Justia U.S. 7th Circuit Court of Appeals Opinion Summaries

Articles Posted in Health Law
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Vargas received extensive medical care from the Veterans Administration. In his suit under the Federal Tort Claims Act, 28 U.S.C. 2671–80, he argued that a VA nurse was negligent in failing to order additional tests after receiving the results of urinalysis in October 2015. More testing, Vargas contended, would have revealed that he suffered from a urinary tract infection; failure to diagnose that infection led to a heart attack, which led to extended hospitalization, which led to pain and inflammation.The Seventh Circuit affirmed the rejection of his claims, upholding the district judge’s decision to allow testimony from a board-certified urologist. Federal Rule of Evidence 702 governs the admissibility of expert evidence in suits under the FTCA. The district judge was entitled to consider the urologist’s view that the applicable standard of care did not require follow-up testing to look for a urinary tract infection. If even a board-certified urologist would not have seen anything in the test result calling for further lab work, then a nurse practitioner’s identical decision cannot be negligent. Illinois does not hold nurses to the higher standard of specialists. View "Love v. United States" on Justia Law

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The Association of American Physicians & Surgeons (AAPS), is a nonprofit organization of physicians and surgeons. The American Board of Medical Specialties, a nonprofit provider of medical certification services, is an umbrella organization for 24 member boards, each dedicated to a particular medical practice area. The Board deems physicians who meet its requirements to be “Board-certified.” To remain certified, physicians must comply with the Board’s Maintenance of Certification (MOC) program and continuing education requirements. All states permit physicians who are not Board-certified to practice medicine.According to AAPS, the Board conspired with its member boards, hospitals, and health insurers to condition the granting of staff privileges and in-network status on physicians’ continued participation in the MOC program so that physicians find themselves forced to participate in the program to practice medicine, at least if they wish to do so in hospitals or to accept certain forms of insurance. The Seventh Circuit affirmed the dismissal of its suit under section 1 of the Sherman Act and claiming negligent misrepresentation on the Board’s website to “create the false impression that [the MOC program] is indicative of the medical skills of physicians.” The complaint does not plausibly allege an agreement between the Board, hospitals, and insurers. Mere legal conclusions are “not entitled to be assumed true.” View "Association of American Physicians & Surgeons, Inc. v. American Board of Medical Specialties" on Justia Law

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Providers filed suit under 42 U.S.C. 1983 and the Medicaid Act, alleging that the Department violated constitutional and statutory law in retroactively recalculating their Medicaid reimbursement rates for the three-month period of January through March 2016.The Seventh Circuit reversed the district court's dismissal of the Providers' procedural due process claim, concluding that, at this early stage in the litigation, the allegations are sufficient to allege a violation of procedural due process. First, the court explained that the Providers retain a legitimate entitlement to a rate determined according to that formula, and any action to alter the rate must be conducted with due process. In this case, according to the amended complaint, the auditors failed to provide any notice of the alleged deficiencies prior to the final decision, and the Providers had no opportunity to submit additional documentation or other evidence following that decision. The court stated that the burden on the Department in providing such notice is no impediment, given that the procedures are already in the Code. The court explained that the Department need only follow those procedures rather than routinely bypass them. Therefore, in the absence of that basic and fundamental protection against unfair or mistaken findings, the court concluded that the Providers have sufficiently alleged a violation of due process. Accordingly, the court remanded for further proceedings. View "Rock River Health Care, LLC v. Eagleson" on Justia Law

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Molina Healthcare contracted with the Illinois Medicaid program to provide multiple tiers of medical-service plans with scaled capitation rates (fixed per-patient fees that cover all services within the plan’s scope). The Nursing Facility plan required Molina to provide Skilled Nursing Facility (SNF) services. Molina subcontracted with GenMed to cover that obligation. Molina received a general capitation payment from the state, out of which it was to pay GenMed for the SNF component. Molina breached its contract with GenMed. GenMed terminated the contract. After GenMed quit, Molina continued to collect money from the state for the SNF services, but it was neither providing those services itself nor making them available through any third party. Molina never revealed this breakdown, nor did it seek a replacement service provider.Prose, the founder of GenMed, brought this qui tam action under both the state and federal False Claims Acts, 31 U.S.C. 3729, alleging that Molina submitted fraudulent claims for payments from government funds. The district court dismissed the case. The Seventh Circuit reversed. The complaint plausibly alleges that as a sophisticated player in the medical-services industry, Molina was aware that these kinds of nursing facility services play a material role in the delivery of Medicaid benefits. View "Prose v. Molina Healthcare of Illinois," on Justia Law

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A False Claims Act, 31 U.S.C. 3729(a)(1)(A), “qui tam” lawsuit against SuperValu claimed that SuperValu knowingly filed false reports of its pharmacies’ “usual and customary” (U&C) drug prices when it sought reimbursements under Medicare and Medicaid. SuperValu listed its retail cash prices as its U&C drug prices rather than the lower, price-matched amounts that it charged qualifying customers under its discount program. Medicaid regulations define “usual and customary price” as the price charged to the general public. The district court held that SuperValu’s discounted prices fell within the definition of U&C price and that SuperValu should have reported them but held that SuperValu did not act with scienter.The Seventh Circuit affirmed, joining other circuits in holding that the Supreme Court’s 2007 “Safeco” interpretation of the Fair Credit Reporting Act’s scienter provision applies with equal force to the False Claims Act’s scienter provision. There is no statutory indication that Congress meant its usage of “knowingly,” or the scienter definitions it encompasses, to bear a different meaning than its common-law definition. SuperValu did not act with the requisite knowledge. SuperValu’s interpretation of “usual and customary price” was objectively reasonable under Safeco. View "Yarberry v. Supervalu Inc." on Justia Law

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Healthcare revenue cycle management contractors manage billing and behind-the-scenes aspects of patient care, from pre-registering patients to reviewing and approving documentation upon release. Reid Hospital contracted with Dell, a revenue cycle management contractor. Their contract limited both sides’ damages in a breach of contract action in the absence of willful misconduct or gross negligence. Dell sold much of its portfolio to Conifer in 2012 while Dell was still losing money on the Reid contract. Conifer began reducing staff and neglecting duties; there was a slowdown throughout the revenue-management cycle and in processing patients’ discharge forms, leading to longer hospital stays that third-party payors refused to reimburse fully. After two years, Reid took its revenue operation back in-house. Reid's consultant found significant errors in Conifer’s work. Reid sued for breach of contract, claiming that Conifer’s actions caused the hospital to lose tens of millions of dollars. The court granted Conifer summary judgment, reading the contract as defining all claims for lost revenue as claims for “consequential damages,” prohibited absent “willful misconduct.”The Seventh Circuit reversed. Even if lost revenue is often considered consequential, this was a contract for revenue collection services and did not define all lost revenue as an indirect result of any breach. Lost revenue would have been the direct and expected result of Conifer’s failure to collect and process that revenue as required under the contract. The parties did not intend to insulate Conifer entirely from damages. View "Reid Hospital and Health Care, Inc. v. Conifer Revenue Cycle Solutions, LLC" on Justia Law

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Starting next semester, Indiana University students must be vaccinated against COVID-19 unless they are exempt for medical or religious reasons. Exempted students must wear masks and be tested for the disease twice a week. The district court rejected a due process challenge to those rules.The Seventh Circuit denied an injunction pending appeal. The court noted that vaccinations and other public health requirements are common, that the University has allowed for exemptions, and that the students could choose to attend a school that has no vaccination requirement. View "Klaassen v. Trustees of Indiana University" on Justia Law

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Talevski, living with dementia, was a patient at Valparaiso Care, a state-run Indiana nursing facility. His wife filed suit under 42 U.S.C. 1983 for violations of the Federal Nursing Home Reform Act (FNHRA), 42 U.S.C. 1396r, which establishes the minimum standards of care to which nursing-home facilities must adhere in order to receive federal funds in the Medicaid program. Some of the requirements relate to residents’ rights, including two cited by Talevski, the right to be free from chemical restraints imposed for purposes of discipline or convenience rather than treatment and the right not to be transferred or discharged unless certain criteria are met.The district court dismissed the action, finding that FNHRA does not provide a private right of action that may be redressed under 42 U.S.C. 1983. The Seventh Circuit reversed. The section 1983 remedy broadly encompasses violations of federal statutory as well as constitutional law. The court noted the express rights-creating language in the statute and that FNHRA is not the type of comprehensive enforcement scheme, incompatible with individual enforcement. The right protected by the statute is not so vague and amorphous that its enforcement would strain judicial competence. View "Talevski v. Health and Hospital Corp. of Marion County" on Justia Law

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Paramedics rushed Millicent to Franciscan, a designated acute‐stroke‐ready hospital. Franciscan transferred her to its intensive care unit. Three days later, Millicent suffered a stroke. Her condition deteriorated and she was put on life support. The family expressed concern about the adequacy of care and sought to transfer Millicent to another facility. Franciscan assisted in submitting transfer paperwork to two other hospitals. Both declined the requests for insurance reasons. While a third transfer request was pending, Franciscan advised the family that Millicent was brain dead and that it had decided to stop treatment. Nearly two years later, Nartey reviewed Millicent’s medical records, which she claimed lacked the transfer paperwork and test results.Nartey, acting pro se, sued. The court grouped Nartey’s complaint into claims that Franciscan violated the federal Emergency Medical Treatment and Active Labor Act (EMTALA) by failing to provide adequate care or to transfer Millicent, 42 U.S.C. 1395dd; that Franciscan violated Title VI, which prohibits federally funded programs from discriminating on the basis of race, color, or national origin, 42 U.S.C. 2000d, and that Franciscan fraudulently concealed test results, preventing Nartey from timely bringing a medical malpractice claim.The Seventh Circuit affirmed the dismissal of the suit. Although Nartey missed filing deadlines, the court addressed the merits. EMTALA is not a malpractice statute covering treatment after an emergency patient is screened and admitted. While Nartey presented some statistical evidence that hospital transfers are less common among racial minorities, Franciscan was not responsible for Millicent remaining there. A reasonable inquiry would have discovered the alleged concealment. View "Nartey v. Franciscan Health Hospital" on Justia Law

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Prosser, a 37-year-old Medicare recipient, suffers from glioblastoma, which causes brain tumors. The five-year survival rate hovers around 5%. Though not curative, Prosser benefits from tumor treating fields therapy (TTF), approved by the FDA in 2011. For most of the day, patients use a device that attaches to the head via adhesive patches that connect to a mobile power supply. The device emits electrical fields to the tumor, which disrupt the division of cancer cells. Early studies show that the device holds promise in prolonging life. TTF therapy is available through a single supplier, Novocure, which rents the device on a monthly basis. The therapy is expensive. Prosser must file a Medicare benefits claim for each period she uses the device. Medicare denied coverage for the treatment period January-April 2018. Though Prosser received the therapy and owed nothing, the denial left Novocure with the bill. Prosser challenged this denial through Medicare’s appeals process before filing suit.The Seventh Circuit affirmed the dismissal of Prosser’s claim for Medicare Part B coverage, holding that she has suffered no injury-in-fact sufficient to satisfy Article III’s standing requirement. Prosser received—and continues to receive—the TTF therapy. She faces no financial liability for the treatment period Medicare denied coverage. Any future financial risk is too attenuated from the denial of the past coverage and far too speculative to establish standing. View "Prosser v. Becerra" on Justia Law