No Good Deed Goes Unpunished

Oscar Wilde observed, “No good deed goes unpunished.”  Whistle-blower Michael Cascio discovered the truth of that saying when a federal court threw out his qui tam case against a national wound care provider that partners with some 800 hospitals across the country.

Mike and two others alleged that Healogics engaged in a fraudulent billing scheme by directing doctors to upcode (i.e., label a procedure as more serious than warranted) and perform medically unnecessary services.  On May 11 the court granted Healogics’s motion to dismiss, noting that the plaintiffs had not identified “a single instance” where a physician actually overcharged or performed unnecessary services or where an overcharge bill was actually sent.

Here’s where Mike’s good deed comes in.  The complaint did alleged a specific instance where a doctor upcoded a procedure.  But, the court pointed out, the complaint went on to allege that when Mike informed the doctor of his error, the doctor “went back and adjusted the billing and dictation” to the correct code.  So, the court noted, in that case there was no false billing.  That’s how Mike’s good deed—informing the doctor of his error–played a role in dismissal of the case.

But the dismissal may not be the end of the case.  The court declined to make it a dismissal with prejudice and gave the plaintiffs until May 25 to file an amended complaint.

The case is U.S. ex rel. Van Raalte v. Healogics, Inc., 2106 BL 150501 (M.D. Fla. 2016).

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