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Finding and Fixing Your Own Noncompliance
Avoiding Citations After House Bill 667

6.12.2018

During the 2016 Legislative Session, the N.C. Assisted Living Association (NCALA) was instrumental in bringing about passage of House Bill 667 which modified existing law on assisted living (AL) surveys, citations and sanctions. The Poyner Spruill Health Law Team, in our role as General Counsel for NCALA, was honored to play a part in the drafting and passage of HB 667.

This statute contained a number of positive changes for North Carolina’s assisted living community. Perhaps the most important revision—and one whose importance cannot be overstated—was a change to the old “past corrected” language formerly found in N.C. General Statute 131D-34.

Prior to passage of HB 667, the law authorized surveyors to cite noncompliance with applicable statutes or regulations governing AL communities even where the provider had already found and fixed the problem at the time of the survey. Such self-discovered violations, if found and fixed by the provider, were still cited as deficiencies by surveyors from the Adult Care Licensure Section (ACLS) or county DSS inspectors, but in those cases where surveyors agreed that the provider really found and fixed the problem before survey – and had maintained compliance – the ACLS was directed to consider that self-correction in deciding whether to impose a money penalty against the AL Community for the noncompliance.

To qualify for this discretional consideration by ACLS, the following elements had to be demonstrated:

  • The violation was not previously identified by the Department; or
  • Violation was discovered by the facility and was self-reported; and
  • The provider had fully corrected the violation and maintained compliance regarding that issue.

However, even if a provider could demonstrate all those factors, ACLS still cited the violation and still had the discretion to impose a penalty. In other words, the provider’s self-correction was just one factor in the decision of ACLS on whether to impose a penalty. And that violation still had the potential to negatively impact a Community’s Star Rating and public reputation.

Under HB 667, that all changed. Now, under current law, where a provider self-discovers a violation and fully implements a plan of correction, the violation may not be cited at all as noncompliance. That means it’s not a Type A1 nor a Type A2 nor a Type B. It cannot be cited at all. And, there can be no resulting penalty and no impact on an AL Community’s Star Rating.

This aspect of HB 667 presents a huge opportunity for providers, and it’s entirely consistent with the purpose of citing violations and imposing sanctions – to incentivize providers to find and fix their own issues and noncompliance.

Sounds great, right? Indeed, it is. But, taking full advantage of this opportunity means that providers have to be on top of their game – meaning on top of their operations, their staff and their continuous quality improvement programs. In short, you can’t fix something you don’t know about so ensuring that staff report to Community leadership all untoward issues, undesirable outcomes and even suspicions that something has gone amiss is critical so providers have the opportunity to examine the situation, determine whether noncompliance occurred, and then implement required corrective measures, both to improve care and to avoid citations.

How do you prove self-correction under HB 667? The law says that noncompliance is not a citable violation if:

  1. The violation is discovered by the facility (that is, found by you, not by surveyors);
  2. The Department (through the ACLS) determines that the violation was abated immediately;
  3. The violation was corrected prior to inspection by the Department;
  4. The Department determines that reasonable preventative measures were in place prior to the violation; and
  5. The Department determines that, subsequent to the violation, the facility implemented corrective measures to achieve and maintain compliance.

After the passage of HB 667, we met with the leadership of NCALA and the ACLS to plan for a series of webinars in which ACLS leadership graciously participated. We discussed this revised concept of “past corrected” noncompliance and, in particular, element number 5, above.

Our concern was the following hypothetical scenario: An unintended event occurs that is or may rise to the level of noncompliance. The AL Community immediately spots the issue, conducts a root cause analysis, identifies the causes, and determines that it had in place at the time of the event reasonable preventive measures designed to avoid it, but something went wrong – staff failed to follow otherwise robust policies, human error or some other cause not linked to a policy or systems failure. The Community also implements additional training and/or other measures designed to ensure the problem doesn’t reoccur.

However, the event involved a resident injury requiring more than first-aid treatment and so it was reportable to the County. That means the County inspectors will likely be in the Community within hours or days of the event. In such a situation, not enough time will have passed between the untoward event and the Community’s development and implementation of correcting measures for surveyors to review those measures and say “yes, those worked.”

After discussing this with ACLS leadership, they concurred that the “past corrected” language of HB 667 was written in a prospective manner, meaning it looks forward, not just backwards at history. As such, ACLS leadership agreed with us that in a situation like our hypothetical one, when surveyors from the State or County are in an AL Community only hours or days after an untoward event evaluating a Community’s response, they will look at the measures implemented by the Community that are designed to achieve and maintain compliance by looking forward from the time of the unintended event and the time when the Community implemented measures to achieve and maintain compliance, and will ask “does it appear that the measures implemented by the Community will both achieve and maintain compliance?” In other words, since not enough time may have passed from the negative event and the start of the Community’s corrective measures to test whether they worked, the surveyors in those situations will examine those corrective measures by evaluating whether they are designed to work and appear sufficient to achieve and maintain compliance. Of course, providers must be able to demonstrate that no further noncompliance involving the same issue has occurred since implementation of its corrective plans.

This may seem like a subtle issue. It’s not. If the Department interpreted HB 667 to require a historical period of actual experience by a provider after it implemented corrective measures to qualify as “past corrected” under HB 667, that could have the effect of negating the intent of this part of HB 667 in all cases where surveyors are in a Community before a provider has sufficient time to demonstrate the effectiveness of its corrective measures.

We’re now focusing much of our work for AL providers – and encouraging our clients to do the same – on identifying and responding promptly and comprehensively to instances of noncompliance, or even suspected noncompliance, and implementing robust responses. Those responses should include all the same elements you would implement via a plan of correction if a survey team cited violations during a survey.

The difference is you’re doing them before the survey, after identifying your own potential problems. We strongly encourage our AL clients to focus on the following proactive steps:

  1. With your Community leadership and staff, train, retrain and retrain some more on identifying and reporting situations in your Community that may be, or clearly are, inconsistent with your expectations, policies and/or applicable regulations.
  2. Empower staff to report those situations without fear of negative consequences. After all, they’re doing you a favor by giving you the chance to correct problems and avoid citations under HB 667.
  3. Learn the elements required under HB 667 to avoid citations (recited in this article) and be prepared to implement them any time you spot potential issues in your Community.
  4. Be proactive in finding and fixing your own noncompliance and, if you’re not sure how to do it well and thoroughly, get some help.
  5. When you do identify potential issues, and design and implement steps to correct them and prevent their recurrence, document all your actions. You may need to show them to surveyors later to make your case that you should not be cited because of HB 667.
  6. Finally, in designing corrective action plans in your Community,
  • Be creative and expansive – ask “are there any other causes of this problem that we’ve not identified, and is there anything else we could try to fix this and make that fix stick?”
  • Talk to your staff about ideas for spotting and fixing issues—after all, they’re the ones out on the floor and often have great ideas.
  • Vet your plans of correction with corporate staff if you have them, other providers whose opinions you respect or outside consultants or counsel. In these cases, an ounce of prevention is worth a pound of cure.

Make sure your Community’s leadership, both local and at the corporate level, are aware of this important change in N.C. law governing AL surveys.

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Ken Burgess is a health care attorney with over 30 years of experience advising clients on a wide range of regulatory, litigation, compliance and operations issues. His practice focuses heavily, but not exclusively, on issues affecting long term care and acute care providers. You can reach Ken at 919.783.2917 or kburgess@poynerspruill.com.

Iain Stauffer focuses his practice in health and administrative law. He came to the firm from the North Carolina Attorney General’s Office where he served as an attorney for 12 years, most recently with the Public Assistance Section. Iain may be reached at 919.783.2982 or istauffer@poynerspruill.com.

Physical Address: 301 Fayetteville Street, Suite 1900, Raleigh, NC 27601 | © Poyner Spruill LLP. All rights reserved.

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