By Sara Cracau, J.D.
Allegations that a home health care agency continued to provide services to patients who were not eligible for such services under Medicare and billed for the services were insufficient to assert a false claim in violation of the False Claims Act. However, allegations that the home health agency falsified Outcome and Assessment Information Set (OASIS) information and medical records did satisfy the pleading requirement for a false claim and reverse fraud. Accordingly, the home health agency’s motion to dismiss the qui tam action brought by a former employee was granted in part and dismissed in part (U.S. ex rel Wagner v. Care Plus Home Health Care, Inc., December 11, 2017, Frizzell, G.).
Background. A registered nurse was employed by Care Plus Home Health Care, Inc. (Care Plus), a certified home health care agency first as an independent contractor and then as the office director of nursing. In her capacity as director of nursing, she concluded that the agency was following business practices that were designed to fraudulently maximize billing, primarily to Medicare. She noticed that the agency was continuing to provide and bill Medicare for services to patients who were not eligible to receive such services. In addition, she noticed that the agency falsified required documentation and medical records to increase Medicare billings and avoid return of Medicare overpayments. She assessed that this scheme had been ongoing since 2010 and resulted in losses to the U.S. of approximately $1,490,000 per year.
The nurse filed a qui tam action against Care Plus, asserting three causes of action: (1) presentation of a false claim; (2) making or using a false record or statement causing payment of a false or fraudulent claim; and (3) making or using a false record or statement to avoid paying or refunding money to the government. Care Plus moved to dismiss the action.
Services. The allegations that ineligible patients were brought on and kept on home health service did not satisfy the pleading requirements for implied false certification claims as it did not "demonstrate the specifics of a fraudulent scheme." Although 11 patient examples were mentioned in the complaint, the complaint lacked specific dates of service and dates of billing for those services, referring only to broad time periods. Furthermore, it was devoid of detailed allegations identifying the actual services that were rendered for which patients were allegedly ineligible. The complaint documented the services actually provided to three patients only. There were no allegations from which the court could infer that claims were actually submitted to the government for those services. Furthermore, the court concluded that the allegations were insufficient to state a plausible FCA claim premised on express false certification.
OASIS information. The allegations that the home health agency falsified OASIS information and medical records did satisfy the pleading requirement for a false claim and reverse fraud because they contained sufficient factual averments indicating that the home health agency made false statements to avoid an obligation to refund overpayments made by the government as required by statute. The complaint stated a plausible reverse false claims cause of action based on factual falsity. In addition, the complaint adequately stated a claim for violation of the FCA premised on false certification because it recited dates of care and dates on which false records were created and submitted.
The case is No. 15-CV-260-GKF-JFJ.
Attorneys: James Dennis Young (Morgan & Morgan, PA) for United States of America. John David Russell (Gable & Gotwals) for Care Plus Home Health Care, Inc.
Companies: Care Plus Home Health Care, Inc.
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