Justia U.S. 6th Circuit Court of Appeals Opinion Summaries

Blue Cross controls more than 60% of the Michigan commercial health insurance market; its patients are more profitable for hospitals than are patients insured by Medicare or Medicaid. BC enjoys “extraordinary market power.” The Justice Department (DOJ) claimed that BC used that power to require MFN agreements: BC would raise its reimbursement rates for services, if a hospital agreed to charge other commercial insurers rates at least as high as charged to BC. BC obtained MFN agreements with 40 hospitals and MFN-plus agreements with 22 hospital systems. Under MFN-plus, the greater the spread between BC's rates and the minimum rates for other insurers, the higher the rates that BC would pay. Class actions, (consolidated) followed the government’s complaint, alleging damages of more than $13.7 billion, and seeking treble damages under the Sherman Act, 15 U.S.C 15. In 2013, Michigan banned MFN clauses; DOJ dismissed its suit. During discovery in the private actions, plaintiffs hired an antitrust expert, Leitzinger. BC moved to exclude Leitzinger’s report and testimony. Materials relating to that motion and to class certification were filed under seal, although the report does not discuss patient information. BC agreed to pay $30 million, about one-quarter of Leitzinger's estimate, into a settlement fund and not to oppose requests for fees, costs, and named-plaintiff “incentive awards,” within specified limits. After these deductions, $14,661,560 would be allocated among three-to-seven-million class members. Class members who sought to examine the court record or the bases for the settlement found that most key documents were heavily redacted or sealed. The court approved the settlement and denied the objecting class members’ motion to intervene. The Seventh Circuit vacated, stating that the court compounded its error in sealing the documents when it approved the settlement without meaningful scrutiny of its fairness to unnamed class members . View "Shane Group, Inc. v. Blue Cross Blue Shield of Mich." on Justia Law

A class of Tennessee residents who applied for Medicaid sought declaratory and injunctive relief, alleging that the delays they have experienced in receiving eligibility determinations on their applications violate 42 U.S.C. 1396a(a)(8) of the Medicaid statute, and that the state’s failure to provide a fair hearing on their delayed applications violates that statute and the Due Process Clause. Regulations implementing the statute provide that “the determination of eligibility for any applicant may not exceed” 90 days for those “who apply for Medicaid on the basis of disability” and 45 days for all other applicants. The district court certified a class and granted a preliminary injunction, which requires the state to grant a fair hearing on delayed applications to class members who request one. The Sixth Circuit affirmed the preliminary injunction, holding that the matter is not moot and that the federal government is not a required party. The court noted that the federal government submitted an amicus brief, supporting plaintiffs’ position. Despite the passage of the Affordable Care Act, states remain ultimately responsible for ensuring their Medicaid programs comply with federal law. View "Wilson v.Gordon" on Justia Law

Plaintiff is a 26-bed, for-profit, physician-owned hospital that specializes in acute-care surgical services. Its Dayton-area competitors include the defendant hospitals (Premier Group), which have joint operating agreement for negotiating managed care insurance contracts and sharing revenues and losses through an agreed-upon formula, while maintaining separate asset ownership and filing separate tax returns and other corporate forms. Plaintiff sued, alleging violation of the Sherman Act, claiming that Premier was not a single entity, but a group of hospitals capable of concerted action to keep plaintiff from competing in the market. The court dismissed, concluding that Premier was a single entity. The Sixth Circuit reversed, citing the Supreme Court’s multi-factored test for determining whether a joint venture constitutes a “combination” under 15 U.S.C. 1: the condition of the business before and after the restraint is imposed; the nature of the restraint and its effect, actual or probable; the reason for adopting the particular remedy, and the purpose or end sought to be attained. The summary judgment record indicated that the purpose of Premier was to prevent plaintiff from entering the Dayton market; there was evidence of coercive conduct, threatening physicians and insurance companies with financial loss if they did business with plaintiff. There was also evidence of continued competition among the defendants, creating a genuine issue of material fact. View "Med. Ctr. at Elizabeth Place, LLC v. Atrium Health Sys." on Justia Law

Relator brought a qui tam action (False Claims Act, 31 U.S.C. 3730(b)), alleging KHN (network of hospitals, physicians, and healthcare facilities) falsely certified its compliance with the Health Information Technology for Economic and Clinical Health Act (HITECH), 123 Stat. 226 (2009), to receive “meaningful use” incentive payments. HITECH was designed to encourage the adoption of sophisticated electronic health record technology and creates incentive payments for “meaningful use” of certified technology, 42 U.S.C. 1395. To receive incentive payments, providers must meet meaningful-use objectives and accompanying compliance measures. Stage 1 of Act implementation required a security risk analysis in accordance with 45 C.F.R. 164.308(a)(1); implementation of need security updates; and correction of identified security deficiencies. During Stage 2, providers are required to address[] the encryption/security of data stored in Certified EHR Technology in accordance with 45 C.F.R. 164.312(a)(2)(iv) and 164.306(d)(3). To receive incentive payments, providers must attest to meeting these standards. The Sixth Circuit affirmed dismissal, finding that Relator failed to plausibly allege that KHN’s attestation of HITECH compliance was false and failed to plead a specific claim for payment; and that Relator’s claims were precluded by a prior Ohio state judgment in a case involving similar claims filed by Relator against KHN. View "United States v. Kettering Health Network" on Justia Law

From 1983-2005, Moen entered into collective bargaining agreements (CBAs) with the union. Employees who retired 1983-1996 and their dependents received hospitalization, surgical and medical coverage without cost. If the retirees (or spouses) were over age 65, Moen also reimbursed the full cost of Medicare Part B premiums. After 1996, retirees and dependents received hospitalization, surgical, and medical coverage upon payment of a co-premium frozen at the time of retirement. If over 65, they received Part B premium reimbursements at specified rates. In 2008, Moen shut down its Elyria operations. A “Closure Effects Agreement” provided that health-care coverage “shall continue” for retirees and spouses “under the [final] Collective Bargaining Agreement.” In 2013, Moen decreased benefits in response to “recent Medicare improvements” and the imposition of an excise tax on “Cadillac plans” through the Patient Protection and Affordable Care Act, 26 U.S.C. 4980I. Medicare-eligible retirees no longer receive coverage or Part B premium reimbursements; Moen shifted non-Medicare-eligible retirees to a plan that requires higher out-of-pocket payments. The court certified a class of about 200 individuals who had retired from the plant and were not covered by an earlier settlement agreement, then granted the plaintiffs summary judgment in reliance on Sixth Circuit precedent that was subsequently repudiated by the Supreme Court. The Sixth Circuit reversed, based on that 2015 decision. View "Gallo v. Moen Inc." on Justia Law

When Colonel Antoon (U.S. Air Force, retired) learned that he needed prostate surgery, he researched options and specialists, which led him to the Cleveland Clinic and Dr. Kaouk. Antoon interviewed Kaouk and arranged for him to perform the operation. When Antoon experienced complications following the surgery, his further investigation caused him to suspect that Kaouk did not actually perform the surgery, but passed off major duties to a surgical resident. Antoon lodged several complaints and filed a medical malpractice action in state court, which was dismissed voluntarily. Antoon then filed suit as a relator under the qui tam provisions of the False Claims Act (FCA), premised on the theory that Kaouk billed the government for work he did not perform, and promoted the robotic surgical device he recommended in violation of the anti-kickback statute, 42 U.S.C. 1302a-7b(b)(2). The United States declined to intervene. The district court dismissed. The Sixth Circuit affirmed, based on a jurisdictional bar. Antoon does not have any direct and independent knowledge of the information upon which his fraud allegations are based; therefore he cannot qualify as an original source of that information, and cannot establish standing as a qui tam plaintiff under the FCA, 31 U.S.C. 3730(e)(4)(B). View "Antoon v. Cleveland Clinic Found." on Justia Law

The State of Tennessee operated the Arlington Developmental Center, an institutional home for people with mental disabilities. In 1992, the United States sued Tennessee under the Civil Rights of Institutionalized Persons Act alleging that, among other things, Tennessee had failed to provide Arlington’s residents with adequate food, medical care, supervision, and shelter. After a trial on the merits, the district court found that Arlington’s conditions violated the due-process rights of its residents. The court ordered the State to submit a plan to improve conditions there. Since then, People First of Tennessee has presented 19 applications for attorneys’ fees to the district court. Tennessee consented to pay every dollar of fees requested in the first 18 applications filed by intervenors-appellees People First of Tennessee (a total of about $3.6 million, including over $400,000 for the period at issue here). But the State objected to People First’s 19th application, which for the most part sought fees for a contempt motion that the district court had stricken from the docket and that People First never renewed. The 19th application also sought fees for hours that People First’s attorneys had chosen to spend monitoring the State’s compliance with the consent decree, even though the State had already paid $10.6 million in fees to a monitor whom the court had appointed for that same purpose. Despite those circumstances, the district court awarded People First $557,711.37 pursuant to the application, holding that People First had been a “prevailing party” with respect to its contempt motion. The State appealed the district court's award. After review, the Sixth Circuit disagreed with the district court's judgment, reversed and remanded. View "United States v. Tennessee" on Justia Law

Keathley retired from working at strip mines. His health deteriorated. He sought Black Lung Benefits Act benefits, 30 U.S.C. 901. Keathley established eligibility under the 15 -year presumption; he had worked in mines for more than 16 years and was able to show a totally disabling impairment by medical opinion testimony and tests showing poor pulmonary function. His employer rebutted this presumption by offering testimony by Dr. Broudy, who diagnosed Keathley with “a combination of chronic obstructive asthma and pulmonary emphysema and chronic bronchitis” caused by smoking. Conceding that “coal dust may have contributed,” Broudy concluded that “it’s far more likely that the impairment was due to obstructive airways disease from cigarette smoking and some predisposition to asthma or bronchospasm.” On remand, the ALJ awarded benefits; the Benefits Review Board affirmed, rejecting Broudy’s opinion that “bronchitis associated with coal dust exposure usually ceases with cessation of exposure,” as contrary to federal regulations, which state that “pneumoconiosis” may be “latent and progressive” and arise after exposure ceases. The Sixth Circuit denied the employer’s petition for review. The employer did not challenge the evaluation of individual tests, identify any factor the ALJ overlooked, or offer any basis for distinguishing among the tests. View "Sunny Ridge Mining Co., Inc. v. Keathley" on Justia Law

Dura began testing employees at its Lawrenceburg, Tennessee manufacturing facility for substances in illegal drugs and in prescription medications packaged with warnings about operating machinery. Plaintiffs, none of whom has a disability under the Americans with Disability Act (ADA), worked at the facility and took various prescribed medications. After they tested positive, Dura directed the employees to disclose their medications to FFS, a third-party company hired to administer the tests. FFS reported the machine-restricted drugs to Dura, which warned plaintiffs to discontinue using the offending medications. After retests came back positive, Dura terminated their employment. Plaintiffs filed suit, alleging violation of the ADA, 42 U.S.C. 12112(d)(4)(A), which prohibits employers from requiring “medical examination[s]” or “mak[ing] inquiries of an employee as to whether such employee is an individual with a disability ... unless such examination or inquiry is shown to be job-related and consistent with business necessity.” A jury found for all but one plaintiff and awarded damages of more than $870,000. The Sixth Circuit reversed a holding that Dura’s drug-testing protocol constituted as a matter of law, a medical examination or disability inquiry and the related punitive-damages award. On remand, the jury must decide whether Dura’s drug testing constituted a medical examination or disability inquiry, relying on definitions and illustrative examples provided by EEOC guidance. If the jury finds Dura liable, it can proceed to consider punitive damages. The court affirmed with respect to the availability of statutory damages and the jury’s adverse business necessity/ job-relatedness verdict. View "Bates v. Dura Auto. Sys., Inc." on Justia Law

Kroll was an emergency medical technician (EMT) for WLAA when she began a romantic affair with her married coworker. As the relationship unraveled, Kroll became increasingly emotional at work. After Kroll had a personal altercation with one a coworker, her supervisor expressed concern regarding her “immoral” sexual conduct and demanded that she undergo psychological counseling. When Kroll refused, she was fired. Kroll claimed that WLAA violated the Americans with Disabilities Act (ADA) by requiring a medical examination that was not “job-related and consistent with business necessity,” 42 U.S.C. 12112(d)(4)(A). On remand, the district court granted summary judgment in favor of WLAA. The Sixth Circuit reversed and remanded, finding that there was evidence record to establish a genuine factual dispute as to whether the required counseling was “job-related and consistent with business necessity.” View "Kroll v. White Lake Ambulance Auth." on Justia Law