United States ex rel. Found. Aiding the Elderly v. Horizon West Inc.,
No. 99-17539 (9th Cir. Sept. 13, 2001)

Relators filed a qui tam action against a hospital and numerous health care providers for receiving Medicare and Medicaid payments for care which was not given. The hospital argued that the case was barred under the False Claims Act because of prior public disclosure. The relators appealed after the district court dismissed the case for lack of jurisdiction.

The United States Court of Appeals, Ninth Circuit reversed the decision of the district court and ordered the case to proceed. The court found that in order for there to be a prior disclosure that would bar such a claim, there would have to be both allegations of a true set of facts (in this case, that subpar care was administered) and a set of misrepresented state of facts (in this case, that the government was billed for the subpar care) which would infer the grounds for a claim under the False Claims Act. The court found that the claim could proceed because, while there had been public allegations of subpar care at the hospital, there had been no prior disclosure of the fact that Medicare and Medicaid had been billed.