Council for Urological Interests v. Sebelius (Summary)

STARK LAW – UNDER ARRANGEMENTS

Council for Urological Interests v. Sebelius, No. 09-cv-0546 (BJR) (D. D.C. May 24, 2013)

The United States District Court for the District of Columbia granted the Department of Health and Human Services’ (“HHS”) motion for summary judgment in a lawsuit brought by an association of physician-owned joint ventures claiming regulations implemented by the Centers for Medicare & Medicaid Services (“CMS”) violated the Administrative Procedure Act (“APA”) and Regulatory Flexibility Act (“RFA”).

The joint ventures provided urologic laser surgery equipment and services to hospitals. Medicare paid the urologists for the professional services provided using the equipment and paid the hospitals the “technical fees” for the procedures. The hospitals then paid a portion of the technical fees back to the joint ventures. In 2008, the Secretary of HHS issued regulations under the Stark Law that prohibited such arrangements. The association argued that changes in the Stark Law interrupted the ability of urologists who owned these types of joint ventures from referring patients to receive services “under arrangements” with contracted hospitals.

On cross-motions for summary judgment, the district court held that the revisions to the Stark Law did not violate the APA, finding that CMS’ interpretation of what it means to  “furnish” designated health services (“DHS”) was reasonable and did not violate congressional intent.

The district court also held that the prohibition of per-click payments in the context of physician self-referrals was not a violation of the APA, finding that the Stark Law contained no language that would protect per-click payment arrangements and that CMS was reasonable in interpreting the law to allow restrictions on such arrangements.

Finally, the district court held that CMS did not violate the RFA, finding that the association failed to respond to HHS’ argument that the RFA requirement was satisfied, which the court took as its conceding that CMS had adequately complied with the certification requirements of the Act.

Hooda v. W.C.A. Serv. Corp. (Summary)

HCQIA IMMUNITY

Hooda v. W.C.A. Serv. Corp., No. 11-CV-504-A (W.D. N.Y. May 17, 2013)

The United States District Court for the Western District of New York (“district court”) upheld a magistrate judge’s report and recommendation by denying in part and granting in part a hospital’s motion for summary judgment.

The hospital was sued by a physician for filing an Adverse Action Report (“Report”) with the National Practitioner Data Bank (“NPDB”).  The hospital filed the Report with the NPDB based on the physician’s resignation of his medical staff privileges while he was under investigation for refusing to attend the delivery of a critically ill infant when the physician was on call.

The physician claimed the Report was filed because he expressed concerns with hospital management and complained that the hospital did not have the proper facilities to deliver and care for the infant.

The hospital and CEO argued that they were immune from the damage claims under the Health Care Quality Improvement Act (“HCQIA”).  The district court agreed.  It first noted that the hospital enjoyed “report immunity” under HCQIA because of its legal obligation to file a report with the NPDB when a doctor is under investigation at the time he surrenders his clinical privileges.

In the alternative, the district court found hospital might have invoked “professional review action immunity” because the hospital’s actions qualified as a “professional review action” and the physician did not rebut the presumption that the hospital had satisfied the requirements for immunity.  Also, based on HCQIA immunity, the review of the physician’s assertion that the hospital’s Report was filed in bad faith was irrelevant.

The district court dismissed the physician’s request for injunctive relief to order the hospital to withdraw the Adverse Action Report as the district court had no authority to do so.  The physician had no right to sue the reporting hospital for an inaccurate report.  Instead, he was only permitted to challenge an Adverse Action Report based on its accuracy and request a review by the Secretary, but the Secretary found the Report to be accurate and appropriate.

Finally, the district court denied the hospital’s motion for summary judgment on its counterclaim seeking attorney’s fees.

https://www.hortyspringer.com/wp-content/uploads/2013/05/Hooda_v_WCAServiceCorporation_May2013-ReportRecommendationOrder.pdf

https://www.hortyspringer.com/wp-content/uploads/2013/05/Hooda_v_WCAServiceCorp_May2013-Order.pdf

 

U.S. ex rel. Health Dimensions Rehab., Inc. v. RehabCare Group, Inc. (Summary)

FALSE CLAIMS ACT

U.S. ex rel. Health Dimensions Rehab., Inc. v. RehabCare Group, Inc., No. 4:12CV00848 AGF (E.D. Mo. May 20, 2013)

The United States District Court for the Eastern Division of Missouri denied a rehabilitation services provider’s (“RehabCare”) motion for summary judgment in a False Claims Act lawsuit brought by one of its competitors (“relator”).  The government intervened in part in the suit.

The government argued that RehabCare paid significant amounts of money in violation of the Anti-Kickback Statute to a contract provider of rehabilitation services in exchange for a subcontract that called for RehabCare to provide therapy services in nursing homes.  RehabCare then submitted claims to Medicare and Medicaid, falsely certifying that the claims were in compliance with the law, and, thus, in violation of the False Claims Act.  RehabCare argued that the suit fell under the public disclosure bar of the False Claims Act because the allegations were based on, among other things, a webcasted conference call and an SEC filing.  The court disagreed and concluded that without the relator’s analysis and investigation, the alleged fraud would not have been understood by the government.

Bridenstine v. St. Francis Hosp. and Med. Ctr. (Summary)

PEER REVIEW PRIVILEGE

Bridenstine v. St. Francis Hosp. and Med. Ctr., Nos. 33778, 33807 (Conn. App. Ct. May 28, 2013)

The Appellate Court of Connecticut affirmed the lower court’s grant of a medical malpractice plaintiff’s motion to set aside a verdict and for a new trial because the defendant physician’s counsel posed a series of questions during trial that violated the state’s peer review privilege.  The estate of a deceased patient brought the lawsuit against, among others, the physician.  The physician provided post-operative care to the patient following a gastric bypass.

During trial, the physician’s attorney engaged in a line of questioning directed toward the physician that would have put before the jury the fact that the hospital peer review committee reviewed the care provided by the physician and concluded that no sanctions were warranted.  The plaintiff objected, arguing that the line of questioning violated the state’s peer review privilege.  The physician contended that the privilege was hers to assert and that she intended to waive it.  A jury verdict was entered in favor of the physician.  However, the lower court granted the estate’s motion to set aside the verdict and for a new trial.

On appeal, the appellate court affirmed the lower court’s judgment.  In doing so, the court rejected the physician’s contention that her only intention during trial was to ask whether her privileges were restricted or terminated, as permitted under the state’s peer review privilege.  According to the court, the physician intended to delve into the prohibited subject of peer review as evidenced by her position during trial that the privilege was hers to assert and that she intended to waive it.

Janson v. Summit Med. Group, Inc. (Summary)

EMPLOYMENT – BREACH OF CONTRACT

Janson v. Summit Med. Group, Inc., No. 2012-CA-000587 (Ky. Ct. App. May 17, 2013)

The Court of Appeals of Kentucky affirmed the lower court’s holdings that a medical group terminated a physician within the provisions of his employment contract and that the hospital was barred from asserting a claim for unjust enrichment related to overpayment of the physician’s severance pay.

The physician sued the medical group claiming breach of contract.  The physician argued that termination of his employment contract with the medical group required a vote of 2/3 of the medical group’s board of directors, which did not occur.   The court disagreed, finding that the 2/3 voting requirement only pertained to termination prior to the completion of the agreement’s initial five-year term.  The court also affirmed the trial court’s dismissal of the medical group’s counterclaim for unjust enrichment based on the affirmative defenses of estoppel and waiver.  Even though the court agreed that the medical group incorrectly computed the physician’s severance pay and overpaid him, it held that it was estopped from asserting the claim because it had complete control over the physician’s severance benefit, paid him the severance amount, and the physician relied upon that payment.  In the alternative, the court reasoned that the medical group waived the unjust enrichment claim because it did not demand restitution until four years after the severance payment was made.

Jones v. Huntsman Cancer Hosp. (Summary)

ADEA

Jones v. Huntsman Cancer Hosp., No. 2:12-CV-814 (D. Utah May 15, 2013)

The United States District Court for the Central Division of Utah granted in part and denied in part a hospital’s motion to dismiss a former staff nurse’s action claiming that the hospital terminated her employment based on age.  The nurse asserted a breach of contract claim and claims under the Age Discrimination in Employment Act (“ADEA”).  The nurse argued that the hospital’s commitments to comply with the ADEA in its personnel policies were a part of her employment contract, which the hospital breached through discriminatory conduct.  The court disagreed, finding the nurse’s breach of contract claim was barred by the exclusive remedy provision of the Utah Anti-Discrimination Act.  However, the court allowed the nurse’s ADEA claims to proceed, concluding that it could not determine, at this stage of the case, whether the hospital was an “arm of the state” entitled to immunity under the Eleventh Amendment of the United States Constitution.

Johnson v. Frederick Mem’l Hosp. (Summary)

EMTALA

Johnson v. Frederick Mem’l Hosp., No. WDQ-12-2312 (D. Md. May 15, 2013)

The United States District Court for the District of Maryland granted a hospital’s motion for partial summary judgment in a lawsuit brought by a patient asserting, among other things, violations of the Emergency Medical Treatment and Labor Act (“EMTALA”).  The patient and his wife brought the suit alleging that the hospital violated EMTALA by failing to properly screen and stabilize him when he presented to the hospital’s emergency room complaining of back pain. Ultimately, the patient suffered from “permanent lower extremity paralysis.”

The court rejected the patient and his wife’s EMTALA claims, first finding that there were no allegations that the hospital’s screening of the patient in its emergency department was “atypical or discriminatory in light of [the patient’s] perceived condition.”  The court then addressed the patient’s failure to stabilize claim, holding that the patient and his wife did not allege that his admission was in bad faith to avoid EMTALA requirements.  Accordingly, the court granted the hospital’s motion for summary judgment on the EMTALA claims and declined to exercise its discretion to hear the remaining state law claims.

Adiemeli v. Loretto Hosp. — May 2013 (Summary)

AGE DISCRIMINATION AND RETALIATORY DISCHARGE

Adiemeli v. Loretto Hosp.
No. 11-CV-3982 (N.D. Ill. May 16, 2013)

The United States District Court for the Northern District of Illinois granted summary judgment in favor of a hospital sued by a former nurse discharged from employment after filing a workers’ compensation claim.

The former employee, a fifty-five-year-old registered nurse, claimed that the hospital terminated her employment in retaliation for filing a workers’ compensation claim and that the termination was a violation of the Age Discrimination in Employment Act (“ADEA”).  The nurse, after working at the hospital for less than twelve months, suffered a job injury and was unable to return to work for a period of two weeks.  However, the hospital’s Family/Medical Leave policy only applied to those employed full-time at the hospital for at least twelve months, thus making the nurse ineligible to qualify for leave.  The hospital terminated the nurse’s employment but told her she could reapply for employment after granted permission to return to work.

The district court granted the hospital’s motion for summary judgment on the age discrimination claim as the nurse provided no evidence of age discrimination in violation of the ADEA.  In addition, the hospital’s wage policy was not discriminatory as it was based on a nurse’s experience and years licensed.

The district court granted the hospital’s motion for summary judgment on the retaliatory discharge claim as the hospital’s leave policy clearly provided a threshold requirement of twelve months employment before the nurse would qualify under the Family/Medical Leave policy.  The district court also held that the exception in the policy giving managers discretion to grant or deny personal leave requests did not apply as the nurse was not covered under the policy.

Pal v. Jersey City Med. Ctr. (Summary)

DUE PROCESS

Pal v. Jersey City Med. Ctr., No. 11-6911(SRC)(CLW) (D. N.J. May 14, 2013)

The United States District Court for the District of New Jersey denied a surgery resident’s motion for leave to amend her complaint filed against a hospital and others. The resident claimed that the hospital violated her constitutional rights by failing to afford her due process protections when it did not provide her with verification that she completed a residency program there.   The court denied the resident’s motion for leave to amend her complaint, holding that verification of completion of a residency was not a property right recognized by federal or state law.  As such, due process protections did not attach to any deprivation of that right.

Fife v. Vicksburg Healthcare, LLC (Summary)

TITLE VII AND ADEA

Fife v. Vicksburg Healthcare, LLC, No. 5:11cv157-KS-MTP (S.D. Miss. May 13, 2013)

The United States District Court for the Southern District of Mississippi granted summary judgment in favor of a hospital in a lawsuit brought by a formerly employed 52-year-old, Caucasian medical technologist alleging, among other things, age and race discrimination.  The hospital terminated the medical technologist for accessing another employee’s medical records in violation of the Health Insurance Portability and Accountability Act (“HIPAA”) and not admitting the unauthorized access when confronted by her supervisors.  The medical technologist sued, claiming, among other things, race discrimination under Title VII and age discrimination under the Age Discrimination in Employment Act (“ADEA”).

The court granted summary judgment on the race discrimination claim because the medical technologist admitted in deposition testimony that her termination was not due to her race.  The court also granted summary judgment on the age discrimination claim, finding that the medical technologist failed to rebut the hospital’s nondiscriminatory reason for her termination. That is, that the hospital terminated her because she violated HIPAA and refused to admit the violation despite audit information indicating otherwise.

The court rejected the medical technologist’s claims of retaliation under Title VII and the ADEA, concluding that her deposition testimony demonstrated that she did not complain about age or race-based discrimination prior to her termination.

The court also granted summary judgment on all of the medical technologist’s state law claims. The court rejected her breach of contract claim because the technologist was an at-will employee with no employment contract and, thus, the hospital could terminate her employment at any time under state law.  The court held that her intentional infliction of emotional distress claim was time-barred because the claim was filed outside the statute of limitations.