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NEWS from the Office of the New York State Comptroller
Contact: Press Office 518-474-4015

DiNapoli: DOH Needs to Step Up Enforcement of Patient Safety Violations

March 10, 2021

The State Department of Health (DOH) has failed to hold accountable certain health care providers including hospitals, nursing homes and individual nurses, for patient safety violations and use its power under the law to impose stronger fines. Additionally, DOH does not ensure amounts collected are directed to increase patient safety, as required, according to an audit released today by State Comptroller Thomas P. DiNapoli.

“Lisa’s Law was created to make health care in New York safer and give patients the knowledge they need to make informed decisions,” DiNapoli said. “The Department of Health generally has improved the public’s access to health care information. Too often, however, it gives negligent health care providers a slap on the wrist by not issuing financial penalties that can act as a deterrent against future incidents and help fund improvements in patient safety. DOH needs to do better.”

The Patient Health Information and Quality Improvement Act of 2000, known as Lisa’s Law, was named after Lisa Smart, a 30-year-old woman who died during surgery because of an error by a physician, who, unknown to her, had a history of negligence. The law created a Patient Safety Center (PSC), under DOH, to maximize patient safety, improve health care, and reduce medical errors by improving data reporting, collection, analysis and dissemination and to improve public access to this information.

DOH is responsible for ensuring civil violations of state health law are enforced. It oversees a resolution process that can result in settlement agreements (orders), including fines and penalties, for health care providers (e.g., clinical laboratories, hospitals, and nursing homes) and individuals (e.g., licensed nurses and certified nurse aides). Penalty amounts above $2,000 are to be used to support the PSC’s work through a special account established for that purpose.

DOH can suspend a portion of a penalty depending on certain factors, such as history of enforcement and non-compliance and strength of the evidence. However, DiNapoli’s auditors found DOH, in some cases, is suspending a substantial portion of the penalty imposed.

For a sample of 109 orders, DiNapoli’s auditors found that DOH often suspended a large percentage of each respondent’s overall penalty — as much as 90 percent in one case. Overall, of the $2,422,150 in penalties reviewed, DOH suspended $1,050,400 (43 percent).

In addition, auditors found DOH was widely inconsistent in how it applied suspensions of penalties for repeat violators. In one case, DOH gave an individual a 40 percent penalty suspension on a first Controlled Substances settlement agreement. The individual subsequently violated the terms of that agreement, yet DOH granted an 81 percent penalty suspension on the second Controlled Substances settlement agreement.

The audit found that when respondents violated their settlement payment plans, DOH was lax in holding them to account. Of a random sample of seven settlements in which DOH allowed the violator to pay a penalty on an installment plan, in all cases, the respondent violated the payment plan terms and DOH did little to follow up.

Auditors also determined DOH needs to improve its oversight to ensure the PSC account is receiving all the revenue it is due. For example, DOH did not know that certain violation categories and certain criminal penalties applied to the PSC account, and did not make sure the fines collected went to the account. DOH’s use of PSC funds was also restricted due to Division of Budget cash ceilings in place during the audit scope, leaving the General Fund — the major operating fund of the state — and federal funding to cover PSC expenses.

DiNapoli’s auditors recommended DOH:

  • Ensure officials are aware of all order codes that generate revenue for the PSC account.
  • Improve accountability over PSC account activities.
  • Develop policies and procedures to document the basis for approving order terms including fine amounts, payment plans, and referrals to licensing authorities.

In general, DOH agreed with the recommendations and indicated actions it had taken or will take to implement them. The department’s full response is included in the audit.

Department of Health: Patient Safety Center Activities and Handling of Revenues

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