Aetna Life Insurance Co. v. Huntingdon Valley Surgery Center, 703 F. App'x 126

Aetna (insurer) sued Foundation Surgery Affiliates, LLC (FSA) and Foundation Surgery Management, LLC (FSM) (collectively, Defendants) and Huntingdon Valley Surgery Center (HVSC) alleging illegal kickbacks and insurance fraud for billing practices; HVSC later settled.
HVSC is out-of-network with Aetna; 22 physician-owners are in-network and allegedly receive ownership shares tied to surgeries performed at HVSC.
FSM provides management services for HVSC (recruiting, contracting, operating the Chargemaster) but is not licensed to provide medical care; FSA is a holding company.
HVSC routinely waived or reduced Aetna members’ copayments, coinsurance, or deductibles to approximate in-network out-of-pocket costs, but billed Aetna using the Chargemaster (list) prices without disclosing the waivers.
HVSC billed through third-party "rental networks" (Beech Street, MultiPlan); the billing form asked for "total charges" but did not define the term; rental-network contracts used terms like "usual billed charges" and "routinely charged," which the court found ambiguous.
The district court granted partial summary judgment for Defendants on the anti-kickback claim (§4117(b)(2)) and on fraud claims (§4117(a)); Third Circuit affirmed the anti-kickback ruling, vacated and remanded on fraud claims due to factual dispute over disclosure obligations.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether FSA/FSM are "health care providers" under §4117(b)(2) (anti-kickback)	Defendants operate and control a licensed facility and thus fall within the statute’s scope; the physician-owners’ incentive scheme violates the anti-kickback ban.	Defendants perform only administrative/management functions and are not licensed to provide medical care; §4117(b)(2) applies only to licensed health care providers.	The court held Defendants are not "health care providers" under §4117(b)(2); affirmed district court summary judgment on the anti-kickback claim.
Whether HVSC’s bills to Aetna were fraudulent under §4117(a) by listing Chargemaster prices without disclosing routine waivers	HVSC’s use of the billing form and contracts required disclosure of actual amounts expected to be paid (so routine waivers rendered the bills misleading).	The billing form only requested "total charges" (list price); charging list prices without disclosing waivers is not fraudulent as a matter of law.	The court held the billing form and contracts are ambiguous about disclosure duties; factual dispute exists about whether listing Chargemaster rates without disclosing routine waivers was misleading — vacated summary judgment and remanded for further proceedings.

Commonwealth v. Jarowecki, 985 A.2d 955 (Pa. 2009) (statutory interpretation principles; plain meaning controls where text unambiguous)
TrizecHahn Gateway LLC v. Titus, 976 A.2d 474 (Pa. 2009) (contract interpretation; ambiguous terms present questions of fact)
Davidowitz v. Delta Dental Plan of Cal., Inc., 946 F.2d 1476 (9th Cir. 1991) (insurer-contract clauses can prevent routine copay waivers)
Kennedy v. Conn. Gen. Life Ins. Co., 924 F.2d 698 (7th Cir. 1991) (contract governs permissibility of providers’ copay waivers)
Bohler-Uddeholm Am., Inc. v. Ellwood Group, Inc., 247 F.3d 79 (3d Cir. 2001) (contract ambiguity standard)
Leocal v. Ashcroft, 543 U.S. 1 (2004) (consistent statutory interpretation across criminal and civil contexts)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard; accept factual allegations as true on motion to dismiss)
Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (summary judgment standard; genuine dispute of material fact)
Florence v. Bd. of Chosen Freeholders, 621 F.3d 296 (3d Cir. 2010) (plenary review on interlocutory appeal under §1292(b))
Kaucher v. County of Bucks, 455 F.3d 418 (3d Cir. 2006) (defining materiality and genuine dispute at summary judgment)