U.S. ex rel. Fowler v. Evercare Hospice, Inc. – Sept. 2015 (Summary)

FALSE CLAIMS ACT

U.S. ex rel. Fowler v. Evercare Hospice, Inc., Civil Action No. 11-cv-00642-PAB-NYW (D. Colo. Sept. 21, 2015)

In this False Claims Act lawsuit, the court found that the facts supported the government’s case and denied the hospice’s motion to have the case dismissed. The court found that the hospice was submitting false claims to the government for payment for treatment received by patients who did not qualify for hospice care.

The court found that the defendant provided hospice care in this case to patients who should not have been certified by Medicare standards to receive the care.  The court found that the hospice provider pressured and incentivized employees to admit patients into hospice care.  The employees were also paid bonuses for each patient admitted.

Jackson v. United States – Sept. 2015 (Summary)

PEER REVIEW

Jackson v. United States, Case No.: 3:14-cv-15086 (S.D. W. Va. Sept. 8, 2015)

The United States District Court for the Southern District of West Virginia denied a patient’s request for production of certain documents for use in a medical negligence action that the hospital claimed were protected from discovery by the State Peer Review Statute. The patient claimed that a medical center improperly withheld documents that were not generated as part of a peer review process. Instead, claiming that since the documents were prepared in the ordinary course of business, they were discoverable.

Following an “in camera” review of the documents at issue, the court disagreed. The court ruled that the documents were clearly prepared as part of the hospital’s peer review process. The court also disagreed with the patient’s claim that the hospital had waived the peer review privilege when its employees met and discussed the patient’s treatment outside of the formal peer review process.

Hsu v. Prime Healthcare Servs. III, LLC – Sept. 2015 (Summary)

ARBITRATION

Hsu v. Prime Healthcare Servs. III, LLC, E060953 (Cal. Ct. App. Sept. 14, 2015)

The Court of Appeal for the Fourth District of California affirmed the denial of an entity’s motion to compel arbitration with a physician, holding the physician’s advocacy for patient care and participation in a lawsuit against a hospital that was owned by the Employer, were outside the scope of the arbitration clause set forth in the physician’s employment contract.

The physician, who was the head of a medical group, became the medical director of a hospital owned by the Employer in 2008. The physician’s medical director agreement provided that “[a]ny dispute or controversy concerning non-professional issues…shall be determined and settled by arbitration.” In 2013, the physician raised concerns on behalf of his medical group that a second hospital owned by the Employer was allegedly increasing its revenue by admitting patients of the medical group to the second hospital instead of placing them in observation status. The medical group filed suit against the second hospital with the help of the physician medical director. One month after the suit was filed, the Employer terminated the physician from his medical director position at the first hospital. The physician alleged he was terminated for advocating on behalf of his patients at the second hospital, and filed a whistleblower action in response.

The Employer filed a motion to compel arbitration of the whistleblower action, arguing the physician’s advocacy at the second hospital was a “non-professional” issue, requiring arbitration. The trial court disagreed and the appellate court affirmed the trial court’s decision, holding that the physician’s claims under the whistleblower statute “necessarily relates” to the physician’s standards of professional practice, and thus were not covered by the arbitration provision.

Schumann v. Collier Anesthesia, P.A. – Sept. 2015 (Summary)

CRNAS AND FAIR LABOR STANDARDS ACT

Schumann v. Collier Anesthesia, P.A., No. 14-13169 (11th Cir. Sept. 11, 2015)

The United States Court of Appeals for the Eleventh Circuit reversed and remanded a district court’s grant of summary judgment, ruling that student registered nurse anesthetists (“SRNAs”) could not recover unpaid wages and overtime under the Fair Labor Standards Act (“FLSA”). The students were enrolled in a 28-month CRNA training program that was comprised of three semesters of classroom learning and four semesters of clinical experience. The students alleged that for purposes of the FLSA, they should have been considered to be “employees” of the school during their clinical rotations and thus were entitled to wages and overtime pay.

The college claimed that the students were not “employees” under the FLSA for a variety of reasons. First, at the beginning of their education, the students agreed that they would not be guaranteed employment as nurse anesthetists following their graduation. Also, a licensed anesthesiologist or CRNA was required to review the SRNA’s work as part of daily evaluations. The school also pointed out that some surgeons and patients did not want students to be involved and allowing a student to participate under a CRNA’s license adds stress that would otherwise not be present.

The students claimed that the college benefited financially by using their services, and that they were also required to work longer hours than required by the curriculum. The students also argued that the college billed Medicare for the services provided.

The district court applied a test set forth in a 70-year-old Supreme Court opinion and found that the SRNAs were not employees for purposes of the FLSA and granted the college’s motion for summary judgment.

The Eleventh Circuit did not agree with that decision. The Eleventh Circuit did not find that the SRNAs were the college’s employees. Rather, it ruled that the district court erred by relying on a test that was from a 70-year-old Supreme Court opinion whose facts did not take into account a CRNA training program. Instead, the Eleventh Circuit reasoned the best way to determine whether the students were employees for purposes of the FLSA was a different, more recent test that has been developed by the Second Circuit, which takes into account modern internships. The circuit court then remanded the case back to the district court to be re-heard using the test that has been developed by the Second Circuit.

Tate v. State of Nev. Board of Medical Examiners – Sept. 2015 (Summary

PHYSICIAN LICENSURE

Tate v. State of Nev. Board of Medical Examiners, No. 65460 (Nev. Sept. 10, 2015)

A physician who showed up to perform surgery after drinking on his lunch break was reprimanded by his employer. The physician was also reported to the Nevada State Board of Medicine. The Board found that the physician violated state law by rendering services to a patient while in an impaired condition. The Board suspended the physician’s license for six months, issued a public reprimand, ordered him to complete an alcohol diversion program and to pay investigation and prosecution costs and a fine.

The physician petitioned for judicial review of the Board’s decision. He also requested an injunction to stay the effect of the Board’s order and to prevent the State Board from filing a data bank report while the judicial review was pending. The trial court held that while an injunction was warranted, a state law precluded it from issuing an injunction pending a final determination by the court.

The physician appealed, claiming the law that prohibited the stay violates the separation of powers doctrine. The Supreme Court of Nevada agreed, finding that the state law prohibiting a stay was unconstitutional. The court reasoned that if the lower court could not issue a stay, then the physician may be irreparably penalized prior to the court being able to review the Board’s decision. In addition, the Nevada Supreme Court considered the fact that without a stay, the Board was required to report the physician to the National Practitioner Data Bank prior to the court completing its judicial review of the Board’s investigation. The Nevada Supreme Court ruled that the Physician should be granted injunctive relief in order to allow the court sufficient time to review the Board’s decision.

Farnsworth v. HCA, Inc. – Sept. 2015 (Summary)

FRAUD AND ABUSE – FALSE CLAIMS ACT

Farnsworth v. HCA, Inc., No. 8:15-cv-65-T-24-MAP (M.D. Fla. Sept. 8, 2015)

The United States District Court for the Middle District of Florida granted in part and denied in part a hospital’s motion to dismiss claims made by a former employee under the False Claims Act. The employee was the Vice President of Quality and Risk Management, who had responsibilities that included the supervision of non-billing matters and employees.

The employee alleged that the hospital routinely billed Medicare and Medicaid for the treatment of certain patients, even though a teaching or attending physician was not physically present when the medical intern or resident performed the procedure. The employee also alleged that the hospital falsified medical records submitted to Medicare and Medicaid for procedures and services ordered by a suspended physician. Third, the employee alleged that the hospital double billed for unauthorized medical research, and that the hospital encouraged its staff to compile fraudulent reports to bill for unnecessary tests and treatments. Finally, the employee claimed that she was fired in retaliation for reporting the fraudulent billing practices to members of management.

The court granted the hospital’s motion to dismiss for the claims involving a third-party company, which was responsible for submitting Medicare and Medicaid bills. The claims against the company were dismissed because the employee did not allege sufficient facts regarding the company. The court denied the hospital’s motion to dismiss the claims made against it directly because the allegations were plausible and supported by appropriate factual detail.

Baugher v. Kadlec Health Sys. – Sept. 2015 (Summary)

EMTALA

Baugher v. Kadlec Health Sys., No. 4:14-CV-5118-TOR (E.D. Wash. Sept. 3, 2015)

The United States District Court for the Eastern District of Washington held that a hospital violated EMTALA when it failed to provide an appropriate screening examination for a patient, instead threatening the patient that if she did not leave the ED, she would be arrested. Notably, this hospital claimed, in its defense, that it was excused from providing a screening examination because the patient entered the hospital yelling and failed to comply with the hospital’s registration process. Further, the hospital claimed the patient left voluntarily.

Because the hospital did not offer admissible evidence indicating that the patient failed to comply or left the hospital voluntarily – and because the patient steadfastly claimed that she was threatened with arrest and therefore left under duress – the court found that the violation of EMTALA was essentially established by the uncontested evidence submitted by the patient. The court noted that the issue of damages to the patient would need to be determined by a jury. While there was no evidence of any physical injury, the court noted that a reasonable jury could find that the patient suffered emotional damages.

Scaife v. Lakewood Hosp. – Aug. 2015 (Summary)

EMTALA

Scaife v. Lakewood Hosp., No. 1:15 CV 388 (N.D. Ohio Aug. 28, 2015)

The United States District Court for the Northern District of Ohio refused to dismiss a lawsuit brought by a patient who alleged that the Cleveland Clinic violated the Emergency Medical Treatment and Active Labor Act (“EMTALA”) when its affiliated hospital failed to properly screen and stabilize the patient prior to transfer, resulting in the loss of her unborn children. The clinic argued that it should be dismissed from the lawsuit because it was not the hospital that was involved in the patient’s treatment.

In refusing dismissal, the court noted that the patient’s allegations that the clinic leased and operated the hospital and employed the providers who cared for the patient were sufficient to survive dismissal, though litigation discovery may later show that the clinic did not have anything to do with the patient’s care, as asserted by the clinic.

Rios v. Hosp. HIMA San Pablo Fajardo – Sept. 2015 (Summary)

EMTALA

Rios v. Hosp. HIMA San Pablo Fajardo, Civil No. 3:14–CV–01760 (JAF) (D.P.R. Sept. 4, 2015)

In a lawsuit involving a patient who died several days after being discharged from a hospital emergency department, the United States District Court for the District of Puerto Rico held that the family of the deceased patient could not maintain an EMTALA claim based on their alleged emotional suffering over the loss of their loved one. The court held that EMTALA violations can only be brought on behalf of the deceased; the relatives themselves had no direct claim pursuant to EMTALA.

Green v. Pennsylvania Hosp. – Sept. 2015 (Summary)

OSTENSIBLE AGENCY

Green v. Pennsylvania Hosp., No. 36 EAP 2014 (Pa. Sept. 3, 2015)

The Supreme Court of Pennsylvania affirmed in part and reversed in part a lower court’s grant of nonsuit in favor of a hospital and several staff members. The suit was brought on behalf of a patient whose death was a result of complications experienced after a tracheotomy. The trial court acknowledged that the patient presented expert testimony that one of the surgeons involved deviated from the standard of care, but it concluded that the patient failed to establish that the surgeon was an ostensible agent of the hospital, as is required under statutory standards for vicarious liability claims.

The supreme court disagreed, stating that the record contained sufficient evidence to create a jury question concerning whether a reasonably prudent person, in the patient’s position, would be justified in the belief that the surgeon was acting as the hospital’s agent when she rendered care. The patient first entered the hospital through the emergency room and was ultimately admitted to the ICU. Also, the patient was treated by nurses and medical staff once an emergency request was issued. The supreme court concluded that the grant of nonsuit for the nurse named in the lawsuit was proper; however, the grant of nonsuit for the hospital was improper and to be remanded.