Kickback Case Survives Motion to Dismiss

A fraud suit alleging that five hospitals in the south bribed local clinics to refer undocumented immigrants to the hospitals to give birth has survived a motion to dismiss.

 

In the suit, captioned U.S. ex rel. Williams v. Health Management Associates (M.D. Ga.), a whistleblower alleges that the Georgia- and South Carolina-based hospitals paid local clinics fees, ostensibly for translation support, assistance in determining Medicaid eligibility and other services.  The clinics serve pregnant undocumented immigrants.  The women who use the clinics generally do not qualify for government healthcare programs.  However, Medicaid does reimburse hospitals for emergency services when undocumented immigrants give birth at their facilities.

 

The whistleblower in Williams alleged that the fees paid by the hospitals to the clinics were sham payments to induce the clinics to refer more patients to the hospitals. 

 

The defendants argued that the whistleblower’s complaint failed to state a claim for relief, but the court disagreed.  Among the reasons, the court noted that the whistleblower had alleged that the defendants executed certifications to the government falsely stating that the services for which they sought reimbursement were procured without payment of a kickback.  The certification further stated that the information provided to the government was “true, correct and complete.” 

 

Based on these alleged false certifications, the court concluded that the whistleblower had adequately alleged that the defendants had falsely billed the government for services provided to the undocumented pregnant women. 

 

The case now proceeds to discovery.