Appeals, secret deals delay fine payment for assisted living centers - North Carolina Health News
By Thomas Goldsmith and Mona Dougani
When Ashe Gardens Assisted Living in Pender County “failed to provide supervision for 11 residents with assaultive, aggressive, sexually expressive and wandering behaviors,” state officials fined the facility $70,000 for that and other lapses, state records show.
But the center hasn’t paid a dime of the fines levied in December 2019. All of those fines remain under appeal to the state Department of Health and Human Services more than a year and a half later. A representative from the facility said they could not comment on this situation.
It’s a common practice across the state; assisted living centers found deficient typically paid less than 20 percent of the total amount of fines for the period, according to a North Carolina Health News analysis of state data.
In fact, since 2018, Ashe Gardens and roughly 194 other centers around the state have been charged more than $4.7 million in fines for failures in caring for some of North Carolina’s most vulnerable people.
Also since 2018, about 165 facilities with fees charged against them have filed legal documents with state lawyers arguing that penalties were too harsh or excessive, according to Department of Justice statistics provided to NC Health News.
Under state law, a facility that is appealing penalties is free to have its license renewed even if it has charges against it, no matter the severity of those charges.
Lowering fines common
In many cases, the fines were lowered either through the behind-closed-doors work of every counties’ little-known Independent Dispute Resolution committees or by lawyers at the funding- and staff-depleted State Attorney General’s office.
The attorney general’s office often settles rather than going up against an assisted living facility or chain that complains that their penalty is too high, said Bill Lamb, board chairman for the nonprofit Friends of Residents group.
Nursing homes and assisted living: which is which?
North Carolina uses the name “adult care homes” to refer to residential centers often called assisted living facilities. These centers evolved out of the rest homes that most counties maintained to look after older people with a need for room, board and some help with daily activities. An expanded version of those duties is still required of adult care homes. People may need care at such a center if their cognitive problems make it possible that their decisions could endanger themselves or others.
These facilities are regulated by the state Department of Health and Human Services.
Nursing homes are officially known as “skilled nursing facilities” in North Carolina. Generally they take a more medicalized approach to residents, who do not have acute illness, but need a higher level of nursing than provided at adult care homes. Skilled nursing facilities, regulated by the federal Centers for Medicare and Medicaid Services, are generally for people who require some form of medical care, or those who need rehab from surgery or illness.
— Includes information from the state Department of Health and Human Services
“There’s no consequence for poor behavior,” Lamb said. “If this was your kid, it’d be like waiting until they are in college until anything happens.”
DOJ spokesman Nazneen Ahmed said in an emailed response that the state uses whatever time and effort is required to answer petitions that call for adjusting penalties. The Division of Health Service Regulation, or DHSR, imposes the penalties as a function of the Department of Health and Human Services.
“If a provider contests a penalty, it will naturally require more conversations about the various factors that were considered in DHSR assessing a penalty,” Ahmed said.
“Also, each situation will also require different considerations based on what is best for the facility’s residents.”
In addition, state DHHS officials and DHSR spent much of their time during 2020 collaborating with and supporting long-term care centers in the face of the pandemic. But staff also kept investigating complaints and protecting the welfare of residents, Ahmed said.
Some of the unpaid fines against North Carolina assisted living centers may not reflect life-threatening problems. But many likely come as troublesome news to caregivers, not to mention to the residents themselves.
For example, since October, Cleveland House, in Cleveland County, has been appealing a $7,000 fee for “failing to meet the acute health care needs for a resident [with dementia] who had black tarry stools, dizziness and weakness and ... delayed treatment for two fractures of the right wrist after a fall.”
Negotiating behind closed doors
Having state lawyers argue or negotiate the disputed penalties typically comes after the facility and regulators use the informal dispute resolution process preferred under state policy, the DOJ said.
A bill passed in October 2011 created the Informal Dispute Resolution Process. And in 2015, the legislature eliminated the state’s Penalty Review Committee, created in 1989 to hold public hearings and propose fines and sanctions in cases where long-term care facilities had been accused of violating state regulations and statutes.
These changes have gradually reduced public access to these decisions and how they are made.
“The resident who was harmed does not get due process, but the facility does,” argued Lamb, the resident advocate.
The informal resolution process consists of a three-person panel, a provider, staff member or facility representative, and people from the Division of Health Service Regulation and Department of Health and Human Services, according to a DHHS document.
That means someone from the facility, a state regulator and a county surveyor meet outside the public’s view and talk about whether the penalty suits the offense.
Got an issue with the care at an assisted living center?
Call the DHHS Complaint Hotline: 1-800-624-3004 (within N.C.) or 919-855-4500
To talk to someone at the Division of Health Services Regulation. A call there will trigger an investigation.
Industry: Process is unfair
A resident, a relative or another representative of a resident affected by the offense may also be present for the discussion of the specific incident only. Members of the public, including the media, are excluded.
“They hear the evidence, and then that panel of three people vote up or down whether or not they still believe a deficiency or whatever exists,” said Jeff Horton, executive director of one of the state’s two assisted living industry groups North Carolina Senior Living Association.
Horton worked for the state Division of Health Service Regulation for several decades before retiring from state service.
Raleigh First Amendment lawyer Amanda Martin said that the public should have access to these dispute resolution meetings based on public interest and public policy.
"That is a different question from what the statute actually provides," she added.
Asked whether the policy effectively excludes the public, Martin said, "Courts do sometimes find that a statute or regulation providing for one thing implies the exclusion of everything else."
The meeting process has made it easier for facilities to have penalties withdrawn, lowered or changed in severity without public attention as the change is made. The committee meetings are held in secret via virtual communication based on the list of who may attend.
However, some providers believe the Informal Dispute Resolution process is unfair.
“I'll be quite honest with you, I know some providers don't use that process because they don't think they get a fair shake because you have two state people and one provider representative representing the industry,” Horton said.
“Even if the person representing the industry thinks the state's wrong, they can get out-voted by the two people that represent the state.”
The state doesn’t keep track of how many previously designated failures are changed in these committees.
Why deals are cut
In penalties negotiated by justice department lawyers, Ahmed said, there are many reasons changes are made to the penalty amount.
Among the approaches:
- Slicing back the recommended amount of penalty to avoid litigation costs and allowing staff additional time to review complaints is one such approach to reduce penalties.
- Lowering the penalty costs when an assisted living facility gives up its license as well as implementing staff training are additional ways such penalty costs are reduced.
Nonetheless, the assisted living centers that are appealing or negotiating their fines remain open even while posting scores as low as negative 80 on a 100-point scale.
North Carolina adult care homes with the lowest ratings that remain in operation include Golden Care Home in Duplin County with a score of -80.75 and a zero star rating, and East Towne with a score of -78.25, also with a zero star rating.
Neither Five Star Investments, Inc., licensee for Golden Care, nor Charlotte Opco Holdings, which holds the license for East Towne, responded to requests for comment. When NC Health News attempted to call Golden Care the number was disconnected or not in service.
Horton argues that star-ratings may not show the quality of care a facility provides.
“You could have a four-star facility...it could have been a stellar facility for years, but just one incident happened that caused them to suffer all these administrators’ sanctions against them,” Horton said.
“I would say that just because you have zero stars, you really need to look at the reports. And when you look at the reports, you need to look at the deficiencies at the state citing, are they actual direct care-related issues or are they other things?”
‘Was barely responsive’
Alzheimer’s Related Care of Dunn, licensee ARC of Dunn, has operated with a zero rating since August 2017, according to state records. That facility did not respond to multiple requests for comment.
“Facility failed to meet the acute health care needs of 1 of 5 sampled residents by not contacting emergency medical services immediately for a resident that was barely responsive and later died in the hospital,” a DHHS report said of an August 2020 incident at ARC of Dunn.
The center drew penalties of $98,400 in 2020, but shows no record of payment.
In fact, about one in 10 of North Carolina adult care homes have star rating grades of zero, a recent listing showed.
Running on zero
And most facilities with zero-star ratings remain in operation.
“DHSR does not have the statutory authority to take licensure action based on a facility’s star rating,” Catie Armstrong, NC DHHS press assistant, wrote in an email.
When the pandemic hit in March 2020, DHHS suspended inspections including “complaints, and follow-up, initial, and infection control investigations,” Armstrong wrote.
Though annual inspections were suspended until Dec. 31, the Informal Dispute Resolution process and appeals process was not suspended during this time.
“These facilities had the right to appeal administrative penalties or licensure actions to the Office of Administrative Hearings,” Armstrong wrote.
Despite Horton’s observation that some providers do not consider the dispute resolution process fair, facilities are achieving a high rate of successful appeals for serious infractions through this process.
Penalties and wages
More than a third, or 37 percent of Type A penalties, the most serious violation, were appealed, according to data from the Adult Care Licensure Section of the NC DHSR analyzed by North Carolina Health News.
Type A violations, according to DHHS, refer to violations by a facility which result in serious physical harm, death, abuse, neglect and exploitation.
Additionally, a total of 33 percent of all penalties issued were appealed from years 2018-2021.
Facilities such as Tyrrell House, in Columbia, which owes more than $69,000 and which was fined for a repeated Type A offense, remain in operation even though fines are still pending.
It may seem disturbing that some facilities facing serious charges are still operating, but industry representatives have typically argued that the alternative of shutting down a center could be worse for residents.
“Just because a facility has been fined doesn't mean that it should be shut down, or that everybody should be moved out,” Horton said. “It’s very disruptive to residents. You’re talking about a very fragile population, the average age these days is almost 80 years old.”
People in the industry have often argued against closing facilities or moving residents because of potential harm to this population. However, state officials have taken this action in cases where the problems of a current location outweigh the dangers of a move.
“Many of these folks suffer from memory care issues, and when you move them it is highly stressful,” Horton said. “There's even data that shows a certain percentage will die just from the move, just from the stress of being moved to a new place. So that's typically not something that's taken lightly to move everybody out of the building.”
Training as a solution?
To mitigate and reduce the most serious types of penalties causing harm to residents of these facilities, additional training could be a safeguard, according to Horton.
In addition to training, funding for adult care homes could alleviate some of the issues seen throughout the state, said Horton.
“One of the things that our association works on is funding for adult care homes,” Horton said. “What we found out, and the state is actually found out, in their study of what we get paid, if you receive public money to take care of folks in a state, you're not getting paid very much.
“The room and board payment hasn't been adjusted in 12 years. We're basically getting paid room and board at 2008 rates.”
“The Medicaid rate that we get paid for Medicaid personal care services has gotten better since the coronavirus has been with us, but it's still not sufficient to hire and retain workers including direct care workers and medication aides.
“Training is always good, but I also think funding, especially public funding is a key to help alleviate some of these serious issues.”
What’s happening in 2021
DHHS recently updated its list of fines and penalties to include incidents that have happened in 2021 so far.
Seventeen new deficiencies were charged in 2021 for 10 facilities but none of the roughly $290,000 in fines have been paid.
Additionally, of all the penalties issued in 2021, about 71 percent are A2 penalties, which refer to violations that result in risk of death or serious harm occurring.
Three of the charges are under appeal.