Health Law Daily Assumptions not a solid foundation for FCA, anti-kickback claims
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Friday, June 15, 2018

Assumptions not a solid foundation for FCA, anti-kickback claims

By Patricia K. Ruiz, J.C.

A relator must make more than just speculative claims under the False Claims Act (31 U.S.C. § 3729) and the Anti-Kickback Statute (42 U.S.C. § 1320a-7b) to survive a motion to dismiss, the Northern District of Illinois held. The court granted a motion to dismiss by UnitedHealthcare Insurance Company (United), finding that the relator’s allegations required too many assumptions and lacked concrete details necessary to such claims (U.S. ex rel. Gray v. UnitedHealthcare Insurance Company, June 12, 2018, Durkin, T.).

Alleged FCA violations and kickback scheme. United is a Medicare Advantage (MA) provider, and the relator was a MA beneficiary enrolled in a United plan. The relator alleged that United’s HouseCalls program, which sent licensed health care providers to beneficiaries’ homes to conduct in-home physical examinations, provided in-home care to beneficiaries without certification that such care was medically warranted. In 2014, he accepted an offer for an in-home examination after being offered a $25 Walmart gift card. Prior to the visit, he did not have certification from his physician asserting that in-home services were warranted, and United never asked for such certification. He did not identify any other beneficiaries who underwent in-home examination. The relator alleged that CMS overpaid United based on diagnosis codes obtained through HouseCalls examinations, in violation of state and federal false claims laws. The relator further alleged that the gift cards offered to beneficiaries violated the Anti-Kickback Statute.

Reliance on too many assumptions. To establish civil liability under the FCA, the relator must allege (1) United made a statement in order to receive money from the government; (2) the statement was false; (3) United knew the statement was false; and (4) the false statement was material to the government’s decision to pay or approve the false claim. However, the relator merely assumes that the in-home examinations were improper and that, as a result of United’s improper submission and certification of the data obtained from the exams, the government mistakenly overpaid. CMS previously stated it would not exclude for payment purposes diagnoses obtained through in-home examinations. The relator also failed to identify any violated regulations indicating that data from in-home examinations is material to CMS’s determination of the payment amount. The court notes that nothing prohibits United from conducting in-home examinations. Further, the relator failed to provide details as to why the in-home examinations were not medically necessary.

Addressing the relator’s Anti-Kickback claims, the court noted that, while United receives payments from a federal health care program generally, even if the Walmart gift card does induce enrollees to schedule in-home examinations, the alleged remuneration does not induce payment to be made for the services. Additionally, the relator’s allegations described a complex scheme requiring the diagnosis of some condition that would not otherwise be found, resulting in a higher risk designation by CMS. The court found that the relator’s antikickback theory to be too speculative, requiring too many assumptions, and lacking in concrete details necessary to allege a violation of the Anti-Kickback Statute.

The court granted United’s motion to dismiss without prejudice, allowing the relator a chance to cure the deficiencies in his complaint.

The case is No. 1:15-cv-07137.

Attorneys: Abram J. Zinberg (The Zinberg Law Firm, APC) for Jeffery Gray. Daniel Meron (Latham & Watkins LLP) for United Healthcare Insurance Co. and United Healthcare Services, Inc.

Companies: United Healthcare Insurance Co.; United Healthcare Services, Inc.; Walmart

MainStory: TopStory CaseDecisions CMSNews AntikickbackNews BillingNews FCANews FraudNews HomeNews PaymentNews PartANews ProgramIntegrityNews IllinoisNews

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