Justia Government Contracts Opinion Summaries

Medicare pays teaching hospitals for work by residents when a teaching physician supervises. During the 1990s, HHS concluded that many hospitals were billing for unsupervised services and began to audit invoices. There was also a GAO report and private litigation: qui tam suits under the False Claims Act, allowing relators to collect a bounty. Under 31 U.S.C. 3730(e)(4)(A), suits cannot be based upon public disclosure of allegations or transactions in public agencies’ official reports unless the relator is an original source of information. A prior case concluded that the 1998 GAO report and similar public documents disclosed that billing for unsupervised work was common practice. The district court dismissed a suit filed against a teaching hospital in 2004, claiming to describe conduct, such as inadequate supervision, not previously disclosed. The Seventh Circuit vacated. No one who read the GAO report, or followed the progress of the audits, would suspect that Rush University was misrepresenting "immediate availability" of teaching physicians during concurrently scheduled procedures. The complaint alleged a kind of deceit that the GAO report does not attribute to any teaching hospital. View "Goldberg v. Rush Univ. Med. Ctr." on Justia Law

A doctor filed a qui tam action under the False Claims Act, 31 U.S.C. 3729, against Brigham and Women's Hospital, Massachusetts General Hospital and doctors, claiming violation of the Act by including false statements in a grant application, concerning neurodegenerative illness associated with aging, submitted to the National Institute on Aging in the National Institutes of Health, an agency of the U.S. Department of Health and Human Services, and that defendants, knowing of the falsity, failed to take corrective action. The district court granted defendants summary judgment. The First Circuit vacated. The district court abused its discretion by excluding or failing to consider certain expert testimony and erred by failing to consider statements of the parties and experts as required by the summary judgment standard. The dispute was not about which scientific protocol produces results that fall within an acceptable range of "accuracy" or whether re-measurements, the basis for preliminary scientific conclusions, were "accurate" insofar as they fall within a range of results accepted by qualified experts, but whether there was intentional falsification. View "Jones v. Brigham & Women's Hospital" on Justia Law

A newborn suffered severe brain damage because doctors failed to promptly diagnose and treat an infection contracted at his 2003 birth. He was born prematurely and certain tests, normally done during pregnancy, were not performed by the federally-subsidized clinic where the mother received care. The clinic and its doctors are deemed federal employees under the Federally Supported Health Centers Assistance Act, 42 U.S.C. 233(g)-(n), and shielded from liability under the Federal Tort Claims Act. In 2005 the parents filed suit in state court and, in 2006, HHS denied an administrative claim for damages. Within six months of the denial the case was removed to federal court. In 2010, the district court held that the claim was filed within the two year statute of limitations under the FTCA (28 U.S.C. 2401(b)) and awarded more than $29 million in damages against the government. The Seventh Circuit affirmed. A claim only accrues when a plaintiff obtains sufficient knowledge of the government-related cause of his injury; the plaintiffs were reasonably diligent. View "Arroyo v. United States" on Justia Law

A 66-year -old arrived at petitioner's center with complex ailments, but oriented, able to feed herself and able to speak. During her 18 days at the center, she was sent to the hospital twice with serious medical complications. Upon investigation, the center was found to have failed to maintain substantial compliance with federal regulations for facilities that participate in Medicare and Medicaid (42 U.S.C. § 1395) in its treatment of the resident and appealed the resulting civil money penalty. An administrative law judge, the Departmental Appeals Board, and the Sixth Circuit affirmed. The ALJ acted properly in requiring submission of written testimony, properly weighed the evidence, and found violation of the federal hydration standard, laboratory services requirement, and mandate of a care plan, resulting in "immediate jeopardy." View "Golden Living Ctr.-Frankfort v. Sec'y of Health & Human Servs. " on Justia Law

In 2001 plaintiff received prenatal care from a clinic that receives federal funds. Its physicians and the clinic are deemed federal employees for purposes of malpractice liability, so that the United States could be substituted as a party to a suit. 28 U.S.C. 2679(d)(1); claims would be governed by the Federal Tort Claims Act, and neither would face liability. For complex situations, the clinic contracted with UIC for specialists. Plaintiff's baby died following a difficult delivery. She sued the clinic, its doctor, the delivery hospital, and two UIC physicians who assisted. The U.S. Department of Health and Human Services denied claims for damages. The district court entered summary judgment for the UIC doctors under the Illinois Good Samaritan Act, which shields physicians who provide "emergency care without fee to a person," 745 ILCS 49/25, but declined to dismiss the case against the government, which had been substituted for the clinic. The Seventh Circuit reversed, first holding that the district court had derivative jurisdiction. Although the salaried UIC doctors did not receive a direct financial benefit from the delivery, their employer billed the clinic for services. There was evidence that one doctor submitted a billing form with respect to the delivery; the other made a "bad faith" decision not to bill. View "Rodas v. Seidlin" on Justia Law

Doctors filed suit, alleging violations of the False Claims Act, 31 U.S.C. 3279 and the Michigan Medicaid False Claim Act, as qui tam relators on behalf of the United States/ The claimed that the business defrauded the government by submitting Medicare and Medicaid billings for defective radiology studies, and that the billings were also fraudulent because the business was an invalid corporation. The federal government declined to intervene. The district court dismissed. Sixth Circuit affirmed. The doctors failed to identify any specific fraudulent claim submitted to the government, as is required to plead an FCA violation with the particularity mandated by the FRCP. A relator cannot merely allege that a defendant violated a standard (in this case, with respect to radiology studies), but must allege that compliance with the standard was required to obtain payment. The doctors had no personal knowledge that claims for nondiagnostic tests were presented to the government, nor do they allege facts that strongly support an inference that such billings were submitted.View "Chesbrough v. VPA, P.C." on Justia Law

The Medicare program pays teaching hospitals to cover "direct" and "indirect costs of medical education," 42 U.S.C. 1395ww(d)(5)(B), (h). Direct costs include expenses such as residents' salaries. Indirect costs are incurred due to "general inefficiencies" and "extra demands placed on other staff." Congress created a formula for calculating indirect expenses based on full-time equivalency interns; an HHS regulation referred to time residents spend in the "portion of the hospital subject to the prospective payment system or in the outpatient department of the hospital." In reimbursing plaintiff, HHS excluded from the FTE count time residents spent on pure research, unrelated to treatment of a patient. While appeal of a decision favoring the hospital was pending, Congress enacted the Patient Protection and Affordable Care Act, 124 Stat. 119, 660–61. For the years at issue, HHS must include in FTE: "all the time spent by an intern or resident in an approved medical residency training program in non-patient care activities, such as didactic conferences and seminars, as such time and activities are defined by the Secretary." HHS promulgated a regulation specifying that eligible non-patient care activities do not include time residents spend conducting pure research. The Sixth Circuit upheld the regulation as within the Secretary's authority and applicable to the years at issue. View "Henry Ford Health Sys. v. Dept. of Health & Human Servs." on Justia Law

Based on her part in billing Indiana Medicaid for ambulance service while running a car service to take patients to medical appointments, defendant was convicted of Medicaid fraud, 18 U.S.C. 1347, and conspiracy to defraud the U.S. government, 18 U.S.C. 371. She was sentenced to 33 months in prison and to pay restitution of $846,115. The Seventh Circuit affirmed. Data relating to time-stamping of bills, which may have established that multiple people submitted bills, was not concealed; the government simply failed to extract (before trial) information to which it and the defense had access. Even if the data was "Brady" material, it would not have changed the outcome. The judge did not err in telling the jury that a scheduled witness was ill without saying that the witness had refused treatment. View "United States v. Gray" on Justia Law

An inmate of the Maine corrections system, sought a civil rights remedy (42 U.S.C. 1983) for alleged denial of adequate medical care for human immunodeficiency virus (HIV) by healthcare professionals at a jail and the state prison. The district court entered summary judgment for the defendants. The First Circuit affirmed with respect to the contractor that provides care, stating that the evidence could not establish Eighth Amendment violations, but reversed with respect to a physicians' assistant. Although the contractor acknowledged that its care "fell short of the mark," carelessness or inadvertence falls short of the Eighth Amendment standard of deliberate indifference. There was a material dispute about deliberate indifference by the physicians' assistant, who had a financial interest in limiting care and a disciplinary history.View "Leavitt v. Correctional Medical Services, Inc." on Justia Law

Plaintiff brought action under the False Claims Act, 31 U.S.C. 3729, claiming that the company used a kickback scheme and knowingly caused submission of false Medicare, Medicaid, and TRICARE claims by hospitals and doctors. The district court held that hospital claims at issue were not false or fraudulent, and that doctor claims were false or fraudulent, but not materially so. The First Circuit reversed. If kickbacks affected the transactions underlying the claims, the claims failed to meet a condition of payment and were false, regardless of the hospital's participation in or knowledge of the kickbacks. It cannot be said, as a matter of law, that the alleged misrepresentations were not capable of influencing Medicare's decision to pay the claims.