UCSF Medical Center defeats whistleblower testimony describing billing fraud

"UCSF Likely To Beat Billing Claims In Whistleblower Suit"
2013-09-27 by Beth Winegarner from "Law360" [http://www.law360.com/articles/476484/ucsf-likely-to-beat-billing-claims-in-whistleblower-suit]:
San Francisco -- A California federal court judge indicated Friday that he is likely to throw out a UCSF Medical Center doctor's whistleblower claims that his colleagues illegally billed Medicare and other insurers, but said he would likely uphold claims that the doctor was passed over for promotion for reporting the alleged fraud.
U.S. District Court Magistrate Judge Joseph Spero didn't formally rule during Friday's arguments but said he was inclined to dismiss plaintiff John Maa's False Claims Act allegations that the medical center fraudulently billed insurers for deep anesthesia administered during endoscopies. Maa's complaint asserted that those claims were illegal because the anesthesia was administered by an unqualified sedation nurse without supervision.
The regulation under which Maa made that claim “doesn't apply to the anesthesia services at issue,” Judge Spero said. “Moderate sedation is what's covered. And if you [plead] moderate sedation, it goes out for another reason, because many people can perform moderate sedation. The claim goes away.”
UCSF argued in its motion to dismiss that Maa's complaint conflated billing for anesthesia with billing for endoscopies. Maa's attorney, Michael Kohn of Kohn Kohn and Colapinto, LLP, argued, however, that medical providers bundled endoscopy-related sedation with the rest of the procedure when billing insurance companies.
But Judge Spero didn't agree with Kohn's argument. “It's about bundling a specific anesthesia service which is not at issue in this case. You think it's bundled; I think it's not,” he said.
The judge said, however, that he thought Maa's allegations that he was refused a tenure-track position at the medical center and faced harassment following his efforts to report the billing practices were specific enough to survive.
Maa testified in a case involving one of his patients, who had died under sedation during an endoscopy at UCSF Medical Center in 2008, and also reported his concerns about the supervision of sedation nurses and billing practices to the medical center's risk-management team, according to his complaint. Maa claimed that although those activities are protected under the First Amendment, he suffered hostility from colleagues and then was told he could not have a tenure-track position when he applied in 2012.
Defendant Dr. Nancy Ascher "told Dr. Maa that [risk-management director Susan] Penney had said that he was 'the problem' with the defense of the Patient Doe litigation,” Maa's complaint said. “Defendant Penney also told defendant Ascher that, if Dr. Maa did not choose one of the attorneys selected for him by the medical center, things would 'get hostile.'”
Judge Spero said those allegations were enough for Maa's complaint to survive UCSF's motion to dismiss. “I think you've pled a First Amendment retaliation claim,” he said. “You've adequately alleged instances of [protected] speech, at least for the purposes of this motion, that are outside the scope of [Maa's] job duties,” required for a whistleblower claim, the judge said.
Ultimately, Judge Spero took the motion to dismiss under submission and said he would issue a ruling soon.
Maa filed suit in January 2012 against the medical center and 11 individual defendants who worked in the center, accusing Dr. James Ostroff, the director of the center’s endoscopy unit and gastrointestinal consultation service, of overseeing practices that allegedly violated requirements for Medicare reimbursement, court documents said. The practices included allowing sedation nurses to administer anesthesia without proper supervision, and these practices ultimately led to the death of Maa’s former patient, Maa claimed.
Judge Spero dismissed Maa's False Claims Act allegations in April but allowed him to revive them in an amended complaint [link].
Maa is represented by Dickson Geesman LLP and David K. Colapinto of Kohn Kohn & Colapinto LLP.
The defendants are represented by John C. Hueston, Brian Hennigan and Eric J. Hayden of Irell & Manella LLP.
The case is Maa et al v. University of California San Francisco Medical Center et al, case number 3:12-cv-00200, in the U.S. District Court for the Northern District of California.