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Licensure Penalties, Plans of Corrections, and Summary Suspensions, Oh My!!

Most of you know that I also appear on RACMonitor every Monday morning at 10:00am eastern. I present a 3-minute segment on RACMonitor, which is a national, syndicated podcast that focuses on RAC audits and the casualties they leave in their wakes. I am joined on that podcast with nation Medicare and Medicaid experts, such as Dr. Ronald Hirsh, health care attorneys David Glaser and me, Tiffany Ferguson, who speaks on the social determinants of health and Matthew Albright, who presents on legislative matters. Other experts join in a rotating fashion, such as Mary Inman, a whistleblower attorney who resides in London, England, Ed Roche, an attorney and statistical wizard who debunks extrapolations, and it is hosted by my friend and producer, Chuck Buck and Clark Anthony and Chyann and others….

But there are other audits that wield similar dire results: OTHER THAN RAC, TPE, MAC, and ZPICs. Licensure audits, for example, can cause monetary penalties, plans of corrections, or even summary suspensions…OH MY!!! (A reference to The Wizard of Oz, obviously).

For hospitals and other health facilities, the licensure laws typically cover issues such as professional and non-professional staffing; physical plant requirements; required clinical services; administrative capabilities; and a vast array of other requirements. In most states, in addition to hospital licensure, full-service hospitals require other licenses and permits, such as laboratory permits, permits relating to hazardous wastes, food service permits, and transportation licenses for hospital-affiliated ambulances. Other residential healthcare facilities, such as nursing homes or behavioral health homes, are typically subject to similar requirements.

Penalties are brandished once audits ensue. Licensure audits do not possess the same financial incentives as RAC audits. In NC the entity that conducts licensure audits is DHSR, the Department of Health Service Regulation. DHSR is still under the umbrella of DHHS, which is the single state entity charged with managing Medicaid. Every State has a DHHS although it may be named something else. In New Mexico, the single state entity is called HSD or Health Services Department. In CA, the single state entity is called DHCS or Department of Health Care Services.

The entity in your State that conducts licensure audits will be under the umbrella of your State’s single State entity that manages Medicaid.

Penalties can be severe.

Summary suspensions occur in all 50 States. A summary suspension is an action in administrative law in which a judge suspends a provider’s license upon the receipt of allegations and prior to a full hearing on the matter. In general, the summary suspension is based on a finding that the suspension is necessary, given the allegations, to protect safety or public health. The summary suspension is a temporary, emergency ruling pending a full hearing on the allegations. For example, in Washington State WAC 170-03-0300(1)(a), permits summary suspension of a child care license by the Department where “conditions in the licensed facility constitute an imminent danger to a child or children in care.”

Imminent dangers can be alleged in hospitals, nursing homes, or residential facilities. I say “alleged” because an allegation is all it takes for a summary suspension to be bestowed. Allegations, unfortunately, must be defended.

Appeal! Appeal! Appeal! Be like Dorothy and get to the Wizard of Oz – no matter what, even if she has to defeat the Wicked Witch of the West!

Last year I had two residential facilities receive summary suspensions at the same time. What do you do if your facility receives a summary suspension?

PANIC.

Kidding. Do not panic. Contact your Medicaid attorney immediately.

Ultimately, we went to trial and defended these two facilities successfully.

Detroit Hospitals and Funeral Home Under Fire by Medicare and Police

What in the health care is going on in Detroit??

Hospitals in Detroit, MI may lose Medicare funding, which would be financially devastating to the hospitals. Is hospital care in Detroit at risk of going defunct? Sometimes, I think, we lose sight of how important our local hospitals are to our communities.

The Center for Medicare and Medicaid Services (CMS) notified DMC Harper University Hospital and Detroit Receiving Hospital that they may lose Medicare funding because they are allegedly not in compliance with “physical environment regulations.”

42 C.F.R. § 483.90 “Physical environment” states “The facility must be designed, constructed, equipped, and maintained to protect the health and safety of residents, personnel and the public.”

CMS will give the hospitals time to submit corrective action plan, but if the plans of correction are not accepted by CMS, Medicare will terminate the hospitals’ participation by April 15, 2019 (tax day – a bad omen?).

The two hospitals failed fire safety and infection control. Section 483.90 instructs providers to ensure fire safety by installing appropriate and required alarm systems. Providers are forbidden to have certain flammable goods in the hallways. It requires sprinkler systems to be installed. It requires emergency generators to be installed on the premises. Could you imagine the liability if Hurricane ABC destroys the area and Provider XYZ loses power, which causes Grandma Moses to stop breathing because her oxygen tube no longer disseminate oxygen? Think of the artwork we would have lost! Ok, that was a bad example because there are no hurricanes in Detroit.

Another important criterion of the physical environment regulations is infection control, which, according to the letters from CMS, is the criterion that the two hospitals allegedly have failed. Each hospital underwent a survey on Oct. 18th when the alleged deficiencies were discovered.

“We have determined that the deficiencies are significant and limit your hospital’s capacity to render adequate care and ensure the health and safety of your patients,” stated the Jan. 15 letters to the hospitals from CMS. CMS informed the hospitals they had until Jan. 25 to submit a plan of correction. It is unclear whether the hospitals submitted these plans. Hopefully, both hospitals have a legal team that did draft and submit the plans of correction.

Michigan is a state in which if Medicare funds are terminated, then Michigan will terminate Medicaid funds automatically. So termination of Medicare funding can be catastrophic. Concurrently, Scott Steiner, chief of Detroit Receiving Hospital, is resigning (shocker).

Detroit must have something in the water when it comes to health care issues in the news because, also in Detroit, a police task force Monday removed 26 fetuses from a Detroit Medical Center (DMC) morgue, all of which were allegedly mishandled by Perry Funeral Home. Twenty of the bodies taken from the DMC cooler had dates-of-birth listed from 1998 and earlier, with six dating to the 1970s. The earliest date of birth of a discovered fetus was Aug. 11, 1971.

State authorities are looking into another case of dozens of infant remains allegedly hidden for years in a DMC hospital. News articles do not mention the DMC hospital’s name, but one cannot help but wonder whether the two incidents – (1) Detroit hospitals failing infection control specifications; and (2) decomposing bodies found in a hospital – are intertwined.

Detroit has to be winning a record here with health care issues – Medicare audit failures in hospitals, possible loss of Medicare contracts, possible suspension of Medicaid reimbursements, and, apparently decomposing fetuses in funeral homes and hospitals.