The opinion
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
JACKSONVILLE DIVISION
UNITED STATES OF AMERICA,
ex rel. Willard Revels, THE STATE
OF FLORIDA, ex rel. Willard
Revels, and WILLARD REVELS,
Relator,
Plaintiffs,
v. Case No. 3:19-cv-834-TJC-LLL
PUTNAM COMMUNITY MEDICAL
CENTER OF NORTH FLORIDA,
LLC,
Defendant.
ORDER
This is a qui tam case under the Federal (“FCA”) and Florida False Claims
Acts (“FFCA”). Relator Willard Revels’ Corrective Second Amended Complaint
alleges that from 2009 through 2019, Defendant Putnam Community Medical
Center (“PCMC”), its current owner HCA Healthcare (“HCA”), and its
predecessor owner filed fraudulent claims to federal health insurers. (Doc. 70).
PCMC filed a Motion to Dismiss. (Doc. 74). Relator filed a Memorandum in
Opposition (“Response”). (Doc. 79). The United States and the State of Florida
both declined to intervene, but the United States has filed a Statement of
Interest. (Docs. 11, 12, 80).
The Court dismissed Revels’ First Amended Complaint but granted
Revels leave to depose three individuals before filing a Second Amended
Complaint (“SAC”). (Doc. 57). PCMC filed a Motion to Strike Allegations in
Relator’s SAC, (Doc. 75), and Revels filed a Response, (Doc. 77).
I. BACKGROUND
A. Alleged Facts
PCMC, located in Palatka, Florida, is an acute care facility (a hospital)
previously owned by LifePoint Hospitals and now owned by HCA. (Doc. 70
¶¶ 9, n.8, 13). Relator alleges that PCMC provided a variety of sleep and
cardiopulmonary tests (“diagnostic tests”) for patients, most of whom were
covered by some form of government-provided healthcare insurance. Id. ¶¶ 2,
17. Relator worked at PCMC as a polysomnography technologist from December
2013–May 2015 and then as the Manager of PCMC’s Sleep Lab from May 2015–
March 2019. Id. ¶ 8. His position was terminated in 2019 when PCMC closed
the Sleep Lab as part of an “alleged reshuffling of ‘business priorities’ that
abruptly ended all Sleep Lab services performed at PCMC,” following several
years of his approaching PCMC’s leadership to report its non-compliance with
federal regulations. Id. ¶ 8; see, e.g., id. ¶¶ 58, 66, 75, 83, 87.
Medicare regulations, specifically 42 C.F.R. § 410.32(b)(1), stipulate that
all diagnostic tests “must be furnished under the appropriate level of
supervision by a physician as defined in section 1861(r) of the Act,” otherwise,
the tests “are not reasonable and necessary.” 42 C.F.R. § 410.32(b)(1). The
appropriate level of supervision requires a
physician’s overall direction and control, but the
physician’s presence is not required during the
performance of the procedure. Under general
supervision, the training of the nonphysician personnel
who actually perform the diagnostic procedure and the
maintenance of the necessary equipment and supplies
are the continuing responsibility of the physician.
Id. § 410.32(b)(3)(i). Without a supervising physician, the SAC alleges, tests
could not have been “reasonable and necessary” under § 410.32 because they
did not meet the legal requirements. (Doc. 70 ¶ 30).
Relator alleges that from 2009 until at least 2019 (“fraudulent billing
period”), PCMC “falsely depicted” that the diagnostic tests were supervised by
a physician. Id. ¶¶ 2, 29. Relator alleges that no supervising physician trained
the technicians performing the diagnostic tests during the fraudulent billing
period. Id. ¶ 32. He thus alleges that all diagnostic tests, follow-up tests, and
medical equipment, such as CPAP machines, that were prescribed based on the
diagnostic test results (“downstream claims”) were fraudulently procured. Id.
¶ 109. Relator alleges that “virtually all” patients (over 90%) receiving health
care services at PCMC were insured under federal health care programs. Id.
¶ 103 (emphasis removed). Relator alleges PCMC therefore knowingly
submitted ineligible claims amounting to millions of dollars to Medicare,
Medicaid, Champ VA, Veteran’s Choice, Tricare, and the Federal Railroad
Retirement Program, and caused providers to make fraudulent downstream
claims. Id. ¶¶ 3, 109. Relator alleges that “tens of thousands” of these false
claims for diagnostic tests were made from 2009–2019. Id. ¶¶ 2, 29. He alleges
that he was personally aware of these claims being submitted because he
“regularly interacted with the PCMC billing department,” “personally
confirmed” patients’ insurance, “investigated” when federal providers declined
payments, “communicated frequently” with health care companies providing
Medicare Advantage plans, and “was informed by his supervisors” about the
Sleep Lab’s billing. Id. ¶ 101. He provides records of several claims billed to
Medicaid for “sleep medicine diagnostic tests” between 2015 and 2018. (Doc.
70-5). He also provides a record of a downstream claim that was paid for by
insurance. (Doc. 70-6).
Relator extensively alleges that PCMC’s CEOs, Compliance Officers, and
Directors of Cardiopulmonary Services knew that PCMC was not compliant
throughout the relevant term. (Doc. 70 ¶¶ 2, 32, 39, 55–56). Relator alleges that
he learned there was a doctor with the title Medical Director of
Cardiopulmonary Services who, on paper, was to perform the required medical
supervision and training duties, but that he did not perform training nor
supervised the lab as required by federal regulations. Id. ¶¶ 46, 51–52. The
doctor “had never performed any duties as [Medical Director] . . . and had never
requested or received any compensation for doing so.” Id. ¶ 52 (emphasis
omitted). Relator and his supervisors approached PCMC’s leadership about the
lack of a supervising physician several times. E.g., id. ¶¶ 47, 54–56, 67–73. He
alleges that PCMC’s leadership rebuffed them at every turn. Id. ¶¶ 47, 54, 56.
Relator alleges that by failing to have a supervising physician for the labs
performing diagnostic tests, PCMC violated the FCA, 31 U.S.C. § 3729(a)(1)(A),
and the FFCA, FLA. STAT. § 68.083(2)(a) for “presenting . . . false or fraudulent
claims to the United States of America and the State of Florida” (“Presentment
Claims”); § 3729(a)(1)(B) and FLA. STAT. § 68.083(2)(b) for “making . . . false
records or statements material to” those claims (“False Records Claims”); and
§ 3729(a)(1)(G) and FLA. STAT. § 68.083(2)(g) for “concealing, or knowingly and
improperly avoiding or decreasing, obligations to pay or transmit money to the
United States . . . and Florida” (“Reverse False Claims”).1 (Doc. 70 ¶ 1). He
alleges that HCA made express false representations because it confirmed that
it would abide by all applicable regulations. Id. ¶¶ 94–98. He also alleges that
PCMC’s new owner, HCA, assumed the liabilities of PCMC’s predecessor owner
when it acquired the facility in 2015 because HCA took over and PCMC retained
the previously existing license. Id. ¶ 9 n.8.
1 “Because the Florida False Claims Act is modeled after the Federal
False Claims Act, the claims [are] analyzed using the same general standards.”
United States v. Cypress Health Sys. Fla., Inc., No. 1:09cv137-SPM-GRJ, 2012
WL 467894, at *1 (N.D. Fla. Feb. 14, 2012).
B. Procedural History
Relator first filed this qui tam action on July 16, 2019. (Doc. 1). The
United States and the State of Florida both declined to intervene on October 10,
2020. (Docs. 11, 12). The Court ordered the complaint to be unsealed and served
on November 3, 2020. (Docs. 13–15). The Court dismissed Relator’s First
Amended Complaint following a hearing on PCMC’s motion to dismiss but
permitted refiling. (Doc 57).
In dismissing the complaint, the Court instructed Relator to “properly
state an FCA claim under Federal Rule of Evidence 9(b) and the Eleventh
Circuit’s precedent” and to “amplify his allegations that false claims were
actually made to federal health care providers and the state of Florida.” Id. at
2–3. It also told Relator to “be explicit as to materiality and causality, whether
he is pleading an implied or explicit certification theory, and which claims relate
to which counts,” and to re-evaluate the sheer number and scope of his claims.
Id. at 3. It permitted him to take three requested depositions without otherwise
lifting the discovery stay. Id. at 3–4. Relator filed the SAC, and in response
PCMC filed this Motion to Dismiss and Motion to Strike. (Docs. 70, 74, 75).
II. MOTION TO STRIKE
PCMC’s Motion to Strike asks the Court to strike Paragraph 55 and
Footnote 23 from the SAC. (Doc. 75). These paragraphs, PCMC argues, recount
testimony from Kimberly Moore, former Director of Cardiopulmonary Services
at PCMC, the one individual Relator deposed. Id. at 6–9, nn.4–5. In Paragraph
55, the SAC alleges Moore had “personal knowledge that claims had been
submitted by [PCMC] to Federal Health Care Programs,” and recounts an email
to PCMC’s Chief Compliance Officer in which she expressed concern about
PCMC not meeting the requirements for a physician supervisor. (Doc. 70 ¶ 55).
Footnote 23 alleges that “Moore had direct access to the financial information
associated with the [Cardiopulmonary Services Department] . . . .” Id. at n.23.
PCMC argues in its Motion to Strike that Relator relies on information that he
“alleges no basis for having personal knowledge” of, but obtained from Moore’s
deposition, to overcome the stringent requirements of Federal Rule of Procedure
9(b) for qui tam actions. (Doc. 75 at 4, 7). PCMC also points out that “Moore was
not responsible for Medicare and Medicaid billing and her testimony on this
topic was entirely vague and bereft of specifics.” (Doc. 75 at 8) (citation omitted).
Relator argues in response that PCMC fails to explain how the added
information from Moore is the key piece upon which the SAC will succeed or
fail. (Doc. 77 at 5–6). He argues more broadly that the SAC “amply met the
concerns expressed by the Court” even without the challenged paragraph and
footnote. Id. at 3.
The Eleventh Circuit has emphasized that courts cannot use “material
obtained during discovery, prior to a final decision on a motion to dismiss . . . in
cases to which the heightened pleading standard of Rule 9(b) applies if the
amendment would allow the plaintiff to circumvent the purpose of Rule 9(b).”
Bingham v. HCA, Inc., 783 F. App’x 868, 876 (11th Cir. 2019).2 In Bingham, the
Eleventh Circuit considered a “[r]elator’s complaint after excising the
additional information obtained through discovery” and “agree[d] with the
district court that the remaining allegations [did] not satisfy the pleading
requirements of Rule 9(b)” because the complaint did not “state with any
particularity” how the defendant violated the FCA. 783 F. App’x at 877. Here,
however, as PCMC itself argues, even if additional information was obtained
from Moore during discovery, it does not fill the required gap between Relator’s
prior allegations and what is required for an FCA claim. Relator needs to allege
that claims were “actually made to federal health care providers and the state
of Florida,” as the Court clarified in its Order. (Doc. 57 at 3). The allegations in
Paragraph 55 and Footnote 23 do not prove that claims were filed and therefore
do not “circumvent the purpose of Rule 9(b).” Bingham, 783 F. App’x at 876. The
paragraph and footnote need not be struck.3
2 The Court does not rely on unpublished opinions as binding precedent,
however, they may be cited when the Court finds them persuasive on a
particular point. See McNamara v. GEICO, 30 F.4th 1055, 1060–61 (11th Cir.
2022).
3 Alternatively, even if the Court were to strike the contested paragraph
and footnote, its ruling on the Motion to Dismiss (Doc. 74) would remain the
same for the reasons discussed below.
III. MOTION TO DISMISS
A. The Parties’ Arguments
PCMC’s Motion to Dismiss makes several arguments. (Doc. 74). The first
group of these relate to regulatory standards: that Relator holds PCMC to an
incorrect supervision standard because PCMC was not required to have a
supervising physician as Relator alleges; id. at 17–19; that Relator does not
allege that any claims were billed under the part of Medicare governed by 42
C.F.R. § 410.32; id. at 19–20; and that the regulatory instruction that requires
a board-accredited physician to supervise the lab is a Local Coverage
Determination and is thus not legally binding, id. at 20–21. PCMC then argues
that the SAC does not sufficiently allege fraud under the Eleventh Circuit’s and
Rule 9(b)’s requirements. Id. at 22–29. PCMC argues that Relator has only
alleged an implied certification, and that the SAC alleges no materially
significant misrepresentations. Id. at 29–36. PCMC also argues that the legal
requirements cannot extend to downstream claims that other doctors and
facilities made relying on PCMC’s certifications. Id. at 36–39. Finally, PCMC
argues that Relator has not properly alleged any False Records Claims, and
that because PCMC did not present false claims, it likewise made no Reverse
False Claims in failing to report its prior claims to the government. Id. at 39–
40.
Relator’s Response argues that he has properly alleged FCA violations
sufficient to withstand a motion to dismiss. (Doc. 79). His arguments include
that the Court may properly rely on some inference to conclude that PCMC did
submit claims to the government for payment. Id. at 9–10. He emphasizes that
the core allegation of the SAC is that no one in PCMC’s Sleep Lab ever received
the training required by applicable regulations, and thus PCMC failed to
comply with a material requirement. Id. at 18–19. He also argues the
materiality of a violation is a holistic evaluation that may include whether Local
Coverage Determinations were ignored. Id. at 20–22. Relator argues that his
allegations form both an express and implied theory of certification.4 Id. at
27–28, n.35.
B. Allegations of Actual Claims Submitted
Relator’s six counts compose three categories of corresponding federal and
Florida law violations. Before discussing each claim, the Court must consider
whether Relator has sufficiently pled the submission of claims, because it
specifically instructed Relator to ensure that he met the Rule 9(b) standard.
(Doc. 57 at 2–3).
4 The United States has also filed a Statement of Interest that provides
the United States’ view that Local Coverage Determinations may point to a
material violation of the FCA, and emphasizes that its declination to intervene
and its continued payment of claims even following Relator’s qui tam action
does not indicate whether Relator’s allegations are sufficient. (Doc. 80).
“The Eleventh Circuit has often disfavored district courts inferring the
submission of false claims.” U.S. ex rel. & 84Partners, LLC, Relator, Plaintiffs,
v. Huntington Ingalls Indust., No. 3:14-CV-1256-TJC-PDB, 2021 WL 4307510,
at *4 (M.D. Fla. Sept. 22, 2021). Allegations of false or fraudulent claims are
subject to the heightened pleading standard of Rule 9(b) and must “state with
particularity the circumstances constituting fraud or mistake.” FED. R. CIV.
P. 9(b).5 “The mere disregard of federal regulations or improper internal
practices does not create liability” unless “the relator [has] allege[d] the ‘actual
presentment of a claim . . . with particularity . . . .’” Urquilla-Diaz v. Kaplan
Univ., 780 F.3d 1039, 1051–52 (11th Cir. 2015) (citations omitted). “The False
Claims Act does not create liability merely for a health care provider’s disregard
5 Generally, federal civil complaints need only state “a short and plain
statement of the claim showing that the pleader is entitled to relief.” FED. R.
CIV. P. 8(a). And each averment should be “simple, concise, and direct,” with no
technical form of pleading required. FED. R. CIV. P. 8(d)(1). “However, ‘[i]n all
averments of fraud or mistake, the circumstances constituting fraud or mistake
shall be stated with particularity. Malice, intent, knowledge, and other
condition of mind of a person may be averred generally.’” U.S. ex rel. Clausen
v. Lab’y Corp. of Am., 290 F.3d 1301, 1308 (11th Cir. 2002) (quoting FED. R. CIV.
P. 9(b)).
Relator argues that Rule 11(b)(3), which permits “flexibility” based on
“reasonably anticipated” evidence in pleading, should also permit a wider
leniency on his claims. Rotella v. Wood, 528 U.S. 549, 560 (2000). The case he
cites pre-dates both Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) and
Ashcroft v. Iqbal, 556 U.S. 662 (2009), and as Relator points out, has not
explicitly been cited as part of the Eleventh Circuit’s rigorous fraud pleading
standard. (Doc. 79 at 7 n.12).
of Government regulations or improper internal policies unless, as a result of
such acts, the provider knowingly asks the Government to pay amounts it does
not owe.” U.S. ex rel. Clausen v. Lab’y Corp. of Am., 290 F.3d 1301, 1311 (11th
Cir. 2002). A relator must “identify any specific claims that were submitted to
the United States or identify the dates on which those claims were presented to
the government.” Id. at 1311 (citation and quotation marks omitted). Because
the submission of the claim is the “sine qua non” of a FCA violation, it requires
“some indicia of reliability . . . to support the allegation of an actual false claim
for payment being made to the Government.” Id. “At a minimum, a plaintiff-
relator must explain the basis for her assertion that fraudulent claims were
actually submitted.” U.S. ex rel. Mastej v. Health Mgmt. Assocs., Inc., 591 F.
App’x 693, 704 (11th Cir. 2014). How courts evaluate whether false claims were
made depends on the type of false claim or statement alleged, the position of
the relator, and whether the relator has “first-hand knowledge of the
defendants’ billing practices.” United States v. Space Coast Med. Assocs.,
L.L.P., 94 F. Supp. 3d 1250, 1257–58 (M.D. Fla. 2015) (citations omitted). “[A]
district court must analyze the totality of the circumstances . . . to determine
whether the relators have met the requirement of providing sufficient indicia of
reliability.” Id.
Here, Relator alleges that he is certain that bills were submitted to the
federal government based in part on his own interactions with patients and
insurers. (Doc. 70 ¶ 101). If Relator relied solely on general knowledge based on
personal experience, his complaint would likely fall short, as did the complaint
in U.S. ex rel. Sanchez v. Lymphatx, Inc., which relied on “general accusations
of false billing” based on the relator’s “personal knowledge” as an “office
manager,” without providing details on “dates,” “frequency,” “amounts,” or
“patients.” 596 F.3d 1300, 1302 (11th Cir. 2010). Indeed, complaints lacking
detail about any “amounts of charges,” “actual dates,” “policies about billing or
even second-hand information about billing practices” or copies “of [any] bill[s]
or payment[s]” do not meet the Rule 9(b) standard. Clausen, 290 F.3d at 1312.
But the SAC goes beyond Relator’s own statements and experience:
Relator provides copies of what he alleges are “[a]ctual representative claims
submitted by [PCMC] and paid by the federal government . . . .” (Doc. 70 ¶ 106);
(Doc. 70-5 at 3). This claims data shows “sleep medicine diagnostic tests
rendered to Medicaid patients by PCMC” from 2015–2018 under CMT codes
95808, 95810, and 95811. (Doc. 70-5 at 3–4). PCMC argues this data does not
help Relator because the data purportedly shows capitated, rather than fee-for-
service claims. (Doc. 74 at 15 n.3, 25); see (Doc. 70-5 at 3). PCMC will have
further opportunities to develop this argument, but for now the Court is
satisfied that Relator has shown claims for diagnostic tests were presented to
the government.
That said, not every alleged false claim in the SAC may move forward.
Relator uses “diagnostic testing” to collectively describe polysomnographic
studies (“PSG”), CPAP titration studies (“CPAP”), electrocardiogram tests
(“EKG”), and pulmonary function tests (“PFT”). (Doc. 70 ¶ 2). Of these, Relator
describes PSG and CPAP tests within the context of sleep disorder treatment,
explaining that these tests were administered by sleep technicians in PCMC’s
Sleep Lab. Id. ¶¶ 19–24. In a separate section of the SAC, Relator discusses
EKG and PFT tests, stating more broadly that they were administered to
“patients suffering from or suspected of various cardiac conditions requiring
clinical treatment” or “suffering from or suspected of various pulmonary
conditions requiring clinical treatment.” Id. ¶ 26. Relator does not allege that
these tests were performed in the Sleep Lab or by sleep technicians, nor did he
clarify this point when challenged by PCMC. See (Doc. 74 at 14–15 n.10). In
fact, the SAC’s later assertion that EKG and PFT testing continued even after
the Sleep Lab was closed seemingly confirms that the EKG and PFT tests
occurred in a separate department. (Doc. 70 ¶ 93 n.32). The problem is, Relator’s
relevant personal knowledge of diagnostic testing comes from his employment
within the Sleep Lab, and his representative claims data—unaccompanied by
any interpretative key—is specific to “sleep medicine.” (Doc. 70-5 at 4). With no
detailed personal knowledge or claims data to buttress his otherwise conclusory
allegations for EKG and PFT diagnostic tests, only the “sleep medicine”
claims—premised on the PSG and CPAP tests from within the Sleep Lab—may
move forward.
The downstream claims are similarly weak. Relator neither worked at the
downstream providers, nor has he provided a claim demonstrably paid by the
federal government to a downstream provider based on PCMC’s certifications.
He provides the medical records of John B. Revels (Relator’s father), who
apparently received a sleep diagnostic test at PCMC and a CPAP machine paid
for by insurance, as an example of a downstream claim. (Doc. 70 ¶ 110); (Doc.
70-6); (Doc. 79 at 26). But the medical records do not specify the insurer who
paid for the CPAP machine, undermining Relator’s allegation that this billing
record shows downstream claims were paid by the government. See (Doc. 70
¶ 110); (Doc. 70-6). Because Relator has not adequately alleged that
downstream claims were presented to and paid by the government, the
downstream claims will be dismissed.
Finally, Relator’s claims of violations before his employment began fall
short. He alleges that PCMC submitted false claims “[s]ince at least 2009 and
continuing through and until at least March 1, 2019 . . . .” (Doc. 70 ¶ 29).
Relator does not allege personal involvement or knowledge across this entire
span; indeed, he only joined the PCMC Sleep Lab in 2013. Id. ¶ 42. Because
Relator’s allegations and representative claims data provide no information on
claims purportedly submitted before he joined PCMC in 2013 or after he left in
2019, only those claims made during his 2013-2019 employment survive.6 See
Mastej, 591 F. App’x at 709–10 (finding that the relator could reliably speak to
conduct occurring while he was an employee, but when “[r]emoved from this
vantage point” after his employment ended, the relator’s allegations became
overly speculative).
Therefore, while Relator has sufficiently alleged PCMC submitted actual
claims for Sleep Lab PSG and CPAP diagnostic tests, he has not sufficiently
alleged that claims from downstream providers, PCMC’s non-Sleep Lab EKG
and PFT diagnostic tests, or tests performed outside the period he was
employed by PCMC were submitted to the government.
C. Illegality, Materiality, and Implied or Express Certification
Relator has specifically identified claims that PCMC made to the United
States for diagnostic tests performed at its Sleep Lab, so the Court proceeds to
consider PCMC’s other legal arguments for why the SAC should be dismissed.
PCMC argues first that Relator has failed to plead falsity in Count I because it
had physicians present in the hospital, because Relator fails to allege any
diagnostic tests billed under Medicare Part B, the section of Medicare that 42
6 The SAC suggests that PCMC continued to submit false claims even
after Relator’s employment ended but provides no further details aside from a
conclusory footnote. See (Doc. 70 at ¶¶ 93 n.32, 114, 118, 122, 127 132, 137). For
the same reasons as the pre-employment claims, Relator has failed to show
post-employment claims submission.
C.F.R. § 410.32 regulates, and finally because Local Coverage Determination
L36839 alone cannot give rise to an enforcement action. (Doc. 74 at 17–21).
To allege an FCA claim under a theory of false certification, Relator must
“allege facts that, if true, would show (1) a false statement or fraudulent course
of conduct, (2) made with scienter, (3) that was material, causing (4) the
government to pay out money or forfeit moneys due.” Urquilla-Diaz, 780 F.3d
at 1052 (citations and quotation marks omitted). Similarly, for claims based on
implied false certification, “liability can attach when the defendant submits a
claim for payment that makes specific representations about the goods or
services provided, but knowingly fails to disclose the defendant’s noncompliance
with a statutory, regulatory, or contractual requirement.” Universal Health
Servs., Inc. v. U.S. ex rel. Escobar, 579 U.S. 176, 181 (2016). Such nondisclosure
is actionable if the “omission renders those representations misleading.” Id.
Here, Relator has alleged that PCMC was required to have an active
supervising physician in its Sleep Lab, that PCMC’s directors were aware of
and repeatedly ignored the requirement, that the requirement was material,
and that the government did in fact pay claims based on PCMC’s certification
of its compliance. See, e.g., (Doc. 70 ¶¶ 30–36, 57–60, 94, 100–01, 104–06) (Doc.
70-5). Relator has also alleged that the regulations, taken as a whole, required
PCMC to have a supervising physician of its Sleep Lab, and that it failed to do
so. (Doc. 70 ¶¶ 94, 104–05). Taking the allegations in the SAC in the light most
favorable to the non-movant and considering the United States’ Statement of
Interest arguing that violations of Local Coverage Determinations may support
liability, Relator has sufficiently alleged in Count I that PCMC submitted
claims that were potentially false. See (Doc. 80).7
D. False Records and Reverse False Claims
Besides alleging that PCMC submitted false or fraudulent claims in
violation of 31 U.S.C. § 3792(a)(1)(A), in Count II Relator alleges that PCMC
used false records or statements to have claims paid by the federal government,
in violation of § 3792(a)(1)(B). (Doc. 70 ¶¶ 117–20). These claims likewise are
subject to Rule 9(b)’s particularity pleading requirement and require a relator
to show “‘(1) the defendant made (or caused to be made) a false statement[;] (2)
the defendant knew it to be false[;] and (3) the statement was material to a false
claim.’” United States v. Prometheus Lab’ys, Inc., No. 8:18-CV-2931-T-33AAS,
2020 WL 6203527, at *5 (M.D. Fla. Oct. 22, 2020) (quoting U.S. ex rel. Phalp v.
Lincare Holdings, Inc., 857 F.3d 1148, 1154 (11th Cir. 2017)). For the same
reasons as above, Relator has sufficiently alleged that PCMC used false
7 The Court instructed Relator to specify whether he alleges an implied
or explicit theory of certification. (Doc. 57 at 3). The SAC calls the
representations “[e]xpress,” (Doc. 70 at 47), but as PCMC argues, the
allegations appear to allege implied certification, (Doc. 74 at 30–32). Relator
responds that he is making an express certification allegation but that his
allegations satisfy both standards. (Doc. 79 at 27–29, n.35). The Court expects
clarification as discovery proceeds.
statements in making claims for its Sleep Lab diagnostic tests. PCMC disputes
the significance and falsity of statements made in its “enrollment application
and provider agreements” and electronic 837-I claim forms. (Doc. 74 at 39).
These arguments can be explored at later stages of the litigation—for now,
Relator has sufficiently pleaded a false records claim.
Finally, looking at Count III, Reverse False Claims under § 3729(a)(1)(G),
Relator has met his pleading burden. See (Doc. 70 ¶¶ 121–24). “Section
3729(a)(1)(G) creates liability for a person who ‘knowingly makes, uses, or
causes to be made or used, a false record or statement material to an obligation
to pay or transmit money or property to the Government,’ or who ‘knowingly
conceals or knowingly and improperly avoids or decreases an obligation to pay
or transmit money or property to the Government.’” United States ex rel. Stepe
v. RS Compounding LLC, 304 F. Supp. 3d 1216, 1226 (M.D. Fla. 2018) (quoting
§ 3729(a)(1)(G)). PCMC’s sole argument for dismissal is that the Reverse False
Claims count “rests on defective allegations.” (Doc. 74 at 40). For the reasons
already stated, the Court disagrees.
E. Florida Claims
Finally, Relator has sufficiently alleged violations of the FFCA (Counts
IV–VI). The FFCA is modeled on the FCA and is analyzed under the same
standards. Space Coast Med. Assocs., L.L.P., 94 F. Supp. 3d at 1252 n.4
(collecting cases). Still, even under the mirrored structure, a complaint must
allege facts implicating false claims submitted to the State of Florida, not just
the United States. See United States v. Norman, No. 8:15-CV-1506-T-23AEP,
2018 WL 264253, at *3 (M.D. Fla. Jan. 2, 2018) (dismissing a complaint which
“[said] nothing about a claim submitted to, or paid by, the State of Florida”).
The representative claims Relator provides were paid by the federal
government via Medicaid managed by the State of Florida, satisfying this
requirement. See (Doc. 70-5 at 3). PCMC’s only argument for dismissal is that
the Florida claims “fall short for the same reasons as their federal
counterparts.” (Doc. 74 at 40). Because Relator has properly alleged violations
of the parallel FCA and connected these allegations to the State of Florida, the
FFCA counts may move forward as well.
Accordingly, it is hereby
ORDERED:
1. Defendant Putnam Community Medical Center’s Motion to Strike
Allegations in Relator’s Second Amended Complaint (Doc. 75) is DENIED.
2. Defendant Putnam Community Medical Center’s Motion to Dismiss
(Doc. 74) is GRANTED to the extent that all claims before December 2013 or
after February 2019, claims premised on EKG and PFT testing done in
departments outside of the Sleep Lab, and all downstream claims are
DISMISSED with prejudice as specified herein. The motion is DENIED
as to all federal and Florida state claims regarding PCMC’s Sleep Lab
diagnostic tests from December 2013 to February 2019.
3. Defendant Putnam Community Medical Center shall answer the
Corrective Second Amended Complaint (Doc. 70) no later than November 18,
2022.
4, The Court-Imposed Stay on Discovery (Doc. 48) is LIFTED.
5. The parties shall jointly filea CASE MANAGEMENT REPORT
no later than November 18, 2022.
DONE AND ORDERED in Jacksonville, Florida the 26th day of
October, 2022.
Cirmotheg g. Corrig on
ee L/ TIMOTHY J. CORRIGAN
a United States District Judge
rmv/agb
Copies:
Counsel of record
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