

26 §400.121(2), Fla.  Stat. (emphasis added).

27 §400.121(3), Fla.  Stat.

28 §400.121(5), Fla.  Stat.

29 §400.121(7), Fla.  Stat.

30 The burden of proof on AHCA to impose an administrative fine is by clear and convincing evidence. Dep’t of Banking & Fin, v. Osborne Stern & Co., 670 So. 2d 932 (Fla. 1996). The burden of proof for the assignment of licensure status is by a preponderance of the evidence. See Florida Dep’t of Transp. v. J.W.C. Co., Inc., 396 So. 2d 778 (Fla. 1st DCA 1981); Balino v. Dep’t of HRS, 348 So. 2d 349 (Fla. 1st DCA 1977).  See also AGENCY FOR HEALTH CARE ADMINISTRATION v. TALLAHASSEE FACILITY OPERATIONS. LLC d/b/a CONSULATE HEALTHCARE OF TALLAHASSEE, 2015 WL 510385, at *12 (February 2, 2015), DOAH CASE NO. 14-0436.

 

The FLSA and Nursing Care Facilities – Unique Challenges

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While most businesses are subject to the Fair Labor Standards Acts’ (“FLSA”) overtime and minimum wage requirements, skilled nursing facilities, assisted living facilities, and nursing homes (collectively “Nursing Care Facilities”) face unique challenges when attempting to comply with the FLSA’s requirements. In fact, a Department of Labor survey conducted in 2000 showed that 84% of nursing homes were in violation of the FLSA’s overtime provisions. See http://www.dol.gov/whd/healthcare/surveys/nursing2000.htm. Violations of the FLSA can be costly. If found to be in violation, an employer will be liable for all of the past overtime owed, liquidated damages (which effectively doubles the amount owed), and attorney fees. 29 U.S.C. § 216(b). If not handled quickly and effectively, oftentimes the attorney fees can far outweigh the actual damages. To avoid these costs, Nursing Care Facilities need to continually ensure that they are in compliance with the FLSA.

Live–In Care Staff

Recently, a Central Florida ALF, Alta HealthCare Group, Inc. (“Alta”), was sued by a live-in care provider for violations of the FLSA’s overtime provisions. “Florida regulations require ALFs to have at least one staff member certified in cardiopulmonary resuscitation (“CPR”) on-site at all times.” Maldonado v. Alta Healthcare Grp., Inc., No. 6:12-CV-1552-ORL-36, 2014 WL 1661265 (M.D. Fla. Mar. 26, 2014) citing Fla. Admin. Code Ann. r. 58A–5.0191(4). To comply with this requirement, Alta hired a staff member at each of its facilities to reside at the ALF. This staff member was expected to perform regular duties when scheduled during the day shift (8:00 a.m. to 8:00 p.m.), and, if an issue arose, provide services during the night shift (8:00 p.m. to 8:00 a.m.). Alta considered any night issues to be minor and non-compensable because the staff “benefited from the ‘implicit value’ of not having to pay living expenses.” I d. Due to these working conditions, Norma Maldonado, a live-in care staff member, filed a lawsuit alleging FLSA overtime violations.

The Court stated that, due to the fact-specific nature of arrangements involving residing on the employer’s premises, employers and employees were free to construct reasonable agreements regarding compensation. Id. citing 29 C.F.R. § 785.23. However, the Court stated, “to be reasonable, employees must be compensated for any actual interruptions in sleep and, moreover, no more than eight hours of sleep time may be deducted for each 24-hour on-duty period.” Id. Emphasis added. The Court held that because Alta’s agreement did not compensate Maldonado for the interrupted sleep and because it attempted to deduct more than 8 hours of sleep time, it was unreasonable and unenforceable. Id.

With the agreement unenforceable, the Court then went on to determine if there were any overtime violations. The Court found that, because Maldonado put notes in each resident’s file every time she had an issue during the night shift, Alta had constructive knowledge of her work and was required to pay for that time. Id. Further, while Alta could claim the value of the residence as compensation, its mere assertion that the value was worth $1,085.00 was not sufficient and it would need to provide more evidence as to the reasonable value of the residence if it wished to apply that amount towards compensation. Id.

Shortly after the Court made this ruling, the parties settled. There are three key lessons to be taken from this case. First, employers should always ensure that working hours are recorded and properly compensated. If a Nursing Care Provider knows or should know that an employee is working, that person is entitled to compensation. Second, if a Nursing Care Provider has live-in staff, it needs to have an agreement with the employee that complies with all of the applicable regulations to be enforceable. If a Court determines that the agreement is not enforceable, the Nursing Care Provider will be liable for all uncompensated time. Third and finally, if a Nursing Care Provider plans on compensating an employee in ways other than monetarily, it needs to have an objectively reasonable and factually supported basis to determine the value of that compensation.

8 and 80 Rule

In general, an employer is required to pay its employees one and one-half times their regular rate of pay for every hour worked over 40 hours in a work week. 29 U.S.C. § 207(a)(2). However, due to the unique issues faced by health care providers when it comes to staffing, the FLSA includes a second option for calculating overtime – the 8 and 80 rule. The 8 and 80 rule allows Nursing Care Facilities, with the agreement of the employee, to calculate overtime on a 14-day basis as opposed to a 7-day basis. While there are exceptions, the agreement should be in writing, signed by the employee, and kept in their file. See 29 C.F.R. § 778.601(c). When overtime is calculated under the 8 and 80 rule, an employee is entitled to one and one-half times their regular rate of pay for any hours worked over 8 in one day and any hours worked over 80 in the fourteen day period. See 29 U.S.C. § 207(j). Further, premium pay for daily overtime under the 8 and 80 system may be credited towards the overtime compensation due for hours worked in excess of 80 for that period. 29 C.F.R. § 778.601(d).

For example, take this employee’s two week timesheet:

During this two week period, the employee worked a total of 80 hours, 56 hours on Week 1 and 24 hours on Week 2. Under the standard overtime rules, the employee would be entitled to 16 hours of overtime pay for Week 1. However, under the 8 and 80 rule, the employee would only be entitled to 8 hours of daily overtime for Monday of Week 2 and, since the total number of hours worked for the two week period did not exceed 80 hours, the employee would not be entitled to any additional overtime for the two week period. In this situation, the 8 and 80 Rule saved the employer 8 hours of overtime pay.

The 8 and 80 rule can provide much needed flexibility to Nursing Care Providers when it comes to staffing. However, this rule adds another layer of complexity to an already complex system of rules that employers must follow. Nursing Care Providers that wish to implement the 8 and 80 rule should consult with an experienced employment law attorney to ensure that they are in compliance with the FLSA.

Conclusion

Complying with the FLSA can prove a difficult challenge for any organization. The unique situations presented by Nursing Care Facilities only amplify those challenges. Further, the cost of non-compliance is incredibly high. Not only will the facility be liable for double damages, it will be liable for the employees’ attorney’s fees. And, with 80% of Nursing Care Facilities out of compliance, the potential for liability is huge.

Many Nursing Care Facilities don’t want to incur the fees of an experienced FLSA attorney to ensure that they are in compliance. However, failure to comply with the FLSA can result in the facility paying not just their attorney fees, but the attorney fees of their employees. If you are a Nursing Care Facility and you need help understanding or dealing with a FLSA issue, contact us a Smith & Associates for a free consultation.

Susan C. Smith is a shareholder in the law firm of Smith & Associates, and has practiced in the area of health care law for over 15 years.

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Nursing Home CON Update

The State Agency Action Reports (SAARs) for the latest CON batching cycle are scheduled to be released on 2/20/15. After that date, applicants that wish to challenge the Agency’s findings have only 21 days to file a Petition for Formal Administrative Hearing. These dates are very important and failure to meet the deadlines may forfeit your rights. To see a full explanation of the CON Batching Cycle, read “Nursing Home CON Batching Cycle Rapidly Approaching”. If you need help or have questions about the upcoming deadlines, please contact us here at Smith & Associates. Our attorneys are dedicated professionals with decades of experience in health care and CON law.

CON for SNF Beds: New Opportunities for ALF Operators

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After a 13 year moratorium on issuing Certificates of Need for new Skilled Nursing Facility beds, Florida is poised for the return of nursing home CON beginning in October. This will present new opportunities for owners and operators of Assisted Living Facilities. Those existing ALFs that would like to obtain approval to offer Skilled Nursing Facility services should be making plans now. It is expected that the competition for approval of new SNF beds will be substantial. But for those who plan ahead and develop a strong argument for need to offer SNF services as part of an overall continuum of care, the rewards can be well worth the effort.

Nursing Home CON Return

Under 2014-174, Laws of Florida, the Legislature has lifted the 13 year ban on CON for skilled nursing facility beds. The imposition of the moratorium was first put in place in 2001 as a Medicaid cost saving measure. The moratorium was originally intended to last 5 years but was extended in 2006 and again in 2011. In recent years, there has been growing pressure to lift the moratorium and to begin preparing for the aging of the baby boomers. Responding to calls to allow for new development of Skilled Nursing Facilities and beds, the legislature authorized the return of CON.

The legislation lifting the moratorium includes new exemptions and expedited reviews for current owners and operators of SNF facilities. For a full summary of the provisions in the bill, please see: www.smithlawtlh.com, and click on Articles.

Opportunities for ALF Operators

It’s certainly no secret that many ALF operators are seeing increasing acuity among their resident populations. This is especially true for those ALF providers with Limited Nursing Services and Extended Congregate Care licenses. Indeed, many ALF operators have complained that the moratorium on SNF beds has resulted in increased pressure to care for higher acuity residents who, in many instances, might be better served in a SNF setting if beds were available.

The lifting of the moratorium will allow some ALF operators to expand the scope of services they offer to include a broader continuum of care. For some, this may be the addition of a SNF unit to their existing ALF facility; for others, it may mean the conversion of an existing ALF to SNF. Ultimately, some providers may seek to offer a full continuum of independent living, Assisted Living, and SNF on one single campus.

Different Architectural and License Requirements

Those interested in seeking SNF beds should thoroughly investigate the differences between SNF and ALF services in terms of the architectural and physical plant requirements as well as the operational and licensure requirements. A full discussion is beyond the scope of this Article, but generally SNF facilities will be evaluated under Florida Building Code requirements for institutional construction and, of course, will be subject to the provisions of Chapter 400, Florida Statutes and Chapter 59A-4, Florida Administrative Code. A CON Application must document the applicant’s ability to meet these standards.

The Upcoming Time Line to Seek SNF Approvals Launches in October

Under existing Rules, AHCA has a schedule that governs the procedures and a detailed time-line for applying for a Certificate of Need. Applications for new skilled nursing facilities and bed additions may be submitted two times per year in the “batching cycle” for “other beds and programs.” A “batching cycle” review is required for any party that wishes to obtain a CON for a new facility or bed addition that is not authorized under an exemption or expedited review. The key dates for the next available batching cycle are as follows:

Event Deadline
Fixed Need Pool Projections 10/03/14
10 days to File Notice of Errors in a Fixed Need Pool 10/13/14
21 Days to File Formal Challenge to Fixed Need Pool 10/24/14
Letter of Intent Filing Deadline 10/20/14
16-day Grace Period Letter of Intent Filing Deadline 11/05/14
CON Initial Application Filing Deadline 11/19/14
Request Public Hearing 14 Days After Publication Of Application Filing in Florida Administrative Register
CON Application Omissions Response Deadline 12/24/14
State Agency Action Reports (SAARs) Issued 2/20/15
Deadline to File Petition for Formal Administrative Hearing to Challenge a SAAR 21 Days After Publication of the SAAR Results in the Florida Administrative Register

Based on the schedule for the next batching cycle, any party wishing to submit a CON Application should immediately begin the process of putting together a “CON Application Team” consisting of at least the following members:

  • Key management for owner/operators;
  • Experienced CON counsel;
  • Experienced health planner;
  • Experienced financial planner; and
  • A health care architect.

Conclusion

Those interested in expanding their scope of services to include SNF beds should pay careful attention to the CON process that will begin in the next several weeks. Letters of Intent must be filed by October 20th for an applicant to be considered in the upcoming batching cycle.

Geoffrey D. Smith is a shareholder in the law firm of Smith & Associates, and has practiced in the area of health care law and CON regulation for over 20 years.

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