Insufficient Surety Bond for Resident Funds
Summary
The facility failed to ensure the security of all personal funds of residents deposited with them, as required by regulations. During a recertification survey, it was found that the surety bond obtained by the facility was insufficient to cover the total amount of residents' funds. Specifically, the facility had a surety bond amounting to $175,000, which was inadequate to cover the total resident funds of $191,407.87. This deficiency affected 81 residents who maintained personal funds accounts with the facility. The facility's policy, revised in May 2024, mandates the purchase of a surety bond to secure residents' deposited funds. However, the Director of Finance acknowledged that the bond amount was not enough and mentioned that they were in the process of securing a new bond before the current one expires. The Administrator was also informed of the insufficiency and confirmed that efforts were underway to adjust the bond amount. The deficiency was identified under the regulation 10 NYCRR 415.26(h)(5)(v).
Penalty
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The facility did not maintain a surety bond in an amount sufficient to cover all residents’ personal funds held in trust. Documentation showed that the surety bond in place was for $20,000, while a current account summary listed forty-five residents with a combined trust account balance of $28,733.79. During an interview, the Executive Director confirmed the bond amount, demonstrating that the bond did not fully cover the total resident trust funds managed by the facility.
A review of facility records and staff interviews revealed that the facility did not maintain a surety bond sufficient to cover all resident personal funds on deposit, with account balances exceeding the bond amount for several months. This failure affected the security of personal funds for multiple accounts managed by the facility.
The facility did not maintain a surety bond sufficient to cover all resident funds it managed, as required by policy. On multiple occasions, the balance of resident funds exceeded the bond amount, and the Business Office Manager confirmed that no reviews were conducted to ensure adequate coverage.
A facility failed to maintain a surety bond that matched the current balance of personal funds held in the resident trust fund, affecting 82 residents. The bond was for $45,000, while the trust fund balance was $63,240.36. The Business Office Manager was unable to explain the discrepancy and confirmed there was no policy regarding the surety bond.
A review of records and staff interviews revealed that the facility did not have a valid surety bond in place to cover the total balance of personal funds deposited by 55 residents in the trust fund account. The bond had expired, and key staff were unaware of its status until the survey.
The facility did not maintain a surety bond sufficient to cover the total amount of resident personal funds held, as the bond was set at $50,000 while the total resident fund balance exceeded $91,000. Two residents accounted for a significant portion of the funds, and the facility's policy did not address surety bond requirements.
Insufficient Surety Bond Coverage for Residents’ Trust Funds
Penalty
Summary
The facility failed to assure the security of all personal funds of residents deposited with the facility by not maintaining a surety bond in an amount sufficient to cover the total balance of residents’ trust accounts. On review of documents, the surveyor was provided a surety bond from the facility’s insurance company in the amount of $20,000, effective from 12/08/24 to 12/08/25. The facility also provided a list labeled “Trust- Current Account Balance as of 8/27/25,” which identified forty-five residents with personal funds accounts managed by the facility and showed a current total balance of $28,733.79. In an interview, the Executive Director confirmed that the surety bond amount was $20,000, which was less than the total amount of residents’ funds held in trust, resulting in the deficiency. No additional resident-specific medical history or clinical conditions were described in the report, and the deficiency pertained solely to the financial protection of residents’ personal funds.
Insufficient Surety Bond for Resident Personal Funds
Penalty
Summary
The facility failed to assure the security of all personal funds deposited by residents by not maintaining a sufficient surety bond to cover the total amount of resident funds managed. Review of the facility's policy on Resident Personal Funds indicated that a surety bond or other satisfactory assurance must be in place to secure all resident funds. Examination of bank statements over a six-month period showed that the facility held resident funds exceeding $100,000, with balances ranging from $106,898.12 to $133,831.89 during several months. However, the surety bond in effect during this period was only $100,000, which was not adequate to cover the highest balances held in resident accounts. Interviews with the Administrator and the Director of Regulatory Compliance (DRC) confirmed that the surety bond should be sufficient to cover the total balance of resident funds. The DRC later provided documentation of an increased surety bond amounting to $150,000, but this updated bond only became effective after the period in question and did not retroactively cover the higher balances previously held. As a result, the security of personal funds for 56 accounts managed by the facility was not fully assured during the months when the resident fund balances exceeded the surety bond amount.
Insufficient Surety Bond Coverage for Resident Funds
Penalty
Summary
The facility failed to provide a surety bond in an amount sufficient to safeguard all resident funds managed by the facility. Record review showed that the facility managed funds for 32 residents, and the surety bond in place covered only $30,000.00. However, bank statements for May, June, and July 2025 revealed that on 23 separate days, the daily ledger balance of resident funds exceeded the bond amount, with balances reaching as high as $48,374.65. During an interview, the Business Office Manager confirmed that the facility did not conduct reviews to ensure the surety bond was adequate for the actual balance of resident funds, as this responsibility was handled by the home office. The facility's policy required it to act as a fiduciary and safeguard resident funds, but this was not met due to the insufficient bond coverage.
Insufficient Surety Bond Coverage for Resident Trust Funds
Penalty
Summary
The facility failed to purchase a surety bond in an amount equal to the current balance of personal funds held in the resident trust fund. At the time of the survey, documentation showed that 82 residents had personal funds managed by the facility, with a total balance of $63,240.36. However, the facility's surety bond was only for $45,000.00, which was significantly less than the current trust fund balance. The Business Office Manager confirmed the discrepancy and was unable to provide a clear explanation for why the bond amount did not match the current balance. Additionally, the facility did not have a policy regarding the surety bond. Interviews with the Business Office Manager revealed uncertainty regarding the timing of processing patient pay amounts, which contributed to fluctuations in the trust fund balance. The manager also acknowledged that at least one deceased resident was still listed as having funds in the trust account. Despite being informed of the concern, the facility did not provide documentation or a policy to address the issue of the insufficient surety bond coverage.
Failure to Maintain Valid Surety Bond for Resident Trust Funds
Penalty
Summary
The facility failed to maintain a valid surety bond to secure the personal funds of all residents deposited in the resident trust fund account. Record review showed that the total balance in the Resident Trust Fund Account was $63,647.25 for 55 residents. The Surety Bond Continuation Certificate provided indicated that the bond, which was for $90,000, had expired and was no longer in effect. Staff interviews revealed that the Business Office Manager was unaware of the bond's expiration and deferred responsibility to the corporate office, while the Corporate Nurse Consultant was also unaware that the bond had expired until it was brought to their attention during the survey. The Administrator was not available for interview during the survey.
Inadequate Surety Bond Coverage for Resident Personal Funds
Penalty
Summary
The facility failed to ensure that resident personal fund accounts were protected with a surety bond sufficient to cover the total balance of all resident funds held by the facility. During an interview, the administrative assistant reported that the total amount of resident funds was $91,117.79. However, documentation provided by the administrator showed that the facility's surety bond only covered up to $50,000, which was less than the total amount of resident funds on hand. The administrator explained that the bond amount was based on a 12-month average balance and acknowledged that a recent property sale by a resident had increased the total balance significantly, with two residents accounting for more than $58,000 of the total funds. Further document review included a resident statement showing a balance of $20,995.70 for one resident after a large bank credit, and a trial balance listing 166 residents with accounts at the facility. The facility's policy on deposit of resident funds stated that personal funds would be safeguarded but did not include information about maintaining a resident trust fund surety bond. The lack of adequate surety bond coverage had the potential to affect all residents with positive account balances.
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