Failure to Track and Refund Resident Security Deposit After Discharge
Penalty
Summary
The deficiency involves the facility’s failure to implement a process to identify and return refundable resident deposits upon discharge, as required under a prior admission agreement. The previous management’s admission contract, revised on 3/22/23, required a $6,000 interest‑free security deposit to reserve a room, with the deposit to be refunded within 45 days after discharge, less applicable balances. Review of records for one resident showed an application dated 4/2/25 with a documented $6,000 deposit and additional room and board charges due at signing. However, later invoice review showed no documentation of the $6,000 deposit. The current admission agreement under new management did not address the prior $6,000 deposit requirement or how deposits made under the previous management’s contract would be handled. The resident associated with the missing deposit had severe cognitive impairment and diagnoses including HTN, non‑Alzheimer’s dementia, and asthma, and was discharged to another facility, as documented in progress notes describing coordination with the resident’s daughter and transfer by transportation with a Broda chair and Hoyer pad. Interviews revealed that the Regional Nurse Consultant was unaware of the prior contract’s $6,000 deposit and refund requirement and stated that the new management did not require such deposits, though they were still under the previous management until the change of ownership was completed and were honoring the original contract. The Administrator reported that funds were not turned over during acquisition and that all information had been requested from the previous ownership, but also stated unawareness of the specific deposit while acknowledging that the corporate Business Office Manager knew of it. These findings show that the facility lacked an effective process to track and return refundable deposits owed to discharged residents under the prior agreement.
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