Marion Healthcare LLC v. S. Ill. Healthcare (Summary)

ANTITRUST

Marion Healthcare LLC v. S. Ill. Healthcare, No. 12-CV-00871-DRH-PMF (S.D. Ill. Aug. 26, 2013)

The United States District Court for the Southern District of Illinois dismissed an outpatient surgery center’s federal and state antitrust claims against a hospital and health insurer.  The surgery center asserted claims under the Clayton Act, Sherman Act, and Illinois Antitrust Act, alleging that the hospital, through its exclusive contracts with the insurer, prohibited the insurer from contracting with the surgery center and other providers of outpatient surgery services.

The hospital and insurer filed a motion to dismiss.  The court granted the motion with prejudice, for the Clayton Act claims, since the Clayton Act only applies to goods, as opposed to services.  According to the court, any goods provided by the defendants were “incidental” to the surgery center’s defined relevant markets of inpatient hospital services and outpatient surgical services.  With respect to the surgery center’s Sherman Act claims of exclusive dealing and illegal tying, the court, applying a rule of reason analysis, determined that the surgery center failed to define a plausible relevant market because it failed to include all potential buyers of inpatient and outpatient services, notably the federal government.

The court dismissed these Sherman Act claims against the hospital without prejudice, thus allowing the surgery center to amend its complaint.  The tying claim against the insurer was dismissed with prejudice because the surgery center was incapable of alleging that the insurer had market power in the tying and/or tied product (hospital services), considering the insurer was not a seller of these services.  The Sherman Act monopolization claim against the hospital was dismissed without prejudice because, once again, the surgery center failed to define a plausible relevant market.  The court’s ruling on the surgery center’s Illinois Antitrust Act claims mirrored those for the federal antitrust claims since federal courts use federal law to construe provisions of the Illinois Antitrust Law that are substantially similar to federal law.

Whipple v. Chattanooga-Hamilton County Hosp. Auth. (Summary)

FALSE CLAIMS ACT

Whipple v. Chattanooga-Hamilton County Hosp. Auth., No. 3-11-0206 (M.D. Tenn. Aug. 26, 2013)

The United States District Court for the Middle District of Tennessee granted a hospital’s motion for summary judgment in a False Claims Act suit brought by a consultant who was performing auditing services for the hospital.  The consultant claimed that the hospital improperly (1) billed patients for inpatient care when they should have been billed as outpatient or observation, (2) added observation charges to claims for outpatient surgeries, and (3) billed certain dialysis procedures as inpatient claims when they should have been billed as outpatient or observation.

In granting the hospital’s motion for summary judgment, the court held that the public disclosure provisions of the False Claims Act barred the consultant’s claims.  The court found that the consultant’s allegations were based on prior investigations and information compiled by, among others, the Office of Inspector General.  Moreover, the consultant was not an original source of the information underlying his claims because the information he collected during his engagement with the hospital was from other sources and included spreadsheets and medical records from past submissions.

Awwad v. Largo Med. Ctr., Inc. (Summary)

RACE DISCRIMINATION

Awwad v. Largo Med. Ctr., Inc., No. 8:11-cv-1638-T-24 TBM (M.D. Fla. Aug. 21, 2013)

The United States District Court for the Middle District of Florida granted a hospital’s motion for summary judgment in a suit brought by a disruptive Palestinian physician, alleging, among other things, race discrimination under 42 U.S.C. §1981.

After an investigation performed by an ad hoc committee of the Medical Executive Committee and a focused peer review, the physician was required, within 30 days, to obtain counseling for anger management and professionalism and continuing education in the area of fluid and electrolyte management.  The physician failed to do this.  Following a medical staff hearing and appeal, the physician’s privileges were revoked.  Subsequently, he sued, asserting various claims, including race discrimination under §1981.

In ruling on the hospital’s motion to dismiss, the court concluded that the physician failed to show that the hospital treated similarly situated, non-Palestinian doctors more favorably.  Specifically, the court found that the physician failed to offer evidence of any physicians who were disruptive and refused to comply with the hospital’s counseling and education requirements, but did not have their privileges revoked.  The court also observed that a disparaging statement by a member of the Medical Executive Committee that the physician was “practicing medicine the Palestinian way” was not enough to infer discrimination by a decision-maker.

Finally, the court held that the hospital offered a legitimate, non-discriminatory reason for revoking the physician’s privileges:  his failure to enroll in anger management counseling and continuing education courses.  Because the physician failed to show that this reason was a pretext for discrimination, his §1981 claim was dismissed by the court.

Molina v. Pocono Med. Ctr. (Summary)

ADA

Molina v. Pocono Med. Ctr., No. 3:11-2276 (M.D. Pa. Aug. 26, 2013)

The United States District Court for the Middle District of Pennsylvania denied a medical center’s motion for summary judgment, concluding that there were unresolved factual issues concerning an employed nurse’s claims under the Americans with Disabilities Act (“ADA”).

The nurse was diagnosed with an autoimmune deficiency which caused her to frequently fall ill, including contracting pneumonia 16 times in a three-year period.  Because of this, the nurse took either vacation or medical leave a number of times throughout her employment.  During a period of Family Medical Leave Act leave after the nurse contracted MRSA pneumonia, the nurse’s treating physician wrote a note that she could return to work with certain accommodations, such as not being exposed to infected patients.  The nurse’s immediate supervisor refused to allow her to return to work as a nurse.  The nurse sued, claiming violations of the ADA and the Pennsylvania Human Relations Act.

The medical center filed a motion for summary judgment, arguing that the nurse was precluded from pursuing claims because in her application for Social Security Disability Insurance (“SSDI”), she indicated that she was “unable to work.”  The medical center also argued that it had a legitimate non-discriminatory reason for not allowing the nurse to return to work.  The court disagreed, holding that the nurse’s SSDI claim did not preclude her ADA claim because the SSDI claim, as opposed to the ADA claim, did not take into account the possibility of a reasonable accommodation.

Further, the medical center’s unsupported assertions that it “clearly was not safe for [the nurse] to return to work” did not qualify as a legitimate non-discriminatory reason for its action in the face of the nurse’s “ample evidence that she can perform the essential functions of her job with reasonable accommodations.”

U.S. ex rel. Singh v. Bradford Regional Med. Ctr. –Aug. 2013 (Summary)

FALSE CLAIMS ACT

U.S. ex rel. Singh v. Bradford Regional Med. Ctr.
No. 04-186 Erie (W.D. Pa. Aug. 22, 2013)

The United States District Court for the Western District of Pennsylvania dismissed the United States’ claims of payment by mistake and unjust enrichment against a physician group which was involved in an equipment sublease with a hospital.  The government based its claims on allegations that the sublease violated the Stark Law and Anti-Kickback Statute.

The court granted the physician group’s motion to dismiss, “because the United States has failed to allege or show that the [physician group] received any direct or [in]direct mistaken payments from the government.”  Since this alone was grounds for dismissal, the court did not reach the physician group’s contention that the government’s claims were barred by the statute of limitations.  However, the court did give the government an opportunity to amend its complaint.

Gronemeyer v. Crossroads Cmty. Hosp. (Summary)

FALSE CLAIMS ACT – RETALIATION

Gronemeyer v. Crossroads Cmty. Hosp., No. 3:10-cv-00571-WDS-DGW (S.D. Ill. Aug. 26, 2013)

The United States District Court for the Southern District of Illinois granted a hospital’s motion to dismiss a previously employed pathologist’s claim of retaliation in violation of the False Claims Act.

As a part of her employment, the pathologist served on the hospital’s Utilization Management Committee, Infection Control Committee, Medical Executive Committee, and Quality Improvement Committee.  Her responsibilities included reviewing records, approving transfusions, and conducting assessments of the medical necessity for transfusions.  While performing these duties, the pathologist allegedly discovered that the hospital was billing for unnecessary transfusions.  She claimed that the hospital terminated her in violation of the False Claims Act anti-retaliation provisions for reporting this to her superiors.

In ruling on the hospital’s motion to dismiss, the court found that the pathologist, as a “fraud-alert” employee, or one whose position involved investigating fraud, was held to a heightened notice standard.  Specifically, for the hospital to be on notice that the pathologist was engaged in protected conduct under the False Claims Act, the pathologist had to use words such as “illegal” or “unlawful” when reporting the allegations to her superiors.  This she did not do.  Accordingly, the court dismissed the pathologist’s retaliation claim.

Godbey v. Iredell Mem’l Hosp., Inc. (Summary)

ADA/REHABILITATION ACT

Godbey v. Iredell Mem’l Hosp., Inc., No. 5:12-cv-00004-RLV-DSC (W.D. N.C. Aug. 19, 2013)

The United States District Court for the Western District of North Carolina granted a hospital’s motion for summary judgment in a disability discrimination action brought by a hearing-impaired patient claiming that the hospital violated the Americans with Disabilities Act (“ADA”) and the Rehabilitation Act.  The patient sought care at the hospital several times, informed the staff that he was deaf, and on at least one occasion requested an interpreter.  The patient never indicated that communicative attempts by the hospital staff, including written notes and engaging interpreters, were insufficient.  Nonetheless, he sued, claiming that the hospital’s “denial of interpretive services constituted intentional discrimination…in violation of the [Rehabilitation Act] and the ADA.”

The hospital filed a motion for summary judgment, which the court granted.  The court held that monetary damages under the Rehabilitation Act were not warranted.  The hospital’s failure to provide an American Sign Language-fluent interpreter did not by itself suffice to maintain the patient’s claim of intentional discrimination under the Rehabilitation Act in the absence of evidence that the other accommodations the hospital made fell short of providing effective communication with the patient.  Injunctive relief under the ADA was, similarly, inappropriate, since the hospital subsequently amended its policy to have qualified interpreters more readily available to prevent a reoccurrence of the alleged violation of the ADA.

Eiland v. San Jacinto Methodist Hosp. (Summary)

ADEA

Eiland v. San Jacinto Methodist Hosp., No. 4:12-CV-00192 (S.D. Tex. Aug. 20, 2013)

The United States District Court for the Southern District of Texas granted a hospital’s motion for summary judgment in a suit brought by a formerly employed nurse, asserting a claim under the Age Discrimination in Employment Act (“ADEA”).

The hospital terminated the nurse’s employment because of a “lengthy disciplinary record…for poor performance and being rude to patients.”  The hospital disciplined the nurse during her employment for, among other things, failing to remove an IV before a patient left the emergency room and failing to administer a medication prescribed by a physician for a life-threatening condition.  The hospital filed a motion to dismiss the nurse’s ADEA claim.  The court granted the motion.  In doing so, the court determined that the hospital had offered a legitimate, non-discriminatory reason for terminating the nurse (the nurse’s lengthy disciplinary record) and the hospital’s proffered reason for termination was not a pretext for age discrimination.

Torres v. Santa Rosa Mem’l Hosp. (Summary)

EMTALA

Torres v. Santa Rosa Mem’l Hosp., No. C 12-6364 PJH (N.D. Cal. Aug. 20, 2013)

The United States District Court for the Northern District of California dismissed several claims, including a claim under the Emergency Medical Treatment and Active Labor Act (“EMTALA”), brought on behalf of a patient who died after presenting with alcohol withdrawal to a hospital’s emergency room.

While in the hospital’s emergency room, the patient was diagnosed with alcohol withdrawal, given one milligram of Lorazepam, instructed to go to a clinic the next day, and then discharged.  Instead of leaving the hospital, the patient went to the hospital’s cafeteria.  He was later forced to leave.  The next morning he was found in the hospital’s parking lot moaning and in distress.  The hospital’s nursing supervisor allegedly told the hospital’s staff that the patient was “not our problem” and instructed the staff to call 911.  The patient died in the hospital parking lot later that same morning.

The plaintiffs alleged, among other things, that the hospital failed to provide a medical screening examination under EMTALA by providing a “cursory lung exam” and that the hospital failed to stabilize the patient by only administering one milligram of Lorazepam.  The plaintiffs also argued that the hospital had a duty to perform a second screening on the patient when he remained on the hospital premises.  The hospital moved to dismiss the plaintiffs’ claims.  The court granted the motion to dismiss, concluding that the allegations regarding a failure to provide a medical screening examination under EMTALA were “wholly conclusory.” The allegations that one milligram of Lorazepam was insufficient to stabilize the decedent’s alcohol withdrawal were, likewise, conclusory and devoid of any factual support.  With respect to the allegations that the hospital had a duty to provide a second screening, the court determined that the plaintiffs failed to provide any support for this theory, nor did they indicate when the duty was triggered.

U.S. ex rel. Steury v. Cardinal Health, Inc. (Summary)

FALSE CLAIMS ACT

U.S. ex rel. Steury v. Cardinal Health, Inc., No. 12-20314 (5th Cir. Aug. 20, 2013)

The United States Court of Appeals for the Fifth Circuit ruled that a complaint under the False Claims Act filed by a former employee of a health care vendor was deficient under an “implied false certification” theory because it failed to adequately allege that a contractual merchantability provision was a condition of payment.  The court found that the former employee’s allegations that merchantability was a “standard condition” of the vendor’s contracts with the government were deficient under Federal Rule of Civil Procedures 9(b).

The court noted that such conclusory allegations did not identify the contractual provisions regarding merchantability, nor did they identify how the vendor’s products deviated from the government’s specifications.  Also, the court did not address the former employee’s “worthless goods” theory because her complaint failed to plead it with the requisite particularity by not stating that any pump sold to the government over nine years was ever found to be deficient or worthless.