The Lighter Side of Health Law – May 2018

AHLA's monthly podcast featuring health lawyer and blogger Norm Tabler's informative and entertaining take on recent health law and other legal developments.

To learn more about AHLA and the educational resources available to the health law community, visit americanhealthlaw.org.

Transcript

Speaker 1: 0:00

Hi, I'm Norm Tablo, host of the A H L A podcast series Speaking of health law, where we focus on the lighter side of health law. I hope you enjoy this. Month's edition. Hospital sued for not sending collection agency after patients. A Washington State woman sued a hospital for not using a collection agency to collect medical bills. That's right. She's sued because the hospital did not seek a collection agency on its patients. When Michelle Eklund didn't pay her bill, the hospital referred the debt to cci. CCI received a fixed fee for every debt referred to it. CCI would send a debtor two form letters if that didn't work. CCI i's involvement was over. Michelle's class action alleged that this violated the Fair Debt Collection Acts prohibition on so-called flat rating. Flat rating occurs when a creditor creates the false impression that a collection agency is involved. It's called flat rating because the creditor typically pay a company a fixed fee for sending letters and pretending it intends to pursue the matter to the end. Michelle alleged that CCI was a flat rat because it received a fixed fee for sending two form letters and then bowing out. But the ninth Circuit affirmed the District Court's award a summary judgment in favor of the hospital. The court cited seven different ways. CCI actively participated with the hospital in the debt collection process. You might call them the seven habits of highly effective debt collectors. CCI was active enough to be an honest to goodness collection agency, so the hospital won the case by proving that it had in fact Sicked a collection agency on its patients. The case is Eklund versus Peace Health ninth circuit solving one problem brings two more health lawyers who practice before the Food and Drug Administration may want to take note of an FDA warning letter reminding us that solving one problem can create a new problem or may even two of them. The FDA letter to Coleman Peanut Company recites that the company uses a CAT quote as the firm's pest control end quote. Presumably the cat is effective because the letter contains no mention of rodents or rodent droppings, but the letter cites two cat related problems. You can probably guess the first one. That's right. Although there were no rodent droppings, there were cat droppings. The second takes some thought. Here's a hint. What do employees do when they see a lovable kitty? That's right, they pet it and then they handle the peanuts without washing their hands. In between. The F D A letter directs Coleman to provide a plan of correction and then be reinspected at Coleman's expense. With Coleman's luck, the cat will probably sue for a wrongful termination. The letter is FDA warning letter number five 2087. The case of the bashful whistleblower. You might say William Nash wanted to have his cake and needed too. He filed a whistleblower case against his former employer, but wanted to remain anonymous so that his current employer wouldn't know that he is a, you guessed, a whistleblower Williams false claims case alleged that his former employer was guilty of defrauding Medicaid out of millions of dollars. When the government declined to intervene, he decided to drop it. He asked the court

Speaker 2: 2:58

To keep the case under seal so his current employer wouldn't find out about it. In the alternative, he asked the court to replace his name with John Doe. The court said, no way. The false claim statute directs the court to unseal a case once the government announces its decision on intervening. Williams. Fear of retaliation is speculative. Besides the statute contains an anti-retaliation provision. The court also turned thumbs down on William's request to be called John Doe in all the pleadings because the public has a right to know who's using its courts. But the court gave William one small victory. It said he could replace the motion under consideration with a new one that deleted the name of his current employer. Ironically, that name had never been in the record until William filed the current motion. Maybe the lesson is that you shouldn't blow a whistle if you don't want to draw attention to yourself. The case is US X R Nash versus UCB Inc. Southern District New York. Not a shred of evidence. You often hear about defendants insisting there's not a shred of evidence, but in this False Claims Act case, the defendant is insisting there is a shred of evidence, lots of shreds, and that's the problem. Tracy and Michael filed a whistleblower action alleging that super value defrauded the government. They say they had conversations with super value employees who admitted fraud by super value. What's more? They kept notes on the conversations at their depositions. They produced written summaries of the calls devastating to super value, right? Well not quiet. You see, Tracy and Michael shredded their notes and they did that after they filed the lawsuit. Oh, and Michael deleted all related information from his computer, and are you sitting down through his computer away? So what are the documents they produced at their depositions? Well, exhibit 16 is an example. It's a quote compilation that Michael created from information Tracy gave him over the phone based on Tracy's notes. And where are Tracy's notes? You guessed it shredded. Not surprisingly, super value is moved for sanctions based on the plaintiff's destruction of evidence. They want the court to strike all allegations and evidence based on the alleged conversations. The case is US XL shut versus super value Central District Illinois. The monkey that lost its appeal. It's not health law, but it's too good to pass up. On April 23rd, a monkey lost its appeal. In the ninth Circuit, the court upheld dismissal of a case brought by Petita people for ethical treatment of animals on behalf of a crested MCC mcca named Naruto against defendants who published selfies belonging to Naruto. That's right. Naruto took selfies. He found an unattended camera, picked it up and took selfies. Darn good selfies. As a matter of fact, the court said that Peter is no friend of Naruto. Well, technically what the court said was that Peter couldn't qualify as a quote next friend because non-humans can't have next friends under the law. But the court went further than that technicality saying that Peter seemed more interested in protecting its own image than NATO's interests. If you're thinking of suing on behalf of your dog or goldfish, I should note that the court ordered Peter to pay, pay defendant's attorney's fees for the appeal. You can't make this stuff up. The case is Naruto versus Slater. Ninth Circuit, the no harm, no foul defense. Former hospital CEO Edward Novak is relying on the no harm, no foul defense, but with a twist. Sure he concedes. He did commit a foul. After all, he was convicted of violating the anti-kickback statute and is still serving time for it and that was AF filed. But now he's a defendant in the subsequent False Claims Act case and he argues there was no harm to Medicare as Ed sees it. When his hospital filed Medicare claims for treating patients admitted by the doctors Ed bribed, the claims were for patient care. The hospital actually delivered. There was no harm to Medicare. It got its money's worth. The stakes are high. The government puts the damages from the kickback scheme at 9 million and wants to apply the treble damage provision of the False Claims Act. Bringing Ed's liability to a cool 27 million. ED ought to be glad the government isn't tacking on the False Claims Act penalties. They can be as high as$11,000 for each Medicare claim. The case is US versus Novak Northern District Illinois. The Swiss cheese defense charged with insider trading based on leaked CMS secrets for defendants have asserted what the government derisively calls the Swiss cheese defense. That's the theory that CMS is like Swiss cheese full of holes, so full of holes that no information there is really secret. Defendants acknowledge that former CMS employee David Blasik trolled the halls of CMS for information on proposed CMS spending and then forwarded the information to hedge fund analysts. But they argue the information wasn't inside information because anybody can find out anything at cms. Now it's up to the jury to decide whether or not C M S is Swiss cheese. The case is US versus Blasik Southern District New York. Well that's it for this month's edition of the A H L A podcast series. Speaking of health law, I hope you enjoyed it. Check your A H L A Weekly and Connections magazine for the next edition of Speaking of Health Law.