United States ex rel. Johnson v. Golden Gate Nat'l Senior Care, L.L.C.

• Citation: 223 F.Supp.3d 882
• Decision Date: 09 December 2016
• Docket Number: Civil No. 08–1194 (DWF/HB)
• Parties: UNITED STATES of America, EX REL. Ricia JOHNSON and Health Dimensions Rehabilitation, Inc., Plaintiffs, v. GOLDEN GATE NATIONAL SENIOR CARE, L.L.C.; GGNSC Holdings, L.L.C; and GGNSC Wayzata, L.L.C.; all doing business as Golden LivingCenter—Hillcrest of Wayzata ; and Aegis Therapies, Inc., Defendants.
• Court: U.S. District Court — District of Minnesota

223 F.Supp.3d 882

UNITED STATES of America, EX REL. Ricia JOHNSON and Health Dimensions Rehabilitation, Inc., Plaintiffs,

v.GOLDEN GATE NATIONAL SENIOR CARE, L.L.C.; GGNSC Holdings, L.L.C; and GGNSC Wayzata, L.L.C.; all doing business as Golden LivingCenter—Hillcrest of Wayzata ; and Aegis Therapies, Inc., Defendants.

Civil No. 08–1194 (DWF/HB)

United States District Court, D. Minnesota.

Signed December 9, 2016

Jonathan M. Bye, Esq., and Kelly G. Laudon, Esq., Lindquist & Vennum LLP, counsel for Plaintiffs Ricia Johnson and Health Dimensions Rehabilitation, Inc.

Amy Slusser Conners, Esq., and Thomas Backer Heffelfinger, Esq., Best & Flanagan LLP; Annisah Um'rani, Esq., and Robert Salcido, Esq., Akin Gump Strauss Hauer & Feld LLP; and Kevin D. Hofman, Esq., and Ryan J. Burt, Esq., Peterson Habicht, PA; counsel for Defendants.

Chad A. Blumenfield, D. Gerald Wilhelm, and Pamela Marentette, Assistant United States Attorneys, United States Attorney's Office, counsel for United States of America.

MEMORANDUM OPINION AND ORDER

DONOVAN W. FRANK, United States District Judge

INTRODUCTION

Relators Ricia Johnson and Health Dimensions Rehabilitation, Inc. ("HDR") (together, "Relators") initiated this qui tam action, on behalf of the United States of America (the "Government"), against Defendants Golden Gate National Senior Care, L.L.C.; GGNSC Holdings, L.L.C; and GGNSC Wayzata, L.L.C. (together, "Golden"); and Defendant Aegis Therapies, Inc. ("Aegis") (all together, "Defendants"). Relators allege that Defendants violated the False Claims Act, 31 U.S.C. §§ 3729 –3733 ("FCA"), by submitting false Medicare claims in connection with Defendants' provision of physical and occupational therapy services to nursing home patients.

The matter is currently before the Court on: (1) Defendants' motion for summary judgment (Doc. Nos. 237, 257); (2) Defendants' motion to exclude the expert testimony of Elisa Bovee and Mark Essling (Doc. No. 260); (3) Relators' motion to exclude the expert testimony of Steven Pelovitz (Doc. No. 239); and (4) Relators' motion to exclude the expert testimony of Sheila Lambowitz (Doc. No. 242). For the reasons discussed below, the Court grants in part and denies in part the motion for summary judgment, the motion to exclude the testimony of Bovee and Essling, and the motion to exclude the testimony of Pelovitz. The Court denies the motion to exclude Lambowitz's testimony.

BACKGROUND

I. General Factual Background

From October 2004 through approximately May 2007, Relator Johnson, an occupational therapy assistant, was employed by Defendant Aegis, a contract provider of physical and occupational therapy services to nursing homes. (Doc. No. 284 ("Johnson Decl.") ¶ 2; Doc. No. 250 ("Um'rani Decl."), ¶ 45, Ex. 45 ("Ribar Dep.") at 9:19–10:6.) During that time, Johnson worked at Golden LivingCenter—Hillcrest of Wayzata ("Hillcrest"), a nursing home operated by Defendant Golden, which operates multiple nursing homes across the country. (Johnson Decl. ¶ 2; Ribar Dep. 10:21–23; Doc. No. 285 ("Essling Decl.") ¶ 17, Ex. 4.) After Johnson left Aegis, she was employed by Relator HDR, also a provider of physical and occupational therapy. (Essling Decl. ¶¶ 3–4, 15; Um'rani Decl. ¶ 3, Ex. 3 ("Johnson Dep.") at 48:1–6, 143:3–6.)

From December 2005 through March 2007, Aegis assigned Johnson to Hillcrest's Wellness Center. (Johnson Decl. ¶ 2.) The Wellness Center, also known as the Nautilus Room, was a small exercise room with one or two stationary bicycles and five pieces of Nautilus strength-training equipment. (Id. ; Johnson Dep. 48:7–49:8.) Typically, one occupational therapy assistant and one physical therapy assistant staffed the Wellness Center, although sometimes only one therapy assistant was present. (Johnson Dep. 82:23–87:11, 92:3–8; Um'rani Decl. ¶ 6, Ex. 6 ("Hodgin Dep.") at 59:4–61:1; id. ¶ 9, Ex. 9 ("Weiche Dep.") at 27:8–14.) Often, each therapy assistant simultaneously supervised multiple patients who were completing a circuit of two or four exercises. (Johnson Dep. 83:2–84:25; Hodgin Dep. 47:19–48:9.) When two therapy assistants were working in the Wellness Center, they often worked as a team, with either therapy assistant guiding an individual patient at any given time. (Johnson Dep. 83:2–84:25; Hodgin Dep. 52:6–19.)

Staff in the Wellness Center used single-page forms, called Nautilus Logs or flow sheets, to record patients' activities in the Wellness Center. (Weiche Dep. 40:14–42:6; Hodgin Dep. 32:24–35:21.) Each Nautilus Log contained short blanks for the patient's name, the name of the therapist initiating the program of therapy, and a brief diagnosis. (Doc. No. 283 ("Laudon Decl.") ¶ 8, Ex. 3.) In addition, each Nautilus Log included a space for staff to circle the applicable discipline or disciplines: occupational therapy, physical therapy, or speech-language pathology. (Id. ) And, each Nautilus Log contained a chart where staff could indicate the date a patient received therapy, the therapy assistant who provided the therapy, and the equipment, resistance level, and repetitions used. (Id. ) The Nautilus Logs were stored in the Wellness Center; they were not maintained as part of patients' medical records. (Hodgin Dep. 35:22–36:24; Johnson Decl. ¶ 3) In fact, while medical records included Plans of Care for occupational therapy and physical therapy, they typically did not contain any express reference to the Wellness Center or to the Nautilus equipment located in the Wellness Center. (Essling Decl. ¶¶ 20–22, Ex. 6.)

In addition to the Wellness Center, Hillcrest's facilities included an occupational therapy gym and a physical therapy gym. (Weiche Dep. 29:11–23.) All therapists and therapy assistants at Hillcrest, those who staffed the gyms and those who staffed the Wellness Center, attended weekly meetings during which patients were discussed. (Johnson Dep. 37:9–38:21; Hodgin Dep. 80:4–83:25.) For Medicare billing purposes, all therapists and therapy assistants used a computerized billing system to record the minutes of therapy that they provided each day. (Weiche Dep. 38:7–40:8.) Each therapist and therapy assistant logged into the computer system using a unique username and password. (Id. ) The computerized billing system did not permit occupational therapists and occupational therapy assistants to record minutes of physical therapy, and it did not permit physical therapists and physical therapy assistants to record minutes of occupational therapy. (Um'rani Decl. ¶ 10, Ex. 10 ("Gobel Dep.") at 80:24–82:22.)

II. General Regulatory Background

Medicare is a federal health insurance program administered by the Centers for Medicare & Medicaid Services ("CMS"), a division of the U.S. Department of Health and Human Services ("HHS"). This case involves two parts of Medicare: Part A and Part B, which provides supplemental insurance coverage for certain services excluded from Part A. See 42 U.S.C. §§ 1395c through 1395i–5 (Part A); id. §§ 1395j through 1395w–6 (Part B). The parties agree that Part A and Part B cover nursing home stays only when the nursing home provides "skilled services" such as occupational and physical therapy. See 42 U.S.C. § 1395f(a)(2)(B) ; 42 C.F.R. §§ 409.31, 410.59, 410.60.

A nursing home licensed to provide skilled services, such as Hillcrest, is a "skilled nursing facility" or "SNF." See 42 U.S.C. § 1395i–3. During the time period at issue, 42 C.F.R. § 483.75(b) required SNFs to "operate and provide services in compliance with all applicable Federal, State, and local laws, regulations, and codes, and with accepted professional standards and principles that apply to professionals providing services in such a facility." 42 C.F.R. § 483.75(b) (effective to Sept. 30, 2009),¹ see also 42 U.S.C. § 1395i–3(d)(4)(A). Further, during the time period at issue, 42 C.F.R. § 483.75(l )(1) required SNFs to maintain adequate medical records: "The facility must maintain clinical records on each resident in accordance with accepted professional standards and practices that are—(i) Complete; (ii) Accurately documented; (iii) Readily accessible; and (iv) Systematically organized." 42 C.F.R. § 483.75(l )(1) (effective to Sept. 30, 2009).²

Part A and Part B use different billing and payment systems. Part A uses a Prospective Payment System ("PPS"), under which CMS determines a per diem reimbursement amount for each patient by considering a number of factors, including the number of minutes of skilled services needed by the patient. (See Doc. No. 287 ("Bovee Decl.") ¶ 3, Ex. A ("Bovee Rep.") at 10–11.) For each patient, SNFs submit an assessment called the "Minimum Data Set" or "MDS" that, among other things, requires SNFs to describe the medical condition and service needs of the patient, including the days and minutes of occupational and physical therapy administered to the patient. (See id. at 11–17.) Part B, in contrast to Part A, reimburses SNFs based on a fee schedule tied to the minutes of service provided to a patient. (See id. at 9–10.)

Finally, under both Part A and Part B, two types of auditing occur: (1) Claims Review; and (2) Survey and Certification. In Claims Review, CMS contractors review, process, and pay claims submitted by SNFs to CMS. (See id. at 17–19.) In Survey and Certification, state survey teams conduct on-site surveys of SNFs to ensure they are complying with applicable Medicare standards. (See Um'rani Decl. ¶ 38, Ex. 38 ("Pelovitz Rep.") ¶¶ 3–20.) Survey and Certification is separate and distinct from Claims Review. (See Doc. No. 245 at ¶ 5, Ex. B ("Pelovitz Dep.") at 20:8–25:11.)

III. Procedural Posture

On May 1, 2008, Relators filed their Complaint in this action. (Doc. No. 1.) On June 27, 2011, the Government declined to intervene (Doc. No. 31), and on June 28, 2011, the Court ordered the Complaint unsealed and served on Defendants (Doc. No. 32). On February 13, 2012, the Court denied Defendants' motion to dismiss the Complaint. (Doc. No. 54). On February 23, 2012, the Court ordered two-stage...