Summary
This Fifth Circuit opinion reviews a False Claims Act qui tam action alleging that a vascular surgery practice fraudulently billed Medicare for ultrasound services before completing the required professional interpretations. The court affirms partial summary judgment on "Testing Only" claims but reverses it regarding "Double Billing" claims due to ambiguities in CPT-4 coding guidelines. The case is remanded for a new trial on damages and the Double Billing claims.
Topics
Practice areas
Questions Presented
- Whether partial summary judgment was proper on falsity and knowledge of falsity for the Testing Only claims.
- Whether partial summary judgment was proper on falsity and knowledge of falsity for the Double Billing claims.
- Whether legally sufficient evidence supported the jury's finding that the Testing Only claims were material to the Government.
- Whether the False Claims Act's scienter requirement extends to knowledge that falsity was material to the Government in a case involving express false certifications.
- Whether the district court abused its discretion by calculating damages through a post-trial expert declaration and entering a remittitur without submitting the calculations to the jury.
- Whether the number of actionable Testing Only claims should also be retried with damages.
Holdings
- Partial summary judgment on falsity was proper because the only reasonable inference was that PVA billed global ultrasound codes before physicians completed the professional component, making the claims factually false.
- Partial summary judgment on scienter was proper because the evidence showed that PVA was at least conscious of a substantial and unjustifiable risk that it could not bill for global ultrasounds before physicians completed the professional components.
- Partial summary judgment for relators was improper because the CPT-4 Manual and record were ambiguous as to whether an Allscripts interpretation constituted the required separate, distinctly identifiable written report and whether a separate MedStreaming report was required.
- The jury's finding that the Testing Only claims were material was supported by legally sufficient evidence.
- In a False Claims Act case involving express false certifications rather than fraudulent omissions or implied certification, the scienter requirement does not separately require proof that the defendant knew the falsity was material to the Government.
- The district court abused its discretion by relying on a post-trial expert declaration not presented to or tested before the jury to calculate damages; a new trial on damages was required for the Testing Only claims.
- The district court must determine in the first instance whether the number of actionable Testing Only claims is sufficiently intertwined with damages to require retrial of that issue as well.
Key quotations
“We cannot say “beyond peradventure” that this language is clear enough to support a grant of summary judgment to Relators.” (13-15)
“We therefore conclude that the district court did not err in declining to extend the False Claims Act’s scienter requirement to the materiality element in this case.” (18)
“We thus hold that the district court should have granted a new trial on damages with respect to the Testing Only claims.” (21)
Factual background
Peripheral Vascular Associates performed vascular ultrasound studies for Medicare patients and generally billed globally for both technical and professional components. For Testing Only claims, patients did not receive an evaluation and management visit, and the only interpretive reports were MedStreaming reports that were sometimes finalized after Medicare billing. Double Billing claims involved patients who received both evaluation and management services and vascular ultrasounds; the dispute was whether an additional standalone MedStreaming report was required when an ultrasound interpretation appeared in an Allscripts medical record. PVA temporarily changed its billing practice in 2017 to wait for interpretive reports but later abandoned that policy.
Procedural history
Relators brought a qui tam action under the False Claims Act alleging that PVA submitted Medicare claims for vascular ultrasound services before the required professional work was completed. The district court granted relators partial summary judgment on falsity and knowledge of falsity, a jury found materiality and thousands of actionable claims, and the district court entered judgment including treble damages, penalties, fees, and costs. The Fifth Circuit affirmed summary judgment on the Testing Only claims, reversed it on the Double Billing claims, vacated the final judgment, and remanded for a new trial consistent with the opinion.
Remand instructions
Vacate the final judgment. Conduct a new trial consistent with the opinion: retain the summary-judgment rulings on falsity and scienter for the Testing Only claims, retry damages for those claims, and retry the Double Billing claims because summary judgment was improper on falsity and scienter. The district court must determine whether the number of actionable Testing Only claims is sufficiently intertwined with damages to require retrial of that issue as well.