United States District Court, S.D. Texas
United States of America and the State of Texas ex rel. Richard Drummond, Plaintiffs,
BestCare Laboratory Services, LLC, et al., Defendants.
OPINION ON SUMMARY JUDGMENT
N. Hughes United States District Judge
Maghareh and his wife, Farzaneh Rajabi, founded BestCare
Laboratory Services, LLC, in 2002. Maghareh owns 51% and
Rajabi owns 49%. BestCare operates a diagnostic laboratory in
Webster - a suburb of Houston -where it tests specimens
mostly from disabled and elderly patients. In addition to its
business in Houston, it has workers in Dallas, San Antonio,
and El Paso. They collect specimens to be tested in Webster.
billed Medicare for every mile a specimen traveled, even when
(a) that specimen was not accompanied by a technician or (b)
it was one of many samples collected in a single trip.
workers shipped specimens on flights to Houston for roughly
$100 per batch. The workers did not travel from these cities
to Webster with the specimens. Neither did they travel from
Webster to Dallas, San Antonio, and El Paso to collect the
specimens. A worker in Dallas, San Antonio, or El Paso
collected the specimens and delivered them to the local
airport. Someone from the Webster laboratory retrieved the
batches from Houston's airport.
technician did drive to other laboratories to collect
samples, he collected several at a time, sometimes from
multiple locations. BestCare billed these trips as though the
samples were returned one-by-one to Webster when collected.
Instead of prorating these trips as logic and the regulation
require, it calculated the maximum number of miles a
technician theoretically could have traveled to collect each
specimen and return it to the laboratory.
court has decided that the government could recover from
BestCare on its theories of unjust enrichment and payment by
mistake. On the government's motion, it now considers
BestCare's responsibility under the False Claims Act.
18 of the Social Security Act establishes, among other
things, government subsidized insurance for disabled and
elderly Americans. Under this Act, laboratories may bill the
United States $1.00 per mile that their workers travel to
collect specimens from patients.
covers "the transportation and personnel expenses"
for a worker to travel to the patient to collect the sample
and return. It is "based on the number of miles
traveled and the personnel costs associated with
to be eligible for a reimbursement, the laboratory must have
paid an expense - the expense of a technician's travel to
collect a sample. When BestCare had gathered the samples in
El Paso to pack for shipping to Webster, the transportation
for collection had been completed. Testing them 765 miles
away was not required to collect them for the patients.
billed the United States $1.00 per mile for each
specimen's trip from Dallas, San Antonio, and El Paso
although its workers did not accompany the specimens. No.
personnel costs were associated with these trips, because the
specimen had already been collected. BestCare was paid, in
other words, for travel expenses that its workers did not
also billed for each specimen separately by calculating the
maximum number of miles that its worker could have
theoretically driven to retrieve them. In reality, the worker
retrieved many specimens in a single trip. He ...