Health care organizations team up to fight implied certification theory

A number of interested health care organizations have filed briefs before the U.S. Supreme Court in Universal Health Services v. U.S. ex rel. Escobar, in which the court will consider the theory of implied certification under the False Claims Act (FCA) (31 U.S.C. §3729). Under this theory, claims submitted to the government for reimbursement are tainted by failure to conform to statute, regulations, or provisions that are not considered a condition of payment (see Does fraud go without saying? Supreme Court to examine ‘implied certification’ in FCA, Health Law Daily, December 8, 2015).

Factual background

The case was brought by the parents of a patient who died at a mental health clinic following a seizure. The parents alleged that the caregivers were not supervised as required and that the clinic did not have psychiatrists and psychologists on staff with the credentials required by the state Medicaid program. They claimed that this noncompliance caused claims for payment to be false claims, even though payment was not conditioned upon meeting these particular regulations (see Appeals court takes practical approach to False Claims Act, Health Law Daily,  March 19, 2015).

Whistleblower suits

The health care organizations filing briefs in support of Universal Health Services, like the American Hospital Association, argue that the implied certification theory broadens the reach of the FCA beyond addressing truly fraudulent claims. The American Medical Association’s (AMA) brief notes the sharp increase in qui tam actions filed by relators hoping to obtain “life-changing wealth” by bringing fraud claims based on noncompliance with an underlying regulation, even when the government is satisfied with the original transaction. The organizations believe that the FCA should be used to fight fraud, and the AMA asserts that “imperfect compliance is not equivalent to fraud.”

Supreme Court sets March date for contraceptive mandate arguments

The Supreme Court has set a 90-minute hearing on March 23, 2016, for the seven cases challenging the Patient Protection and Affordable Care Act’s (ACA) (P.L. 111-148) contraceptive mandate. The challenges seek a decision from the Supreme Court overturning the ACA requirement that non-profit groups take action to opt out of the mandate, allowing them to benefit from the blanket exclusion granted to churches and other religious institutions (see Supreme Court will hear 7 challenges to contraceptive mandate, Health Reform WK-EDGE, November 10, 2015).

Non-profits challenge

At issue is whether the contraceptive coverage mandate and its accommodation process, which requires the filing of additional paperwork stating objections to the provision of contraceptives, violate the Religious Freedom Restoration Act (RFRA) (P.L. 103-141) by forcing religious nonprofits to act in violation of their sincerely held religious beliefs, when the government has not proven that the compulsion is the least restrictive means of advancing any compelling interest. The accommodation itself, the organizations argue, is a substantial burden on their religious exercise.

The Supreme Court will rule on whether the mandate and the accommodation violate the RFRA, but refused specifically to hear claims under the RFRA and the First Amendment that the government discriminated between those allowed an exemption and those not.

ACA implementation

The March hearing before the Supreme Court highlights the challenges found in implementing the contraceptive mandate. Despite these challenges, the ACA provision for contraceptive coverage has already directly benefited millions of women who use contraceptives by decreasing their total out-of-pocket spending on contraceptives.

According to researchers at Washington University in St. Louis, prior to the ACA, high initial costs were barriers to women using highly effective contraceptive methods such as intrauterine devices (IUDs) and implants. Cost also affected adherence to commonly used refillable methods such as oral contraceptive pills, the contraceptive patch, or the vaginal ring with recurring prescription co-payments previously required.

The researchers noted that the provision for contraceptive coverage has the potential to substantially improve public health. Access to contraception without financial barriers reduces unintended pregnancies and births, which in turn can improve maternal and infant health.

E.D. MO.: Politician’s contraception mandate challenge survives, thanks to Eighth Circuit remand

Missouri State Senator and former State Representative Paul Wieland’s (R) Religious Freedom Restoration Act (RFRA) (42 U.S.C. § 2000bb et seq.) challenge of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) contraception mandate will continue, a U.S. district court in Missouri ruled. Wieland and his wife claimed that the mandate forced them to violate their sincerely-held religious beliefs by either enrolling in a health plan that would have covered contraceptive services for their daughters or foregoing health insurance altogether. The district court formerly dismissed Wieland’s case but issued the new ruling upon remand from the Eighth Circuit Court of Appeals (Wieland v. HHS, January 8, 2016, Hamilton, J.).

Case history

Wieland and his family are lifelong Catholics who oppose the use of contraception. As a member of the Missouri General Assembly, Wieland received health insurance coverage through the Missouri Consolidated Health Care Plan (MCHCP). He and his wife objected to enrolling in a plan that provided contraceptive coverage and claimed that their only other option was to forego health insurance altogether, since they didn’t believe a plan that did not provide for contraceptive coverage existed and that, if it did, it would be significantly more expensive. The Wielands sued HHS and the Departments of the Treasury and Labor, alleging that the contraception mandate violated their rights under the RFRA, the First Amendment, the Fifth Amendment, and the Administrative Procedure Act (APA) (5 U.S.C. § 706).

The U.S. District Court for the Eastern District of Missouri (Eastern District) initially dismissed the case for lack of standing (see Court rejects parent’s challenge to individual mandate for birth control coverage, October 17, 2013). On appeal, the Eight Circuit determined that the Wielands suffered an injury, in that they would have been able to have a contraceptive-free plan but for the mandate, and that the situation resulted from HHS’ actions and not discretionary actions on the part of the state. It remanded the case back to the Eastern District for further action (see Parents have standing in contraceptive mandate lawsuit, July 22, 2015).

Sincerely-held beliefs

The Eastern District took note of the Eighth Circuit’s decision in Sharpe Holdings, Inc. v. U.S. Department of Health and Human Services (October 9, 2015, Noce, D.), in which the Eighth Circuit determined that subjecting a party to significant monetary penalties based on its sincerely-held religious beliefs was a substantial burden (see Contraceptive accommodation judgment final for for-profit employers, non-profits are still looking up, October 14, 2015). It also found persuasive the logic of a district court’s in March for Life v. Burwell (August 31, 2015, Leon, R.), in which the court determined that, while “plaintiffs are not the direct objects of the Mandate, they are very much burdened by it,” (see Nonprofit employer, religious employees not bound by contraceptive coverage requirement, September 2, 2015). The Eastern District ultimately allowed the Wielands’ RFRA claim to continue, noting that it could reasonably infer that the mandate caused them to violate their sincerely-held religious beliefs, while noting that the government could still eventually prove that it was furthering a compelling governmental interest through the least restrictive means necessary. The Eastern District dismissed the Wielands’ remaining claims, noting, in particular, that the mandate was neutral and generally applicable, failed to affect the manner in which the Wielands raise their children, and regulated conduct rather than speech. Furthermore, the Wielands lacked prudential standing under the APA, as they were not qualified health plans.

The case is No. 4:13-cv-01577-JCH.

Religious ‘friends’ get their words in edgewise in Supreme Court debate

Amicus briefs piled in before the Supreme Court over the contraceptive coverage argument so that each agreeing organization would have its chance to be heard. In March, the Court will hear both sides of the argument over whether the government’s “accommodation” allowing religious organizations to opt out of the requirement that they provide contraceptive coverage for their employees infringes on their religious freedom.

ACA accommodation

Sections 1001 and 1004 of the Patient Protection and Affordable Care Act’s (ACA) (P.L. 111-148) requires most private health insurance plans to provide coverage for a broad range of preventive services, including FDA-approved prescription contraceptives and services for women. Religiously-affiliated nonprofits and closely held for-profit corporations can opt out of providing contraceptive coverage by electing an accommodation, but they are not eligible for an exemption. When an accommodation is requested, female employees and dependents who are covered by a plan sponsored by an employer electing an accommodation have contraceptive coverage, but their employer does not have to pay for it.

The accommodation was originally created as a way to release nonprofit religiously-affiliated employers that oppose birth control from the requirement of paying for contraceptive coverage, but ensure that the employees and their dependents are able to obtain full coverage for the contraceptives to which they are entitled. This is done by requiring the insurer—rather than the employer—to bear the costs of the employees’ contraceptive coverage. Those challenging the accommodation believe that the requirements for opting out of the coverage still impose an undue burden on religion in violation of the Religious Freedom Restoration Act (RFRA) (42 U.S.C. §2000bb).

Amicus briefs

On November 6, 2015, the Supreme Court agreed to hear the challenges of seven religious non-profits challenging the accommodation. To date, several friends-of-the-court briefs have been filed on their behalf. In favor of the religious organizations, these include: (1) Orthodox Jewish Rabis; (2) 207 members of Congress; (3) the American Center for Law and Justice; and (4) the Cato Institute, among others. The government must submit its response brief by February 10, 2016. Oral arguments are expected to be heard the end of March.