Cabotage v. Ohio Hosp. for Psychiatry, LLC (Summary)

FALSE CLAIMS ACT

Cabotage v. Ohio Hosp. for Psychiatry, LLC, No. 2:11–cv–50 (S.D. Ohio Mar. 26, 2013)

In this False Claims Act (“FCA”) retaliation case, a trial court granted summary judgment to a psychiatric hospital and the company that operated it on all of a nurse’s claims related to the termination of her employment.  The nurse had become concerned that the hospital’s medical director was engaging in fraudulent and illegal activities.  She assumed that claims related to such activities were being submitted to Medicare and Medicaid.  She reported these concerns to her immediate supervisor and the vice president of human resources.  She also called the Medicare Fraud Hotline, which prompted an on-site investigation by the Ohio Department of Mental Health.  In addition, the nurse took copies of various confidential documents home as part of her investigation of her concerns.

At one point, the nurse stated that a patient told her that she did not want to take the medicine that had been prescribed for her by the medical director and that the medical director had not seen her.  The nurse stated, at the patient’s request, that she then called the patient’s daughter from home to tell her about the patient’s concerns.  Afterward, the nurse was terminated for contacting a patient’s family member from home, without authorization.

The nurse alleged that she was engaged in whistle-blowing activity, that the hospital knew about her activity, and that it fired her in retaliation, in violation of the FCA.

The court granted summary judgment to the hospital with respect to the FCA claim.  Under the FCA, a person has recourse for a retaliatory discharge if (1) the individual engages in activity protected by the act, (2) the employer knew that the individual was engaging in the protected conduct, and (3) the employer retaliated against the individual, at least in part, because of his or her protected activity.

“Protected activity” means conduct “in furtherance of an action.” As per the court, merely reporting concerns to a supervisor, as the nurse did, does not constitute protected activity.  Because the nurse merely raised her concerns with supervisors and assumed that false claims were being submitted to the government, the court found that the nurse’s conduct did not rise to the level of protected activity.

Furthermore, the court found that, even assuming that the nurse had properly alleged a retaliation claim, the hospital met its burden of showing that it would have made the same decision absent any protected conduct, because the nurse violated the hospital’s confidentiality policies by contacting a patient’s family from home without proper authorization.