Court Refuses to Dismiss Intervened Qui Tam Action Involving Nation’s Largest Hospice Provider

In June 2014, the Justice Department intervened in a False Claims Act qui tam action filed against hospice behemoth IPC The Hospitalist Company, Inc., alleging that IPC submitted false claims by knowingly engaging in systematic overbilling for hospital evaluation and management services billed to Medicare, Medicaid, and other federal healthcare programs. According to the government’s complaint, IPC encouraged its physicians to bill at the highest levels regardless of the level of service provided and allegedly pressured physicians with lower billing levels to “catch up” to their peers.

Recently, an Illinois district court refused to dismiss the action. In denying IPC’s motion to dismiss, the court opined that the government’s complaint sufficiently detailed the fraud so as to satisfy the particularity requirements of Federal Rule of Civil Procedure 9(b). Of particular note, the court ruled that the complaint sufficiently passed muster as to all government healthcare programs, even though the complaint only included specific examples of false claims hitting the Medicare program.

Attorneys on all sides of the False Claims Act bar are watching this case closely. In addition to involving potentially millions of dollars in damages, the court could wrestle with many FCA/healthcare fraud legal issues impacting multi-location healthcare systems.

More information for whistleblowers is located at the Nolan Auerbach & White website.