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From Health Law Daily, October 6, 2015

Court slams door on FCA inpatient room complaint

By Mary Damitio, J.D.

An employee of a psychiatric hospital who alleged that the facility violated the False Claims Act (FCA) (31 U.S.C. § 3729(a)(1)(A),(B)) by housing patients in temporary dayrooms did not sufficiently allege a claim that the failure to provide individual patient rooms amounted to fraudulent or false claims. In dismissing the qui tam complaint with prejudice, the district court found that the employee also failed to set forth allegations detailing how the failure to provide individual patient rooms rendered the services provided by the facility worthless (U.S. ex rel. Bellevue v. Universal Health Services, Inc., October 5, 2015, Durkin, T.).

Background. The relator, an employee (employee) who worked as a nurse counselor at Hartgrove Hospital, brought a qui tam action against Universal Health Services of Hartgrove, Inc. d/b/a Hartgrove Hospital (Hartgrove) alleging that it violated the FCA and state statutes by falsely submitting claims to Medicaid for the treatment of adolescent patients who were not provided inpatient rooms. The employee alleged that Hartgrove exceeded its bed limit and housed some patients temporarily on rollaway cots in dayrooms rather than in individual rooms. According to the employee, the failure to provide individual patient rooms rendered Hartgrove’s Medicaid claims fraudulent. The first complaint was dismissed and the employee filed an amended complaint (see Psychiatric hospital gets Fraud Claims Act complaint dismissed, but repleading allowed, April 27, 2015). Hargrove again moved to dismiss the complaint.

Inpatient services. The employee’s allegations that Hartgrove’s failure to provide patient rooms rendered its inpatient claims fraudulent did not state a claim for FCA liability. Nothing cited by the employee supported his claim that Medicaid payments for inpatient services were conditioned upon the hospital providing individual rooms.

Worthless services. The employee also failed to sufficiently allege how Hartgrove’s failure to provide individual rooms rendered all of its services worthless. The court, as it had in its dismissal of the first complaint, again found that the employee failed to explain how the patients’ treatments were so adversely affected by temporarily sleeping in dayrooms that all of the services provided by Hartgrove were worthless.

Remaining allegations. The employee’s false certification and fraudulent inducement claims failed to include any supporting factual allegations and were dismissed as well.

The case is No. 11 C 5314.

Attorneys: Michael Charles Rosenblat (Michael C. Rosenblat, PC) for George Bellevue. Stephen C. Payne (Gibson, Dunn & Crutcher LLP) for Universal Health Services of Hartgrove Inc. dba Hartgrove Hospital.

Companies: Universal Health Services of Hartgrove Inc. dba Hartgrove Hospital

MainStory: TopStory FCANews FraudNews QuiTamNews IPFNews IllinoisNews

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