42 CFR § 488.320 - Sanctions for inadequate survey performance.

---
identifier: "/us/cfr/t42/s488.320"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "42 CFR § 488.320 - Sanctions for inadequate survey performance."
title_number: 42
title_name: "Public Health"
section_number: "488.320"
section_name: "Sanctions for inadequate survey performance."
chapter_name: "CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF HEALTH AND HUMAN SERVICES"
subchapter_number: "G"
subchapter_name: "STANDARDS AND CERTIFICATION"
part_number: "488"
part_name: "SURVEY, CERTIFICATION, AND ENFORCEMENT PROCEDURES"
positive_law: false
currency: "2026-04-05"
last_updated: "2026-04-05"
format_version: "1.1.0"
generator: "[email protected]"
authority: "42 U.S.C 1302 and 1395hh."
regulatory_source: "53 FR 22859, June 17, 1988, unless otherwise noted."
cfr_part: "488"
---


# 488.320 Sanctions for inadequate survey performance.

(a) *Annual assessment of survey performance.* CMS assesses the performance of the State's survey and certification program annually.

(b) *Sanctions for inadequate survey performance.* When a State demonstrates inadequate survey performance, as specified in § 488.318, CMS notifies the survey agency of the inadequacy and takes action in accordance with paragraphs (c) and (d) of this section.

(c) *Medicaid facilities.* (1) For a pattern of failure to identify deficiencies in Medicaid facilities, CMS—

(i) Reduces FFP, as specified in paragraph (e) of this section, and if appropriate;

(ii) Provides for training of survey teams.

(2) For other survey inadequacies in Medicaid facilities, CMS provides for training of survey teams.

(d) *Medicare facilities.* For all survey inadequacies in Medicare facilities, CMS—

(1) Requires that the State survey agency submit a plan of correction;

(2) Provides for training of survey teams;

(3) Provides technical assistance on scheduling and procedural policies;

(4) Provides CMS-directed scheduling; or

(5) Initiates action to terminate the agreement between the Secretary and the State under section 1864 of the Act, either in whole or in part.

(e) *Reduction of FFP.* In reducing FFP for inadequate survey performance, CMS uses the formula specified in section 1919(g)(3)(C) of the Act, that is 33 percent multiplied by a fraction—

(1) The numerator of which is equal to the total number of residents in the NFs that CMS found to be noncompliant during validation surveys for that quarter; and

(2) The denominator of which is equal to the total number of residents in the NFs in which CMS conducted validation surveys during that quarter.

(f) *Appeal of FFP reduction.* When a State is dissatisfied with CMS's determination to reduce FFP, the State may appeal the determination to the Departmental Appeals Board, using the procedures specified in 45 CFR part 16.