Experts play a crucial role in False Claims Act cases involving disputes over whether a provider's claims for reimbursement by Medicare violate Medicarerules and regulations. If both sides, relator/government and the defense, have experts, then unless an expert's testimony is stricken or limited, the dueling opinions of experts will often create issues of fact and thereby preventeither side from obtaining summary judgment. Moreover, courts frequentlygive experts wide latitude in expressing their opinions under the rubric thatexpert opinions will "assist the trier of fact" even though an expert's opinions and methodology may be highly suspect.
A case that recently demonstrated that the tolerance for experts --in this instance, government experts-- is not limitless and that refused to permit experts to testify on the grounds that their testimony would not help the jury is U.S. ex rel Lawson v. Aegis Therapies, Inc., 2015 WL 1541491 (March 31, 2015, S.D. GA). In this instructive case, the Court struck the testimony of two government Medicare experts on the grounds that they essentially applied an incorrect and more stringent regulatory standard to evaluate the defendants' Medicare billing practices. Moreover, the Court refused to permit one expert to recast and equate that more stringent standard as the correct regulatory standard "based on her personal experience."
In Aegis, a relator brought a False Claims Act case against a skilled nursing facility ("SNF") and a rehabilitation therapy company which provided services to the facility's residents. Among other things, the relator claimed that the SNF provided medically unnecessary care to the residents, and as a result, submitted false claims for reimbursement to Medicare. The governmentintervened in the case, and it retained two experts, a physician and a nurse practitioner, both of whom opined that out of a random review of 30 patient files, 29 patients had received medically unnecessary rehabilitative care.
The defendants moved to exclude the testimony of these two experts, allegingthat they employed the "wrong standard" to determine what constitutes "reasonable and necessary" medical services in their evaluation of the SNF patients' medical records. Essentially, the defendants challenged the"reliability of the experts' methodology and the helpfulness of their testimony to the jury." The Court agreed and struck the government's two experts, finding that their testimony was "not based on a reliable methodology and it will not assist the trier of fact in determining a material factual question."
The Court's decision to exclude the experts turned in large part on what standard was to be applied to determine "what level of improvement [for the patient] is required for a skilled service to be necessary" and covered under Medicare. The Court found that the applicable Medicare standard fordetermining whether "reasonable and necessary medical services" were provided to patients depended on whether there was a reasonable expectation that the service being provided (e.g., speech-language pathology services, physical therapy, occupation therapy) will cause the patient to "improve materially in a reasonable and generally predictable period of time." Instead of applying this "material improvement" standard, the government's experts applied a different standard. In assessing whether the defendants had provided medically necessary services to the patients, the government's experts evaluated whether the services provided to the SNF's patients caused a "significant practical improvement" in the patient's condition. This later standard, the Court observed, had a "different meaning on its face than the applicable 'material standard.'"
Though the evaluating standards for what constitutes a reasonable and medically necessary service were different on their face and derived from different parts of the Medicare program (Part A and Part B), the government argued that the experts' use of the "significant improvement" standard, though different legally than the "material improvement standard," essentially meant the same thing in the "ordinary sense." In turn, one of the government's experts assured the Court that she had, "in fact, applied the correct standard."The Court was having none of it. The Court observed that "using a standard --either in its regulatory sense or in its ordinary sense-- that is decidedly at oddswith the actual governing standard" does not assist the trier of fact to determine the facts at issue in the case. In fact, such testimony, the Court went on, could "confuse or mislead the jury" such that the risk of confusing the jury outweighed "any potential benefit" from the testimony.
Having stricken the government's experts, the Court granted summary judgment to the defendants in part based on the government's failure to show that the defendants had, in fact, submitted false claims to Medicare.
The Aegis case is a remarkable decision. First, the Court clearly took the time to review the complex Medicare law, regulations, and manuals at issue. It did not throw up its hands at the complexity of the issues, but instead sifted through it and the testimony to come up with a well reasoned decision as to what legal standard should be used to determine whether the Medicare services provided were medically necessary, i.e., the standard for determining whether the Medicare claims at issue were false. Second, in so doing, the Court did not defer to the experts on the issues of law "as applied" in the context of deciding whether a particular service provided to patients was medically necessary. Third, in Dickens' book, Through the Looking Glass, Humpty Dumpty says, "When I use a word . . . it means just what I choose it to mean -- neither more nor less." The Court rejected that approach. The terms,"material' and "significant," are not fungible nor may they be interpreted to mean the same when used in the "ordinary" way.