NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_____________
No. 09-3006
_____________
JEWISH HOME OF EASTERN PA,
Petitioner
v.
CENTERS FOR MEDICARE AND MEDICAID SERVICES;
DEPARTMENT OF HEALTH AND HUMAN SERVICES,
Respondents
____________
On Petition for Review from on Order by the Secretary
of the Department of Health and Human Services
(No.A-09-42)
Submitted January 27, 2011
Before: FUENTES, CHAGARES, and ROTH, Circuit Judges.
(Filed February 11, 2011 )
____________
OPINION
____________
CHAGARES, Circuit Judge.
Jewish Home of Eastern Pennsylvania petitions for review of the final
decision of the Secretary of the Department of Health and Human Services
affirming the imposition of civil money penalties for failure to be in substantial
compliance with the Medicare and Medicaid Services participation requirements
pursuant to 42 C.F.R. ' 483.25(h)(2). For the reasons that follow, we will deny
the petition for review.
I.
We write for the parties= benefit and recite only the facts essential to our
disposition. The Jewish Home of Eastern Pennsylvania (AJHEP@) provides
nursing care to Medicare beneficiaries. JHEP is required to comply with the
mandatory health and safety requirements for participation in the Medicare
program. To participate in the Medicare program, JHEP must submit to random
surveys conducted by state departments of health to ensure that it is meeting all
the program requirements. See 42 C.F.R. ' 488.305.
On December 9, 2005, the Pennsylvania Department of Health, acting on
behalf of the Center for Medicare and Medicaid Services (ACMS@), conducted a
survey of JHEP. The survey concluded that JHEP had eight regulatory
deficiencies, including violations of 42 C.F.R. ' 483.25(h)(2), which requires a
facility to ensure that each resident receives adequate supervision and
assistance with devices to prevent accidents. Based on these deficiencies, the
CMS imposed a $350 per day fine from December 9, 2005 through January 26,
2006, totaling $17,150. On October 16, 2006, the CMS performed another
survey of JHEP and found twelve deficiencies. CMS imposed a $400 per day
2
fine effective from October 16, 2006 through November 16, 2006, totaling
$12,800.1
On August 9, 2006 and October 20, 2006, JHEP appealed both civil
monetary penalties to an Administrative Law Judge (AALJ@). JHEP argued that
the allegations of noncompliance were based on the inadmissible disclosure of
Aprivileged@ quality assurance records. Additionally, JHEP claimed that the
survey violated equal protection because it was the product of discrimination
based on race and religion. The ALJ denied JHEP=s motion to suppress the
quality assurance records. Prior to the trial, JHEP stipulated that it failed to
provide the necessary supervision or assistive devices to three of its residents,
and subsequently presented no testimony as to these residents. In June 2008, a
two-day trial took place and the ALJ upheld the fines against JHEP. The ALJ
found that JHEP was not in substantial compliance with the participation
requirements during the relevant time periods and declined to consider the equal
protection claim because it lacked subject matter jurisdiction to hear substantive
constitutional claims.
1
Pursuant to 42 U.S.C. ' 1395i-3(h)(2)(B)(ii), the CMS may impose a civil money
penalty in an amount not to exceed $10,000 per day. There are two categories
of monetary penalties: (1) APenalties in the range of $3,050 - $10,000 per day
are imposed for deficiencies constituting immediate jeopardy,@ 42 C.F.R. '
488.438(a)(1); and (2) APenalties in the range of $50 - $3,000 per day are
imposed for deficiencies that do not cause immediate jeopardy, but either have
caused actual harm, or caused no actual harm, but have the potential for more
than minimal harm,@ 42 C.F.R. ' 488.438(a)(ii).
3
JHEP timely filed an appeal to the Board of Appeals. On June 18, 2009,
the Board affirmed both of the civil monetary penalties. On July 10, 2009, JHEP
filed the current petition for review.2
II.
On review by this Court, the Secretary=s findings Aif supported by
substantial evidence on the record considered as a whole, shall be conclusive.@
42 U.S.C. ' 1320a-7a(e). A[S]ubstantial evidence is more than a mere scintilla.
It means such relevant evidence as a reasonable mind might accept as adequate
to support a conclusion.@ Monsour Med. Ctr. v. Heckler, 806 F.2d 1185, 1190-91
(3d Cir. 1986) (internal quotations omitted). In reviewing the Secretary=s
interpretation of a Department of Health and Human Services regulation, we may
only overturn the interpretation if it is arbitrary, capricious, an abuse of discretion,
or otherwise not in accordance with the law. 5 U.S.C. ' 706(2); Thomas
Jefferson Univ. v. Shalala, 512 U.S. 504, 512 (1994). We give substantial
deference to an agency=s interpretation and application of its own regulations.
Thomas Jefferson Univ., 512 U.S. at 512.
III.
Notably, JHEP does not contest the finding that it was not in substantial
compliance with the Medicare program during the relevant survey periods.
Instead, JHEP argues that CMS=s findings and penalties are invalid because they
2
We have jurisdiction over this petition pursuant to 42 U.S.C. ' 1320a-7a(e).
4
are (1) based on Aprivileged@ quality assurance documents, and (2) are a result of
racial and religious discrimination. We conclude that both of JHEP=s grounds for
review are unfounded.
JHEP maintains that the incident reports in question were generated by its
quality assurance committee, and as such, are subject to disclosure and use
restrictions under 42 U.S.C. ' 1396r(b)(1)(B).3 The language of 42 U.S.C. '
1396r(b)(1)(B), however, limits the scope of protection from discovery to the
records of the committee. See, e.g., State ex rel. Boone Ret. Ctr. v. Hamilton,
946 S.W.2d 740, 743 (Mo. 1997) (finding that 42 U.S.C. ' 1396r(b)(1)(B)
Aprotects the committee=s own records -- its minutes or internal working papers or
statements of conclusions -- from discovery. No honest reading of the statute,
however, can extend the statute=s privilege to records and materials generated or
created outside the committee and submitted to the committee for its review.@).
After reviewing the record presented, we conclude that the documents in
question were contemporaneous, routinely-generated incident reports and not the
quality assurance team=s minutes, internal papers, or conclusions. As such,
these incident reports are not subject to disclosure restrictions. Hence, these
3
Section 1396r(b)(1)(B) provides: AA State or the Secretary may not require
disclosure of the records of such committee except insofar as such disclosure is
related to the compliance of such committee with the requirements of this
subparagraph.@ This subparagraph mandates that the nursing facility have a
quality assessment and assurance team which Ameets at least quarterly to
identify issues with respect to which quality assessment and assurance activities
are necessary@ and Adevelops and implements appropriate plans of action to
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incident reports along with JHEP=s prior stipulations provided the Secretary with
ample evidence to determine that JHEP was not in substantial compliance with
the Medicare program.
correct identified quality deficiencies.@
6
JHEP also alleges that the issuance of civil monetary fines violates equal
protection because the fines are the result of selective enforcement based on
race and religion.4 Selective discriminatory enforcement of a facially valid law is
unconstitutional under the Equal Protection Clause. See Yick Wo v. Hopkins,
118 U.S. 356, 373 (1886); Holder v. City of Allentown, 987 F.2d 188, 197 (3d Cir.
1993). The Supreme Court has held that a law which is Afair on its face and
impartial in appearance@ may nonetheless constitute illegal discrimination Aif it is
applied and administered by public authority with an evil eye and an unequal
hand.@ Yick Wo, 118 U.S. 356, 373-74 (1886) (finding that where Chinese
nationals did not violate city ordinances but were still fined, the only reason for
the fines was discrimination based on race and nationality in violation of equal
protection).
To establish a selective-enforcement claim, JHEP must show (1) that it was
treated differently from other similarly situated individuals, and (2) Athat this
selective treatment was based on an unjustifiable standard, such as race, or
religion, or some arbitrary factor, . . . or to prevent the exercise of a fundamental
right.@ Dique v. N.J. State Police, 603 F.3d 181, 184 n.5 (3d Cir. 2010)
(quotations omitted)). Hence, to maintain an equal protection claim of this sort,
JHEP must provide evidence of intentional or purposeful discriminatory purpose,
not mere unequal treatment or adverse effect. Snowden v. Hughes, 321 U.S. 1,
4
While JHEP is a non-denominational facility, JHEP argues that it may maintain
an equal protection claim because of its association with a protected group --
7
8 (1944). JHEP must show that the Adecisionmaker . . . selected or reaffirmed a
particular course of action at least in part because of, not merely in spite of, its
adverse effects . . . .@ Wayte v. United States, 470 U.S. 598, 610 (1985)
(quotations omitted).
JHEP relies upon three primary documents to show discriminatory effect
and discriminatory purpose. First, JHEP submits side-by-side comparisons of
citations issued to JHEP as compared to other local facilities. JHEP also
provides a statistical report which concluded that the number of citations issued
to JHEP was high in comparison to other facilities surveyed from the Scranton
Field Office and that this finding was likely the result of bias and not likely the
result of differences in the quality of care, error or chance. Additionally, JHEP
presents the affidavit of an employee who claims that a CMS surveyor made a
discriminatory statement in October 2004, over a year before the surveys in
question. Specifically, in surveying whether JHEP provided activities on
Saturdays for residents of all denominations, the surveyor was told that there was
a KiddushCa ceremony involving a blessing and food that all individuals were
invited to regardless of their religious affiliations. According to the employee, the
surveyor responded that she was Christian and would feel uncomfortable
attending such an activity.
We hold that JHEP has failed to establish a claim for selective enforcement
under the Equal Protection Clause. JHEP has not demonstrated that CMS
persons of Jewish ancestry.
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issued fines with an intentionally discriminatory purpose. We find JHEP=s
reliance on the surveyor=s alleged statement to be misplaced as it was clearly
taken out-of-context, was not contemporaneous to the surveys in question, and
was not relevant or facially discriminatory. Additionally, JHEP has failed to show
that it was treated differently from other similarly situated facilities. Therefore,
we conclude that JHEP=s equal protection claim has no merit.
IV.
After considering all of JHEP=s arguments, we will deny the petition for
review.
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