United States ex rel. Bartlett v. Ashcroft
39 F. Supp. 3d 656
W.D. Pa.2014Background
- Relators Bartlett and Gummo, former Tyrone Hospital employees, allege a Stark Act self-referral scheme and FCA violations by Physician Defendants and Tri-County Imaging.
- Tyrone Hospital paid Tri-County for CT scans, with DiGiacobbe receiving a 15% fee, creating a financial flow among physicians, Tri-County, and Tyrone Hospital.
- Physician Defendants owned Tri-County shares and had a role in radiology, with Tri-County providing CT services at Tyrone Hospital’s facility.
- HHS CMS/UB-92 forms and spreadsheets identify attending/other physicians tied to inpatient/outpatient Medicare claims; these claims are alleged to be Stark-tainted.
- Court grants partial summary judgment to Relators on Stark Act violations (financial relationship and referrals) and denies others; Defendants’ summary judgment on FCA and AKS issues remains contested.
- Settlement statements indicate broader case posture changes (Tyrone Hospital and Dr. DiGiacobbe later dismissed).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a Stark Act financial relationship existed | Bartlett/Relators show physician shareholder ties and Tri-County arrangement. | Physician Defendants contend no Stark-relevant relationship or valid exception proven. | Yes, a Stark Act financial relationship existed (pre-2002 indirect arrangement guidance applied for context). |
| Whether an exception to Stark liability applies | Relators argue no Stark exception fits; otherwise, strict liability applies. | Defendants did not establish any Stark exception. | Relators succeed on the absence of a Stark exception; Stark liability found unless exception applies (none proven). |
| Whether Tyrone Hospital submitted Medicare claims arising from referrals | HHS spreadsheets show claims with Physician Defendants as attending/other physicians. | Claim details do not prove referral or CT-scan linkage; factual dispute may exist. | Relators established Stark-tainted claims; Tyrone Hospital submitted Medicare claims based on referrals. |
| Whether Defendants knowingly caused false claims under the FCA | Relators argue Stark violations and financial ties show knowledge of false claims. | No direct evidence of knowledge; FCA liability requires knowledge beyond Stark violation. | Disputed; summary judgment denied on FCA causation/knowledge; trial needed for intent. |
| Whether Anti-Kickback Statute violations exist | Payments to Tri-County (space, CT fees, salaries) induce referrals. | Payments at fair market value and within safety frameworks may avoid liability; contentions hinge on intent. | Issues of material fact preclude summary judgment for AKS; jury must assess intent and reasonableness. |
Key Cases Cited
- Schmidt v. Zimmer, Inc., 386 F.3d 235 (3d Cir. 2004) (falsity theories under FCA; knowing submission of false claims)
- Greber v. United States, 760 F.2d 68 (3d Cir. 1985) (intent to induce referrals; broad AKS interpretation)
- Kosenske v. Carlisle HMA, Inc., 554 F.3d 88 (3d Cir. 2009) (Stark Act exceptions and indirect compensation arrangements)
- Rogan v. United States, 517 F.3d 449 (7th Cir. 2008) (indirect compensation arrangements under Stark/anti-kickback context)
- United States v. Wilkins v. United Health Grp., Inc., 659 F.3d 295 (3d Cir. 2011) (AKS/False Claims Act principles; liability theories)