Copperas Cove LTC Partners v. HHS

Case: 21-60892 Document: 00516802223 Page: 1 Date Filed: 06/27/2023
United States Court of Appeals
for the Fifth Circuit
United States Court of Appeals
Fifth Circuit
____________ FILED
June 27, 2023
No. 21-60892 Lyle W. Cayce
____________ Clerk
Copperas Cove LTC Partners, Incorporated,
Petitioner,
versus
United States Department of Health and Human
Services,
Respondent.
______________________________
Appeal from the Department of Health & Human Services
Agency No. A-18-117
______________________________
Before Jones, Dennis, and Willett, Circuit Judges.
Edith H. Jones:*
Copperas Cove LTC, a nursing home, challenges a fine imposed by
the Centers for Medicare and Medicaid Services (CMS). Having carefully
reviewed this appeal in light of the briefs, oral argument, and record, we are
constrained to DISMISS the petition for review. The Administrative
Procedure Act’s strictures on judicial review and the latitude afforded the
_____________________
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this opinion
should not be published and is not precedent except under the limited circumstances set
forth in 5th Circuit Rule 47.5.4.
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No. 21-60892
Administrative Law Judge (ALJ) and Departmental Appeals Board are not
overcome here. But we witness a tragic outcome. A severely disabled 35-
year-old resident of the facility was removed from the only home he had
known since age seven—a home that, if imperfect in some ways, had never
failed regulatory scrutiny in the past.
In 2016, a state survey team found that Copperas Cove was not in
compliance with certain Medicare requirements. Most of these violations
stemmed from its treatment of Resident #5, a long-term resident with severe
cerebral palsy, severe mobility impairment, severe intellectual disabilities,
macular degeneration, lack of safety awareness, and a history of inappropriate
behavior with staff and other residents. The survey team flagged several
violations that had not been mentioned during years of previous surveys.
Copperas Cove was fined and Resident #5 relocated to another facility. The
nursing home tried and failed to convince the ALJ, and then the Appeals
Board, that the fine should be reduced or eliminated. It now petitions to this
court.
Copperas Cove argues that the Appeals Board should have reviewed
the ALJ decision using a “preponderance of the evidence” standard. Yet its
argument confuses the standard of proof initially applied by an ALJ with that
applied by the Appeals Board. When reviewing the ALJ’s decision, the
Appeals Board guidelines and precedent limit its review to determining
whether: “(1) factual findings in the decision are supported by ‘substantial
evidence’ in the record as a whole; (2) the decision’s necessary legal
conclusions are correct (that is, are consistent with applicable statutes and
regulations); and (3) a ‘prejudicial error of procedure . . . was committed.’”
See Guidelines – Appellate Review of Decisions of Administrative Law Judges
Affecting a Provider’s Participation in the Medicare and Medicaid Programs,
“Completion of the Review Process,” ¶(c),
https://www.hhs.gov/about/agencies/dab/different-appeals-at-dab/
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appeals-to-board/guidelines/participation/index.html; Glenoaks Nursing
Ctr., DAB No. 2522, at 6 (2013); Douglas Bradley, M.D., DAB No. 2663, at 5
(2015). Moreover, Copperas Cove’s suggestion that this scheme of review
violates procedural and substantive due process lacks merit.
Copperas Cove also attacks the factual basis for its purported
regulatory violations. But each finding, whether this court may disagree or
not, was supported by substantial evidence. See 42 U.S.C. § 1320a–7a(e).
First, the Appeals Board found that Copperas Cove chemically restrained
Resident #5 in violation of 42 C.F.R. § 483.13(a) (Oct. 2016). CMS
presented evidence that Copperas Cove significantly increased Resident #5’s
Risperidone prescription without (a) any medical diagnosis for the conditions
that Risperidone is meant to treat or (b) any showing that the dosage was
necessary for safety purposes. Second, the Appeals Board found that
Copperas Cove involuntarily secluded Resident #5 in violation of 42 C.F.R.
§ 483.13(b). The CMS surveyor and Copperas Cove staff stated that the
nursing home would seclude Resident #5 in his room “for its convenience,
so that it could meet the needs of other residents without having to monitor
him.” Third, it follows that Copperas Cove failed to “implement written
policies and procedures that prohibit mistreatment,” 42 C.F.R. § 483.13(c)
(Oct. 2016), since that requirement stipulates that facilities “must [n]ot use
. . . involuntary seclusion.” Id. § 483.13(c)(1)(i) (Oct. 2016). Fourth, the
Appeals Board found that Copperas Cove did not comply with the National
Fire Protection Association’s Life Safety Code Standard 19.7.1.1, which
requires a written plan for the evacuation of all persons in the event of a fire.
42 C.F.R. § 483.70(a)(1)(i) (Oct. 2016) (requiring compliance with the Life
Safety Code). Copperas Cove’s written evacuation plan did not identify
severely disabled residents who could not protect themselves in the event of
a fire. These evidentiary challenges fail.
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Copperas Cove’s allegations of procedural error are likewise lacking.
It cites the Texas Rules of Evidence to object to testimony offered by the
CMS surveyor, even though those rules are inapplicable to agency
proceedings. 42 C.F.R. § 498.61. Its allegation that it was not allowed to
question the CMS surveyor about her qualifications is false; the record shows
that the ALJ simply advised counsel that exploring her background would not
be helpful if the facts about which she testified were undisputed. And contra
Copperas Cove’s claims, the record demonstrates that both the ALJ and the
Appeals Board gave due consideration to evidence from Resident #5’s
physician in making their determinations. Similarly, the ALJ and the Appeals
Board considered—and found unhelpful—the testimony of Dr. Pearl
Merritt, Copperas Cove’s expert witness.
Copperas Cove argues that CMS is equitably estopped from
enforcement insofar as Copperas Cove’s manner of caring for Resident #5
was ongoing for many years, and previous CMS surveys never flagged the
violations that the agency now identifies. But as it stated in its opinion, the
Appeals Board has “held that neither it nor an ALJ is authorized to grant a
non-federal party relief from a CMS enforcement action based on equitable
defenses or doctrines.” The nursing home’s mode of care would not entitle
it to estoppel in any case. The fact that previous surveyors overlooked
noncompliance in the past—or even orally authorized it—does not estop the
government from enforcement in the future. F.D.I.C. v. Royal Park No. 14,
Ltd., 2 F.3d 637, 641 (5th Cir. 1993).
Last, Copperas Cove asserts, in a conclusory fashion, that the
penalties assessed are unreasonable. However, it fails to address any of the
factors relevant to civil penalties specified in the federal regulations. See
42 C.F.R. § 488.438(f). And it does not dispute that the per-day fine was
only a fraction of the maximum amounts allowed under the regulations. As
such, its challenge fails.
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For the foregoing reasons, the petition for review is DISMISSED.
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