Home Health & Hospice Week

Surveyors ramp up use of alternative sanctions that took effect last July.

If you thought surveyors would shy away from imposing door-closing new alternative sanctions, think again.

Background: In the 2013 Home Health PPS final rule, the Centers for Medicare & Medicaid Services approved use of five new alternative sanctions for HHAs. CMS implemented three lesser sanctions in July 2013 — temporary management, directed plan of correction, and directed in-service training. They were used rarely, if ever, perhaps because CMS did not issue guidance on imposing alternative sanctions until March 2014. In July 2014, CMS unleashed the big dogs — civil money penalties and payment suspensions for new patients.

Surveyors appear more eager to use these two money-related sanctions. The Columbus Dispatch newspaper recently profiled the case of a Columbus, Ohio home health agency that was slapped with an $84,000 CMP. American Home Health administrator Cindy Ashley warned CMS that the fine will cause her agency to close. “I don’t think we can come up with that kind of money,” Ashley recently told The Dispatch.

American was cited for unauthorized services to patients, failing to tell doctors of a change in patients’ conditions, relying on records that contained inaccurate or outdated medication regimens, and not having doctors sign off promptly on care plans for patients, according to the newspaper. American corrected the deficiencies, but was fined $2,000 per day for 42 days under the CMPs. That’s a fraction of the $10,000 that an agency can rack up under the CMPs, but it resulted in a total that may be enough to close the agency’s doors forever.

And American’s not the only agency to meet that fate. In Indiana, attorney Robert Markette Jr. of Hall Render in Indianapolis advised a long-running agency facing CMPs for an immediate jeopardy citation. That was the case even though the surveyor appeared to have misunderstood the situation.

When advised of the cost, “the agency just gave up,” Markette relates. They couldn’t afford the CMPs or appeal, “so they closed the doors and walked away.”

For most agencies, the CMP and payment suspension sanctions “are a death sentence,” Mar-kette tells Eli. “It’s pretty rough.”

Agencies can rack up as much as $10,000 per day (for IJ situations). Surveyors have two days to give agencies notice in IJ cases, Markette points out. That can add up to a $20,000 CMP before an agency even knows it’s in trouble.

15 HHAs Face Sanctions So Far

These agencies aren’t alone. Data CMS has furnished to the National Association for Home Care & Hospice reveals that to date, CMS has im-posed alternative sanctions on 15 HHAs since July 2014, NAHC’s Vice President for Law William Dombi tells Eli. CMS has imposed 22 sanctions on those 15 agencies (some agencies received multiple sanctions).

The sanctions levied include eight CMPs, eight suspensions of payment for new admissions (SPNAs), two directed plans of correction, and four directed in-service trainings. “Several of the CMPs and SPNAs were imposed on HHAs as a result of immediate jeopardy findings,” Dombi believes.

More IJs: The implementation of sanctions seems to be coinciding with an upswing of IJ determinations, notes former state survey director Rebecca Friedman Zuber, now a Chicago-based regulatory consultant. IJ citations carry the heaviest CMPs.

But IJ citations for HHAs “are still rare,” Dombi points out.

Fines Make Attractive Survey Tools

It’s not surprising that surveyors are starting to run with their new ability to impose CMPs. “Fines are the easiest of the sanctions to impose and are commonly used in the nursing home world,” Zuber says. “Both states and CMS know how to use that tool.”

Fines can be very attractive to regulators “because they do just what they have done in [the Ohio] case — put troubled providers pretty much out of business,” Zuber says.

And the “detailed matrix on the application of sanctions” that CMS laid out in its March 2014 surveyor guidance “made it an easy action for CMS,” Dombi says. “It took much of the subjectivity out of the process.”

Twenty-two sanctions may seem like a lot, but some experts thought it would be even more by now, including former JCAHO surveyor Lynda Laff with Laff Associates in Hilton Head Island, S.C. “I am surprised it has taken [CMS] so long to actually put some teeth into the regulations,” Laff says.

“I expected surveyors to use CMPs more frequently by now,” agrees Washington, D.C.-based healthcare attorney Elizabeth Hogue.

Sanctions For Repeat Standard-Level Deficiencies Loom

Some comfort: “Most of the [CMP] instan-ces I have heard of involve pretty egregious deficiencies,” Zuber says. “They don’t appear to be using fines to address a repeat standard-level deficiency, which they could actually do under the regulations.”

If surveyors impose CMPs only in cases with extreme problems, “agencies that are managed effectively should have little concern about CMPs,” Hogue says.

Watch out: But don’t be surprised to see CMPs for lesser offenses come down the pike. Ob-servers suggest CMS has discreetly encouraged states to ease into the alternative sanctions process. That honeymoon period for sanctions may be coming to a close soon.

Surveyors may begin by imposing CMPs “on agencies with multiple, significant problems and then use them more often for agencies with less significant issues,” Hogue suggests.

“With only eight CMPs in the first 10 months out of nearly 13,000 HHAs, we would expect to see an increase in CMPs over time,” Dombi predicts.

“The pace is picking up,” Markette believes. “It’s going to get ugly.