WASHINGTON, D.C. (September 27, 2019)—Recently the U.S. District Court of Appeals for the 11th Circuit issued findings in a closely-watched whistleblower case from Alabama (United States of America versus AseraCare, Inc.) initially brought in 2008 that was vigorously pursued by the Department of Justice under the federal False Claims Act. A key element in the case was the question of whether a disagreement over hospice eligibility between AseraCare’s medical director and the government’s expert witness who reviewed the case after the fact was sufficient to constitute a false claim. At potential stake was a liability of more than $200 million. While this case centered on hospice eligibility, its underpinnings—related to the question of whether a subjective difference of clinical opinion is sufficient for a finding of fraud—is a landmark finding that could impact the Department of Justice’s (DoJ’s) enforcement efforts from here forward in health care cases.

In brief, the 11th Circuit took two actions:

  • The Court affirmed a lower court’s determination that a difference in clinical opinion regarding patients’ eligibility for hospice care between the government’s expert witness who conducted a record review of the cases in question and AseraCare’s medical director is not sufficient—in and of itself and absent any other evidence of insufficiency of medical documentation or billing for care not rendered—for a finding of fraud (“…[P]hysicians applying their clinical judgment about a patient’s projected life expectancy could disagree, and neither physician [] be wrong.”)
  • The Court also acknowledged that in previous consideration the DoJ had not been permitted to present evidence demonstrating that AseraCare was knowledgeable of practices within the organization that resulted in certifications for care that were not fully considered by certifying physician and therefore did not meet hospices requirements. As a result, the Court remanded the case so that such evidence could be considered, but that upon reconsideration the DoJ must link these practices to the claims brought under the case.

The National Association for Home Care & Hospice (NAHC) joined forces with several organizations, including the American Medical Association (AMA) and the National Hospice and Palliative Care Organization (NHPCO), in a “friend of the court” (Amicus Curiae) brief supporting AseraCare in the legal position that a consulting physician’s opinion of a patient’s terminal prognosis is insufficient, on its own, to support an allegation that AseraCare submitted false or fraudulent claims to Medicare. NAHC President Bill Dombi served as co-counsel in the brief.

The case presented serious allegations of concern to the entire hospice community in that it is not uncommon for physicians to disagree about the life expectancy of a patient. However, to subject a hospice to an allegation of false claims simply on the basis of a consulting physician’s post-hoc view of a patient’s life expectancy threatened hospice overall as an end-of-life benefit under Medicare. NAHC is heartened that both the U.S. District Court and the 11th Circuit Court of Appeals recognized the invalidity of the action of the DoJ. While the ruling only specifically affects the states within the 11th Circuit (Alabama, Georgia and Florida) it can be expected that the ruling will influence other courts.