Judge upholds $414,000 fine against Iowa home-care company

A federal judge has upheld a fine of $414,000 against a Sioux City home health care company accused of poor patient care.

The fine against Mercy Home Care was originally imposed in 2016, but the lengthy appeal process and subsequent delays in publishing a decision resulted in the matter only recently becoming public.

In its appeal, Mercy Home Care had challenged the federal fine, calling it unreasonable. In a strongly worded ruling, Administrative Law Judge Leslie C. Rogall stated that, if anything, the financial penalty was “unreasonably low.”

The fine is tied to an August 2016 inspection of Mercy Home Care, which is a licensed home health agency funded in part with Medicare dollars. As a result of that inspection, the federal Centers for Medicare and Medicaid Services determined the company was not in substantial compliance with conditions of participation in the Medicare program due to issues involving patient care. CMS imposed a civil monetary penalty of $6,000 for each of the 69 days the company remained out of compliance. Those daily fines totaled $414,000.

Mercy Home Care appealed that action, and while the company did not dispute that it was out of compliance for 69 days, it challenged the size of the fine.

After a hearing on the issue, Rogall upheld the penalty in a November 2018 ruling. Mercy appealed the decision, arguing that inspectors had failed to consider the “professional expertise” of the company’s registered nurses, and that CMS had relied on “isolated statements about individual patients” when imposing the fine.

That appeal led to the U.S. Department of Health and Human Services’ Departmental Appeals Board remanding the matter back to the judge in July 2021 – more than two-and-a-half years after the initial ruling. The board asked Rogall to render a new decision that “set out her rationale” as to the reasonableness of the fine.

In the new decision, recently made public by HHS, the judge reaffirmed her previous findings. Mercy, Rogall ruled, had failed to recognize that a female patient who was receiving post-surgical wound care in her home “had a worsening wound that had quadrupled in length, nearly doubled in surface area, developed a large amount of discharge, and caused a significant amount of pain, despite a plan-of-care goal that the wound decrease in size, have decreased drainage, and a decrease in pain … The nature, manner, and degree of noncompliance would support a much higher penalty.”

The judge stated that Mercy, in its appeal, had offered only “a terse and inaccurate discussion” of the regulatory issues, in part by incorrectly arguing there were no repeat violations to be considered, and in part by arguing the violations surrounding the wound-care patient were unrelated to patient care. Mercy “offered no defense” as to the alleged deficiencies in its care for the woman, Rogall stated.

“The deficiency was serious in that it involved an unrecognized worsening of the very wound that (Mercy) was treating and monitoring through home health services,” Rogall ruled. “A $6,000 per-day civil monetary penalty, which is at the low end of the middle range, is entirely reasonable … To the extent the per-day civil monetary penalty $6,000 is unreasonable, it is only because it is unreasonably low.”

When contacted by the Iowa Capital Dispatch, Mercy Home Care referred all questions to the company’s corporate office. That office has yet to respond to calls from the Capital Dispatch.

Mercy Home Care is affiliated with MercyOne Siouxland Medical Center, which is a part of Trinity Health of Livonia, Mich., the second-largest Catholic health care system in the United States.