Eight months after O'ahu caregiver Elvira Pineda pleaded guilty to stealing thousands of dollars from an elderly dementia client, the state granted Pineda permission to open an adult foster home.

The Department of Human Services said it issued the certification in June 2005 because it was unaware Pineda, a certified nurse aide and care home operator, had pleaded guilty to the felony theft charge. It also said it was unaware that the Department of Health, just three months before the permission was granted, had placed Pineda on a state list that basically banned her for life from working in a long-term-care facility again.

DHS allowed Pineda to open the foster home even though, unbeknownst to the agency, she still was on the equivalent of probation for stealing, along with a co-defendant, $20,000 from the elderly client.

By the end of 2005, DHS forced Pineda to shut down the foster home. She had violated terms of her certification, though DHS wouldn't say how. Pineda could not be reached for comment.

The Pineda case illustrates what can happen when two different state agencies are charged with regulating long-term-care facilities in Hawai'i, creating a dual system that has created inconsistencies in oversight and widespread confusion. DHS oversees foster homes, while the Health Department regulates the rest.

"Nobody really understands the system," said Cullen Hayashida, long-term-care coordinator at Kapi'olani Community College. "It's a complicated administrative structure that creates chaos."

Even though the Health Department had placed Pineda on the CNA blacklist in March 2005, she was able to open a foster home in part because her guilty plea didn't show up as a conviction when DHS did a criminal background check on her.

In October 2004, Pineda was able to persuade the court to defer her guilty plea for five years, meaning that if she stayed out of trouble during that period, the felony theft charge would not go on her record.

DHS has since changed its policy and now denies certifications to foster home applicants who have deferred pleas for any serious offenses, according to agency officials.

They also noted that DHS in 2005 did not check the CNA list because back then certified nurse aides rarely ran foster homes.

Part of the difference in regulatory approaches between DHS and DOH stems from the differences between foster and care homes. The former has no more than three residents; the latter can have dozens.

Still, the differing approaches have led to frustration and confusion, health care workers say.

In 2002, the dual system generated so many complaints that the Legislature asked the state auditor to investigate. While auditor Marion Higa found many shortcomings, some of which have since been addressed, she recommended against consolidating oversight into a single agency, citing other problems that would arise.

Some inconsistencies that still exist:

• DHS does criminal background checks for foster home applicants; DOH doesn't do them for care home applicants, though that is expected to change. The agency is working on administrative rules to implement a 2006 law mandating such checks.

• The two agencies take opposite approaches in dealing with deferred acceptance of guilty or no contest pleas. DHS considers them convictions for purposes of denying certifications. But DOH doesn't consider deferrals convictions for purposes of maintaining the state's CNA blacklist. If a CNA pleads guilty to abusing an elder client but gets a deferral, the agency generally would not place that worker on the list.

• DOH has been referring problem CNAs for inclusion on the state's list for years; DHS has never done so because the agency until recently had no administrative rules allowing such referrals.

• Both agencies handle mistreatment cases differently. If the primary caregiver for a foster home is found to have abused, neglected or exploited a client, DHS revokes the operator's certification and closes the home. At DOH, regulators examine the circumstances of each case before deciding what action to take, and some care home operators guilty of minor abuse or neglect — where no harm was intended — might not have their licenses revoked.

• The public's access to certain records varies. When DOH revokes the license of a care home operator for abuse, the records detailing the abuse are public. When DHS closes a foster home because of abuse, the agency's Adult Protective Services' records detailing what happened are confidential by statute, leaving the public no access to the specifics.

State officials say they have revised their policies and rules in recent years to strengthen oversight of long-term-care facilities and are continuing to pursue improvements. One major change involved who makes the decisions to certify foster homes.

That responsibility used to rest with case management agencies, who simultaneously were paid to oversee patient care at those homes. In her audit, Higa noted the potential conflict of interest under that system. The certification responsibility now rests with an independent company hired by DHS.

Despite Higa's recommendation not to consolidate oversight, KCC's Hayashida believes having a single entity in charge would solve more problems than it would create.

But even if such consolidation doesn't happen, Hayashida and others say, more coordination is needed to make the current system more efficient and easier to navigate.