United States ex rel. Class v. Bayada Home Health Care, Inc., CIVIL ACTION No. 16-680
| Decision Date | 24 September 2018 |
| Docket Number | CIVIL ACTION No. 16-680 |
| Parties | UNITED STATES OF AMERICA ex rel. SUSAN CLASS, et al., Plaintiffs-Relators, v. BAYADA HOME HEALTH CARE, INC., Defendant. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
MEMORANDUM OPINION
This is a qui tam action brought by Relators, Susan Class, Kendra Banta, and Susan Davis ("Relators"), against Defendant, Bayada Home Health Care ("Bayada"), under the False Claims Act ("the FCA"). Relators allege that Bayada falsely billed Medicare for home health services provided to patients that it knew were not "homebound" in violation of 31 U.S.C. § 3729(a)(1)(A), submitted false statements in support of such bills in violation of 31 U.S.C. § 3729(a)(1)(B), and retained payments for such false claims in violation of 31 U.S.C. § 3729(a)(1)(G).
Bayada has moved to dismiss all claims pursuant to Federal Rule of Civil Procedure 12(b)(1), urging that Relators do not have standing to pursue their claims because they signed enforceable "Separation Agreements" when they left their employment with Bayada, which released Bayada from "any and all claims." In the alternative, Bayada asks that I dismiss all claims pursuant to Federal Rules of Civil Procedure 12(b)(6) and 9(b), contending that the Amended Complaint fails to meet the threshold pleading requirements.
For the reasons discussed below, I will deny Bayada's Motion to Dismiss.
Relators' Amended Complaint sets forth the following pertinent facts:1
Defendant is a provider of in-home healthcare to approximately 22,000 patients in 25 states. Such services can be eligible for Medicare coverage. To qualify for home healthcare reimbursement under Medicare, a patient must (1) be "homebound;" (2) require part-time skilled nursing services or speech therapy, physical therapy, or continuing occupational therapy as determined by a physician; and (3) be under a plan of care established and periodically reviewed by a physician and administered by a qualified home health agency ("HHA"). (Am. Compl. ¶9.) To be "homebound," a patient "is generally confined to her home and can leave only by dent of considerable effort." (Id.) After a physician refers a patient for homebound services, an HHA does an initial assessment using a diagnostic instrument referred to as "OASIS." (Id. ¶¶ 3, 12-14.)
When a patient qualifies for homebound services, Medicare will pay for part-time skilled nursing care, physical, occupational, and speech therapy, counseling, part-time home health aide services, and medical equipment and supplies. Medicare pays for home healthcare in 60-day pay "episodes" through a Prospective Payment System ("PPS"). Throughout a patient's 60-day episode, the HHA is required to document their condition, services performed, and continued need for skilled care. For a patient to continue receiving home healthcare for another 60-day episode, HHA must reassess the patient and that patient must be re-certified by a physician as requiring and qualifying for home healthcare. A universal requirement of the Medicare program is that all services provided must be reasonable and medically necessary, and Medicare providersmay not bill the Government for medically unnecessary services or procedures performed only to generate profit for the provider. (Id. ¶¶ 10-11, 17-18, 20.)
Relators are former Bayada employees. Relator Class worked as a registered nurse ("RN") and case manager for Bayada from 2012 through 2015. Relator Davis worked as a client services manager for Bayada from 2005 through December of 2014. Relator Banta worked as an RN for Bayada from June of 2009 through December of 2014. Relators allege that Bayada (1) "knowingly admitted, re-certified, and billed the United States for home healthcare provided to patients it knew were not homebound;" (2) "knowingly made, used, or caused to be made or used, a false record or statement material to its obligation to re-pay or transmit money to the United States for such non-homebound patients;" and (3) "knowingly concealed or knowingly and improperly avoided or decreased its obligations to re-pay or transmit money to the United States for such non-homebound patients." (Id. ¶¶ 3-6.)
Relators allege that it was "well known among staff that certain patients were obviously not homebound, but were kept on service regardless." Relator Davis claims that she is familiar with "numerous patients" who either refused home health services or contacted Bayada's offices to request they be removed from home health services because they no longer required such care. Relator Davis was allegedly instructed by Bayada administrators Richard York and Karen Rizzo to schedule follow-up phone calls with these patients. Relators claim these calls were "designed to persuade the patients to acquiesce to admission or re-admission." Relators also allege that Jason Wedman, a Bayada physical therapist, "frequently kept patients on unnecessarily and for long periods," and that Relator Davis "often" received phone calls from patients of Wedman who believed they did not need further therapy and requested to be taken off service but Wedman "talked them into" remaining on service. (Id. at ¶¶ 25, 29.)
Relators provide information about three patients they claim were billed to the Government using false records that contained false assessment data, or who were admitted and billed by Bayada despite non-qualification for home health services. They first allege that patient C.P. was certified as homebound and in need of skilled nursing in November of 2014. Caregivers were scheduled to visit C.P. twice a week for wound care. Relators allege that C.P. did not have a wound that required care, was not homebound, and "frequently" could not be reached at home by telephone because she was not there. Relator Banata pre-scheduled times for her visits to C.P. because C.P. was "frequently" away from her home, and on one visit, C.P. told Relator Banata that she would not be home for the next visit because she had a "big birthday party" to attend. Despite reports of "such excursions" to Bayada, Relator Banta was instructed to continue providing home health services to C.P. According to Relators, Bayada continued to bill the Government for unnecessary care for C.P. until approximately January of 2015 despite its "express knowledge" that C.P. was not homebound. (Id. at ¶ 26.)
Next, Relators allege that Relator Banta was the assigned RN for patient M.C. who was originally admitted for wound care and subsequently was hospitalized for symptoms related to congestive heart failure. When M.C. returned home from the hospital, Relator Banta found that her wound had healed and her congestive heart failure was well-managed. Relator Banta also found that M.C. was not homebound because she was frequently leaving home for reasons unrelated to her medical treatment. Relators allege that, despite this, Manager Sara Gates instructed Relator Banta not to discharge M.C. because "it would result in a partial episode and cost Bayada money." Relators allege that Bayada instead charged the Government for Relator Davis to educate M.C. about management of her congestive heart failure, even though M.C. was an RN herself and was familiar with congestive heart failure and its management. According toRelators, M.C.'s condition was well-managed and did not require skilled nursing care. M.C. was eventually discharged when she left town for a holiday trip, yet Bayada retained all payments received from Medicare for Patient M.C.'s purported education even after they learned she was frequently leaving home and had planned a holiday trip out of town. (Id.)
Finally, Relators allege that patient V.A. was certified as homebound and visited by Bayada every three weeks for the purpose of having her catheter changed by nurse Laura Weinstein. V.A. was living in a facility at the time that Bayada billed for her care, and the facility provided weekly transportation to a casino. Relators allege that Bayada staff knew that V.A. participated in these trips and enjoyed them during the time she was certified as homebound and her services were being billed to the Government. Relators allege Bayada knew from these casino visits that V.A. was not homebound and that discovery of these visits by the Government would result in the Government learning of Bayada's false certification. Rather than reporting these excursions or reimbursing Medicare, Bayada staff instead attempted to cover up the trips and retain the payments. Relators allege that Bayada warned the staff at the facility in which V.A. resided to refuse to permit V.A. to continue her casino trips in order to make it appear she was homebound, although she was not. Bayada allegedly threatened to cease sending Nurse Weinstein to help the facility with catheter changes if the facility staff did not stop V.A. from going on the casino trips. As such, V.A. was denied her weekly casino trips and confined to the facility so that Bayada could retain its false payments from Medicare and continue to submit further false claims to Medicare. (Id.)
Relators contend that Bayada knowingly billed Medicare for these three patients whom they knew or should have known were not homebound, and retained payments and concealed orknowingly and improperly avoided its obligations to reimburse the United States for these patients. (Id. at ¶ 27.)
Relators filed their original Complaint under seal on February 11, 2016. After numerous extensions, the Government declined to intervene. Relators filed their Amended Complaint on July 6, 2017, bringing the following FCA claims: violation of 31 U.S.C. § 3729(a)(1)(A) ("Count I"), 31 U.S.C. § 3729(a)(1)(B) ("Count II'), and 31 U.S.C. § 3729(a)(1)(G) ("Count III").
Bayada first moves to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction. Bayada's motion is a factual attack on jurisdiction. Unlike a facial challenge that concerns a...
To continue reading
Request your trial