Health Law Daily FCA discovery requests must be proportional to the needs of the case
Tuesday, May 22, 2018

FCA discovery requests must be proportional to the needs of the case

By Rebecca Mayo, J.D.

Relators in a qui tam action may obtain discovery as long as it is proportional to the needs of their case. A magistrate judge denied requests for an order to compel discovery where relators requested information that had already been produced and information that the court was not convinced was sufficiently relevant and proportional to the needs of the case (Fisher v. IASIS Health Care LLC, May 18, 2018, Willett, E.).

Background. Health Choice of Arizona is a wholly owned subsidiary of IASIS Healthcare LLC and provides healthcare services to Arizona Medicaid enrollees through subcontracted providers. A number of current and former employees of HCA filed a qui tam action against HCA and IASIS. The relators allege that HCA cheated on its prior authorization (PA) program by automatically approving tens of thousands of PA requests through a process called "administrative approval," without performing any part of the required medical necessity review; and then hiding their failures from the state. The relators made a number of discovery requests, which HCA and IASIS objected to.

Payments. The relators requested all documents showing the amount paid by the state Medicaid program to HCA for each payment period. However, HCA and IASIS had already produced this documentation in response to a prior production request. Further, the court was not persuaded that any additional documents existed or that they would be relevant and proportional to the needs of the case.

The relators also requested all documents that reflect all paid claims for which a prior authorization was approved through "admin approval," noting that prior production of these documents lacked specific information such as date stamps. However, the current discovery requests at issue failed to request date stamps or the other specific information the relators claimed was missing. Further, the additional information is not sufficiently relevant and proportional to the needs of the case.

HCA and IASIS provided PA data for only the PA requests that were "administratively approved." The relators requested additional information about data on requests that were adjudicated through other approvals in order to prove the allegations that medical necessity review was systematically bypassed. The court found that the issue in this case is "whether the decisions individually made or collectively made as part of a program by [HCA and IASIS] violated the FCA. Those decisions must be evaluated independently, not in comparison to another set of decisions."

Vendor relationship. The relators requested HCA’s testimony on their relationship with a specific vendor, and also requested production of documents and communications that relate to any contract, relationship or agreement with the vendor and HCA and/or IASIS. The relators claimed that the documents and testimony would demonstrate financial motivation as to why HCA failed to perform the required PA cost control services.

However, they failed to persuade the court that a financial conflict of interest existed or how the existence of such conflict would be materially relevant to the court’s adjudication of the case. HCA and IASIS produced the vendor contract, and the court found that requiring HCA and IASIS to comply with the request for further discovery would not be proportional to the needs of the case.

The case is No. 2:15-cv-00872-JJT.

Attorneys: David J. Chizewer (Goldberg Kohn Ltd.) for Aaron Fisher. Anne Michelle Chapman (Mitchell Stein Carey Chapman PC) and Kathryn E. Wilhelm (Ropes & Gray LLP) for IASIS Healthcare LLC and Health Choice of Arizona Inc.

Companies: IASIS Healthcare LLC; Health Choice of Arizona Inc.; Instream

MainStory: TopStory CaseDecisions CMSNews BillingNews FCANews FraudNews MedicaidNews MedicaidPaymentNews ProgramIntegrityNews QuiTamNews ArizonaNews

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