United States ex rel. Jackson v. Depaul Health Sys.

454 F.Supp.3d 481

UNITED STATES of America, EX REL. Terry JACKSON, Plaintiff,

v.DEPAUL HEALTH SYSTEM, et al., Defendants.

CIVIL ACTION NO. 15-020

United States District Court, E.D. Pennsylvania.

Signed April 15, 2020

Peter R. Bryant, Bryan R. Lentz, Bochetto & Lentz PC, Philadelphia, PA, for Plaintiff.

Charlene Keller Fullmer, Margaret L. Hutchinson, Elizabeth S. Mattioni, Gerald B. Sullivan, Assistant U.S. Attorney, U.S. Attorney's Office, Philadelphia, PA, for United States of America.

Abigail A. Hazlett, Richard J. Zack, Brian M. Nichilo, Pepper Hamilton LLP, Philadelphia, PA, for Defendants.

MEMORANDUM

EDUARDO C. ROBRENO, District Judge

I. INTRODUCTION

Terry Jackson brings a qui tam action against Baker's Bay Nursing Home Associates, LP, and DePaul Healthcare, LP, for violating the False Claims Act by allegedly providing worthless services to its nursing home residents and submitting falsified forms to the government. Before the Court are Defendants' motion in limine and motion for summary judgment.

Jackson's evidence of regulatory noncompliance does not show the level of malfeasance required to prove a factually false claim based on a worthless services theory. On the other hand, Jackson does point to enough evidence of the submission of inaccurate forms to raise a genuine issue of material fact about the submission of a legally false claim based on an express certification theory.

Therefore, for the reasons set forth below, the motions will be granted in part and denied in part.

II. FACTUAL BACKGROUND

Defendants operate River's Edge, a 120-bed nursing facility that provides short- and long-term care to between 60 and 120 residents. To provide care to these residents, it employs Certified Nursing Assistants ("CNA"), Licensed Practical Nurses ("LPN"), Registered Nurses ("RN"), and Primary Care Physicians. Patient care and regulatory compliance is overseen by a Director of Nursing ("Director"). River's Edge receives payment for the services it provides to its residents through private pay, commercial insurance, and Medicaid and Medicare.

A. River's Edge's Regulatory Compliance

As a recipient of Medicare and Medicaid funds, River's Edge is required to submit to the federal government Minimum Data Set ("MDS") forms for each resident annually, quarterly, and if there is a significant change in a resident's condition.¹ MDS forms contain resident information, such as whether a resident fell or experienced excess weight loss. But the MDS forms do not contain all the data from a resident's file. Instead, the Director collects data from Activities of Daily Living ("ADL") forms, which are filled out by CNAs, and translates this information into the MDS forms. MDS forms also include a certification that the information contained in the form is accurate and that the payment of federal funds is conditioned on the accuracy of the form. River's Edge is then paid per resident per day based on the information contained in each resident's MDS form.

River's Edge is also required to comply with a Pennsylvania regulation requiring a minimum of 2.7 hours of care per patient per day ("PPD"). 28 Pa. Code § 211.12. Compliance with this regulation is based on the total actual hours worked by staff in a 24-hour day divided by the number of residents. And compliance is tracked by a staffing coordinator and monitored by the Director. River's Edge creates a four-to-six-week schedule and a projected PPD based on this schedule. Then, it creates a daily staff assignment sheet based on the schedule and the number of residents for each day. Last, the actual PPD is calculated by looking at the payroll records and the daily assignments.

River's Edge's operations are audited by the Pennsylvania Department of Health through unannounced visits. At these visits, which last several days, the Department of Health announces to the residents that they should share with the Department their complaints about the facility. Despite these unannounced visits, between 2012 and 2017 the Department of Health did not find any aspect of River's Edge operation to be "immediate jeopardy" deficient,² and River's Edge was never ordered to shut down. That said, the Department of Health issued two statements of deficiencies for River's Edge in 2015: (1) failure to accurately complete seven MDS forms and (2) failure to properly submit Electronic Event Reports³ for a scabies outbreak for twelve residents.

In addition to the unannounced regulatory audits, River's Edge independently ensures regulatory compliance. To ensure compliance with standard of care regulations, the Director performs daily rounds and conducts monthly resident council meetings. And to ensure compliance with the PPD regulations, River's Edge schedules its staff to work more than the minimum required hours, such that there is a surplus in excess of the required 2.7 PPD, to account for staff call outs and no shows.

B. Terry Jackson

Terry Jackson, the plaintiff or relator in this case, worked at River's Edge part-time as a CNA from 1999 to 2014. As a CNA, her job was to assist nurses in caring for patients and to fill out ADL forms. Jackson was never involved with (1) billing Medicaid or Medicare, (2) scheduling or calculating PPD, (3) procurement of supplies, or (4) Department of Health inspections. Nonetheless, Jackson alleges that during her time at River's Edge, the facility was understaffed, provided substandard care to its residents, and must have submitted fraudulent compliance forms to the federal government.

Jackson alleges that River's Edge was so understaffed that nurses could not respond to residents' call-bells and could not provide adequate care. According to Jackson, while each nursing staff member should have been assigned 12 residents to comply with the PPD regulation, they were typically each assigned between 14 and 16 residents. She was present for three Department of Health inspections in her 15 years at River's Edge, and she claims that the facility changed staff schedules during inspections to ensure that there was enough staff during the inspections. She also alleges that bed-ridden residents were left in unsanitary conditions, including being left in soiled sheets without being bathed, due to staffing shortages. And she alleges that LPNs performed tasks that only RNs were certified to perform. Further, Jackson describes a lack of proper equipment, such as clean towels and linens. But at the same time as she makes all of these allegations, she acknowledges that the care she provided was fair, good, or excellent.

Jackson claims there were fraudulent representations in the MDS forms submitted for Medicare and Medicaid reimbursement because the ADL forms that she completed contained errors. Jackson completed ADL forms weeks after giving the care being documented due to her having insufficient time to complete the forms at the same time as rendering the care. So, although she was never told to falsify ADL forms, she asserts that the delay in completing the forms inevitably led to errors, which in turn necessarily caused false representations in the MDS forms because the MDS forms are prepared based on information in the ADL forms. Jackson also alleges that some services recorded in River's Edge's MDS forms never actually occurred. But she does not point to any specific error in an ADL form or misrepresentation in an MDS form.

C. D.F., W.M., and C.D.

Jackson provides four examples—three specific and one non-specific—of low-quality care at River's Edge. Most of Jackson's allegations of substandard care are devoid of specifics. Her assertion that a resident had a maggot-infested wound does not include the resident's name or the time frame of this incident. But Jackson does point to, as representative examples of poor care, circumstances allegedly constituting substandard care to three residents.

First, D.F. had scabies, a highly contagious skin condition, which was treated for two weeks with a cream to relieve symptoms. Jackson contends that D.F.'s treatment should have been more than just application of symptom-relief cream. But she does not present evidence of a more appropriate treatment, and River's Edge contends that the treatment provided was adequate. D.F. was also not quarantined, which led to an outbreak of scabies. River's Edge did not report the outbreak, but it has subsequently implemented procedures to ensure the reporting of infection outbreaks in the future.

Second, W.M. suffered from bedsores and was not always turned every two hours, as required for bedsore treatment, because of a lack of staffing. According to Jackson, the extent of the substandard care was that she sometimes failed to turn W.M. every two hours. And W.M. was treated by a wound care specialist.

Last, C.D., a ninety-year-old resident in a wheelchair, was left unattended and suffered a fall that resulted in severe injuries. C.D. was on the ground for twenty minutes after the fall because River's Edge staff chose not to move her given the extent of the injuries and the risk of exacerbating the injuries. They called an ambulance instead. As a result of the fall, C.D. lost the mobility that she had prior to the fall.

D. Procedural History

Jackson's complaint consists of two counts: (1) False Claims Act and (2) retaliation. Upon investigation of Jackson's allegations, the United States declined to intervene in the action. Defendants moved to dismiss for failure to state a claim. And the Court granted Defendants' motion in part, dismissing Jackson's retaliation count but allowing her False Claims Act count to proceed on both a worthless services theory and a false certification theory.

Now, Defendants move for summary judgment, arguing that the record shows the services provided were not worthless and that Jackson fails to point to evidence of a false material certification. Together with the motion for summary judgment, Defendants move to exclude the testimony of Jackson's expert.

III. LEGAL STANDARD

Summary judgment is...