SC Administrative Law Court Decisions

The South Carolina Department of Health and Environmental Control (DHEC) seeks a $5,000 fine and the revocation of Randolph's Residential Care, Inc. (Randolph's) license to operate a community residential care facility. Randolph's opposes DHEC's position and asserts that no revocation or fine should be imposed. Jurisdiction in this dispute lies in the ALJD. S.C. Code Ann. § 1-23-600(B) (Supp. 2000); S.C. Code Ann. § 44-7-320(B) (Supp. 2000). After a review of the facts and arguments presented, no revocation is warranted but a fine of $4,000 is imposed.

1. Has Randolph's provided care as a community residential care facility for more than ten residents so as to violate the applicable statutes and 25A S.C. Code Regs. 61-84 (Supp. 2000)? ⁽¹⁾

2. If a violation has occurred, is the proper sanction the revocation of Randolph's license to operate a community residential care facility and the imposition of a fine of $5,000?

1. Positions of Parties

DHEC asserts the facility is licensed to serve only ten residents and that at the time of a DHEC inspection on April 5, 2001, the facility was serving at least 12 residents. DHEC argues that such actions constitute a violation of the statutes and regulations governing community residential care facilities.

Randolph's argues that it has not provided services for more than ten individuals. Rather, it argues that it provides rental space in its upstairs area and that at the time of the DHEC inspection the two individuals thought to be residents of the care facility were merely rental tenants. Further, Randolph's argues that any services provided to the tenants were not provided by Randolph's but were provided by volunteers. Thus, such services cannot be considered services provided by Randolph's.

2. Findings of Fact

I find by a preponderance of the evidence the following facts:

Randolph's is a community residential care facility operating in Charleston, South Carolina and licensed for ten residents. As the result of a complaint, DHEC, on April 5, 2001, conducted an on-site inspection of Randolph's. The evidence produced at the hearing establishes that twelve residents were receiving services from the facility at the time of the inspection.

Of the twelve, ten of those residents lived in the downstairs area of the two buildings which comprise the facility. However, at least two additional individuals were residing at the facility on the second floor of one of the two buildings. The two individuals who lived upstairs received their medications at the facility and had those medications administered to them by facility staff members or volunteers working on behalf of Randolph's. Further, meals were provided to these two residents by staff or volunteers of the facility. Finally, Randolph's arranged for medical appointments for the two individuals.

As a result of the April 5, 2001 inspection, DHEC determined that Randolph's had violated the terms of its license by providing services to twelve residents, two more than allowed by Randolph's license. Randolph's responded on April 20, 2001, to DHEC's position. However, DHEC deemed the response to be insufficient and a series of contacts between the two parties ensued over the next two months, culminating in a letter of sanction on June 28, 2001. A June 28, 2001 notice to Randolph's concluded that Randolph's violated the statutes and regulations governing community residential care facilities. Randolph's sought a contested case hearing and the matter has now been brought to the ALJD.

3. Conclusions of Law

a. Regulation of Community Residential Care Facilities

A community residential care facility is subject to regulation by DHEC under a licensing requirement. S.C. Code Ann. §§44-7-250 & 260 (Supp. 2000); 25A S.C. Code Regs. 61-84 § 102 (Supp. 2000). DHEC regulations specifically limit a facility to caring for no more persons than authorized in the license which permits the facility to operate as a community residential care facility. Regs. 61-84 § 301 (A) (Supp 2000). ("No facility shall have set up or in use at any time more beds than the number specified on the face of the license, nor shall the facility receive for care persons in excess of the licensed capacity."). In the instant case, all agree that Randolph's is a facility licensed for ten beds and may care for only ten residents. The dispute here is whether more than ten residents have been cared for by Randolph's as a community residential care facility.

b. Residents Cared For By Randolph's

An entity licensed as a community residential care facility is licensed to provide to its residents "room and board" and "provides a degree of personal assistance ." S.C. Code Ann. § 44-7-130(6); Regs. 61-84 § 101(E) (Supp. 2000) ("Community Care Residential Care Facility is a facility which offers room and board and which provides a degree of personal assistance . . ."). Here, the facts establish that ten residents lived in the downstairs area of the two buildings comprising the facility and that at least two additional individuals resided on the second floor of one of the two buildings. These two individuals were administered medications at the facility by facility staff members or volunteers, received meals provided by staff or volunteers of the facility, had their medical appointments arranged by Randolph's, and had beds provided on the second floor of the facility. Such actions establish that Randolph's improperly provided its services as a community care residential facility for twelve residents.

Under the facts of this case, Randolph's provided meals to the upstairs residents and also provided a bed and a room for occupancy. Such actions by Randolph's constitute the providing of "room and board" to the two individuals here under review. Further, Randolph's provided "personal assistance" to the two residents in the form of administering medication and arranging for doctor's appointments. Such actions are "personal assistance" since the term includes "helping the resident with activities of daily living" with "daily living activities" including such actions as "obtaining appointments" and "self-administration of medication." Regs. 61-84 § 101(O) and (G) (Supp. 2000). Thus, Randolph's acted as a community care residential care facility to more than ten residents.

The argument that the residents were merely tenants paying rent to Randolph's is unpersuasive. Medical services such as administering medication or arranging doctor's appointments is inconsistent with a landlord-tenant relationship. See APT Asset Management, Inc. v. Board of Appeals of Melrose, 735 N.E.2d 872 (Mass.App.Ct. 2000) (where the court agreed that a landlord-tenant relationship does not customarily provide the tenants with self-administered medication management performed by the landlord).

Likewise, the argument is unpersuasive which asserts that since volunteers provided the services to the two individuals under review, Randolph's is not providing the services. On the contrary, Regs 61-84 contemplates that a typical facility will often provide services to residents via volunteers. For example, volunteers must have a physical examination before being allowed to handle food or provide residential care, (Regs. 61-84 § 205(A)(1) (Supp. 2000)), are required to undergo tuberculin testing, (Regs. 61-84 § 205(A)(2) (Supp. 2000)), and the administrator must ensure that a volunteer's performance complies with the facility's policies and the requirements of Regs. 61-84 (Regs. 61-84 § 205(B)). Thus, the mere fact that the services for the two residents were performed by volunteers is not a basis for allowing services to be provided to residents in excess of the allowed ten.

1. Positions of Parties

DHEC asserts the serving of excess residents is the second violation in less than two years and that the past history of non-compliance requires both a fine of $ 5,000 and the revocation of the license. Randolph's argues that it made a good faith attempt to comply with the law and any violation was merely a misunderstanding as to whether rental tenants could be housed on the premises and served by volunteers. Thus, Randolph's argues a sanction of a revocation and fine is too excessive.

2. Findings of Fact

I find by a preponderance of the evidence the following facts:

DHEC's notice of sanction of June 28, 2001 informed Randolph's that its license was being revoked and that a fine of $5,000 was being imposed.

a. Facts of Past History

To a large degree, DHEC relies upon the past history of violations by Randolph's to support its position since in recent years Randolph's has failed to comply with several regulatory requirements. Indeed, Randolph's history of compliance has not been one for emulation.

For example, in 1999, DHEC became aware of a change of ownership of the facility for which Randolph's failed to submit the necessary documents and information needed to process a change of ownership. As a result, DHEC sought to revoke Randolph's license on August 26, 1999. After a period of correspondence, the required materials were ultimately obtained. Accordingly, on October 21, 1999, DHEC processed the change of ownership and ceased revocation actions.

A second event resulted in a sanction of $2,500 on January 24, 2000. DHEC determined that the facility was providing supervisory care to 19 residents despite being licensed for only 10 residents. Randolph's position was that it was providing services for "day" care but not for overnight or permanent residence. Randolph's agreed to the fine. Despite Randolph's agreeing to pay the sanction, as late as March 2, 2000, DHEC had not yet received payment of the fine. After further contact with the facility, on May 4, 2000, Randolph's made the required payment.

A third sanction of $500 was asserted against Randolph's by letter dated September 25, 2000. The sanction was imposed since DHEC learned that Randolph's was operating without its administrator having a current license as a community residential care facility administrator. Randolph's paid the penalty on April 28, 2001.

Finally, the matter currently under dispute constitutes a fourth violation occurring on April 5, 2001.

The April 5, 2001 violation is the second for providing services to residents in excess of the ten permitted under Randolph's license. For this violation, DHEC seeks a $5,000 fine and the revocation of Randolph's license.

b. Facts of Mitigating Factors

While the April 5, 2001 violation did in fact occur, the inspection did not reveal the presence of any residents for whom care was lacking or for whom care was being improperly provided. In fact, during the inspection, inspectors saw residents who were properly dressed, who were responsive to the inspectors, and who appeared well groomed. Further, the facility has taken steps to eliminate the "rental" aspect of its operation in that the two "tenants" are no longer being cared for at the facility. Finally, physical as well as personal problems have been a source of concern for Randolph's administrator. The evidence establishes that such physical and personal problems are being addressed and will not likely be a continuing problem for the facility.

3. Conclusions of Law

A violation of either the statutes enacted under the State Certification of Need and Health Facility Licensure Act addressing community residential care facilities or the regulations of 25A S.C. Code Regs. 61-84 (Supp. 2000) may result in a sanction. S.C. Code Ann. § 44-7-320(A)(1)(a) (Supp. 2000) ("The department may deny, suspend, or revoke licenses or assess a monetary penalty against a person or facility for: (a) violating a provision of this article or departmental regulations."). Given that a violation has occurred, the issue here is what sanction is warranted under the facts of this case.

a. Monetary Fine or Revocation As A Sanction

Under the facts of this case, I cannot find that a revocation is warranted. Rather, a fine is proper.

No persuasive evidence demonstrates that current residents are being cared for in an improper manner. In fact, the evidence establishes that the inspectors observed residents who were properly dressed, who were responsive to the inspectors, and who appeared well groomed. Certainly, caring for more residents than permitted under the license can ultimately create circumstances that jeopardize the health, safety or well-being of the residents. However, in the absence of established neglect, no strong basis exists to revoke the license. To revoke would require the existing residents to undergo a significant change of circumstance and would likely impose hardships. Such should not be undertaken unless no other sanction can achieve the desired corrective result. Rather, the sanction for such a violation should be less than a revocation and must be one that will affirmatively and meaningfully discourage the practice.

Further, the evidence establishes that the facility has taken efforts to correct the cited violation of excess residents. Here, the landlord-tenant practice is no longer present since the facility has taken steps to eliminate the "rental" aspect of its operation. Indeed, the two "tenants" are no longer being cared for at the facility.

Finally, consideration of the compliance history of Randolph's is a significant concern. In fact, the current violation of excess residents is the second in less than two years. However, two offsetting elements diminish the weight attributed to a past lack of compliance.

First, Randolph's administrator has encountered physical as well as personal problems impacting the facility. Such physical and personal problems are now being addressed and will not likely be a continuing problem for the facility. Second, Randolph's presented a legally incorrect but plausible basis for its belief that it could provide services to rental tenants. Thus, its violation of the ten resident limit is not deliberate, but rather is one of ignorance. While ignorance is no excuse, such is of some consideration is imposing a sanction.

Thus, after a consideration of the facts of this case, a revocation is not supported. Rather, a fine is required.

b. Amount of Fine

"The penalty imposed by the department for violation of this article or its regulations must be not less than one hundred nor more than five thousand dollars for each violation of any of the provisions of this article [and] [e]ach day's violation is considered a subsequent offense." S.C. Code Ann. § 44-7-320(C) (Supp. 2000). Clearly, the fine is a discretionary amount which varies with the circumstances.

Here, twice in less than two years, Randolph's has failed to comply with its ten resident limit. Further, it has failed to timely comply with the change of ownership requirements and failed to provide a licensed administrator for the facility on at least one occasion. In each instance, Randolph's has been less than prompt in complying with the requirements for satisfying the fines imposed. Further, it appears that a prior fine of $2,500 has not been sufficient to convince Randolph's to strictly comply with the requirements for ten residents. Accordingly, under all of the facts and circumstances identified, a fine of $4,000 is imposed in this instance.

Randolph's Residential Care, Inc. shall pay a fine of $4,000 for violating the ten resident limit of its license to operate a community residential care facility. The fine shall be paid within thirty days of the date of this order.

AND IT IS SO ORDERED.

_____________________________

RAY N. STEVENS

Administrative Law Judge

Dated: March 7, 2002

Columbia, South Carolina

1. Regs. 61-84 was reorganized and amended effective July 27, 2001. The provisions of Regs. 61-84 controlling here are the regulations in effect at the time of the April 5, 2001 violation and the June 28, 2001 imposition of the sanction. On those dates, Regs. 61-84 included the original enactment provisions of May 23, 1986 as modified by the amendments effective May 24, 1991 noted in the State Register Volume 15, Issue No. 5.