United States ex rel. Montcrieff v. Peripheral Vascular Assocs., P.A.

• Citation: 507 F.Supp.3d 734
• Decision Date: 14 December 2020
• Docket Number: SA-17-CV-00317-XR
• Parties: UNITED STATES of America, EX REL.; Tiffany MONTCRIEFF, Relator; Roberta A. Martinez, Relator; and Alicia Burnett, Relator, Plaintiffs v. PERIPHERAL VASCULAR ASSOCIATES, P.A., Defendant
• Court: U.S. District Court — Western District of Texas

507 F.Supp.3d 734

UNITED STATES of America, EX REL.; Tiffany MONTCRIEFF, Relator; Roberta A. Martinez, Relator; and Alicia Burnett, Relator, Plaintiffs

v.PERIPHERAL VASCULAR ASSOCIATES, P.A., Defendant

SA-17-CV-00317-XR

United States District Court, W.D. Texas, San Antonio Division.

Signed December 14, 2020

John Deck, US Attorney's Office - WDTX, San Antonio, TX, Thomas Arthur Parnham, Jr., United States Attorney's Office, Austin, TX, for Plaintiff United States of America.

Adam M. Shapiro, Pro Hac Vice, Justin T. Berger, Sarvenaz J. Fahimi, Pro Hac Vice, Cotchett Pitre & McCarthy LLP, Burlingame, CA, Wallace M. Brylak, Jr., Brylak & Associates, San Antonio, TX, for Plaintiffs Tiffany Montcrieff, Roberta A. Martinez, Alicia Burnett.

Jeff J. Wurzburg, Stephen J. Romero, Norton Rose Fulbright US LLP, San Antonio, TX, Mark A. Cole, Pro Hac Vice, Spencer Fane LLP, Overland Park, KS, Sean R. McKenna, Spencer Fane LLP, Dallas, TX, for Defendant.

ORDER

XAVIER RODRIGUEZ, UNITED STATES DISTRICT JUDGE

On this day the Court considered six pretrial motions: Plaintiffs' motion to exclude certain opinions of a defense expert (ECF No. 80), three Defense motions to exclude the testimony of Plaintiffs' witnesses (ECF Nos. 82, 83, and 86), and cross motions for summary judgment (ECF Nos. 94 and 95). After careful consideration, the Court issues the following order.

BACKGROUND

This False Claims Act case arises out of the alleged fraudulent billing practices of Defendant Peripheral Vascular Associates, P.A. ("PVA"). The Plaintiffs ("Relators") allege that PVA, a healthcare provider, falsely billed Medicare for services it did not perform, either in whole or in part. Relators assert that PVA submitted tens of thousands of false bills, exposing PVA to millions of dollars in liability.

PVA is a full-service vascular surgery practice with multiple locations throughout San Antonio, Texas. ECF No. 94 ¶¶ 1–2.¹

PVA performs vascular ultrasounds, among other things. Vascular ultrasounds may be ordered by a PVA physician or an outside referring physician. Id. ¶ 2. Vascular studies have two components relevant to this case: a technical component and a professional component. Id. ¶ 3. In essence, the technical component is performing the ultrasound and the professional component is a physician analyzing the results of ultrasound. Id. When PVA performs one or both of these components, it submits a bill for reimbursement of the cost of the procedure to the appropriate payor—Medicare, an insurance company, or an uninsured patient. For the purposes of this order, only the method by which PVA bills Medicare and other federal payors is relevant.

Starting in the 1960s, shortly after Congress created Medicare, the need for a uniform system of medical billing became apparent. In response to this growing need, the American Medical Association ("AMA"), with industry input, developed the first version of the Current Procedural Terminology ("CPT") Codes. William T. Thorwarth Jr., M.D., CPT: An Open System That Describes All That You Do , 5 J. Am. Coll. Radiol. 535, 555–560 (2008), https://www.jacr.org/article/S1546-1440(07)00612-6/fulltext. The CPT Codes are a series of alphanumeric sequences used by healthcare providers to describe the procedures and services that they perform. These Codes are incredibly specific. For example, CPT Code 90832 describes an individual psychotherapy session that lasts 30 minutes. However, CPT Code 90834 describes an individual psychotherapy session that lasts 45 minutes. Yet another Code describes a session that lasts 60 minutes. These Codes are necessarily specific because health insurance companies reimburse a healthcare provider at a predetermined rate for each code.

In 1996, Congress passed the Health Insurance Portability and Accountability Act, which required the U.S. Department of Health and Human Services ("HHS") to adopt uniform standards of coding for electronic transactions involving healthcare information. Id. HHS adopted as one of the standards of coding the AMA's CPT Codes, which had undergone significant revision and updating. Id. In 2002, the CPT Codes formally became one of the methods by which healthcare providers must bill Medicare for medical services:

The Secretary adopts the following maintaining organization's code sets as the standard medical data code sets ... (a)(5) The combination of Health Care Financing Administration Common Procedure Coding System (HCPCS), as maintained and distributed by HHS, and Current Procedural Terminology, Fourth Edition (CPT–4), as maintained and distributed by the American Medical Association, for physician services and other health care services.

45 C.F.R. § 162.1002(a)(5). The CPT-4 continues to be a valid method of billing medical services to Medicare for reimbursement. Id. § 162.1002(c).

PVA and other healthcare providers submit bills to Medicare using an electronic version of the CMS-1500 form. ECF No. 95 ¶ 1. PVA lists a particular CPT Code on that form in order to inform Medicare that it has performed a particular procedure or service. Id. ¶ 3. When submitting the CMS-1500 form, a healthcare provider certifies that the claim for reimbursement is "true, accurate and complete," "complies with all applicable Medicare and/or Medicaid laws, regulations, and program instructions for payment," and that the "services on this form were medically necessary and personally furnished by me." Id. ¶ 2.

The technical and professional components of a vascular study can be billed separately or jointly. ECF No. 94 ¶ 3. Which provider bills a particular component of a vascular study depends on who performs the study. PVA physicians read and interpret studies performed at PVA offices and at hospitals. Id. ¶ 6. When a hospital performs the technical component of a study, the hospital bills for that component. Id. ¶ 5. When a PVA physician or registered vascular technologist performs the technical component, PVA bills for that component. Id. ¶ 6–7. PVA performs some vascular studies without a PVA physician seeing or treating the patient. Id. ¶ 15. These "Testing Only" studies occur when PVA performs the technical component of a vascular study for a different treating provider. Id. The technical component of a vascular study can be billed immediately after it is performed. Id. ¶ 8.

Once the technical component of a vascular study is complete, the professional component—a physician interpretation of a vascular study—can occur. A physician can interpret a vascular study in a number of ways: the physician can observe the ultrasound as it is performed; the physician can review printouts of the studies with the patient; and technologists can provide the physician with completed worksheets and preliminary reports depicting the results of the study. Id. ¶ 13.

A healthcare provider can bill Medicare for both the technical and professional components of a vascular study using a "global" CPT Code. ECF No. 95 Ex. 4. at 84. This is a standard five-digit code indicating that each component was performed. When a provider bills for just one component, it must use a two-character "modifier" that signifies that only one component has been performed. Id. at 181. As relevant here, a provider can append the "-TC" modifier when billing just the technical component, or the provider can use the "-26" modifier to bill for just the professional component. ECF No. 81 Ex. A at 8. Other than for a brief period in 2017, PVA billed Medicare for all vascular studies performed in its vascular laboratories using the "global" CPT Code without a modifier. ECF No. 95 ¶¶ 4–5.

PVA uses a program called Allscripts Clinical Module ("Allscripts CM") as its electronic medical records system and a program called Allscripts Practice Management ("APM") as its billing software. Id. ¶¶ 17, 22. A patient's medical record is contained in Allscripts CM. Id. ¶ 17. Any documentation of interpretations of a vascular study are contained in the patient's medical record. Id. ¶ 18. When a service or procedure is provided to a patient, PVA records the encounter in Allscripts CM. Id. ¶ 22. After the encounter is recorded, an interface software called ChargePass records it in APM, and a voucher is created for processing by PVA's coding and billing staff. Id. Two coders review a claim before submitting a bill to the payor. Id. ¶ 23.

In 2014, PVA adopted an archiving and communications system called MedStreaming. Id. ¶¶ 10–11. The purpose of this system was to help PVA physicians manage workflow and to create a reporting system that was easier for healthcare providers and patients to understand. Id. Every vascular study that PVA performs has a MedStreaming report. Id. ¶ 12. PVA's practices regarding its use of MedStreaming play a central role in this litigation.

Relators filed their initial Complaint under seal in April 2017. ECF No. 1. They filed their First Amended Complaint, also under seal, in December 2017. ECF No. 8.

The Relators brought this action under the authority granted by 31 U.S.C. § 3730(b), which authorizes private persons to sue for violations of the False Claims Act ("FCA"), 31 U.S.C. §§ 3729 et seq , on behalf of the United States Government. They allege that PVA submitted false claims to Medicare by 1) billing for services before they were complete; and 2) billing for services that were not ordered by a physician. ECF No. 8 ¶¶ 1–3.

Relators assert that in an appropriate case, PVA follows particular steps to perform and bill Medicare for ultrasound studies: When a patient is referred to PVA, the patient is designated as "scheduled" in MedStreaming. Id. ¶ 28. The patient has an initial appointment with a PVA physician, and the physician orders necessary tests. Id. A PVA sonographer performs the tests, the images are captured in MedStreaming, and the patient's status is updated to "acquired." Id. When the sonographer begins a preliminary report, the sonographer changes the status to "Ready." Id. When the sonographer completes the preliminary...