Sharp v. Eastern Oklahoma Orthopedic Center
Filing
390
OPINION AND ORDER by Judge Terence Kern ; granting in part and denying in part 213 Motion for Summary Judgment; denying 215 Motion for Partial Summary Judgment (vah, Chambers)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF OKLAHOMA
UNITED STATES OF
AMERICA, ex rel. BRENDA L. SHARP,
Plaintiff,
vs.
EASTERN OKLAHOMA ORTHOPEDIC
CENTER,
Defendant.
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Case No. 05-CV-572-TCK-TLW
OPINION AND ORDER
Before the Court are Plaintiff’s Motion for Partial Summary Judgment (Doc. 215) and
Defendant’s Motion for Summary Judgment (Doc. 213).
I.
Background and Procedural History
Brenda Sharp (“Relator”) filed this qui tam action on behalf of the United States of America
pursuant to the False Claims Act (“FCA”), 31 U.S.C. § 3729, et. seq., against Defendant Eastern
Oklahoma Orthopedic Center (“EOOC”).1 EOOC is an orthopedic medical practice comprised of
fourteen physicians in Tulsa, Oklahoma. Relator was previously employed as EOOC’s Front Desk
Supervisor until she was terminated in May 2005. In this position, Relator’s duties included day-today scheduling, maintaining demographics of patients, checking patients in and out, cashiering, and
supervising other employees. In the course of performing these duties, Relator alleges to have
witnessed several practices by EOOC that violated the FCA.
1
The FCA authorizes private citizens to assert FCA claims on behalf of the United States. 31
U.S.C. § 3730(b). These actions are known as qui tam actions, with the private citizen or “relator”
acting “for the person and for the United States government against the alleged false claimant.”
United States ex rel. Sikkenga v. Regence Bluecross Blueshield of Utah, 472 F.3d 702, 706 n.3
(10th Cir. 2006) (internal quotation marks omitted).
Relator has four remaining causes of action: (1) presentation of false claims to the
government, in violation of 31 U.S.C. § 3729(a)(1); (2) making or using a false record or statement
to get a false claim paid or approved by the government, in violation of 31 U.S.C. § 3729(a)(2); (3)
making or using a false record or statement to conceal, avoid, or decrease an obligation to pay the
government, in violation of 31 U.S.C. § 3729(a)(7); and (4) retaliatory discharge.2 With respect to
the first three FCA claims, Relator asserts that four specific practices by EOOC resulted in FCA
violations: (1) upcoding preoperative examinations; (2) miscoding of follow-up visits where such
visits were solely for data collection and were not medically necessary;3 (3) waiving Medicare coinsurance and deductibles for certain patients; and (4) billing patient accounts involving worker’s
compensation and liability claims to Medicare, instead of billing such amounts to any primary
insurance first, resulting in violations of the Medicare Secondary Payer (“MSP”) rules.4 On April
2
Relator voluntarily dismissed her state law claims, which comprised the fifth, sixth, seventh,
and eighth causes of action in the First Amended Complaint. (See Pl.’s Resp. Def.’s Mot. to
Dismiss at 37-38 (Doc. 47).) On February 27, 2009, the Court issued an Opinion and Order (Doc.
56) granting in part and denying in part EOOC’s Motion to Dismiss the First Amended
Complaint (Doc. 43). The Opinion and Order dismissed Relator’s claim for violation of
Medicare’s anti-kickback provision.
3
In her First Amended Complaint, Plaintiff claimed “Dr. [Rodney] Plaster would schedule
periodic follow-up visits with the patients to gather data to be used in the studies and would bill
Medicare even though it was not medically necessary or supported by the dictation provided by
Dr. Plaster.” (First Am. Comp. at ¶ 21.) Plaintiff has since conceded that the follow-ups were
medically necessary and, thus, has abandoned that portion of her claim related to clinical studies.
(See Pl.’s Mot. for Partial Summ. J. at 25.)
4
On September 7, 2012, Relator filed a Motion to Amend the Pleadings (Doc. 338)
requesting leave to amend the First Amended Complaint to allege additional violations of the
FCA related to preoperative examinations. In particular, Relator claimed EOOC violated the
FCA by submitting claims to Medicare without including the appropriate ICD-9-CM V-codes
(the “V-code claim”). The Court denied Relator’s Motion to Amend on February 28, 2013 (Doc.
388). Accordingly, the Court has not considered the arguments made by Relator or EOOC in their
respective motions for summary judgment regarding the V-code claim.
2
13, 2012, after several years of discovery, EOOC filed a Motion for Summary Judgment, and Relator
filed a Motion for Partial Summary Judgment.
II.
Summary Judgment Standard
Summary judgment is proper only if “there is no genuine issue as to any material fact, and
the moving party is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(c). The moving
party bears the burden of showing that no genuine issue of material fact exists. See Zamora v. Elite
Logistics, Inc., 449 F.3d 1106, 1112 (10th Cir. 2006). The Court resolves all factual disputes and
draws all reasonable inferences in favor of the non-moving party. Id. However, the party seeking
to overcome a motion for summary judgment may not “rest on mere allegations” in its complaint but
must “set forth specific facts showing that there is a genuine issue for trial.” Fed. R. Civ. P. 56(e).
The party seeking to overcome a motion for summary judgment must also make a showing sufficient
to establish the existence of those elements essential to that party’s case. See Celotex Corp. v.
Catrett, 477 U.S. 317, 323-33 (1986). The relevant legal standard does not change where the parties
file cross motions for summary judgment, and each party has the burden of establishing the lack of
a genuine issue of material fact and entitlement to judgment as a matter of law. See Atl. Richfield
Co. v. Farm Credit Bank of Wichita, 226 F.3d 1138, 1148 (10th Cir. 2000).
III.
FCA Background
As a general matter, “[t]he FCA covers all fraudulent attempts to cause the government to pay
out sums of money.” United States ex rel. Conner v. Salina Reg’l Health Ctr., 543 F.3d 1211, 1217
(10th Cir. 2008) (internal quotation marks omitted). At all relevant times, the FCA prohibited:
(1)
(2)
knowingly present[ing], or caus[ing] to be presented, to an officer or employee of the
United States Government . . . a false or fraudulent claim for payment or approval;
knowingly mak[ing], us[ing], or caus[ing] to be made or used, a false record or
statement to get a false or fraudulent claim paid or approved by the Government;
3
...
(7)
knowingly mak[ing], us[ing], or caus[ing] to be made or used, a false record or
statement to conceal, avoid, or decrease an obligation to pay or transmit money or
property to the Government[.]
31 U.S.C. § 3729(a)(2008). Section 3729(a)(1) prohibits the presentation of false or fraudulent
claims to the government for payment. To establish a violation of Section 3729(a)(1), a relator “must
show by a preponderance of the evidence that: (1) a false or fraudulent claim (2) is presented to the
United States for payment or approval (3) with knowledge that the claim is false or fraudulent.”
United States ex rel. Trim v. McKean, 31 F. Supp. 2d 1308, 1315 (W.D. Okla. 1998).
Section 3729(a)(2) prohibits the making or using of false records or statements in an attempt
to get a false claim paid by the government. See Shaw v. AAA Eng’g & Drafting, Inc., 213 F. 3d 519,
531 (10th Cir. 2000) (“Under § 3729(a)(2), liability is premised on the presentation of a false record
or statement to get a false or fraudulent claim paid or approved.”) (internal quotation marks omitted).
A relator may establish a violation of § 3729(a)(2) by showing: “(1) a false record or statement (2)
is used to cause the United States to pay or approve a fraudulent claim (3) with the defendant’s
knowledge of the falsity of the record or statement.” Trim, 31 F. Supp. 2d at 1315.
Section 3729(a)(7) prohibits making a false record or statement in attempt to avoid paying
the government what it is owed; this type of violation is referred to as a “reverse false claim.” United
States ex rel. Bahrani v. Conagra, Inc., 465 F.3d 1189, 1194 (10th Cir. 2006) (explaining that §
3729(a)(7) is a reverse false claim provision because the “financial obligation that is the subject of
the fraud flowed in the opposite of the usual direction”) (internal quotation marks omitted); United
States ex rel. Bain v. Ga. Gulf Corp., 386 F.3d 648, 653 (5th Cir. 2004) (describing § 3729(a)(7) as
the “reverse False Claims Act subsection,” and explaining that “[i]n a reverse false claims suit, the
defendant’s action does not result in improper payment by the government to the defendant, but
4
instead results in no payment to the government when a payment is obligated”). The elements of a
reverse false claim are: “(1) that the defendant made, used, or caused to be used a record or statement
to conceal, avoid, or decrease an obligation to the United States; (2) that the statement or record was
false; (3) that the defendant knew that the statement or record was false; and (4) that the United
States suffered damages as a result.” Wilkins ex rel. United States v. State of Ohio, 885 F. Supp.
1055, 1059 (S.D. Ohio 1995).
The Tenth Circuit has acknowledged that the FCA “recognizes two types of actionable claims
– factually false claims and legally false claims.” Conner, 543 F.3d at 1217. In a “factually false”
case, “proving falsehood is relatively straightforward: A relator must generally show that the payee
has submitted an incorrect description of goods or services provided or a request for reimbursement
for goods or services never provided.” Id. (internal quotation marks omitted). In a “legally false”
case, “the relator must demonstrate that the defendant has certified compliance with a statute or
regulation as a condition to government payment, yet knowingly failed to comply with such statute
or regulation.” Id. (internal quotation marks omitted).
The knowledge requirement, which is an essential element of all types of violations alleged
by Relator, is defined by statute. “Knowing” and “knowingly” mean “that a person, with respect to
information – (1) has actual knowledge of the information; (2) acts in deliberate ignorance of the
truth or falsity of the information; or (3) acts in reckless disregard of the truth falsity of the
information, and no proof of specific intent to defraud is required.” 31 U.S.C. § 3729(b). Based on
this knowledge requirement, it is settled law that “[a] mere violation of a regulatory provision, in the
absence of a knowingly false or misleading representation, does not amount to fraud.” Trim, 31 F.
Supp. 2d at 1315. “For a statement to be knowingly false, it must be more than merely an innocent
5
mistake or misinterpretation of a regulatory requirement.” Id.; see also United States ex rel. Quirk
v. Madonna Towers, Inc., 278 F.3d 765, 767 (8th Cir. 2002) (“[I]nnocent mistakes and negligence
are not offenses under the [FCA].”); Hagood v. Sonoma Cnty. Water Agency, 929 F.2d 1416, 1421
(9th Cir. 1991) (explaining that “[i]nnocent mistake” and “negligence” do not satisfy the FCA’s
knowledge requirement and that “[t]o take advantage of a disputed legal question . . . is to be neither
deliberately ignorant nor recklessly disregardful”).
IV.
Medicare Background
Medicare is “a system of health insurance administered by the United States Department of
Health and Human Services, through the Center for Medicare and Medicaid Services (CMS).”
United States v. R&F Props. of Lake Cnty., Inc., 433 F.3d 1349, 1351 (11th Cir. 2005). CMS
coordinates reimbursement for Medicare claims by “contracting with private insurance carriers
throughout the United States to administer and pay claims within their regions . . . .” Id. Providers
submit their claims using “HCFA 1500” forms. “HCFA forms serve as invoices for billing Medicare
and Medicaid: they must contain the doctor’s name, the patient’s name, the dates services were
provided, and a five-digit code identifying each service provided to a particular patient, called a ‘CPT
code.’” United States v. Krizek, 192 F.3d 1024, 1026 (D.C. Cir. 1999). “In 1992, the CPT code book
was revised to introduce ‘evaluation and management codes’ to cover non-procedure, non-surgical
oriented services.” United States v. Krizek, 859 F. Supp. 5, 10 n.2 (D.C. Cir. 1994). Evaluation and
management (“E/M”) services provided to existing patients are billed using one of five CPT codes:
99211, 99212, 99213, 99214, or 99215. United States ex rel. Freedman v. Suarex-Hoyos, 781 F.
Supp. 2d 1270, 1274 (M.D. Fla. 2011). CPT code 99214 should be used for an
office or other outpatient visit for the evaluation and management of an established
patient, which requires at least 2 of these 3 key components: A detailed history; A
6
detailed examination; Medicare decision making of moderate complexity. . . .
Physicians typically spend 25 minutes face-to-face with the patient and/or family.
(Ex. 138 to Pl.’s Resp.) CPT code 99215 has the same requirements as code 99214, except that the
Medicare decision making must be of “high complexity,” and a physician typically spends 40
minutes face-to-face with the patient and/or family. (Ex. 139 to Pl.’s Resp.)
V.
Analysis of the Parties’ Cross-Motions for Summary Judgment
EOOC requests summary judgment on all remaining claims. As to violations of §§
3729(a)(1), (2), and (7), EOOC argues that none of the four practices described by Relator result in
liability under the FCA. EOOC also seeks summary judgment on the retaliatory discharge claim.
Relator requests summary judgment on her claims arising under §§ 3729(a)(1), (2), and (7) but does
not seek summary judgment on her retaliatory discharge claim.
The Court will address whether either party is entitled to summary judgment as to the four
specific practices supporting the FCA claims: (1) upcoding preoperative visits; (2) miscoding followup visits; (3) waiving co-insurance; and (4) violating MSP rules. The Court will then address
whether EOOC is entitled to summary judgment on the retaliatory discharge claim.
A.
Upcoding Preoperative Visits
Relator argues EOOC presented factually false claims by failing to assign the correct CPT
code to preoperative examinations. She alleges that “pre-operation patient visits were being upcoded by [EOOC] in that appointments were being marked at a higher level than the time actually
spent with patients.” (First Am. Comp. ¶ 23.) Specifically, Relator contends EOOC assigned codes
99214 and 99215 to visits, even when the nature of the preoperative examinations did not support
the use of such codes. Such claims allegedly violated both §§ 3729(a)(1) and 3729(a)(2) of the FCA.
7
In the First Amended Complaint, Relator provides four specific examples of preoperative
visits which she alleges have been upcoded, including visits by Alice W., Betty E., Della W., and
Mary B. (First Am. Compl. ¶ 23.) However, at the summary judgment stage, Relator has provided
no evidence to support her allegations that false claims were submitted for any of the four patients
identified in the First Amended Complaint. Instead, the only false claim Relator has provided
pertains to one preoperative examination of Relator’s aunt, and the Court’s analysis is limited to this
false claim. Both Relator and EOOC have moved for summary judgment.5
1.
Falsity
As Front Desk Supervisor, Relator did not typically directly observe or participate in
preoperative examinations. (B. Sharp Depo., Ex. 8 to Def.’s Br. Summ. J., at 475:6-20.) However,
Relator was present outside the examination room during the preoperative examination of her aunt.
At this time, Relator observed that the physician was only in the room for five minutes and recalls
her aunt commenting that the visit only lasted five minutes. (Id. at 525:1-527:11, 534:9-19.) The
encounter form for her aunt’s preoperative examination was coded using 99214 (see Ex. 34 to Pl.’s
Resp.), a code that should be used where the physician spends twenty-five minutes with the patient,
see supra Part IV.
The encounter form for this visit, when accompanied by the testimony of Relator, raises a
genuine issue of material fact as to whether or not the aunt’s preoperative visit would have qualified
to be coded using a 99214 CPT code. This is sufficient to create a question of fact regarding whether
5
Relator seeks summary judgment on her upcoding claim on the basis that EOOC failed to
include the appropriate V-codes on the claim forms for preoperative examinations. As discussed
supra note 4, the Court did not permit Relator to amend the First Amended Complaint to add the
V-code theory. Accordingly, the Court will not consider any arguments made based on the Vcodes, and Relator’s request for summary judgment on her upcoding claim is denied as moot.
8
EOOC submitted at least one false claim for an upcoded preoperative examination.6 As explained
above, Relator has offered no evidence to support her contention that EOOC submitted false claims
for any other patients under her preoperative upcoding theory. Therefore, Relator’s preoperative
upcoding theory is limited to this single potential false claim, her aunt’s preoperative visit.
2.
Knowledge7
To satisfy the knowledge element of her upcoding claim, Relator must prove that EOOC had
actual knowledge of the falsity of Relator’s aunts preoperative examination claim or acted in
deliberate ignorance or reckless disregard of the truth or falsity of such preoperative examination
claim. See 31 U.S.C. § 3729(b). Neither an innocent mistake nor negligence are sufficient to prove
that a statement was knowingly false. See Trim, 31 F. Supp. 2d at 1315; United States ex rel. Quirk
v. Madonna Towers, Inc., 278 F.3d 765, 767 (8th Cir. 2002).
Relator concedes she has no evidence of what knowledge a given employee had at the time
the paperwork for preoperative examinations was completed. (See Pl.’s Resp. at 66.) However,
Relator has offered testimony from several EOOC employees regarding their general knowledge of
preoperative examinations, what was required for 99214 or 99215 codes, and that EOOC physicians
were not spending sufficient time to qualify for these codes. For example, EOOC patient account
representative Rhonda Vera, EOOC staff member Cynthia Pratt, and EOOC medical assistant Cindy
Pollard were aware that EOOC physicians were spending less than five minutes with patients during
the preoperative examinations and that patients were complaining about bills. (R. Vera Depo., Ex.
6
A qui tam relator may survive summary judgment so long as relator has evidence of at least
one false claim in hand. See United States ex rel. Crews v. NCS Healthcare of Ill., Inc., 460 F.3d
853, 856 (7th Cir. 2006).
7
Neither Relator nor EOOC dispute the second element of the FCA claims under §§
3729(a)(1) and (2) – that EOOC submitted claims to the government for payment.
9
17 to Pl.’s Resp., at 49:17-50:3 (“And the patients were getting upset for being billed at Level 5
when they didn’t see the doctor for maybe two minutes at the most.”); C. Pratt Depo., Ex. 36 to Pl.’s
Resp., at 64:18-66:21 (“But I started getting questions from patients at EOOC about why their preop
charges would be this much or whatever, and ‘He only seen [sic] me for five minutes, you know.
How could he get all of that in five minutes?’ And they were complaining.”); C. Pollard Depo., Ex.
37 to Pl.’s Resp., at 153:22-154:25 (“Basically come in and shake hands and we’ll see you at
surgery, that type of thing.”).) Relator has also presented evidence that Vera spoke with a Medicare
representative regarding her concerns that preoperative visits were being improperly coded:
Q.
A.
Did you talk with him about pre-ops?
...
We talked about – yes we did. It was a Level 5 pre-op visit and they were
only basically seeing the – what do you call the – a – their helpers?
Q.
Physician’s assistant.
A.
Yes, thank you. Their physician’s assistants, and the doctors would walk in
and say, “Everything okay?” and walk back out. And the patients were
getting upset for being billed at Level 5 when they didn’t see the doctor for
maybe two minutes at the most.
(R. Vera Depo., Ex. 17 to Pl.’s Resp., at 49:17-50:3.) This testimony is sufficient to allow a
reasonable jury to conclude that EOOC had knowledge that preoperative examinations were
routinely improperly coded due to insufficient time spent with a physician, such that Relator’s aunt’s
encounter form could be considered a knowing false claim.
Relator also moved for summary judgment on the preoperative upcoding theory, arguing that
no genuine issue of material fact exists and that she is entitled to judgment as a matter of law.
However, the Court finds that Relator’s evidence is not so conclusive as to entitle her to summary
10
judgment; instead, genuine issues of fact exists regarding the upcoding theory, and Relator’s request
for summary judgment is denied.
B.
Miscoding Follow-up Visits
Relator argues that EOOC submitted factually false claims because the claim forms for
follow-up visits by one particular EOOC physician, Dr. Rodney Plaster, misstated the services
provided at the visits. Specifically, Relator contends that Dr. Plaster checked the status of
asymptomatic prosthetic implants during follow-up visits but used the diagnosis code for
degenerative joint disease on the claim forms. Relator argues this happened because Dr. Plaster
“couldn’t be bothered to code” and had no knowledge of how to code such visits. (Pl.’s Resp. at 82.)
Both Relator and EOOC moved for summary judgment on this theory.8
1.
Falsity
Dr. Plaster, an orthopedic surgeon at EOOC, specializes in performing total knee and total
hip replacements using artificial knee and hip joints in patients with degenerative disc disease. (R.
Plaster Depo., Ex. 25 to Def.’s Br. Summ. J., at 5:23-6:1.) Following joint replacement surgery, Dr.
Plaster sees his patients for follow-up visits. (Id. at 69:2-4.) The HCFA1500 forms for Dr. Plaster’s
follow-ups identify “degenerative joint disease” as the primary diagnosis for the visit. (See, e.g., Ex.
32 to Def.’s Br. Summ. J.; Ex. 83 to Pl.’s Resp.) According to Dr. Plaster, the installation of a
prosthesis does not cure degenerative joint disease; instead, further evaluation and management of
the disease is required even after implantation of a prosthesis. (R. Plaster Depo., Ex. 25 to Def.’s
Br. Summ. J., at 73:20-24; R. Plaster Dec., Ex. 6 to Def.’s Reply, at ¶¶ 4-5.)
8
Relator has not indicated whether this theory falls under § 3729(a)(1) or § 3729(a)(2). For
reasons explained below, this theory fails under either section.
11
A reasonable jury could not find in favor of Relator on the falsity element of her follow-up
theory. Ultimately, the degenerative joint disease is the underlying reason why the patients required
a prosthetic joint, and there is nothing factually false about Dr. Plaster’s coding the visits as
“degenerative joint disease.” The discrepancies between the dictation – indicating that the patient
is returning following joint replacement surgery – and the diagnosis code for degenerative joint
disease on the encounter form are not inconsistent and do not indicate that the claim forms were false
or misleading in any manner. Therefore, EOOC is entitled to judgment as to Relator’s miscoding
of follow-up visits theory of liability.
C.
Wavier of Co-Insurance
Relator contends that EOOC incorrectly classified one particular individual, Patient 188582,
as an “insurance only” patient and did not collect coinsurance or deductibles from this patient for
his visits.9 In doing so, Relator argues EOOC violated §§ 3729(a)(1) and (2) of the FCA by
misrepresenting the actual charges EOOC incurred for Patient 188582’s visits. Both EOOC and
Relator moved for summary judgment on this theory.
1.
Falsity
A “provider, practitioner, or supplier who routinely waives Medicare copayments or
deductibles is misstating its actual charge;” therefore, a false claim can result from this practice.
Department of Health and Human Services, Publication of OIG Special Fraud Alerts, 59 Fed. Reg.
9
In Exhibit 98 to Plaintiff’s Response to Defendant’s Motion for Summary Judgment, Relator
provides the Court with a list of other patients that were treated as “insurance only.” However,
unlike the undisputed evidence provided as to Patient 188582, Relator does not provide any
evidence of (1) whether those patients were covered by Medicare or private insurance; or (2)
whether any of those patients had a financial hardship which would necessitate their classification
as “insurance only.” Without such evidence, Exhibit 98 has no evidentiary value in relation to
this theory. Therefore, the Court’s analysis is limited to Patient 188582.
12
65372, 65374-75 (Dec. 19, 1994) (emphasis added). Further, in a section entitled “Applying Criteria
for Reasonable Charge Determination,” the Medicare Claims Processing Manual provides:
Physicians or suppliers who routinely waive the collection of deductible or
coinsurance from a beneficiary constitute a violation of the law pertaining to false
claims and kickbacks. . . . Deductible and coinsurance amounts are taken into
account (included) in determining the reasonable charge for a service or item. In this
regard, a billed amount that is not reasonably related to an expectation of payment
is not considered the “actual charge” for the purpose of processing a claim or for the
purpose of determining a customary charge.
Medicare Claims Processing Manual, Ch. 23, § 80.8.1 (emphasis added), available at
www.cms.hhs.gov/manuals/downloads/clm104c23.pdf. When this type of false claim occurs,
Medicare pays more than it should for a particular visit. See 59 Fed. Reg. at 65475 (providing the
following example of a false claim: “If a supplier claims that its charge for a service is $100, but
routinely waives the co-payment, the actual charge is $80. Medicare should be paying 80% of $80
(or $64), rather than 80% of $100 (or $80).”)10
Relator has offered sufficient evidence to permit a reasonable jury to conclude that EOOC
submitted false claims by failing to disclose that it routinely waived the coinsurance and deductibles
for Patient 188582, while knowing that he did not have any financial hardship.11 EOOC used a
computer software system to classify patients by “type” based on certain characteristics, including
whether the patient had private insurance or participated in Medicare. (R. Smith Depo., Ex. 6 to
10
If a Medicare Part B carrier determines that a claim is compensable, the provider does not
receive reimbursement for the full amount of its actual charge. Instead, Medicare pays 80% of
what it determines to be a reasonable charge for the services provided. 42 U.S.C. § 1395l(a)(1).
The parties dispute whether Medicare actually paid any more for Patient 188582’s visits
than it would have if EOOC disclosed the waivers of coinsurance and deductibles. (See Pl.’s
Resp. at 93.). However, such fact has no bearing on whether or not the claims submitted by
EOOC were factually false under the FCA. See 59 Fed. Reg. at 65374-75.
11
The parties do not dispute that Patient 188582 had no financial hardship.
13
Def.’s Br. Summ. J., at 80:5-16; D. Poston Depo., Ex. 34 to Def.’s Br. Summ. J., at 13:24-14:21.)
Patient 188582 was classified as Patient Type 25, “Insurance Only,” while he was on private
insurance. (T. Emel Depo., Ex. 5 to Def.’s Br. Summ. J., at 30:11-23, 31:5-19.) After Patient
188582 changed from private insurance to Medicare, he incorrectly remained classified as a Patient
Type 25; therefore, EOOC did not collect co-payments, coinsurance, or deductibles for Patient
188582’s visits after this time. (D. Poston Depo., Ex. 34 to Def.’s Br. Summ. J., at 26:3-28:4.)
Therefore, EOOC submitted false claims on behalf of this patent and misstated the charge it incurred
for each of Patient 188582’s visits, regardless of whether Medicare paid more as a result of the false
claims or not.12
2.
Knowledge
EOOC disputes whether it had knowledge of the misclassification or whether it made an
innocent error. (See Def.’s Br. Summ. J. at 78 (“If EOOC intended to categorize this patient as
Insurance Only once he became a Medicare beneficiary, the proper code would have been Patient
Type 52 (Medicare Insurance Only), not Patient Type 25 (Insurance Only).”).) In contrast, Relator
contends Patient 188582 was purposely classified as Patient Type 25 at the direction of Dr. Emel.
(Pl.’s Resp. at 32.)
No question of material fact exists regarding whether EOOC acted with the requisite
knowledge as to the misclassification of this patient. Although Relator argues that Patient 188582
was purposely classified as “insurance only” by Dr. Emel, she has absolutely no evidentiary support
12
In its Motion, EOOC argues that Relator cannot establish any “routine” waiver of
deductibles or coinsurance by EOOC because Relator can only demonstrate that EOOC waived
deductibles and coinsurance for one patient. However, as this Court held in its Opinion and
Order of February 27, 2009 (Doc. 56), such a waiver may be routine even where it only involves
one patient.
14
for this argument. Dr. Emel testified that he knew Medicare prohibited its beneficiaries from being
classified as “insurance only” and, as a result, he “didn’t check the box on the charge ticket saying
‘insurance only’ if they were Medicare patients.” (T. Emel Depo., Ex. 5 to Def.’s Br. Summ. J. at
26:7-16; 50:15-18.) Dolores Poston, a patient account representative who handled Patient Type 25
patients, testified only to the general procedure by which a patient is classified as Patient Type 25
and did not indicate whether Dr. Emel or anyone else told her to classify Patient 188582 as insurance
only while he was on Medicare. (D. Poston Depo., Ex. 13 to Pl.’s Resp., at 26:20-27:22.)
Additionally, Drs. Browne and Boone cannot recall classifying any Medicare patients as “insurance
only.” (C. Browne Depo., Ex. 24 to Def.’s Br. Summ. J. at 33:19-21 (“As far as I know, I have never
given an insurance only to a Medicare patient.”); B. Boone Depo., Ex. 9 to Def.’s Br. Summ. J. at
14:4-9.) Thus, neither Dr. Emel nor Ms. Poston have any recollection of Dr. Emel making a specific
decision to maintain this patient as “insurance only,” particularly after Patient 188582 became a
Medicare beneficiary. Without evidence of something more than a mere oversight in failing to
change the status of this patient, a reasonable jury could not find that EOOC acted with the requisite
knowledge. See Trim, 31 F. Supp. 2d at 1315 (“A mere violation of a regulatory provision, in the
absence of a knowingly false or misleading representation, does not amount to fraud.”).
D.
Violation of MSP Rules
Relator argues EOOC violated §§ 3729(a)(1) and (2) of the FCA by billing patient accounts
involving worker’s compensation and liability claims to Medicare as “a payer of first resort,” instead
of billing such accounts to any available primary insurance first. (First Am. Comp. ¶ 25.) This
practice allegedly resulted in the submission of false claims because EOOC “failed to disclose the
existence of a primary plan to Medicare” and because EOOC’s “employees knowingly submitted
15
these claims with Medicare as the primary payer.” (Id.) Relator’s theory encompasses twenty-four
patients, one involving a worker’s compensation claim and the others relating to accidents. All
alleged false claims related to violation of the MSP rules were submitted prior to 2003. Both Relator
and EOOC moved for summary judgment on this theory.13
1.
§ 3729(a)(1) and (2)
a.
Falsity
Relator’s falsity theory rests primarily on EOOC’s failure to complete “Box 11” on the
Medicare claim forms, which asks the medical provider to identify other available insurance.
However, the Court finds that such failure did not result in false claims for several reasons. First,
at relevant times to this theory of recovery, the MSP regulations were ambiguous.14 One portion of
the regulations offering guidance on how to bill claims involving a Medicare patient who might also
be covered by automobile or other liability insurance provided:
§ 411.54 Limitation on charges when a beneficiary has received a liability insurance
payment or has a claim pending against a liability insurer.
...
(c) Basic rules –
...
(2) Specific limitations. Except as provided in paragraph (d) of this section,
the provider or supplier –
(I) May not bill the liability insurer or place a lien against the
beneficiary’s liability insurance settlement for Medicare covered services.
(ii) May only bill Medicare for Medicare-covered services . . . .
42 C.F.R. § 411.54 (2002). This regulation advised providers to bill Medicare and not liability
insurers. However, another regulation in effect at the time required Medicare providers to agree
13
This theory of FCA liability implicates §§ 3729(a)(1), (2), and (7), and the Court will
address each claim.
14
The MSP Manual released in 2003 clarified these ambiguities.
16
“[t]o bill other primary payers before billing Medicare except when the primary payer is a liability
insurer . . . .” Id. § 489.20(g) (2002). These two regulations arguably contradict one another: one
prohibits medical providers from billing the liability insurer, while the other requires providers to
bill liability insurers.
Second, EOOC employees had sought guidance as to these ambiguities and believed they
were in compliance. Robin Smith, EOOC’s Administrator and Compliance Officer, and Carolyn
Tinsley, an EOOC employee who handled billing for some cases involving liability insurers, testified
that they asked Medicare or the regional Medicare contractor for guidance when they had questions
about MSP issues. (R. Smith Depo., Ex. 6 to Def.’s Br. Summ. J., at 93:18-94:2; Depo. of C.
Tinsley, Ex. 38 to Def.’s Br. Summ. J., at 170:5-22, 173:7-12.) Smith testified that “[a]t the time,
[Medicare] w[as] subrogating claims and we, as long as we informed them it was a motor vehicle
accident, we filed the claim to [Medicare] rather than pursue any other form of payment. We had
the option.” (R. Smith Depo., Ex.6 to Def.’s Br. Summ. J., at 88:7-15, 97:6-14.) “[W]hat she told
me was it was never wrong to file a claim with [Medicare]. I could file a claim to them at any time
number one.” (Id. at 94:23-95:7.)
Third, EOOC did complete Box 10 on the Medicare claim forms, which asks the provider
whether the patient’s condition is related to employment, an automobile accident, or other accident.
It is undisputed that EOOC completed Box 10 for each of the twenty-four patients at issue, thereby
notifying Medicare of the possibility of another payer. (Id. at 113:15-114:15.) Fourth, one reason
that EOOC did not complete Box 11 was because EOOC could not be certain that any other payers
existed. Business Office Manager Melissa Turner (“Turner”) testified that EOOC financial
counselors would speak with patients who had been involved in an accident and obtain information
regarding possible payers. (M. Turner Depo., Ex. 36 to Def.’s Br. Summ. J., at 104:13-23.)
17
However, neither the financial counselor nor the patient could determine who was at fault for the
accident; instead, the insurance companies made the liability determination. (Id.) Finally, Relator’s
own expert, Stephanie Womack, agreed that by checking Box 10, EOOC placed Medicare on
sufficient notice of the existence of another potential payer. (S. Womack Depo., Ex. 2 to Def.’s Br.
Summ. J., at 266:24-267:7.)15
Given the confusion regarding the MSP regulations, EOOC’s attempts at compliance,
EOOC’s completion of Box 10, EOOC’s inability to know the identity of primary payers, and
Relator’s expert’s admission that EOOC technically notified Medicare of the potential existence of
primary payers by checking Box 10, a reasonable jury could not find that EOOC submitted any false
claims based on Relator’s MSP violation theory. See United States v. Prabhu, 442 F. Supp. 2d.
1008, 1027 (D. Nev. 2006) (noting that a defendant cannot be found to have submitted a false claim
where “reasonable persons can disagree regarding whether the service was properly billed to the
Government”).
b.
Knowledge
Alternatively, and for similar reasons, Relator has offered no evidence to show that EOOC
had actual knowledge that it could not bill Medicare as a primary payer. Even when EOOC failed
to complete Box 11 and identify the primary insurer – when the identity of such insurer was known
– the Court does not find this act to constitute anything more than an honest mistake or mere
negligence. See United States ex rel. Hixson v. Health Mgmt. Sys., Inc., 613 F.3d 1186, 1190 (8th
Cir. 2010) (“[A] statement that a defendant makes based on a reasonable interpretation of a statute
15
EOOC filed a Motion to Exclude the Testimony and Report of Plaintiff’s Proffered Expert
Witness Stephanie Womack on April 23, 2012 (Doc. 238). The Court has not ruled on this
motion. For purposes of this section of the Order only, the Court relies on Relator’s expert’s
testimony and assumes such testimony is admissible.
18
cannot support a claim under the FCA if there is no authoritative contrary interpretation of that
statute. This is because the defendant in such a case could not have acted with the knowledge that
the FCA requires before liability can attach.”); Prabhu, 442 F. Supp. 2d. at 1028-29 (“[T]he FCA
knowledge standard does not extend to honest mistakes, but only to ‘lies.’ Thus, a Defendant does
not ‘knowingly’ submit a ‘false’ claim when his conduct is consistent with a reasonable
interpretation of ambiguous regulatory guidance.”). EOOC’s billing practices for MSP claims
conformed to a reasonable interpretation of ambiguous regulations and such interpretation was
supported by the regional Medicare contractor. Therefore, Relator has also failed to present
sufficient evidence as to the knowledge element.
2.
§ 3729(a)(7)
Relator contends EOOC violated the FCA by retaining payments from Medicare after EOOC
had been paid by the appropriate liability insurer, which also implicates § 3729(a)(7). (See First Am.
Comp. ¶¶ 18, 33.) As explained above, § 3729(a)(7) requires Relator to demonstrate: (1) that EOOC
made or used a record or statement to conceal, avoid, or decrease an obligation to the United States;
(2) that the record or statement was false; (3) that EOOC knew the record or statement was false; and
(4) that the United States suffered damages as a result. See Wilkins, 885 F. Supp. at 1059.
Relator has not come forward with sufficient evidence to support her § 3729(a)(7) claim. In
her First Amended Complaint, Plaintiff identifies several patient accounts in which she believes
EOOC failed to refund overpayments to Medicare. (See First Am. Comp. ¶ 18.) In its motion for
summary judgment, EOOC submitted evidence demonstrating that any alleged overpayments by
Medicare were refunded. (See, e.g., Exs. 39 and 40 to Def.’s Br. Summ. J.) In response, Relator did
not offer any further evidence creating a question of fact as to whether EOOC wrongfully retained
19
any overpayments related to these patients. As with most of her claims, Relator simply has no
evidence supporting her initial allegations, and EOOC is entitled to judgment as a matter of law.
E.
Retaliatory Discharge
“Since employees will often be in the best position to report frauds perpetrated by their
employers, the FCA includes ‘whistleblower’ provisions protecting employees who do so from
retaliation.” McBride v. Peak Wellness Center, Inc., 688 F.3d 698, 703-04 (10th Cir. 2012); 31
U.S.C. § 3730(h). Section 3730(h) provides:
Any employee who is discharged [or] demoted . . . by his or her employer because
of lawful acts done by the employee . . . in furtherance of an action under this section,
including investigation for, initiation of, testimony for, or assistance in the action
filed or to be filed under this section, shall be entitled to all relief necessary to make
the employee whole.
31 U.S.C. 3730(h). The Tenth Circuit, quoting legislative history, has stated that this section
provides relief “only if the whistleblower can show by a preponderance of the evidence that the
employer’s retaliatory actions resulted because of the whistleblower’s participation in a protected
activity.” United States ex rel. Sikkenga v. Regence Bluecross Blueshield of Utah, 472 F.3d 702, 729
(10th Cir. 2006) (quoting S. Rep. No. 99–345, at 35 (1986), as reprinted in 1986 U.S.C.C.A.N. 5266,
5300).
The Tenth Circuit has not articulated a precise test for this claim, but the Court construes the
above language from Sikkenga as requiring three elements: (1) the employee engaged in protected
activity; (2) the employer had knowledge that the employee was engaged in protected activity; and
(3) the employer retaliated against the employee because of this conduct. See id.; see also
Harrington v. Aggregate Indus. Ne. Region, Inc., 668 F.3d 25, 31 (1st Cir. 2012) (adopting three-part
test requiring “an employee to show that (i) he was engaged in conduct protected under the FCA;
20
(ii) the employer had knowledge of this conduct; and (iii) the employer retaliated against the
employee because of this conduct”); United States ex rel. Schweizer v. Oce N.V., 677 F.3d 1228,
1237 (D.C. Cir. 2012) (concluding that statutory language “states two basic elements: (1) acts by the
employee ‘in furtherance of’ a suit under § 3730—acts also known as ‘protected activity’; and (2)
retaliation by the employer against the employee ‘because of’ those acts,’” but then dividing the
second element into two parts inquiring as to knowledge and motivation). Rather than adopt a twopart test with multiple components to the second part, the Court finds it simpler to state the elements
as a three-part test.
1.
Protected Activity
In the FCA context, protected activity means “taking action in furtherance of a private qui
tam action or assisting in an FCA action brought by the government.” McBride, 688 F.3d at 705
(internal quotations omitted). “An employee need not actually file a qui tam action to qualify for
whistleblower protection, but the activity prompting the [retaliatory action] must have been taken
‘in furtherance of’ an FCA enforcement action.” Id. (internal quotations omitted). An employee can
be engaging in protected activity even if “the employee is not contemplating bringing a qui tam suit,
is not even aware that there is such a thing as a qui tam action, and has no idea whether his . . .
investigation or other acts, if made known to the government, might cause the Attorney General to
sue his employer under the False Claims Act.” Schweizer, 677 F.3d at 1238; United States ex rel.
Smith v. The Boeing Co., No. 11-7030, 2006 WL 542851, at *7 (D. Kan. Feb. 27, 2006) (“Most
courts recognize that conduct can be ‘in furtherance’ of an FCA action if it involves investigation
of matters that reasonably could lead to a viable False Claims Act case.”).
21
Relator has presented evidence that, sometime before October 2005, Relator and Susan Kulla
(“Kulla”), EOOC Director of Operations and Relator’s supervisor, began investigating EOOC’s
billing practices to determine if specific billing practices were resulting in the submission of false
Medicare claims. (B. Sharp Depo., Ex. 2 to Pl.’s Resp., at 620-24.) Neither Relator or Kulla were
expressly charged in their job duties with Medicare compliance or detecting fraudulent activity. This
investigation led to a meeting with certain EOOC doctors (“October meeting”), which was scheduled
and led by Kulla and in which Relator participated. The Court finds, based on the summary
judgment evidence, that these pre-October meeting activities could be considered protected activity
by Relator. The evidence reflects that Kulla and Relator were not merely concerned about regulatory
compliance; they were concerned that factually false claims were being submitted to the government
and pulled specific examples of those claims to discuss with the doctors. (Id. at 620:22-25 (“Susan
had the meeting, had us look at different things in the office to bring to the doctors that Robin was
doing things improperly, sending claims to Medicare improperly.”).) These examples included
instances in which patients were not being seen for the requisite amount of time to qualify for the
code used and other intentional misstatements of fact. (Id. at 623-24.) Although Relator did not use
the words “false claim” or discuss the FCA during the October meeting, their initial investigation
could be considered “in furtherance of” a qui tam action and was indeed the impetus for Relator’s
reporting false claims and instigation of this qui tam action.
Relator has also presented evidence that, from at least January 2005 until the date of her
termination, she was engaged in external whistleblowing by reporting alleged fraudulent billing
22
practices directly to Medicare and/or its “Program Safeguard Contractor,” AdvanceMed.16 For
example, in one letter to AdvanceMed, Relator stated:
I have pulled a couple and made a copy of the dictation so you can see that Dr.
Plaster does not mention anything about DJD 715.96 which is the diagnosis code that
they used when the patient first came in to see the doctor prior to any surgery. . . .
They are having no problems and are told the reason for the appointment is for the
study program. . . . .The patient is told they will not be charged for the visit but the
insurance company is being charged and this is unfair to you . . . .
(2/24/05 Letter, Ex. 130 to Pl.’s Resp.) These allegations led directly to investigations into EOOC’s
billing practices by AdvanceMed. According to Relator, she was continuing to investigate and pull
files for submission to Medicare up to and including the date of her termination. This external
whistleblowing directly to Medicare and/or its agent from January 2005 to the date of her
termination constitutes classic protected activity.
2.
Notice
“[A] plaintiff claiming retaliatory discharge under the FCA has the burden of pleading facts
which would demonstrate that defendants had been put on notice that plaintiff was [engaging in
protected activity].” McBride, 688 F.3d at 705 (internal quotations omitted). “Notice may be
provided in a number of ways: for example, by informing the employer of ‘illegal activities’ that
would constitute fraud on the United States; by warning the employer of regulatory noncompliance
and false reporting of information to a government agency; or by explicitly informing the employer
of an FCA violation.” Id. (internal citations omitted) (emphasis added). Although some form of
notice is certainly required, an employee “does not have to alert his employer to the prospect of a
16
After Relator’s report of fraudulent conduct to Medicare, she received a letter from Karen
Divens at AdvanceMed instructing her to direct all future communications to AdvanceMed. (See
Ex. 126 to Pl.’s Resp.)
23
False Claims Act suit” because “§ 3730(h) does not require the employee to know that the
investigation he was pursuing could lead to a False Claims Act suit.” Schweizer, 677 F.3d at 1238.
The Tenth Circuit has indicated that if an employee’s “regular duties include investigation
of fraud, such persons must clearly plead notice to their employers of their intentions of bringing or
assisting in an FCA action in order to overcome the presumption that they are merely acting in
accordance with their employment obligations.” Sikkenga, 472 F.3d at 729. However, if fraud
investigation and detection is not part of the employee’s typical job duties, she need not use “fraud”
or any other specific language in order to put an employer on notice of their protected activity. See
United States ex rel. Karvelas v. Melrose-Wakefield Hosp., 360 F.3d 220, 239 n.26 (1st Cir. 2004)
(“Because [relator’s] job duties did not involve investigating government payments or billings, he
need not meet the heightened requirements for employees whose job descriptions do include such
responsibilities in order to establish a § 3730(h) retaliation claim.”) (abrogation on other grounds
recognized by United States ex. rel. Gagne v. City of Worcester, 565 F.3d 40 (1st Cir. 2009)).
Relator’s evidence is sufficient to create a question of fact as to whether at least one relevant
decisionmaker17 was aware that Relator was engaging in protected activity from on or around
October 2005 until the date of her termination. First, Drs. Emel and Boone were present at the
October meeting, during which Relator and others discussed the results of the internal investigation
coordinated by Kulla regarding specific problems with EOOC’s billing practices. (B. Sharp Depo.,
Ex. 2 to Pl.’s Resp., at 620:12-14.) Kulla, Relator, and others pulled specific examples of
problematic Medicare claim forms that had previously been submitted for payment and presented
17
As discussed below, there is a question of fact as to who made the termination decision and
when such decision was made.
24
them to the doctors.18 (Id. at 620:22-25, 622:17-623:6.) At the conclusion of the meeting, Relator
warned the doctors that “they didn’t want Medicare knocking at their door.” (B. Sharp Depo., Ex.
8 to Def.’s Br. Summ. J., at 649:13-25.) EOOC contends that the October 2005 meeting is not
sufficient to provide notice that Relator had engaged in any protected activity because the words
“fraud” or “false claims” were not used. However, it was not part of Relator’s duties as Front Desk
Supervisor to investigate fraud or Medicare compliance, and the Court finds it sufficient that Relator
was identifying problems and issuing warnings to doctors who could have been the ultimate
decisionmakers regarding her termination. See McBride, 688 F.3d at 705 (explaining that notice can
be provided by “warning the employer of regulatory noncompliance and false reporting of
information to a government agency”); Weihua Huang v. Rector and Visitors of Univ. of Va., 896
F. Supp. 2d 524, 551-52 (W.D.Va. 2012) (explaining that when an “employee is not specifically
charged with investigatory duties (like, say, an auditor is),” there are no “magic words” and the
employee “need only show that the employer was aware of the employee’s investigation”) (internal
quotations omitted).
Second, with respect to protected activity occurring after the October meeting, it is
undisputed that Kulla, a member of management and Relator’s immediate supervisor, was aware that
Relator was reporting fraudulent claims to Medicare. Although Relator is not aware if Kulla told
any of the possible decisionmakers about her external whistleblowing (B. Sharp. Depo., Ex. 8 to
Def.’s Br. Summ. J., at 87:17-18), Relator noted in her deposition that EOOC was a relatively small
office where information could easily spread, (see id..at 661:18-19). In addition, Relator informed
18
Smith, the Medicare Compliance Officer, was not present at this meeting because Kulla did
not invite her. (Id. at 156:22-157:1 (“But about this little investigation, that was – [Kulla] wanted
to present it to the doctors, because it’s a little awkward to go to the compliance officer [Smith] to
tell them what they’re doing wrong . . . .”).)
25
AdvanceMed that, at some point, Smith “blocked [Relator] out of the computer.” (Ex. 130 to Pl.’s
Resp.)
Viewing the circumstances as a whole and in favor of Relator, Relator has presented evidence
that she: (1) warned certain possible decisonmakers about regulatory noncompliance and problems
with specific claims that had been submitted to Medicare for payment, which was outside her job
description as Front Desk Supervisor; (2) communicated with Medicare/AdvanceMed for an
extended period of time while still working for EOOC, including gathering and copying documents
at work in a relatively small office setting; (3) expressly informed Kulla, her direct supervisor and
a member of EOOC management, about her external whistleblowing; and (4) was, at some point,
blocked out of certain aspects of EOOC’s computer system. This is sufficient to create a question
of fact on the issue of notice, particularly where questions of fact exist surrounding the circumstances
of the termination decision and who the relevant decisionmakers were.
3.
Retaliatory Intent
Relator does not have any direct evidence of retaliatory intent, and the Court finds it proper
to analyze whether Relator has demonstrated that EOOC’s proferred reason for the termination is
pretextual, such that she has created a triable question of fact as to retaliatory intent. See United
States ex rel. Erickson v. Uintah Spec. Servs. Dist., 268 F. App’x. 714, 717 (10th Cir. 2008)
(unpublished) (implicitly approving use of something akin to McDonnell Douglas burden shifting
in FCA retaliation cases) (affirming grant of summary judgment where the plaintiff “failed to
demonstrate that the audit report was not a legitimate, non-discriminatory reason for her
termination”).19 Generally, a plaintiff “can meet this burden to show pretext in either of two ways:
19
The D.C. Circuit and First Circuit have explicitly adopted the McDonnell Douglas
burden-shifting framework for analysis of retaliatory intent in § 3730(h) retaliation claims at the
26
(1) by showing that the proffered reason is factually false or (2) by showing that discrimination was
a primary factor in the employer’s decision, which is often accomplished by revealing weaknesses,
implausibilities, inconsistencies, incoherencies, or contradictions in the employer’s proffered reason,
such that a reasonable fact finder could deem the employer’s reason unworthy of credence.” Tabor
v. Hilti, Inc., 703 F.3d 1206, 1218 (10th Cir. 2013) (internal alterations and quotations omitted).
Relator was terminated on May 10, 2005. (See Ex. 45 to Def.’s Br. Summ. J.) EOOC’s
stated reason for Relator’s termination is that her position as Front Desk Supervisor was consolidated
with that of the Business Office Manager. (See Def.’s Br. Summ. J. at 33 (“[Relator’s] position was
eliminated. The business office and the front desk positions were consolidated.”); Depo. of R.
Smith, Ex. 8 to Pl.’s Resp., at 152:20-153:15 (“We were merging the business office and the front
office together and we would be eliminating [Relator’s] position.”); B. Boone Depo., Ex. 9 to Def.’s
Br. Summ. J., at 91:17-92:9 (“Well, we did away with the position. We combined it with our
business office . . . .”.)
Relator has presented evidence of weaknesses, implausibilities, inconsistencies,
incoherencies, and contradictions in EOOC’s proffered reason, such that a reasonable fact finder
could deem the employer’s reason unworthy of credence. First, Relator has presented evidence that
she was engaging in protected activity up to and at the time of her termination by continuing her
summary judgment stage. Schweizer, 677 F.3d at 1241; Harrington, 668 F.3d at 30-31 (adopting
approach but explaining that “[t]his burden-shifting framework is a useful screening device in the
summary judgment milieu, but courts typically put it aside once the third step is reached”).
Although not adopting it by name, other circuits “have adopted or alluded to a similar rule. See
Scott v. Metro. Health Corp., 234 F. App’x. 341, 346 (6th Cir. 2007); Hutchins v. Wilentz,
Goldman & Spitzer, 253 F.3d 176, 186 (3d Cir. 2001); Norbeck v. Basin Elec. Power Coop., 215
F.3d 848, 850–51 (8th Cir. 2000). Thus, there appears to be some consensus that analysis of
“pretext” evidence is appropriate in determining whether a plaintiff can reach a jury on the
causation element.
27
investigation and communicating with Medicare, and the Court has found a question of fact as to
whether any decisionmakers were on notice of this activity. Thus, temporal proximity between some
of the alleged protected activity and the termination exists. Second, Relator received a positive
performance evaluation in March 2005, two months prior to her termination. (Depo. of R. Smith,
Ex. 8 to Pl.’s Resp., at 150:23-151:14.) Third, Melissa Turner (“Turner”), the Business Office
Manager who would be filling the position once combined with Relator’s position, was on maternity
leave at the time of Relator’s termination. (Depo. of M. Turner, Ex. 120 to Pl.’s Resp., at 27:3-8.)
The timing of consolidating a position with another, when there will be no person present to fill
either role, could be considered implausible. In addition, Smith never had any discussions with
Turner about the consolidation, which seems unlikely since she was the individual who would be
filling the “combined” position. (Id. at 27:25-28:6.)
Finally, and most importantly, questions of fact abound regarding the actual circumstances
surrounding Relator’s termination, and there is evidence that EOOC’s proferred reason was never
even communicated to Relator at the time of her termination. The evidence shows that Smith
instructed Kulla to terminate Relator. According to Relator, Kulla gave Relator the following
explanation for her termination:
I – I said, “Well, [Kulla] – I asked [Kulla] what – why.[”] She told me that they want
– they’re going to fire me. And I said, “What for?” And she said, “Dr. Plaster went
to [Smith],” and then I guess [Smith] and Dr. Plaster, from my understanding, was
[sic] talking to each other and Dr. Emel come [sic] around the corner and he asked
what was going on and he said, “I want her out by Friday.”
(B. Sharp Depo., Ex. 8 to Def.’s Br. Summ. J., at 70:18-25.) Kulla did not offer any other
explanation for her termination and did not discuss any consolidation of positions. (Id.) Kulla also
28
testified that Smith did not mention any consolidation of positions when she instructed Kulla to
terminate Relator.
Q.
A.
Q.
A.
Q.
A.
Q.
A.
Q.
A.
Q.
A.
Q.
A.
Why did Dr. Emel want Ms. Sharp gone?
That wasn’t explained to me. That was all that was said.
Was any discussion made about consolidating her position with Melissa
Turner’s position?
Not at that point.
Who made the decision to terminate Ms. Sharp?
I don’t know.
How can you not know?
I was just told they wanted her gone, Dr. Emel wanted her gone.
Anyone besides Dr. Emel?
That’s verbatim what Robin [Smith] told me.
Was there any reason given to you to support Ms. Sharp’s termination?
No.
Did you see her do anything that warranted termination?
No.
(Depo. of S. Kulla, Ex. 94 to Pl.’s Resp., at 128:21-129:14 (emphasis added).) Smith offered an
entirely different version of events than Kulla:
Q.
A.
Q.
A.
Q.
A.
Q.
A.
Well, on this specific instance, supposedly, Dr. Plaster was very upset and
was raising his voice with you in the hallway. And Dr. Emel walked up at the
end of the conversation. And from what I understand, Dr. Emel told you at
that point that he wanted Brenda Sharp gone by Friday. Do you recall that
happening?
No.
So it just didn’t happen?
I don’t recall that at all. And he never – Dr. Emel never asked me to fire her.
According to Susan Kulla, in her affidavit that she submitted in this case, she
said that you told her that Dr. Emel wanted Brenda Sharp gone. Did he ever
make that statement to you?
Not that I remember, no.
At some point, Ms. – that week actually, Ms. Sharp was terminated. Do you
remember that?
I remember discussing more than a week or two ahead of time of her leaving,
that we were merging the jobs together. We were merging the business office
and the front office together and we would be eliminating that position.
29
(Depo. of R. Smith, Ex. 8 to Pl.’s Resp., at 152:20-153:15.) But even Smith’s version of events is
not fully supported by EOOC’s witnesses. For example, Dr. Boone, EEOC’s Medical Director,
could not recall any board meetings or executive meetings where the consolidation of the positions
was discussed. (B. Boone Depo., Ex. 9 to Def.’s Br. Summ. J., at 91:21-24.)
Viewed in total, the above evidence is sufficient to demonstrate that EOOC’s proferred
reason – consolidation of her position with another – is implausible or unworthy of belief, such that
Relator may proceed to trial on the question of retaliatory intent. See Harrington, 668 F.3d at 34
(FCA retaliation claim) (finding that employee had presented evidence of weaknesses in employer’s
proferred reason relating to a drug test because company was not following own testing protocol and
explaining that “irregularities in an employer’s dealings with an employee who has fallen out of
favor can support a reasonable inference of pretext”).
VI.
Conclusion
Plaintiff Brenda L. Sharp’s Motion for Partial Summary Judgment (Doc. 215) is DENIED.
Defendant Eastern Oklahoma Orthopedic Center’s Motion for Summary Judgment (Doc.
213) is GRANTED IN PART and DENIED IN PART. Following is a breakdown of the Court’s
rulings as to each remaining cause of action:
1.
20
Violation of 31 U.S.C. § 3729(a)(1):
(a)
Upcoding preoperative examinations theory: DENIED20
(b)
Miscoding of Dr. Plaster’s follow-up visits theory: GRANTED
(c)
Waiving Medicare co-insurance theory: GRANTED
(d)
Violations of Medicare Secondary Payer rules: GRANTED
The only false claim that will be considered is that submitted for Relator’s aunt.
30
2.
Violation of 31 U.S.C. § 3729(a)(2):
(a)
Upcoding preoperative examinations theory: DENIED21
(b)
Miscoding of Dr. Plaster’s follow-up visits theory: GRANTED
(c)
Waiving Medicare co-insurance theory: GRANTED
(d)
Violations of Medicare Secondary Payer rules: GRANTED
3.
Violation of 31 U.S.C. § 3729(a)(7):
(a)
Violations of Medicare Secondary Payer Rules: GRANTED
4.
Retaliatory Discharge pursuant to 31 U.S.C. § 3730(h): DENIED
IT IS SO ORDERED this 29th day of October, 2013.
____________________________________
TERENCE C. KERN
UNITED STATES DISTRICT JUDGE
21
The only false claim that will be considered is that submitted for Relator’s aunt.
31
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