U.S. ex rel. Osheroff v. Tenet Healthcare Corp. (Summary)

 

FALSE CLAIMS ACT – WHISTLEBLOWER

U.S. ex rel. Osheroff v. Tenet Healthcare Corp., No. 09-22253-CIV (S.D. Fla. July 12, 2012)

The United States District Court for the Southern District of Florida denied a healthcare company’s motion to dismiss a whistleblower’s complaint on the grounds that it was based on publicly disclosed information and therefore barred under the Public Disclosure Bar of the False Claims Act. However, the court did grant the company’s motion to dismiss the complaint because it failed to sufficiently allege that the company knew that it had filed false Medicare and Medicaid claims, with leave for the whistleblower to amend the complaint.

The healthcare company and its subsidiaries owned or leased medical office buildings and hospitals. A whistleblower alleged that the company’s hospitals took patient referrals from physicians who leased the company’s office space, and these referrals were then submitted as claims to Medicare and Medicaid. The whistleblower also alleged that the company offered referring physicians below-market rental rates in exchange for the referrals.

Since the whistleblower’s allegations were derived from an informational email that the healthcare company circulated to 3,300 recipients, the company sought to dismiss the whistleblower’s allegations on the grounds that the allegations were subject to the Public Disclosure Bar of the False Claims Act. However, the court denied this motion because the whistleblower’s allegations were the result of independent synthesis and analysis of the information provided in the email.

Also, although the whistleblower alleged that a financial relationship existed between the company and referring physicians in the form of below-market lease rates to referring physicians, the court held that the allegation was not pled with sufficient particularity to establish that the company knew that it had submitted Medicare and Medicaid claims that violated the False Claims Act. Accordingly, the court granted the motion to dismiss claims relating to false claims allegations, but it granted the whistleblower leave to file an amended complaint.