Governing body failed to oversee administrator, payroll, and facility bank account
Summary
The deficiency involves the governing body’s failure to provide effective oversight of facility management and financial operations, including payroll and the primary facility bank account into which Medicare, Medicaid, insurance, and private resident payments were deposited. Facility policy dated 10/9/2025 stated that the governing body was legally responsible for establishing and implementing policies for management and operation of the facility, appointing an administrator who was responsible for management, and ensuring a process for the administrator to report on audits, budgets, staffing, and supplies. The facility was unable to produce any governing body policy that was in effect prior to 10/9/2025. Board members and the chairman described their role as mainly policy-making and oversight, with the administrator as the only employee of the board, but they relied largely on verbal reports and limited written financial information from the administrator. Governing body minutes showed that payroll had been brought back in-house after previously being outsourced, and that a new bookkeeping system was implemented. Over multiple meetings, the board received high-level financial reports from a CPA, including reports of profits and losses, but there were gaps in financial reporting, such as a meeting where financials were not reported due to the absence of the administrator and CPA. The minutes also documented that personnel manuals from 2022 and 2023 were never presented to the board for approval, even though earlier manuals had been approved, and that key office positions such as Social Services, Human Resources, and Business Office Manager were vacant. Board members later learned that policy manuals had been revised without board approval and that multiple versions of the policy manual were in circulation. A spreadsheet from CPA Firm #1 covering a 19‑month period showed that the administrator and two bookkeeping staff cashed out a total of $142,627.44 over the maximum benefit allowed by facility policy. An analysis from the CPA identified three employees who far exceeded the window for payroll payouts after payroll was brought back in-house and recommended that the board review prior auditors’ accruals for vacation, holiday, and sick leave and interview prior administrators about vacation restrictions during COVID. The chairman later acknowledged that he did not think the board had reviewed those accruals or discussed the CPA’s letter. Interviews with board members revealed that their primary checks and balances were annual audits and review of summarized financial statements, that they did not have detailed visibility into payroll or individual salaries, and that they were unaware of staff turning in hours worked at home. The board members stated they were blindsided when an external auditor identified significant unexplained salary increases for the administrator and two bookkeeping staff, and they acknowledged that the governing body had “dropped the ball” on ensuring the administrator was held accountable and that policy changes and financial operations were properly reviewed. The failure of the governing body to oversee the administrator, payroll system, and bank account was determined to have the potential to affect all 45 residents in the facility. The chairman reported that during the tenure of a prior administrator, payroll had been outsourced to an out-of-state firm without the board’s knowledge, which contributed to that administrator’s departure. Afterward, the administrator and a bookkeeper recommended bringing payroll back in-house, and the board accepted their assurances that there were no problems. The chairman stated that he questioned the administrator and visited the facility but relied on the information provided and did not receive the level of financial detail he felt was needed. Board members described that they received total salary figures as a blanket line item and general expense breakdowns, but not detailed salary registers or clear tracking of compensated absences. One board member stated that the governing body’s oversight and visibility into operations were limited and that they had not been given copies of the policy manual, despite the policy requiring a process for holding the administrator accountable for reporting on management and operations. Another board member linked the unapproved 2023 personnel handbook changes, including wording that allowed staff to cash in time, to the financial issues, noting that the way the policy was written contributed to increased payouts. Throughout interviews, board members and the chairman acknowledged that they relied heavily on trust in the administrator and did not implement or follow through on robust checks and balances to detect or prevent mismanagement of payroll and the facility’s bank account.
Penalty
Resources
Below are regulatory guidelines relevant to this citation:
A resident had a $1,791 credit balance tied to SOC payments for Medicare co-insurance, but the facility delayed issuing the refund while trying to determine whether the payment was a true refund or an insurance mistake. The BOM acknowledged the refund was held too long and that the facility’s policy required completion of the refund process within 30 days.
The governing body failed to ensure uninterrupted administrative oversight when the facility was left without a licensed NHA with an active Ohio license after the prior administrator resigned. Corporate staff reported the owner’s Ohio NHA license was inactive, BELTSS confirmed the inactive status, and the facility also lacked a full-time onsite DON, relying instead on an interim DON and other offsite corporate support.
Lack of Written Procedures for Temperature and HVAC Monitoring: The facility failed to develop and implement written P&P for monitoring room air temperatures and HVAC units. Staff described a process of checking resident room temperatures, averaging readings by station, and documenting HVAC filter changes, but the logs did not identify the inspection components or the staff performing the work, and the facility had no written guidance for the process.
Failure to maintain a licensed administrator. The facility's governing body did not appoint a properly licensed administrator to manage the facility, and no licensed administrator had been in place since the previous administrator became the administrator of record at another facility. The CFO stated he was not a licensed administrator and did not go into the building, and the DON stated she expected the facility to have a licensed NHA.
A facility Governing Body failed to ensure complete, consolidated, and accurate accounting of resident personal funds and balance transfers after an ownership change. A Business Office Manager said resident fund accounts were still being transitioned into a new RFIM account, records from corporate were difficult to obtain, and one resident's account remained outstanding for months. A cognitively intact resident reported receiving late, incorrect statements that did not let him verify credits and debits, while another resident's transfer timing was unclear; attempts to reach Corporate and Regional BOMs were unsuccessful.
The facility failed to have a licensed administrator and could not produce a governing body policy. Record review showed the prior administrator left and the current administrator was not hired until more than a year later, leaving the facility without an administrator for over 365 days. The DON identified 25 residents in the facility, and the administrator was unable to locate the governing body policy during the survey.
Delayed Refund of Resident Credit Balance
Penalty
Summary
The facility failed to follow its policy and procedure for refunding a credit balance when Resident 1 did not receive a refund within 30 days. Resident 1 had a Transaction Record showing a credit balance of $1,791.00 related to share of cost payments made in October 2025 for Medicare co-insurance. During interview, the Business Office Manager stated the co-insurance was later paid by the resident’s Medicare supplement and the check was received by the facility on 12/17/25, but the facility delayed issuing the refund while trying to determine whether it was a true refund or an insurance error. The Business Office Manager acknowledged that the refund was held too long and should have been sent within 30 days. The facility policy titled Accounts Receivable Refund or Credit Balances stated the Business Office is responsible for identifying overpayments and that the maximum time to complete the refund process is 30 days, or in accordance with State guidelines.
No Active Licensed Administrator Onsite
Penalty
Summary
The governing body failed to ensure the facility had uninterrupted administrative oversight by a licensed nursing home administrator with an active Ohio license after the previous administrator resigned. At the time of survey entrance, no licensed nursing home administrator was present in the facility. Corporate staff stated the previous administrator had resigned earlier that day, and the facility owner was licensed in Ohio but his license was inactive as of 04/01/26, which was confirmed by online licensure verification and by the Board of Executives of Long-Term Services and Supports (BELTSS). The Board also verified that the owner had been notified about the inactive license on 04/20/26 and had no evidence of attempts to reactivate it between that date and 06/29/26. During the investigation, corporate staff stated the facility did not have a full-time onsite DON and was using an interim DON who was out of state and reachable by phone. The previous administrator stated he resigned because of concerns including the owner’s direction to terminate the DON the prior week, leaving the facility without full-time onsite nursing oversight, and the use of a corporate clinical director in another state. The owner later stated the previous administrator had given notice and that the facility was trying to arrange interim coverage, but he did not provide evidence that measures were in place to ensure uninterrupted administrative services. Additional observations on 06/30/26 showed there was still no licensed nursing home administrator with an active Ohio license onsite to provide administrative oversight.
Lack of Written Procedures for Temperature and HVAC Monitoring
Penalty
Summary
The facility failed to develop and implement written policies and procedures for monitoring room air temperatures and HVAC units. During record review, the Weekly Air Temperature Record showed temperatures documented for Station 1 through Station 4, the Lobby, and Offices on multiple dates, with outside temperatures ranging from 81 F to 96 F and indoor readings recorded in the low to mid-70s. During interviews, Maintenance Consultant 1 stated that room temperatures were checked daily, should be taken at knee level, and that the weekly process was to randomly check several resident rooms at each station and document the average temperature for each station. MC 1 also stated that the Weekly Air Temperature Log reflected the facility's process. A review of the Change of Air Filters on Air Conditioner Units log showed entries for multiple dates that consisted only of a downward arrow mark extending from Unit 1 through Unit 16. MC 1 stated that the log did not identify what HVAC components were checked beyond air filter replacement and did not identify who performed the inspection or maintenance, and also stated that the facility did not have written P&P addressing room temperature monitoring. The Administrator stated that the current process for weekly room temperature monitoring involved MA 1 obtaining temperatures in all resident rooms, documenting the readings on paper, and then the Administrator calculating and documenting the average temperature for each nursing station. The Administrator further stated that the facility did not have written P&P for room temperature monitoring or HVAC inspections that specified the inspection process, required inspection components, documentation requirements, or staff responsibilities.
Failure to Maintain a Licensed Administrator
Penalty
Summary
The facility's governing body failed to appoint a properly licensed administrator to manage the facility, and the report states that no licensed administrator had been accountable for the facility since 05/07/2026. A letter from the Oklahoma State Department of Health to another facility, dated 06/18/2026, showed that the facility's previous administrator became the administrator of record at another facility beginning 05/07/2026. During an interview on 07/04/2026, the CFO stated that the last day the facility had a licensed administrator was 05/07/2026, that the facility did not currently have a licensed administrator, and that he was not a licensed administrator and did not go into the building. On 07/08/2026, the DON stated that she expected the facility to have a licensed nursing home administrator.
Incomplete Resident Fund Accounting After Ownership Change
Penalty
Summary
The facility's Governing Body failed to timely ensure a complete, consolidated, and accurate accounting of residents' personal funds, transactions, and balance transfers after a change in ownership. During observation, interview, and record review, the Business Office Manager stated the facility was still transitioning resident funds into a new Resident Fund Management Service account and was having difficulty obtaining records from corporate to consolidate all resident funds. She said resident #1's account was still outstanding since March 2025 and that she was unaware how residents received accounting statements from the previous accounts, providing only the facility's current RFIM statements. Resident #2, a cognitively intact male, reported he had not received complete financial statements of transactions and personal funds from the facility during the prior year and had complained multiple times to the Business Office Manager. He stated the late statements he received were incorrect, did not allow him to verify credits and debits, and made him think money was missing after the ownership change. Photocopies of his 2025 statements were provided, but the documents did not show when or how they were received by the resident. The Business Office Manager further stated the consolidation of RFIM accounts was not done immediately after ownership transfer and was completed a few at a time since March 2025, and she was unaware of the exact time resident #3's account was transferred. Attempts to reach Corporate and Regional Business Office Managers were unsuccessful, and the facility's Governing Body standards and guidelines stated it was responsible for facility management, including cash management and resident interests.
Missing Licensed Administrator and Governing Body Policy
Penalty
Summary
The facility failed to have a licensed administrator and also could not produce a governing body policy for the facility. Record review showed an Oklahoma Employment Security Commission Employee Response Statement with the previous administrator’s last date of employment listed as 04/17/25, while the facility staff list showed the current administrator was hired on 05/08/26, leaving the facility without an administrator for over 365 days. The DON identified 25 residents resided in the facility. On 06/10/26 at 3:30 p.m., the administrator was unable to locate a governing body policy for the facility.
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