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A new state inspection report is highly critical of the operation of the Yukio Okutsu State Veterans Home, finding that required infection control procedures were not in place prior to the devastating spread of COVID-19 in a facility where 27 veterans and their spouses have died after being infected with the virus.

The report, which includes inspections conducted in September and this week, concluded that “social distancing by the maintenance staff was not adhered to; quarantine of the maintenance staff following their suspected COVID-19 exposures was not implemented; proper hand hygiene was not followed by employees after the removal of their personal protective equipment (PPE); and the staff did not change their PPE in between the care of person under investigation (PUI) residents.”

“These deficient practices lead to the COVID-19 outbreak in the facility and may have contributed to 26 COVID-19 resident deaths,” according to the report prepared by the state Office of Health Care Assurance for the U.S. Centers for Medicare and Medicaid Services.

Hours after the state distributed the report Friday, a spokeswoman for the state Department of Health said it was being rescinded and a revised version of the document will be distributed next week. Janice Okubo, DOH spokeswoman, said the report was mistakenly released with the understanding that CMS had approved it, but the department later learned CMS wants revisions made to the document.

In all, 71 residents and 35 employees at Okutsu tested positive for the disease during the outbreak, and 27 Okutsu residents have died since Aug. 28 after becoming infected with COVID-19. Two residents with the virus remained hospitalized at Hilo Medical Center as of Friday, while the remaining staff and residents have recovered from the virus, according to a hospital spokeswoman.

Utah-based Avalon Health Care that manages the home agreed to transfer control of the facility to the East Hawaii Region of the Hawaii Health System Corp. after Hawaii County Mayor Harry Kim publicly demanded that Gov. David Ige remove Avalon from the facility.

The report by the state Office of Health Care Assurance found the Okutsu home was out of compliance with federal regulations. In a letter dated Thursday, Veronica Mitchell, OHCA’s Medicare section supervisor, orders the facility to implement an infection prevention and intervention plan, hire an infection control consultant or manager, and retrain staff on subjects including cleaning and infection prevention.

The letter to Okutsu Administrator Douglas Taylor says federal payments for the care of new patients will be withheld and the facility could face fines from CMS unless the federal requirements are met by Oct. 23. The nursing home has 95 beds, but had only 45 residents as of Thursday.

The first staffers to test positive at the Okutsu facility were part of the Okutsu maintenance crew, and a member of the maintenance staff who became infected told inspectors that four workers at a time had been gathering in the employee break room from March until late August, when infections among staff and patients were detected.

From then on, only two employees were allowed in the break room at a time, the worker told inspectors. The workers moved about in all parts of the facility, inspectors were told.

One maintenance employee was informed by his daughter on Aug. 20 that their family may have been exposed to the coronavirus, and was sent home that morning. That Okutsu worker tested positive for COVID-19 on Sept. 5, according to the report. Another worker from the maintenance crew was also sent home that same day when it appeared he might have symptoms of the virus.

When the inspectors asked a supervisor why a third maintenance employee who worked with the other two and used the same break room was not also sent home on Aug. 20, the report says the supervisor replied, “It’s not my call, but if I have to do it over again, I would have sent them home.”

All three of those maintenance employees ate lunch together in the break room on Aug. 19, and two of them ate together on Aug. 20, according to the report. The third worker who remained on the job told inspectors that he reported to Okutsu on Aug. 23 for a COVID-19 test, and after being tested was told by personnel that the results of a test he took on Aug. 20 came back positive.

When the inspector questioned a superior about why the third worker remained on the job on Aug. 20 and Aug. 21, she replied, “He was asymptomatic, so he can come to work.” The inspection report noted guidance from the Centers for Disease Control and Prevention that work restrictions may be applied to people who are suspected of being exposed, or those who are awaiting test results.

The family of one of the three maintenance workers was later identified as part of a 20-person community outbreak that began on Aug. 15, and the worker reported to Okutsu for work on Aug. 17,  according to the report.

Staff who conducted the Okutsu survey also observed a doctor who visited infected patients in Okutsu on Sept. 9, and then left the facility without washing his hands and walked to his car while wearing his contaminated face shield and N95 respirator mask. CDC guidelines require removal of personal protective equipment and then hand washing.

The survey also faulted staff at Okutsu for failing to promptly recognize new onset diarrhea as a symptom of COVID-19 in a 72-year-old dialysis patient. That should have triggered a test for the disease on Aug. 25, but didn’t.

That raised the possibility that the Okutsu resident might have infected patients or staff at the home or at a Hilo dialysis center, and the Okutsu resident finally tested positive on Aug. 28, according to the report.

Allison Griffiths, spokeswoman and vice president for legal affairs for Avalon, declined comment on the report Friday. “The report has been rescinded, so we’re going to await any comment until we receive the actual report,” she said.

She added, “We are reserving, of course, all of our appeal rights, which we will exercise.”

Avalon has repeatedly said the Okutsu State Veterans Home has been following the directives of the CDC, CMS and the state health department on COVID-19 infection control and prevention. The company notes that the coronavirus has hit the elderly in care homes the hardest across the nation.

“Our top priority remains the safety of staff, residents, and visitors. This includes making sure all of our employees and staff throughout the facility understand how to protect themselves and the residents in their care,” Avalon said in a general statement .

“We are dedicated to providing quality care for our residents. Our staff is working around the clock to care for and protect our residents. We will continue to fight to keep our residents and staff safe,” according to the Avalon site.

Read the letter from the state OHCA to the facility here.

Read the full inspection, subject to federal revisions, below.