Articles Posted in U.S. Supreme Court

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A Massachusetts’ Medicaid beneficiary received services at Arbour, a mental health facility owned by Universal’s subsidiary. The teenager had an adverse reaction to a medication that a purported doctor prescribed after diagnosing her with bipolar disorder. She died of a seizure. Her parents discovered that few Arbour employees were licensed to provide mental health counseling or to prescribe medications without supervision. They filed a qui tam suit, alleging violations of the False Claims Act (FCA), which imposes penalties on anyone who “knowingly presents . . . a false or fraudulent claim for payment or approval” to the federal government, 31 U.S.C. 3729(a)(1)(A). They alleged an “implied false certification theory of liability,” which treats a payment request as an implied certification of compliance with relevant statutes, regulations, or contract requirements that are material conditions of payment. They cited Universal’s failure to disclose serious violations of Massachusetts Medicaid regulations and claimed that Medicaid would have refused to pay the claims had it known of the violations. The First Circuit reversed dismissal, in part. A unanimous Supreme Court vacated. The FCA does not define a “false” or “fraudulent” claim; the claims at issue may be actionable because they do more than merely demand payment. Representations that state the truth only so far as it goes, while omitting critical qualifying information, can be actionable misrepresentations. By conveying specific information about services without disclosing violations of staff and licensing requirements, Universal’s claims constituted misrepresentations. FCA liability for failing to disclose violations of legal requirements does not depend upon whether those requirements were expressly designated as conditions of payment. While statutory, regulatory, and contractual requirements are not automatically material, even if labeled as conditions of payment, a defendant can have “actual knowledge” that a condition is material even if the government does not expressly call it a condition of payment. View "Universal Health Servs., Inc. v. United States" on Justia Law

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The Medicaid statute’s anti-lien provision, 42 U. S. C. 1396p(a)(1), pre-empts state efforts to take any portion of a tort judgment or settlement not “designated as payments for medical care.” A North Carolina statute requires that up to one-third of damages recovered by a beneficiary for a tortious injury be paid to the state to reimburse it for payments made for medical treatment on account of the injury. E. M. A. suffered serious birth injuries that require her to receive 12 to 18 hours of skilled nursing care per day and that will prevent her from working or living independently. North Carolina’s Medicaid program pays part of the cost of her ongoing care. E. M. A. and her parents filed a medical malpractice suit against the physician who delivered her and the hospital where she was born and settled for $2.8 million, due to insurance policy limits. The settlement did not allocate money among medical and nonmedical claims. The state court placed one-third of the recovery into escrow pending a judicial determination of the amount owed by E. M. A. to the state. While that litigation was pending, the North Carolina Supreme Court held in another case that the irrebuttable statutory one-third presumption was a reasonable method for determining the amount due the state for medical expenses. The federal district court, in E.M.A.’s case, agreed. The Fourth Circuit vacated. The Supreme Court affirmed. The federal anti-lien provision pre-empts North Carolina’s irrebuttable statutory presumption that one-third of a tort recovery is attributable to medical expenses. North Carolina’s irrebuttable, one-size-fits-all statutory presumption is incompatible with the Medicaid Act’s clear mandate View "Wos v. E. M. A." on Justia Law

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The Federal Tort Claims Act waives sovereign immunity from tort suits, 28 U. S. C. 1346(b)(1), except for certain intentional torts, including battery; it originally afforded tort victims a remedy against the government, but did not preclude suit against the alleged tort-feasor. Agency-specific statutes postdating the FTCA immunized certain federal employees from personal liability for torts committed in the course of official duties. The Gonzalez Act makes the FTCA remedy against the U.S. preclusive of suit against armed forces medical personnel, 10 U. S. C. 1089(a), and provides that, “[f]or purposes of this section,” the FTCA intentional tort exception “shall not apply to any cause of action arising out of a negligent or wrongful act or omission in the performance of medical ... functions.” Congress subsequently enacted the Federal Employees Liability Reform and Tort Compensation Act, which makes the FTCA remedy against the government exclusive for torts committed by federal employees acting within the scope of their employment, 28 U. S. C. 2679(b)(1); federal employees are shielded without regard to agency or line of work. Levin, injured as a result of surgery performed at a U. S. Naval Hospital, sued the government and the surgeon, asserting battery, based on his alleged withdrawal of consent shortly before the surgery. Finding that the surgeon had acted within the scope of his employment, the district court released him and dismissed the battery claim. Affirming, the Ninth Circuit concluded that the Gonzalez Act served only to buttress the personal immunity granted military medical personnel and did not negate the FTCA intentional tort exception. The Supreme Court reversed and remanded. The Gonzalez Act section 1089(e) abrogates the FTCA intentional tort exception, allowing Levin’s suit against the U.S. alleging medical battery by a Navy doctor acting within the scope of employment. The operative clause states, “in no uncertain terms,” that the FTCA intentional tort exception “shall not apply,” and confines the abrogation to medical personnel employed by listed agencies. View "Levin v. United States" on Justia Law