Health Law Daily False claims action against hospital dismissed for lack of specificity
Thursday, January 3, 2019

False claims action against hospital dismissed for lack of specificity

By David Yucht, J.D.

A federal district court in North Dakota found that an orthopedic surgeon formerly employed by a hospital insufficiently plead causes of action against his prior employer who he accused of violating the False Claims Act (FCA) (31 U.S.C. § 3729). The court determined that his allegations were not made with the specificity and particularity required in fraud actions nor were his complaints to his employer that a colleague was performing unnecessary surgeries protected activity needed to prove retaliation (U.S. ex rel. Bennaissa v. Trinity Health, December 31, 2018, Hovland, D.).

Background. An orthopedic surgeon formerly employed by Trinity Hospital alleged that his former employer engaged in a scheme to bill Medicare and Medicaid for unnecessary surgical procedures and by encouraging physicians to "upcode" services. He asserted that Trinity engaged in a scheme by which it overcompensated physicians based on referrals with physicians referring patients for and performing unnecessary procedures. To support these allegations, the surgeon referred to cases of five patients who he believed were treated unnecessarily and thereby endangered by a colleague of his. After he brought his concerns about this doctor’s unnecessary procedures to Trinity executives, the reporting physician was terminated. He sued alleging violations of the FCA involving unnecessary treatment, up-coding, false records and retaliation.

No FCA claims. The court determined that the former employee failed to plead with particularity that Trinity submitted false claims for payment to the government. He alleged that Trinity received funds from government programs but failed to show how this money was linked to unnecessary services or upcoding. He never pleaded that Trinity submitted any claims but rather presumed that Trinity filed claims because it was legally required to do so. Moreover, he failed to plead any representative examples of false claims showing any specific claims for funds filed with the government. The court was not convinced by his argument that certifications that Trinity was required to file with the government were falsely made and resulted in the falsification of each subsequent claim for funding. Although a false claim action may be shown by the filing of a fraudulent certification, it was still necessary to plead with particularity that claims for funds related to the fraudulent certification were actually made.

No FCA false statements. The court also found that the surgeon insufficiently pleaded his claim that Trinity had made or used a false statement related to a claim. Although he asserted that Trinity filed false statements concerning statutory compliance, his allegations failed to indicate with particularity how these allegedly false statements were used to obtain funds. Moreover, he never provided specifics about these statements but presumed they were completed and filed because the law required them to be filed. He assumed that they were false because of his belief that Trinity was not in compliance with particular laws; specifically, the Anti-kickback law and the Stark Act.

No retaliation. The court also dismissed the surgeon’s retaliation claim. No where in his pleadings did he indicate that he complained to Trinity about any FCA protected activity. He indicated that he complained to Trinity executives that his colleague was performing unnecessary procedures, not that anyone was billing the government for these procedures. Since the employee did not complain about FCA protected activity, his termination from the hospital was not an illegal FCA retaliation.

The case is No. 4:15-cv-00159-DLH-CSM.

Attorneys: Daniel Moore Twetten (Loevy & Loevy) for Rafik Benaissa, M.D. Brian D. Roark (Bass, Berry & Sims PLC) for Trinity Health, Trinity Hospital, Trinity Kenmare Community Hospital and Trinity Hospital-St. Joseph's.

Companies: Trinity Health; Trinity Hospital; Trinity Kenmare Community Hospital; Trinity Hospital-St. Joseph's

MainStory: TopStory CaseDecisions CMSNews AntikickbackNews FCANews ProgramIntegrityNews QuiTamNews NorthDakotaNews

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