Report 2010-108 Recommendations and Responses in 2013-041

Report 2010-108: Department of Public Health: It Reported Inaccurate Financial Information and Can Likely Increase Revenues for the State and Federal Health Facilities Citation Penalties Accounts

Department Number of Years Reported As Not Fully Implemented Total Recommendations to Department Not Implemented After One Year Not Implemented as of 2012-041 Response Not Implemented as of Most Recent Response
Department of Public Health 3 17 7 7 7

Recommendation To: Public Health, Department of

To increase revenue for the penalty accounts, Public Health should ensure that it conducts all state surveys of facilities every two years, as required by state law.

Response

In August 2013, CDPH hired a contractor to perform a workload analysis to assess program workload and barriers, perform a gap analysis, and identify immediate actions that CDPH can take to begin to remediate the gaps identified. The contractor will also identify areas that need additional in-depth review and will develop additional scopes of work for additional contracts (with other contractors) to fully assess issues identified and provide recommendations, including identifying staffing levels required to complete the workload and more efficient means of conducting surveys. The contractor will complete the initial assessment by June 30, 2014. The additional contracts will begin in July 2014 and be completed by December 31, 2015. CDPH anticipates implementing all contractor recommendations for completing state and federal workload, resources needed, methods to identify increased efficiencies, and addressing other identified gaps by December 31, 2017.

  • California State Auditor's Assessment of Status: Not Fully Implemented
  • Completion Date: December 31, 2017
  • Response Date: October 2013

Recommendation To: Public Health, Department of

To ensure that citation review conferences are completed expeditiously, Public Health should continue to take steps to eliminate its backlog of appeals awaiting a citation review conference.

Response

At the time of the BSA audit, CDPH had a backlog of 607 citation review conferences. As of October 10, 2013, CDPH had a backlog of 152 B citations. All A and AA citations have been completed. CDPH projects it will eliminate the backlog entirely by the end of 2014.

  • California State Auditor's Assessment of Status: Not Fully Implemented
  • Completion Date: December 31, 2014
  • Response Date: October 2013

Recommendation To: Public Health, Department of

To increase revenue for the penalty accounts, Public Health should seek legislation authorizing it to revise periodically the penalty amounts to reflect an inflation indicator, such as the CPI.

Response

With the enactment of the 2011 Budget Trailer Bill ABX 1-19, the maximum citation penalty amounts for B citations increased from $1,000, to $2,000. CDPH reviewed the A and AA citation penalties and determined they were adequate. CDPH will not pursue legislation to further increase penalty amounts.

  • California State Auditor's Assessment of Status: Not Fully Implemented
  • Completion Date: July 2011
  • Response Date: October 2013

Recommendation To: Public Health, Department of

To ensure that it complies with current state law and increases transparency, Public Health should adopt regulations for the administration of temporary management companies.

Response

Existing law provides the circumstances under which a temporary manager may be needed to safeguard the health and safety of residents. CDPH developed an internal process to select and install a temporary manager, including guidelines for qualifications and a temporary manager template contract that may be modified for each appointment. By January 30, 2014, CDPH will incorporate these guidelines into Licensing and Certification's Policy and Procedures Manual. Incorporating these processes into the Policy and Procedures Manual will ensure consistency in application and transparency to the public. CDPH believes this fulfills the intent of the recommendation and regulations are not necessary.

  • California State Auditor's Assessment of Status: Not Fully Implemented
  • Completion Date: January 30, 2014
  • Response Date: October 2013

Recommendation To: Public Health, Department of

To increase revenue for the state account, Public Health should seek legislation authorizing it to require facilities that want to contest the monetary penalty to pay the penalty upon its appeal which could then be deposited into an account within the special deposit fund. The original monetary penalty deposited, plus interest accrued in the account, should then be liquidated in accordance with the terms of the decision.

Response

In January 2011, CDPH met with stakeholders to solicit their input on the BSA report. In March 2011, CDPH released those recommendations, as required, via its report to the Legislature. Requiring facilities to pre-pay penalties and placing the penalties in an interest bearing account would cost CDPH approximately $65,000 a year to collect and account for these funds until the appeals were exhausted and liquidate them at that time. To cover these administrative costs, CDPH would need to impose a non-refundable administrative fee upon filing of an appeal or increase licensing fees. Currently, in lieu of contesting a penalty, facilities may pay 65 percent of the penalty within 15 business days of the issuance of the citation. Full payment is due within 30 calendar days of issuance. For these reasons, CDPH will not change the penalty collection process.

  • California State Auditor's Assessment of Status: Will Not Implement
  • Response Date: October 2013

Recommendation To: Public Health, Department of

To ensure consistency with federal guidance related to federal requirements, and that it is not creating incentives for facilities to appeal citations issued for noncompliance with state requirements, Public Health should provide guidance to its staff that discourages settling appealed monetary penalties for a better term than had the facility not contested the citation and paid the penalty within the time frame specified in law to receive a 35 percent reduction. If Public Health believes instances occur when it is appropriate to reduce a monetary penalty by more than 35 percent, it should document which statutory or regulatory factors that formed the basis for concluding that the original class of citation and corresponding monetary penalty amount were no longer considered valid or relevant.

Response

CDPH will not implement this recommendation. The right to appeal is a part of the due process afforded to all providers. CDPH does not view the outcome of negotiations as providing an incentive for facilities to appeal. CDPH must maintain maximum flexibility to negotiate citations and weigh all factors in a final settlement. Implementing this recommendation would hinder CDPH's ability to achieve equitable settlements and force CDPH to adhere to a fixed policy that may not be appropriate in all circumstances.

  • California State Auditor's Assessment of Status: Will Not Implement
  • Response Date: October 2013

Recommendation To: Public Health, Department of

To increase revenue for the penalty accounts, Public Health should seek legislation specifying a time frame within which facilities with nonappealed citations that do not qualify for a 35 percent reduction must pay their monetary penalties and allowing Public Health to collect interest on late payments of monetary penalties.

Response

CDPH will continue to look for opportunities for legislation specifying a timeframe within which non-appealed citations must be paid. However, as stated in our initial response, CDPH does not agree with the recommendation to collect interest on citations that are not appealed and will not seek legislation to do so.

  • California State Auditor's Assessment of Status: Not Fully Implemented
  • Completion Date: January 1, 2016
  • Response Date: October 2013

Current Status of Recommendations

All Recommendations in 2013-041