U.S. Court in Minnesota Allows Whistleblower’s Upcoding Claims Against Ambulance Provider
- January 31, 2025
A billing professional can proceed with her allegations that a Minnesota-based ambulance provider violated the False Claims Act (FCA) by upcoding services to a higher level of service than was provided to maximize reimbursement from government health care programs, a federal district court in the state held January 24.
However, the U.S. District Court for the District of Minnesota dismissed without prejudice relator Ashley Mothershed’s claim that Mayo Clinic Ambulance billed federal and state health care programs for medically unnecessary ambulance transports, finding the complaint failed to allege falsity under the FCA.
Mothershed is an ambulance coding compliance professional who worked remotely for Mayo’s billing department from November 2020 through June 2021, and then again from September 2021 through May 2022.
She filed a qui tam action against Mayo alleging that it submitted false claims by failing to generally review whether ambulance transports were medically necessary and by upcoding non-emergency transports to emergency transports and basic life support (BLS) services to advanced life support (ALS) services. The federal government and state of Minnesota declined to intervene. Mayo moved to dismiss.
As a threshold issue, the court said Mothershed, given her coding expertise and position in Mayo’s billing department, could clear the Fed. R. Civ. P. 9(b) pleading standard by pleading representative examples or particular details of each alleged scheme with sufficient indicia of reliability.
The court found Mothershed did not sufficiently allege falsity as to her claim that Mayo billed non-medically necessary ambulance transports to government health care payers. Mothershed’s four representative examples all involved situations where the ambulance transport was presumed medically necessary, the court said. And while Mothershed alleged that Mayo generally did not review claims for medical necessity, she failed to show that any of those claims were submitted to government payers.
But the court held Mothershed could proceed with her upcoding allegations. The complaint provided three representative examples of hospital-to-hospital patient transfers that were billed as emergency transports even though they were scheduled and marked as “no lights or sirens,” which the court said was sufficient to allege falsity at this stage of the litigation.
Likewise, Mothershed sufficiently alleged falsity as to her claims that Mayo upcoded BLS services to ALS services, which are reimbursed at a higher rate. Specifically, Mothershed pointed to two representative examples where no ALS assessment or intervention was performed but Mayo still billed for ALS services, the court said.
Finally, the court found Mothershed sufficiently alleged the knowledge element of an FCA claim based on conversations with her Mayo supervisors about problems with its billing practices. “These actions demonstrate, at a minimum, a reckless disregard because Mayo was aware of the substantial and unjustifiable risk that they might have been submitting false claims, but they ignored those warnings by Mothershed.”
United States ex rel. Mothershed v. Mayo Clinic Ambulance, No. 22-602 (DWF/JFD) (D. Minn. Jan. 24, 2025).