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United States ex rel. Druding v. Druding

United States Court of Appeals for the Third Circuit

September 10, 2019, Argued; March 4, 2020, Opinion Filed

No. 18-3298

Opinion

 [*91]  GREENAWAY, JR., Circuit Judge.

This case requires us to consider whether and when clinical judgments can be considered "false" in the context of the False Claims Act ("FCA"), 31 U.S.C. §§ 3729-3733 (2009). It is a matter of first impression in this Court.

Victoria Druding, Linda Coleman, Barbara Bain, and Ronni O'Brien (collectively, "Appellants"), each of whom is a former employee of Appellee Care Alternatives, brought this FCA action alleging that Care Alternatives admitted patients who were ineligible for hospice care and directed its employees [**2]  to improperly alter those patients' Medicare certifications to reflect eligibility. In support of their position, Appellants retained an expert. The expert opined in his report that, based on the records of the forty-seven patients he examined, the patients were inappropriately certified for hospice care thirty-five percent of the time.

Care Alternatives' expert disagreed and testified that a reasonable physician would have found all of the patients reviewed by Appellants' expert hospice-eligible on each occasion that Appellants' expert had deemed certification inappropriate. In considering Care Alternatives' summary judgment motion, the District Court determined that a mere difference of opinion between experts regarding the accuracy of the prognosis was insufficient to create a triable dispute of fact as to the element of falsity. In fact, the District Court required Appellants to instead provide evidence of an objective falsehood. Upon finding Appellants had not adduced such evidence, the District Court granted summary judgment in favor of Care Alternatives.

Today, we reject the District Court's objective-falsehood requirement for FCA falsity. Since we find that Appellants' expert [**3]  testimony created a genuine dispute of material fact as to falsity, we will vacate the judgment and remand to the District Court for further proceedings consistent with this opinion.

I. BACKGROUND

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952 F.3d 89 *; 2020 U.S. App. LEXIS 6795 **

UNITED STATES OF AMERICA and STATE OF NEW JERSEY ex rel. VICTORIA DRUDING; BARBARA BAIN; LINDA COLEMAN; RONNI O'BRIEN v. CARE ALTERNATIVES Victoria Druding, Barbara Bain, Linda Coleman, and Ronni O'Brien, Appellants

Prior History:  [**1] On Appeal from the United States District Court for the District of New Jersey. (D.C. Civ. Action No. 1-08-cv-02126). District Judge: Honorable Jerome B. Simandle.

Druding v. Care Alternatives, Inc., 346 F. Supp. 3d 669, 2018 U.S. Dist. LEXIS 165900 (D.N.J., Sept. 26, 2018)

CORE TERMS

falsity, patient, certification, district court, scienter, clinical, hospice, documentation, reimbursement, hospice care, eligible, summary judgment, medical opinion, terminally ill, certifying, expert testimony, medical record, regulations, prognosis, difference of opinion, medical prognosis, terminal illness, accompanied, fraudulent, purposes, grant summary judgment, genuine dispute, instructions, angiograms, falsehood

Public Health & Welfare Law, Medicare, Coverage, Part A Hospital Insurance, Governments, Federal Government, Claims By & Against, Civil Procedure, Appeals, Standards of Review, De Novo Review, Summary Judgment Review, Standards of Review, Legislation, Interpretation, Evidence, Types of Evidence, Testimony, Expert Witnesses