Justia Health Law Opinion Summaries

Several pharmacists in Michigan and Ohio operated independent pharmacies where they engaged in fraudulent billing practices. Rather than reversing insurance claims for prescriptions that were never picked up by patients, these pharmacists intentionally left the claims uncorrected, thereby receiving payments for medications that were not actually dispensed. They also increased the volume of such claims by waiving copays and substituting generic drugs for brand-name ones while billing for the more expensive medication. An audit by Qlarant, a government contractor, uncovered that the pharmacies had billed Medicare and Medicaid for far more medication than they had purchased, resulting in significant financial losses to insurers.The United States District Court for the Eastern District of Michigan tried four of the charged pharmacists after their co-defendants pleaded guilty. A jury convicted all four of conspiracy to commit healthcare and wire fraud, with additional healthcare fraud convictions for two defendants. The district court granted a motion for acquittal on some substantive counts, sentenced the defendants to terms ranging from 24 to 120 months, and imposed restitution obligations commensurate with their roles in the scheme. The defendants appealed, raising issues about the admission of expert testimony, evidentiary rulings, variance from the indictment, jury polling, sentencing enhancements, and restitution orders.The United States Court of Appeals for the Sixth Circuit reviewed the convictions and sentences. It held that the admission of the government’s expert testimony did not violate the Confrontation Clause, that the district court properly excluded certain defense evidence and did not err in qualifying the expert in front of the jury, and that the evidence supported a single overarching conspiracy. The court also found no error in the calculation of loss amounts, enhancements for sophisticated means, or the procedure and amount of restitution. The Sixth Circuit affirmed the judgments of the district court. View "United States v. Hamaed" on Justia Law

Mark and Courtney Wightman, who own a dental clinic in Louisiana, entered into an agreement with DenteMax, a preferred provider organization (PPO), allowing DenteMax to offer their services at discounted rates to its network subscribers in exchange for access to more patients. Unbeknownst to the Wightmans, DenteMax also entered into a separate agreement with Ameritas Life Insurance Corporation, which permitted Ameritas to pay DenteMax’s network providers, including the Wightmans, at the same discounted rates. The Wightmans only became aware of this arrangement when Ameritas reimbursed them at the discounted rates rather than their standard rates for services rendered to Ameritas-insured patients.The Wightmans filed suit in the United States District Court for the Eastern District of Louisiana against Ameritas and DenteMax, alleging breach of contract, violations of Louisiana’s Preferred Provider Organization Act (PPO Act), and unjust enrichment. The district court initially dismissed several claims, partly on the ground that the suit was prescribed (time-barred). On appeal, the United States Court of Appeals for the Fifth Circuit certified a question to the Louisiana Supreme Court, which held that PPO Act claims are contractual for prescriptive purposes, making the claims timely. The Fifth Circuit reversed the district court’s prior dismissal. DenteMax settled, and on remand, the district court granted summary judgment to Ameritas, concluding that dental services are not “healthcare services” under the PPO Act, and that the Wightmans had abandoned their non-PPO Act claims.On further appeal, the United States Court of Appeals for the Fifth Circuit held that dental services are “healthcare” under the PPO Act, reversing the district court’s grant of summary judgment on those claims. The court also found error in the district court’s treatment of the abandonment of non-PPO Act claims and remanded for further proceedings. The denial of leave to amend was affirmed. View "Wightman v. Ameritas Life Ins" on Justia Law

A woman was seriously injured as a passenger in a car accident in Montgomery County, Alabama. She first received treatment at one hospital and was then transferred to another for further care. Both hospitals, which are affiliated with public entities, filed statutory hospital liens in probate courts to secure payment for her medical expenses from any settlement or recovery she might obtain related to her injuries. The total amount of the liens exceeded the amount available from the car owner’s insurance, which provided $75,000 in coverage. The woman settled with the insurance company and received a portion of the proceeds, with the rest held by her attorney pending resolution of the hospital liens.Afterward, she filed an action in the Montgomery Circuit Court, seeking interpleader and declaratory relief to determine the validity and amounts of the hospitals’ liens. One hospital, the University of South Alabama Health University Hospital, argued it was immune from suit under Article I, § 14, of the Alabama Constitution because it is a state agency. The trial court agreed, found that the state hospital was a necessary party, and dismissed the claims against both hospitals with prejudice, concluding it lacked subject-matter jurisdiction.The Supreme Court of Alabama reviewed the dismissal de novo. It held that an interpleader action brought under Rule 22 of the Alabama Rules of Civil Procedure to resolve the validity and amount of hospital liens does not implicate state immunity and does not deprive the trial court of jurisdiction, even when a state entity is named as a defendant. The Court reversed the trial court’s dismissal and remanded the case for further proceedings, allowing the plaintiff’s interpleader claim to go forward. View "Wood v. Health Care Authority for Baptist Health" on Justia Law

A former patient of a hospital in Bayamón, Puerto Rico, alleged that her personally identifiable and health information was compromised in a ransomware attack that affected over half a million patients. She received a notice letter from the hospital confirming the breach but stating that, although files were accessed and encrypted, there was no indication that patient information had been used by unauthorized persons. Subsequently, she filed a putative class action in federal court, claiming that the breach resulted from the hospital’s failure to properly safeguard patient data. She asserted that this failure exposed her and others to risks such as identity theft, required them to spend time and incur expenses mitigating potential harm, and diminished the value of their information.The United States District Court for the District of Puerto Rico, after several rounds of amended complaints and motions, dismissed the claims for lack of Article III standing. The district court found that the plaintiff’s complaint did not plausibly allege that her alleged injury—such as the discovery of a fraudulent cellphone account opened in her name—was traceable to the hospital’s data breach. Attempts to add further allegations or conduct jurisdictional discovery were denied as futile.On appeal, the United States Court of Appeals for the First Circuit reviewed whether the plaintiff had adequately pleaded both an injury in fact and traceability for standing. The court held that, while the complaint sufficiently alleged an injury in fact by describing actual misuse of her information, it failed to plausibly connect that harm to the hospital’s data breach. The court found no specific facts to support a temporal or factual link between the breach and the fraudulent activity. As a result, the First Circuit affirmed the dismissal of all claims for lack of standing. View "Santos-Pagan v. Bayamon Medical Center" on Justia Law

After being involuntarily detained for 72 hours under California Welfare and Institutions Code section 5150 due to a diagnosis of bipolar disorder and concerns about his safety, Anthony Sgaraglino was discharged from the psychiatric unit at Ventura County Medical Center. The attending physician determined that Anthony did not meet the criteria for an extended hold under section 5250. Despite his family’s warnings that he was suicidal and their efforts to continue his commitment, Anthony was released without medication. He died by suicide the following day.Anthony’s parents, Franklin and Linda Sgaraglino, filed a wrongful death lawsuit against the County of Ventura in the Superior Court of Ventura County, alleging general negligence based on the hospital’s decision to discharge Anthony without medication and despite warning signs. The County moved for summary judgment, arguing it was immune from liability under Welfare and Institutions Code section 5113. The trial court agreed, granting summary judgment in favor of the County. The court found that section 5113 provided immunity for decisions related to the release of psychiatric patients, and rejected the argument that the immunity did not extend to claims of gross negligence. The court also deemed the facts in the County’s separate statement as undisputed because the plaintiffs failed to file a responsive statement.The California Court of Appeal, Second Appellate District, Division Six, reviewed the case. It affirmed the trial court’s decision, holding that section 5113 immunizes psychiatric treatment facilities and their operators from both civil and criminal liability for actions taken by a person released at or before the end of an involuntary commitment period. The Court also held that this immunity applies even where claims are framed as gross negligence and that new theories of liability not raised below could not be considered on appeal. Judgment was affirmed. View "Sgaraglino v. County of Ventura" on Justia Law

A physician who owned and operated a hospice company in Louisiana was convicted by a jury of twenty-three counts of health care fraud. The company, under his direction, systematically billed Medicare at higher reimbursement rates than were warranted, particularly by utilizing the General Inpatient Care (GIP) rate for patients who did not qualify, and by billing for additional services already included in hospice per diem rates. Despite being notified by Medicare auditors multiple times that the company’s billing was improper and lacked sufficient documentation, the physician failed to disclose these findings to his staff or to change the company’s billing practices. The fraudulent activity resulted in the company billing Medicare for more than $84 million and receiving over $42 million in payments.Earlier, the United States District Court for the Eastern District of Louisiana presided over the trial. The defendant attempted to introduce an expert witness on Medicare billing and coding, but the court only permitted the witness to testify regarding clinical decision-making, not billing practices, due to insufficient qualifications. After the jury found the defendant guilty on all counts, the district court sentenced him to 240 months in prison—an upward variance from the Sentencing Guidelines—and ordered restitution. The court justified the increased sentence based on the defendant’s lack of remorse, repeated violations of court orders, and the need to deter similar conduct.On appeal, the United States Court of Appeals for the Fifth Circuit reviewed whether the district court erred in excluding expert testimony, whether the evidence was sufficient to support the convictions, and whether the sentence was unconstitutionally excessive or substantively unreasonable. The Fifth Circuit held that any error in excluding the expert testimony was harmless, found the evidence sufficient to support the convictions, and concluded that the sentence was neither grossly disproportionate nor substantively unreasonable. The court affirmed the judgment of the district court. View "USA v. Akula" on Justia Law

Four individuals who were Medicaid beneficiaries in Illinois were admitted to long-term care facilities between 2018 and 2023. The facilities submitted required electronic admission packets to the Illinois Department of Healthcare and Family Services so that the cost of care could be reimbursed by Medicaid. In each case, the Department either rejected or mishandled these admission packets, resulting in the facilities not being reimbursed for all or part of the care provided. Despite regulations prohibiting providers from billing Medicaid beneficiaries for unreimbursed care, the facilities sent bills to the plaintiffs. The plaintiffs, however, did not pay these bills, nor did they suffer any loss of benefits or interruption in care.The plaintiffs filed a proposed class action in the United States District Court for the Northern District of Illinois against state officials responsible for Medicaid administration. They alleged violations of due process and the Medicaid Act, and requested only injunctive relief to require systemic changes in the admission packet review process. The defendants moved to dismiss, arguing both lack of standing and failure to state a claim. The district court found that the plaintiffs had standing because they received bills, but it dismissed the case for failure to state a claim, reasoning that the plaintiffs were not denied benefits or services and no statutory or constitutional rights were violated.On appeal, the United States Court of Appeals for the Seventh Circuit reviewed only standing. The appellate court held that the plaintiffs lacked standing for injunctive relief because they did not allege a real and immediate threat of repeated injury. The prior receipt of bills did not amount to legal harm, as the plaintiffs had no obligation to pay. The court modified the district court’s judgment to reflect a jurisdictional dismissal for lack of standing and affirmed the judgment as modified. View "Arcidiacono v Whitehorn" on Justia Law

After two employees and a former resident at a Medicare-participating nursing home in Maryland were diagnosed with active tuberculosis in 2015, county health officials determined that the facility was at high risk for transmission. The officials directed the facility’s staff to take responsibility for testing and follow-up for residents. The facility carried out skin tests and chest x-rays, identifying several residents with latent tuberculosis, but did not proceed to evaluate or treat those residents for latent TB, nor did it document reasons for not treating them. Over a year later, a state health agency investigated and concluded that the facility failed to ensure proper follow-up and documentation, violating federal infection control regulations. The Department of Health and Human Services (HHS) agreed, found that the noncompliance created “immediate jeopardy,” and imposed a per-day civil monetary penalty.The facility challenged the findings and penalty before an administrative law judge, who rejected its arguments and upheld both the finding of noncompliance and the penalty. The Departmental Appeals Board affirmed the administrative law judge’s decision.On review, the United States Court of Appeals for the Fourth Circuit considered whether the Seventh Amendment entitled the facility to a jury trial in HHS’s administrative proceedings for monetary penalties. The court held that there is no Seventh Amendment right to a jury trial in this context because the enforcement action at issue involves “public rights,” not common law claims. The court reasoned that Congress created novel statutory obligations for Medicare-participating facilities, not merely reclassified common law causes of action, and that these obligations are enforced through an administrative scheme distinct from common law torts or contract actions. The court also found that HHS’s actions were neither arbitrary nor capricious and that its decision was supported by substantial evidence. The petition for review was denied. View "Sligo Creek Center v. Health and Human Services" on Justia Law

A nurse formerly employed at a West Virginia hospital system brought a qui tam action on behalf of the United States under the False Claims Act. She alleged that the hospital system, its affiliated entities, and a former executive submitted claims to the federal government that were prohibited by the Stark Law and the Anti-Kickback Statute. Specifically, she claimed that the defendants’ compensation and financial arrangements with physicians created unlawful incentives for referrals, resulting in the submission of false claims to Medicare between 2013 and 2022. The complaint included detailed tables of claims and described physician compensation structures, as well as financial transfers between entities within the health system.The United States District Court for the Southern District of West Virginia reviewed the case after the government declined to intervene. The court dismissed the amended complaint for failure to plead fraud with the particularity required by Rule 9(b) of the Federal Rules of Civil Procedure. The district court found that the complaint did not sufficiently allege the necessary elements of a False Claims Act violation, including a plausible connection between physician compensation and prohibited referrals, or that any claims submitted were actually false under the Stark Law or the Anti-Kickback Statute. The district court also denied the plaintiff’s post-judgment motions to vacate the judgment and for leave to amend the complaint, finding that additional amendment would prejudice the defendants after years of litigation and access to substantial discovery.On appeal, the United States Court of Appeals for the Fourth Circuit affirmed the district court’s dismissal and denial of leave to amend. The Fourth Circuit held that the complaint did not plead fraud with the required particularity, failed to plausibly allege violations of the Stark Law or the Anti-Kickback Statute, and did not present facts sufficient to support claims of conspiracy or reverse false claims. The court found no abuse of discretion in denying post-judgment relief. View "United States ex rel. Kyer v. Thomas Health System, Inc." on Justia Law

After being involved in a rear-end collision, the defendant was arrested for felony driving under the influence in Idaho. Officers observed signs of impairment, but a breathalyzer test showed no alcohol. The defendant admitted to using anti-depressant medication. Subsequent blood tests revealed the presence of prescription drugs used for mental health treatment. As part of the investigation, the State obtained various records related to the defendant’s prescriptions and medical treatment from the Idaho Prescription Monitoring Program (PMP), Star Pharmacy, and Ada County Jail.Initially, the defendant moved to suppress evidence obtained from his arrest, arguing a lack of probable cause, and the Idaho Court of Appeals agreed, resulting in the suppression of certain statements and blood test results. On remand in the District Court for the Fourth Judicial District, the State sought the defendant’s medical and prescription records. Over the defendant’s objection, the court allowed the State to obtain these records. Before trial, the defendant filed a motion in limine to exclude the records, claiming they were protected by Idaho’s psychotherapist-patient privilege (Idaho Rule of Evidence 503). The district court granted the motion, finding the records were privileged and that the defendant had not waived this privilege by his statements to police.The Supreme Court of the State of Idaho reviewed whether the PMP, Star Pharmacy, and Ada County Jail records were privileged under Rule 503. The Court held that the PMP and Star Pharmacy records did not constitute “confidential communications” as defined by the rule, and that the defendant failed to prove the Ada County Jail medical questionnaire met the requirements for privilege. The Court reversed the district court’s order granting the defendant’s motion in limine and remanded for further proceedings. The Court affirmed only the part of the order concerning other jail records not challenged on appeal. View "State v. Borek" on Justia Law