Resident Funds Restricted as Punishment for Smoking Non-Compliance
Summary
The facility failed to protect a resident’s right to manage personal financial affairs by placing the resident on a money management program as a consequence for smoking in the room. The resident, R4, had diagnoses including hypertensive heart disease without heart failure, adult failure to thrive, pain in the right hip, anemia, neuralgia and neuritis, retention of urine, nicotine dependence, and cigarette non-compliance. The MDS documented a BIMS score of 15, indicating intact cognition. R4’s care plan and progress notes documented repeated incidents of smoking inside the room. After smoking materials were confiscated, the resident was placed on money/cigar management, and the restriction was extended after additional incidents. The progress notes stated that money management was initiated or extended as a consequence of the resident smoking in the room, and that the resident was closely monitored and directed to designated smoking areas. Staff interviews confirmed that the facility used money management as a response to smoking non-compliance. The administrator stated that residents who smoke in their rooms may be educated and counseled, and that repeated offenses may result in money management so the resident may not be able to take cash out from the trust fund. The DON stated that R4’s funds were restricted for a period of time after repeated smoking incidents. The social services director described money management as a tool used to control access to funds and cigarettes, and the business office manager confirmed that the facility was managing R4’s trust fund while the resident was in the facility. The facility policy stated residents have the right to manage their own financial affairs and handle their spending money, while also describing money management as an intervention for hazardous smoking behavior.
Penalty
Resources
Below are regulatory guidelines relevant to this citation:
Failure to Disburse Resident Funds at Discharge: The facility did not return remaining resident trust account balances when two residents were discharged, and it did not provide discharge instructions for SSA payment transfer. One resident had intact cognition and multiple chronic conditions, while the other had severe cognitive impairment and psychiatric diagnoses. Account reviews showed remaining balances were left in the facility system, and staff confirmed the trust accounts were not closed and the funds were not provided at discharge.
A resident with depressive disorder, lymphedema, gout, and anxiety disorder had an MDS BIMS score of 11, indicating moderate impairment. The facility opened a resident fund account, but the authorization form lacked a signature date and left blank the section for anyone signing for the resident; although the form was signed by the resident, there was no documentation showing who assisted or that the POA was involved. An LPN/business office staff member stated she was not sure who signed the form.
A facility failed to place managed resident funds into interest-bearing accounts for four residents whose personal funds were authorized for facility management. Quarterly statements for residents with COPD, CHF, HTN, dysphagia, cerebral infarction, heart failure, anxiety, and Alzheimer's disease showed account balances but no documentation of interest being credited, and AR staff confirmed the accounts had not been set up to earn interest.
Inaccurate Receipt and Handling of Resident Trust Funds: A resident with aphasia following cerebral infarction, malnutrition, and gait/mobility issues questioned the balance of the trust account after giving two $100 bills to the receptionist for deposit. The facility later found the two $100 bills attached to a receipt showing only a $100 deposit, and staff confirmed the resident had deposited $200 but was given an inaccurate receipt in error.
A resident with dementia, anxiety, and depression, but intact cognition on MDS, reported that residents did not have access to their money on weekends and was still waiting for items on a shopping list. Staff said money was only available during weekday business hours, one staff member held the only key to the cash box, and an activities assistant could not shop for residents because she could not obtain the funds. The administrator stated there was no weekend plan for resident access to money and that a communication breakdown prevented shopping for multiple residents.
Resident trust account access was not provided the same day when a resident requested $30 on a weekend. Staff told the resident only $2 was available during weekend money pass because of limited cash in the box and offered to help complete a request form for Monday. Records showed the resident had $1,648.57 in the trust account, and admin staff stated residents could request more than $2 if needed and should not be denied money when funds were available.
Failure to Disburse Resident Funds at Discharge
Penalty
Summary
The facility failed to ensure remaining resident fund balances were dispersed at discharge and failed to provide discharge instructions for transfer of Social Security payments. Resident #1 was admitted with multiple diagnoses including coronary artery disease, type 2 diabetes mellitus, ischemic cardiomyopathy, hypertension, major depression, lumbar spinal stenosis, chronic kidney disease, peripheral vascular disease, dysphagia, glaucoma, muscle weakness, difficulty walking, non-compliance with medication regimen, and nicotine dependence. The most current MDS assessed the resident with intact cognition, no recorded behavior, walker and wheelchair use with set-up, supervision with ADLs, range of motion impairment to both upper extremities, occasional urinary incontinence, no falls, and risk for pressure ulcer development with no skin breakdown. The resident discharged to an assisted living facility, but the record did not show that the resident was given the personal fund account balance or instructions for transferring the SSA payment. Review of the resident account showed a $102.00 balance on 07/01/26, a $1,000.00 SSA payment deposited into the facility FMS account on 07/02/26, and a total balance of $1,102.00; the resident later withdrew $75.00 on 07/21/26, and the BOM confirmed the trust account was not closed and the remaining balance was not provided at discharge. The facility also failed to return the remaining resident trust account balance for another resident who was discharged home with family. Resident #7 had diagnoses including schizophrenia, CHF, CAD, hypertension, anxiety disorder, bipolar disorder, and anemia, and the most current MDS assessed severe cognitive impairment with supervision or touching assistance needed for ADLs. Discharge documentation did not show that the resident was provided the remaining trust account balance. The resident statement showed a balance of $742.27 on 07/01/26, and current account documentation later showed a balance of $724.27 that had not been disbursed or returned. The BOM and Administrator confirmed the resident trust accounts were not closed with the remaining balances provided to the residents when discharged, and that no instruction was provided to ensure the monthly SSA check was deposited into a specified account after discharge.
Resident Fund Account Authorization Not Properly Documented
Penalty
Summary
The facility failed to ensure that a resident’s right to manage financial affairs was upheld by obtaining a signed authorization for the resident fund account. Resident R37 was admitted to the facility with diagnoses including depressive disorder, lymphedema, gout, and anxiety disorder. The resident’s MDS assessment dated 3/30/26 showed a BIMS score of 11, indicating moderate impairment. The care plan directed staff to actively involve the resident and the resident’s family in the plan of care. Review of the resident fund authorization form showed the account was opened with a fax date of 4/16/26, but the form had no signature date and the section for anyone signing for the resident was left blank. Although the form was signed by Resident R37, there was no additional information showing who assisted or authorized the account, and further review did not show that the resident’s POA was involved in opening the fund account. The facility’s trial balance dated 7/20/26 showed the resident’s account remained active. During interview, the LPN/business office staff member stated she was not sure who signed the form and confirmed the account start date as 4/16/26.
Resident Funds Not Held in Interest-Bearing Accounts
Penalty
Summary
The facility failed to ensure residents' personal funds were deposited in an interest-bearing account for four residents whose funds were being managed by the facility. Resident #11, admitted with COPD, HTN, and Alzheimer's disease, had authorized the facility to manage personal funds, and the quarterly statement showed a balance of $374.15 with no documentation of interest being disbursed to the account. Resident #22, admitted with CHF, HTN, and dysphagia, also authorized the facility to manage funds, and the quarterly statement showed a balance of $650.00 without documentation of interest disbursement. Resident #40, admitted with COPD, HTN, and cerebral infarction, had a quarterly statement showing a balance of $237.60 with no documentation of interest being disbursed. Resident #77, admitted with HTN, heart failure, and anxiety, had a quarterly statement showing a balance of $1,995.62 with no documentation of interest disbursement. During interview, Accounts Receivable staff confirmed the accounts for these residents had not been placed in interest-bearing accounts and stated none of the residents who had resident fund authorization had received interest on the money in their accounts. The facility policy stated that when the facility manages resident funds, it acts as a fiduciary and holds, safeguards, manages, and accounts for those personal funds.
Inaccurate Receipt and Handling of Resident Trust Funds
Penalty
Summary
The facility failed to ensure an accurate process was used for receiving, documenting, and safeguarding resident personal funds for one resident. Resident 56 was admitted with diagnoses including aphasia following cerebral infarction, unspecified protein calorie malnutrition, and abnormalities of gait and mobility. The resident questioned the balance of the trust account and stated there should have been $200 in the account. The facility’s investigation found that the resident had given two $100 bills to the receptionist for deposit, but the resident received a receipt showing only a $100 deposit. The Business Office later located the two $100 bills attached to a receipt that reflected only $100. The Business Office Manager stated that when residents brought in cash, a two-part receipt should be written, with one part given to the resident and the other part paperclipped with the cash in a sealed envelope for the Business Office. The Director of Social Services and a receptionist both confirmed the resident had deposited $200 but was given a $100 receipt in error, and the Assistant Business Office Manager stated the receptionist should have separated the resident’s funds correctly in an envelope when received.
Failure to Provide Timely Access to Resident Funds
Penalty
Summary
The facility failed to ensure residents had timely access to their personal funds for shopping needs, affecting 1 of 1 resident reviewed for personal funds and 9 of 9 additional residents on the Week 1 Resident Shopping List. Resident #55 had diagnoses of non-Alzheimer's dementia, anxiety disorder, and depression, and the MDS documented a BIMS score of 15, indicating intact cognition. During interview, Resident #55 stated residents did not have access to their money on weekends and that she was still waiting for items on a shopping list. The Accounts Receivable Policy and Procedure dated 7/7/26 instructed the facility to ensure residents had appropriate access to their funds. Staff A, the Administrative Assistant, stated residents could access their money only Monday through Friday from 8:00 AM to 4:30 PM and that she held the only key to the cash box. Staff B, the Activities Assistant, stated she was unable to go shopping for any residents on the Week 1 Resident Shopping List because she could not obtain money from Staff A. Staff C, the Administrator, stated the facility did not have a plan for residents to get money on weekends and later stated a breakdown in communication prevented staff from shopping for residents the previous week.
Resident Trust Account Access Delayed
Penalty
Summary
The facility failed to ensure a resident’s trust account was accessible the same day when the resident requested thirty dollars on a weekend. Social service documentation showed the resident requested the money during money pass on 07/11/2026 at 10:57 AM, but was told the facility only provided two dollars on weekends because of the limited amount of money in the cash box. Staff offered to help the resident complete a money request form so the money could be received on Monday morning. Record review showed the resident’s personal funds and trust account balance was $1,648.57 on 07/13/2026. Administrative staff stated residents received two dollars during daily money pass and could request more money if needed, with a cash box available at the nurse’s station for after-hours requests. Administrative staff also stated residents should never be denied money requests if funds were available. The facility’s Resident Fund and Trust Account policy stated the trust account was for resident cash needs such as facility monthly services, haircuts, pop money, personal care items, and other approved items.
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