Are FCA Whistleblowers Legal?
Intermountain Healthcare wants the Supreme Court to weigh in on if the False Claims Act’s (FCA) provisions for whistleblowers violates the Constitution. This could affect compliance efforts across healthcare.
Medical Judgment No FCA Sanctuary
The issue arose last summer when the US Court of Appeals for the Tenth Circuit ruled that medical judgment can’t be used as a defense at the summary judgment stage when a healthcare provider is accused of billing for medically necessary treatments, Bloomberg Law reported. As a result, two hospitals face allegations they submitted false claims for unnecessary heart procedures.
The Intermountain whistleblower was a staff physician who alleged Sherman Sorensen, MD, was performing unnecessary heart surgeries at two Salt Lake City, Utah hospitals, one owned by Intermountain Healthcare ad the other owned by HCA. The whistleblower, Gerald Plukoff, MD, claims the two hospitals violated the FCA by describing the surgeries as medically and reasonable when filing Medicare claims.
A major part of the case, Bloomberg reported, involved the statistical comparison of the number of procedures Sorensen performed versus his peers. The complaint explained that one of the specific heart procedures in question was performed only 37 times by the Cleveland Clinic in 2010, while billing records showed Sorenson allegedly claimed to have performed 861 that same year.
The US District Court for Utah dismissed the in action 2016, ruling that decisions based on medical judgments couldn’t be considered false under the FCA. The appeals court overturned the ruling, believing it is possible for a medical judgment to be false or fraudulent. HCA was dropped from the complaint, but it’s St. Mark Hospital joined Intermountain Medical Center as defendants.
Ruling Opens FCA Pandora’s Box
Intermountain Healthcare points to the Constitution’s Appointments Clause, saying whistleblowers are technically working for the government but can’t be dismissed, according to Reuters. The Utah hospital system and other facilities fear that the already hundreds of cases brought against providers, facilities, and health systems by whistleblowers will sky-rocket if unchecked.
According to Reuters, “Intermountain argues that there’s a deep split in the federal circuits on the pleading standard for FCA fraud claims. But it also asserts a far more sweeping argument that the whistleblower provisions of the FCA are unconstitutional. Its reasoning: Whistleblowers who file FCA cases are, in effect, acting as officers of the United States because they have the power to level fraud allegations and collect damages and penalties in the name of the U.S. government, yet they are not properly appointed and subject to removal under Article II of the Constitution. ”
The Supremes May Not Review FCA
Many legal scholars reflect that Intermountain’s request that the Supreme Court review the appeal court’s ruling already faces an uphill fight. Several legal precedents going back to the FCA’s Civil War roots affirm the right of citizens to raise a flag if the government is allegedly being swindled. US Attorney General candidate William Barr maintains that the FCA is constitutional despite challenging it previously.