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United States ex rel. Duffy v. Lawrence Memorial Hospital

United States District Court, D. Kansas

July 7, 2017

UNITED STATES OF AMERICA, ex rel. Megen Duffy, Relator -Plaintiff,



         Megen Duffy has filed this qui tam action alleging the violation of the False Claims Act (“FCA”), 31 U.S.C. §§ 3729(a)(1). Duffy asserts that defendant Lawrence Memorial Hospital (“LMH”): knowingly presented, or caused to be presented, a false or fraudulent claim for payment or approval to the Centers for Medicare & Medicaid Services (“CMS”); or made a material false statement in connection with a claim for payment; or made a material false statement in connection with a sum of money owed to the Government, or concealed or improperly avoided an obligation to pay or transmit money to the Government.

         This case is now before the court upon LMH's motion for summary judgment. Doc. No. 151. The court has reviewed the parties' briefs and exhibits.[1] For the reasons which follow, the court shall deny the summary judgment motion.


         Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” FED.R.CIV.P. 56(a). A “genuine dispute as to a material fact” is one “such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.” Id. At the summary judgment stage, the court's job “is not ... to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial. . . . If [however] the evidence is merely colorable . . . or is not significantly probative . . . summary judgment may be granted.” Id. at 249-50.


         The second amended complaint (Doc. No. 18) is the operative document for delineating Duffy's claims. In “Count I” Duffy alleges multiple violations of the FCA. Many of the alleged violations involve the value-based purchasing system for reimbursing care given to Medicare and Medicaid patients. Under this system, care-providers may qualify for payments from the Government for submitting accurate and complete information to CMS and may qualify for incentive payments if the reported data shows that they are achieving certain treatment goals associated with better medical outcomes. Duffy claims that LMH submitted false data which affected various measures of inpatient and outpatient care used to calculate incentive payments. Doc. No. 18, ¶¶ 161-163, 166-168, 172-174. The bulk of the argumentation presented with LMH's summary judgment motion involves data reporting chest pain patients' “arrival time” in the emergency room. For example, a large part of the summary judgment motion concerns Duffy's claim that LMH did not properly measure the time elapsed between a chest pain patient's “arrival” at the emergency room and the administration of an EKG.

         Duffy also alleges that LMH made a false claim or made or used a false record certifying compliance with Section 6032 of the Deficit Reduction Act, 42 U.S.C. § 1396a(68). This section requires that entities receiving annual payments of at least $5, 000, 000 from a Medicaid program shall as a condition of receiving such payments establish written policies for all employees to be provided detailed information about the FCA, administrative remedies for false claims, state laws pertaining to false claims, and whistleblower protections under such laws. Id. at ¶ 160.

         Finally, Duffy claims that LMH violated the provisions of the FCA which prohibit using a false record or statement to conceal or improperly avoid an obligation to return an overpayment of money to the Government. Id. at ¶¶ 164-65, 169-70. This is a so-called “reverse false claim” under § 3729(a)(1)(G).


         The following facts are considered uncontroverted solely for the purposes of this summary judgment motion or, if in dispute, are viewed in a light most favorable to the nonmoving party. Some additional facts may be incorporated in the court's discussion of the legal issues in the section V of this order.

         LMH participates in and receives money from the Medicare and Medicaid programs. As a participant, LMH reports information regarding patient care to CMS for its Inpatient Quality Reporting (“IQR”) and Outpatient Quality Reporting (“OQR”) programs. On a quarterly basis, LMH's Quality Services Department manually abstracts data from patient charts to report it to CMS. CMS has “Specifications Manuals” for the IQR and OQR programs which define and describe the data which LMH must submit. According to the manuals, all documentation in the medical record must be timed, dated and authenticated. The “General Abstraction Guidelines” provided by CMS state that when abstracting data from medical records, “[t]he medical record must be abstracted as documented, (i.e., taken at ‘face value').” If an event is not documented in the medical record, it is not abstracted and reported.

         By successfully and accurately making such reports, LMH avoids penalties in the form of reduced payments for services to Medicare beneficiaries. Also, since fiscal year 2013, LMH's performance on some defined quality reporting measures has impacted CMS payments to LMH under the Hospital Value Based Purchasing (“HVBP”) program. This program provides incentive payments to hospitals based upon the hospital meeting or not meeting certain HVBP metrics.

         Some of the measures reported by LMH rely on the determination of a patient's “arrival time.” CMS defines “arrival time” in the Specifications Manuals as: “The earliest documented time (military time) the patient arrived” at the hospital.

         When a patient arrives at the LMH Emergency Department, a triage tech or nurse greets the patient and gets information from the patient, including the nature of the medical issue. An “interim form” is used at the Emergency Department entrance to record such things as chief complaint, time, doctor, allergies and medications. LMH discards the interim form after use. LMH also uses “triage sheets” to record information as patients enter the Emergency Department. The sheets record basic information, such as vital signs, for example, that can be converted with more detail into a triage note. The sheets are discarded after information is transferred to an electronic triage note. A triage note is an electronic nursing document which contains more detail regarding a patient. LMH has instructed Emergency Department staff to write down the EKG time on triage sheets and to match the EKG time to the “triage time” on the triage note.

         Hospital admissions workers have written down patient information on “face sheets” for later computer entry. LMH shreds the face sheets after use. Sometimes “cheat sheets” have been used to record patient information that was not on the face sheets.

         CMS Specifications Manuals provide that emergency department records and outpatient records be examined to determine “arrival time.” LMH is advised by the manuals to look at the earliest Emergency Department document in a patient's medical record to determine the patient's arrival time. “Emergency Department documentation” is broadly defined to include: vital sign records, registration forms, triage records, EKG reports, face sheets, consent for treatment forms, etc.

         Starting in September 2010, LMH Emergency Department Educator or Clinical Coordinator Elaine Swisher, and then-Emergency Department Director Joan Harvey, sent a series of written communications to Emergency Department staff which conveyed a priority that EKGs be given to chest pain patients in the Emergency Department before the patients were registered. Some of the communications indicated that this was important to maximize LMH's reimbursement from the government and that the goal was to have the EKG within three minutes of the patient's entry.[2] The registration process for an Emergency Department patient is called “QTR.” A time stamp is generated when the QTR process is completed by the Emergency Department.

The following are three examples of the communications:
Make sure those patients who present to triage with chest pain come STRAIGHT BACK TO A ROOM - NO VS IN triage - StraightBack, Jack!! Quick registration can be done at bedside!! Bare the chest FIRST - get those patches on and get the EKG done, THEN finish undressing the pt, put on O2, put on monitor, get VS, etc. Door to EKG is 3, count ‘em 3 minutes!!! We can do this, but it will require a change in current practice.
Yes, we are looking at other creative ways to expedite our processes to meet the “3 minute goal.” The key factor here will be when we complete the registration process, so when in doubt wait to register until that 12 lead is completed.
In 2012 CMS (Medicare) will reimburse hospitals at a greater rate for those in the top 10% - - which is where the 3 minute time comes in. . . . Patients with an acute onset of chest pain or associated symptoms should have EKG done prior to QTR. Triage techs should not be told “go ahead and register, I will be right there.”

         Crystal Rocha declared in an affidavit that she was employed as a registration clerk at LMH from approximately May 2012 to May 2013.[3] She stated that triage techs would enter information for Emergency Department patients (name, birth date, reason for visit, etc.) into the LMH computer system and that this was done prior to an EKG, unless the patient was unconscious. She further stated that if chest pain patients were registered prior to an EKG, LMH nurses would change the patient's record to show the EKG was done within a few minutes of the registration or was done at exactly the same ...

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