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From Health Law Daily, November 12, 2018

Relators must connect the dots between claims, lack of compliance

By Rebecca Mayo, J.D.

It is not enough for a relator to assert that claims were false by their nature when bringing a qui tam action under the False Claims Act (FCA). A district court judge granted motions for summary judgment in favor of healthcare providers and healthcare facilities alleged to have submitted false claims to the government. The court found that presenting evidence of a submitted claim without presenting a statute, regulation or contractual requirement that the claim was not in compliance with, or vice versa, is not sufficient to show a claim is false (Pink v. Khan, November 7, 2018, Brody, A.).

The facility. Two healthcare providers owned and operated a hospital and a separate pain management clinic. The pain management clinic had a contract with a Medicaid-only health insurance provider to provide MRIs to people who received their health insurance from that provider. In order to get specific accreditation for the hospital, the pain management clinic sold its MRI facility to the hospital. However, after the transfer of ownership, the pain management clinic allegedly continued to bill patients and insurance for MRIs received at the MRI facility even though it was not longer the owner of the facility.

Two former employees who were hired into management and financial operations roles by the healthcare providers, and later fired, filed claims under the FCA against the healthcare providers, and the facilities. The providers and facilities moved for summary judgment.

False claims. A claim that misrepresents what goods or services it provided to the Government are factually false. The employees argue that the claims presented by the pain clinic that misrepresent which healthcare entity actually provided the MRI are factually false. The court disagreed, finding that he claim did not represent what "goods or services" were provided. Although the claim may have misrepresented the owner and operator of the facility providing the services, the government received exactly what it paid for, which was an MRI for an insured patient.

When the claimant lies about its compliance with a statutory, regulatory, or contractual requirement, a claim is legally false. The employees argue that the claims were legally false because they made an implied certification about their compliance with regulations for offsite hospital departments. However, they only provide evidence of a claim submitted by the pain clinic and fail to present any statute, regulation, or contract term that the pain clinic was bound by. The employees did point to a policy concerning offsite hospital departments but only a claim made by the hospital could misrepresent the hospital’s compliance with these regulations. The court found that the employees failed to provide evidence of "at least one claim" that was legally false and granted the motions for summary judgment. Further, the court found that the employees put forth no specific record evidence pertaining to their reverse false claims allegations and granted the motions for summary judgement as to those claims.

The case is No. 13-4924.

Attorneys: Robert C. Drake (Robert C. Drake LLC) for Sheldon Pink. David M. Laigaie (Eckert Seamans Cherin & Mellott LLC) for Yasin Khan and Elizabeth Khan.

Companies: Kreider Health Solutions, LLC; Westfield Hospital; Lehigh Valley Pain Management, Inc.

MainStory: TopStory CaseDecisions CMSNews FCANews FraudNews MedicaidNews ProgramIntegrityNews PennsylvaniaNews

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