          Case: 16-13004   Date Filed: 09/09/2019   Page: 1 of 57


                                                            [PUBLISH]




              IN THE UNITED STATES COURT OF APPEALS

                   FOR THE ELEVENTH CIRCUIT
                     ________________________

                            No. 16-13004
                      ________________________

                  D.C. Docket No. 2:12-cv-00245-KOB




UNITED STATES OF AMERICA,

                                             Plaintiff - Appellant,

versus


ASERACARE, INC.,
GGNSC ADMINISTRATIVE SERVICES,
d.b.a. Golden Living,
f.k.a. Beverly Enterprises, Inc.,
HOSPICE PREFERRED CHOICE, INC.,
HOSPICE OF EASTERN CAROLINA, INC.,

                                             Defendants - Appellees.
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                              ________________________

                      Appeal from the United States District Court
                         for the Northern District of Alabama
                             ________________________

                                    (September 9, 2019)

Before ROSENBAUM and JULIE CARNES, Circuit Judges, and
SCHLESINGER,∗ District Judge.

JULIE CARNES, Circuit Judge:

       This case requires us to consider the circumstances under which a claim for

hospice treatment under Medicare may be deemed “false” for purposes of the

federal False Claims Act. Defendants comprise a network of hospice facilities that

routinely bill Medicare for end-of-life care provided to elderly patients. In the

underlying civil suit, the Government alleged that Defendants had certified patients

as eligible for Medicare’s hospice benefit, and billed Medicare accordingly, on the

basis of erroneous clinical judgments that those patients were terminally ill. Based

on the opinion of its expert witness, the Government contends that the patients at

issue were not, in fact, terminally ill at the time of certification, meaning that

AseraCare’s claims to the contrary were false under the False Claims Act.




∗ The Honorable Harvey E. Schlesinger, United States District Judge for the Middle District of
Florida, sitting by designation.


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       As the case proceeded through discovery and a partial trial on the merits, the

district court confronted the following question: Can a medical provider’s clinical

judgment that a patient is terminally ill be deemed false based merely on the

existence of a reasonable difference of opinion between experts as to the accuracy

of that prognosis? The district court ultimately answered this question in the

negative and therefore granted summary judgment to AseraCare on the issue of

falsity.

       Upon careful review of the record and the relevant law, and with the benefit

of oral argument, we concur with the district court’s ultimate determination that a

clinical judgment of terminal illness warranting hospice benefits under Medicare

cannot be deemed false, for purposes of the False Claims Act, when there is only a

reasonable disagreement between medical experts as to the accuracy of that

conclusion, with no other evidence to prove the falsity of the assessment. We do,

however, think that the Government should have been allowed to rely on the entire

record, not just the trial record, in making its case that disputed issues of fact,

beyond just the difference of opinion between experts, existed sufficient to warrant

denial of the district court’s post-verdict sua sponte reconsideration of summary

judgment on the falsity question. We therefore affirm in part and remand in part.




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I.     BACKGROUND 1

       Each year, more than a million Americans make the difficult decision to

forgo curative care and turn instead to end-of-life hospice care, which is designed

to relieve the pain and symptoms associated with terminal illness. See 79 Fed.

Reg. 50452, 50454–55 (Aug. 22, 2014). The federal government’s Medicare

program makes such care affordable for a significant number of terminally ill

individuals. Defendants, collectively referred to as AseraCare, operate

approximately sixty hospice facilities across nineteen states and admit around

10,000 patients each year. Most of AseraCare’s patients are enrolled in Medicare.

In fact, from 2007 to 2012, Medicare payments composed approximately ninety-

five percent of AseraCare’s revenues. As such, AseraCare routinely prepares and

submits claims for reimbursement under Medicare.

       This case began when three former AseraCare employees alleged that

AseraCare had a practice of knowingly submitting unsubstantiated Medicare

claims in violation of the federal False Claims Act. We begin by setting out the

requirements hospice providers like AseraCare must meet in order to be entitled to




1
  We derive the pertinent facts from the parties’ submissions, the summary judgment record, and
the trial testimony presented in the proceeding below.


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hospice reimbursement and identifying the tools the Government uses to police

compliance with these requirements.

      A.     The Medicare Hospice Benefit

      In order for a hospice claim to be eligible for Medicare reimbursement, the

patient’s attending physician, if there is one, and the medical director of the

hospice provider must “each certify in writing at the beginning of [each] period,

that the individual is terminally ill . . . based on the physician’s or medical

director’s clinical judgment regarding the normal course of the individual’s

illness.” 42 U.S.C. § 1395f(7)(A). “Terminally ill” means that the individual “has

a medical prognosis that the individual’s life expectancy is 6 months or less.” 42

U.S.C. § 1395x(dd)(3)(A). Under the statute’s implementing regulations, a claim

for hospice reimbursement must conform to several requirements in order to be

payable. Most notably for purposes of this appeal, the certification must be

accompanied by “[c]linical information and other documentation that support the

medical prognosis,” and such support “must be filed in the medical record with the

written certification.” 42 C.F.R. § 418.22(b)(2).

      An initial certification conforming to these requirements is valid for a period

of ninety days. 42 U.S.C. § 1395f(7)(A). The patient must be recertified in a

similar manner for each additional sixty- or ninety-day period during which he or

she remains in hospice. Id. While a life-expectancy prognosis of six months or
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less is a necessary condition for reimbursement, regulators recognize that

“[p]redicting life expectancy is not an exact science.” 75 Fed. Reg. 70372, 70488

(Nov. 17, 2010). Accordingly, the Medicare framework does not preclude

reimbursement for periods of hospice care that extend beyond six months, as long

as the patient’s eligibility is continually recertified. This framework also

recognizes that, in some cases, patients with an initial prognosis of terminality can

improve over time, and it allows such patients to exit hospice without losing their

right to Medicare coverage to treat illness. Id. Thus, there is no statutory limit to

the number of periods for which a patient may be properly certified. 42 U.S.C.

§ 1395d(d)(1) (establishing that hospice providers may collect reimbursement for

an unlimited number of recertification periods).

      The Medicare program is overseen by the Centers for Medicare and

Medicaid Services (“CMS”), a division of the Department of Health and Human

Services. CMS operates locally through so-called Medicare Administrative

Contractors (“MACs”), which process claims from healthcare providers and make

payment for eligible services. A majority of AseraCare’s Medicare claims are

processed by a MAC called Palmetto GBA (“Palmetto”), which operates in the

southeast United States.

      In preparing its claims for hospice reimbursement, AseraCare employs

interdisciplinary teams of skilled staff—including physicians, nurses,
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psychologists, social workers, and chaplains—that render services directly to

patients and collectively make eligibility determinations. To guide this review,

AseraCare professionals rely in part on documents called Local Coverage

Determinations (“LCDs”), which are issued by Palmetto’s medical directors.

LCDs provide detailed lists of diagnostic guidance and clinical information that, if

documented in a patient’s medical record, suggest that the patient has a life

expectancy of six months or less. LCDs are not clinical benchmarks or mandatory

requirements for hospice eligibility, however. Rather, they are designed to help

clinical staff understand the type of information that should be considered prior to

concluding that a patient is terminally ill. The LCDs themselves explicitly state

that they are non-binding.

      Once AseraCare physicians reach a clinical judgment that a patient is

eligible for hospice care, AseraCare may begin providing treatment. It submits

claims to Palmetto for reimbursement only after care has been rendered. The trial

testimony of Mary Jane Schultz, a registered nurse and former director of

Palmetto’s medical review team, clarified at trial the process by which Palmetto

reviewed and paid claims for hospice coverage during the relevant time period of

2007 to 2012. As Ms. Schultz described, the first round of claim review was

conducted by an automated claim-processing system designed to ensure that no

critical information, such as a patient’s Medicare identification number, was
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missing or invalid. If no critical information was missing, the system would then

check for any “red flags” that might require further review of the claim—such as

the involvement of a particular provider, patient, or type of care that Palmetto staff

believed may pose heightened eligibility risks. For instance, if Palmetto wished to

conduct a targeted audit of claims submitted by a particular provider, it could

program the automated system to pull all or a portion of those claims for additional

review before payment.

      If automated review uncovered no missing information or red flags, the

system would process the claim directly for payment. As a result, Palmetto paid

many claims without directly reviewing the medical documentation underpinning

them. Where, on the other hand, a claim was flagged for heightened medical

review, Palmetto would immediately issue a request to the provider for medical

documentation substantiating the patient’s terminal prognosis, such as notes from

physicians, nurses, and social workers and records of medications and treatments

prescribed. A trained medical review team would then review the supporting

documentation before determining whether the claim should be paid in full, paid in

part, or denied. Like AseraCare’s medical staff, the medical review team

commonly uses the LCDs as guidelines in its assessment, but it is not required to

rigidly apply their criteria. Instead, the review team also looks at the “whole

picture” of information submitted with the claim.
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      B.     The False Claims Act

      The False Claims Act (“FCA”) serves as a mechanism by which the

Government may police noncompliance with Medicare reimbursement standards

after payment has been made. The Act imposes civil liability—including treble

damages—on “any person who . . . knowingly presents, or causes to be presented,

a false or fraudulent claim for payment” to the federal government or who

“knowingly makes, uses, or causes to be made or used, a false record or statement

material to a false or fraudulent claim.” 31 U.S.C. § 3729(a)(1)(A)–(B). To

prevail on an FCA claim, the plaintiff must prove that the defendant (1) made a

false statement, (2) with scienter, (3) that was material, (4) causing the

Government to make a payment. Urquilla-Diaz v. Kaplan Univ., 780 F.3d 1039,

1045 (11th Cir. 2015).

      Private citizens, called qui tam relators, are authorized to bring FCA suits on

behalf of the United States. 31 U.S.C. § 3730(b). The United States can, and

frequently does, intervene in qui tam suits to develop the civil case itself. Thus, to

the extent the Government concludes that it has reimbursed a hospice provider that

knowingly submitted deficient claims, the Government can use the FCA cause of

action to recoup payments and to penalize the provider.

II.   PROCEDURAL HISTORY

      A.     Suit Against AseraCare Under the FCA
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      The underlying case began in 2008, when three former AseraCare

employees, acting as qui tam relators, filed a complaint against AseraCare alleging

submission of unsubstantiated hospice claims. Following a transfer of venue from

the Eastern District of Wisconsin to the Northern District of Alabama, the

Government intervened and filed the operative complaint. In its complaint, the

Government alleged that AseraCare knowingly employed reckless business

practices that enabled it to admit, and receive reimbursement for, patients who

were not eligible for the Medicare hospice benefit “because it was financially

lucrative,” thus “misspending” millions of Medicare dollars. The Government’s

complaint described a corporate climate that pressured sales and clinical staff to

meet aggressive monthly quotas for patient intake and, in so doing, discouraged

meaningful physician involvement in eligibility determinations. More specifically,

the Government alleged that AseraCare “submitted documentation that falsely

represented that certain Medicare recipients were ‘terminally ill’” when, in the

Government’s view, they were not.

      In light of these allegations, the Government’s case falls under the “false

certification” theory of FCA liability. Under this theory, FCA liability may arise

where a defendant falsely asserts or implies that it has complied with a statutory or

regulatory requirement when, in actuality, it has not so complied. See Universal

Health Servs., Inc. v. United States ex rel. Escobar, 136 S. Ct. 1989, 1999 (2016).
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      In developing its case, the Government began by identifying a universe of

approximately 2,180 patients for whom AseraCare had billed Medicare for at least

365 continuous days of hospice care. The Government then focused its attention

on a sample of 223 patients from within that universe. Through direct review of

these patients’ medical records and clinical histories, the Government’s primary

expert witness, Dr. Solomon Liao, identified 123 patients from the sample pool

who were, in Dr. Liao’s view, ineligible for the hospice benefit at the time

AseraCare received reimbursement for their care. Should it prevail as to this

group, the Government intended to extrapolate from the sample to impose further

liability on AseraCare for a statistically valid set of additional claims within the

broader universe of hospice patients for whom AseraCare received Medicare

payments.

      To supplement the testimony of Dr. Liao, the Government also sought to

develop evidence that AseraCare’s broader business practices fostered and

promoted improper certification procedures while deemphasizing clinical training

on terminal-illness prognostication. Several former AseraCare employees,

including the qui tam relators, supported the Government’s narrative by describing

a process in which physicians merely rubber-stamped terminal-illness certifications

without thoroughly examining the relevant medical records underlying them.

      Importantly, though, the Government’s false-claims allegations in this case
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were narrowly circumscribed. There were no allegations that AseraCare billed for

phantom patients, that certifications or medical documentation were forged, or that

AseraCare employees lied to certifying physicians or withheld critical information

regarding patient conditions. Indeed, there was no doubt in the proceeding below

that AseraCare possessed accurate and comprehensive documentation of each

patient’s medical condition and that its certifications of terminal illness were

signed by the appropriate medical personnel. Rather, the Government asserted that

its expert testimony—contextualized by broad evidence of AseraCare’s improper

business practices—would demonstrate that the patients in the sample pool were

not, as a medical fact, terminally ill at the time AseraCare collected reimbursement

for their hospice care. The sole question related to the sufficiency of the clinical

judgments on which the claims were based.

       On this theory, the Government sought to recover damages under two

subsections of the FCA, 31 U.S.C. § 3729(a)(1)(A)2 and 31 U.S.C.

§ 3729(a)(1)(B),3 and on claims of common-law unjust enrichment and mistaken



2
  “[A]ny person who . . . knowingly presents, or causes to be presented, a false or fraudulent
claim for payment or approval . . . is liable to the United States Government . . . .” 31 U.S.C.
§ 3729(a)(1)(A).
3
  “[A]ny person who . . . knowingly makes, uses, or causes to be made or used, a false record or
statement material to a false or fraudulent claim . . . is liable to the United States
Government . . . .” 31 U.S.C. § 3729(a)(1)(B).


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payment.

       B.      First Motion for Summary Judgment

       Following extensive discovery and expert analysis of relevant patient

records, AseraCare moved for summary judgment on the ground that the

Government failed to adduce evidence of the falsity of any disputed claims and

failed to show that AseraCare had any knowledge of the alleged falsity. Most

notably for purposes of this appeal, AseraCare put squarely before the district court

the question whether the Government’s medical-opinion evidence was sufficient to

establish the threshold element of falsity. To that point, AseraCare urged the

district court to embrace a “reasonable doctor” standard for the assessment of

falsity, which would state that, to avoid summary judgment in an action involving

false claims for hospice reimbursement, the Government must show that a

reasonable physician applying his or her clinical judgment could not have held the

opinion that the patient at issue was terminally ill at the time of certification.4

       The district court found the “reasonable doctor” standard “appealing and

logical,” but noted that it had not been adopted by the Eleventh Circuit and

4
  AseraCare asked the district court to adopt the standard for falsity established by the Northern
District of Illinois in a case with a similar fact pattern and posture. The court in that case
dismissed FCA claims against a for-profit hospice facility because relators failed to allege facts
“demonstrating that the certifying physician did not or could not have believed, based on his or
her clinical judgment, that the patient was eligible for hospice care.” United States ex rel.
Geschrey v. Generations Healthcare, LLC, 922 F. Supp. 2d 695, 703 (N.D. Ill. 2012).


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declined to apply it. The court ultimately denied AseraCare’s motion for summary

judgment, concluding that fact questions remained regarding whether clinical

information and other documentation in the relevant medical records supported the

certifications of terminal illness on which AseraCare’s claims were based.

      Following the denial of its motion for summary judgment, AseraCare moved

to certify the following question for interlocutory appeal before this Court under

28 U.S.C. § 1292(b):

      In a False Claims Act case against a hospice provider relating to the
      eligibility of a patient for the Medicare hospice benefit, for the
      Government to establish the falsity element under 31 U.S.C.
      § 3729(a)(1), must it show that, in light of the patient’s clinical
      information and other documentation, no reasonable physician could
      have believed, based on his or her clinical judgment, that the patient
      was eligible for the Medicare hospice benefit?

The district court certified the question for interlocutory appeal. We considered

AseraCare’s motion for review but declined to consider the question at that stage

of the proceeding.

      C.     Bifurcation of Trial

      Subsequent to the denial of summary judgment, AseraCare moved the

district court to bifurcate trial under Federal Rule of Civil Procedure 42(b) into two

phases: one phase on the falsity element of the FCA and a second phase on the

FCA’s remaining elements and the Government’s common-law claims. The

Government vehemently opposed the motion. It argued that the proposed

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bifurcation was “extraordinary,” requiring the Government “to jump over an

arbitrary hurdle that is without precedent” because “the elements of ‘falsity’ and

‘knowledge of falsity’ are not so distinct and separable that they may be tried

separately without injustice.” Indeed, the Government noted, the elements of FCA

liability had “never before been bifurcated by a federal district court.” The

Government further argued that bifurcation was unworkable because documentary

and testimonial evidence that was probative in the falsity phase—“because it

undermines the reliability of the [certifications of terminal illness]”—was “also

probative in the ‘knowledge of falsity’ phase because it shows AseraCare knew or

should have known that it was submitting false claims for non-terminally [sic]

patients.”

      Nonetheless, the district court granted the motion in light of its concern that

evidence pertinent to the knowledge element of the FCA would confuse the jury’s

analysis of the threshold question of whether the claims at issue were “false” in the

first instance. The court noted that, while “pattern and practice” evidence showing

deficiencies in AseraCare’s admission and certification procedures could help

establish AseraCare’s knowledge of the alleged scheme to submit false claims—the

second element of the Government’s case—the falsity of the claims “cannot be

inferred by reference to AseraCare’s general corporate practices unrelated to

specific patients.” In the court’s view, allowing the Government to present
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knowledge evidence before falsity was determined would be unduly prejudicial to

AseraCare, thus warranting separation of the knowledge and falsity elements.

       In accordance with this rationale, the district court “drew the line of

admissibility” in Phase One of trial “at anecdotal evidence about a specific, but

unidentified, patient or event that would be impossible for the Defense to rebut.”

The court did, however, allow in Phase One anecdotal testimony regarding

improper clinical or corporate practices that “had a time and place nexus with the

123 allegedly ineligible patients at issue.” Such testimony, in the court’s view,

would have been “highly probative and admissible in Phase One.” Indeed, in

bifurcating trial, the court presumed—based on the Government’s own

representations—that the Government possessed and would present such evidence

in Phase One. The court did allow in Phase One general testimony regarding

AseraCare’s business practices and claim-submission process during the relevant

time period, but only to contextualize the falsity analysis and “afford[] the jury an

opportunity to more fully understand the hospice process within AseraCare.” Such

evidence was not, however, admissible to prove the falsity of the claims at issue. 5




5
  The Government continues to complain on appeal that bifurcation of the trial was
“fundamentally unfair” and confused the issues, albeit it does not expressly challenge on appeal
the district court’s decision.


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       D.     Phase One of Trial

       The first phase of the trial lasted approximately eight weeks and proceeded

to a jury verdict largely against AseraCare on the question of falsity. During its

case in chief, the Government presented several days of testimony from Dr. Liao,

who explained that, in his expert opinion, the medical records of the patients at

issue did not support AseraCare’s “terminal illness” certifications because they did

not reveal a life expectancy of six months or less. Dr. Liao made clear that his

testimony was a reflection of only his own clinical judgment based on his after-the-

fact review of the supporting documentation he had reviewed. He conceded that

he was “not in a position to discuss whether another physician [was] wrong about a

particular patient’s eligibility. Nor could he say that AseraCare’s medical expert,

who disagreed with him concerning the accuracy of the prognoses at issue, was

necessarily “wrong.” Notably, Dr. Liao never testified that, in his opinion, no

reasonable doctor could have concluded that the identified patients were terminally

ill at the time of certification. Instead, he only testified that, in his opinion, the

patients were not terminally ill. Even more notable is the fact that Dr. Liao himself

changed his opinion concerning the eligibility of certain patients over the course of

the proceeding—deciding that some of the patients he had earlier concluded were

not terminally ill were in fact terminally ill. Nevertheless, he testified at trial that

both sets of contradictory opinions remained “accurate to a reasonable degree of
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certainty.” To explain these reversals, Dr. Liao stated that he “was not the same

physician in 2013 as [he] was in 2010.”

      The Government also presented testimony of the relators and other

AseraCare employees regarding AseraCare’s certification procedures, but, as

discussed supra, this testimony was characterized as being offered solely to show

context, not falsity. In rebuttal, AseraCare offered expert testimony that directly

contradicted Dr. Liao’s opinions.

      The parties’ expert witnesses disagreed along two lines. First and foremost,

they fundamentally differed as to how a doctor should analyze a patient’s life

expectancy for Medicare reimbursement purposes. The Government’s Dr. Liao

applied what might be called a “checkbox approach” to assessing terminal illness:

He examined the patients’ records and compared them against Palmetto’s LCDs

(and other, similar medical guidelines) for specific diagnoses, including

Alzheimer’s, heart disease, cardiopulmonary disease, and “adult failure to thrive.”

By contrast, AseraCare’s experts considered but did not formulaically apply the

LCD guidance in making their assessments. Instead, they took a “whole patient”

approach, making prognoses based on the entirety of the patient’s history, the

confluence of ailments from which a patient may be suffering, and their own

experience with end-of-life care. AseraCare’s experts did not discount the LCD

“criteria,” but—as the latter instruct— these experts did not consider themselves
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compelled to conclude that a patient was ineligible merely because the patient had

failed to meet one of those indicia.

      The district court correctly stated in its instructions to the jury that the LCDs

are “eligibility guidelines” that are not binding and should not be considered “the

exact criteria used for determining” terminal illness. As such, the jury was not

permitted to conclude that Dr. Liao’s testimony was more credible because he

made reference to the LCD criteria, or that AseraCare’s claims were false if they

failed to conform to those criteria. Nonetheless, the experts’ disagreement as to the

proper analytical approach impacted their ultimate judgments as to each patient’s

terminality.

      Because neither the checkbox approach nor the holistic approach to making

terminal-illness prognoses is contrary to the law, the jury’s sole job at trial was to

review the medical records of each patient and decide which experts’ testimony

seemed more persuasive on the question whether a particular patient should be

characterized as “terminally ill” at the time of certification. To be clear, the

Government never alleged that AseraCare’s doctors relied on medical

documentation that was too thin, vague, or lacking in detail to reasonably

substantiate their “clinical judgments” of terminal illness. Indeed, there is no

dispute that each patient certification was supported by a meaningful set of medical

records evidencing various serious and chronic ailments for which the patient was
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entitled to some level of treatment. The question before the jury was instead which

doctor’s interpretation of those medical records sounded more correct. In other

words, in this battle of experts, the jury was to decide which expert it thought to be

more persuasive, with the less persuasive opinion being deemed to be false. To

guide that assessment, the district court provided the following instruction on

falsity: “A claim is ‘false’ if it is an assertion that is untrue when made or used.

Claims to Medicare may be false if the provider seeks payment, or reimbursement,

for health care that is not reimbursable.”

      Ultimately, the expert testimony in this case revealed a fundamental

difference of professional opinion regarding the manner in which each patient’s

complete medical picture contributed to his or her life expectancy at the time he or

she received hospice care. Both sets of experts looked at the same medical

documentation, considered the same medical standards for the terminal-illness

determination (even while differing as to the weight such standards should be

given), and relied on their own experience as seasoned physicians specializing in

end-of-life care. Dr. Liao testified that, in his professional opinion, the patients at

issue were not likely to die within six months of the date on which they were

certified for hospice care. AseraCare’s experts arrived at opposite conclusions.

      As an illustration of this disagreement, consider the testimony of the

Government’s Dr. Liao and AseraCare’s Dr. Gail Cooney regarding the patient
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Elsin K., who was an AseraCare hospice patient for over a year and who ultimately

died in an AseraCare facility. Elsin was first admitted to hospice upon her

physician’s diagnosis of “debility,” also called “adult failure to thrive,” in which a

patient experiences a general decline in health due to old age. Elsin experienced

subsequent periods of improvement and decline; she left hospice care and was

recertified on at least two occasions before her death.

      As with each patient at issue in this case, Dr. Liao’s assessment of Elsin’s

hospice eligibility contrasted starkly with Dr. Cooney’s, even though there was no

dispute as to Elsin’s underlying diagnoses. Dr. Liao noted that many of Elsin’s

ailments, including severe infections arising from a joint replacement, were

chronic and had recurred for many years. He also noted that she did not

demonstrate the level of physical debility that published medical criteria typically

associate with terminal patients. On the basis of his medical review, he described

Elsin as struggling with chronic illness but “overall rather stable, if not

improving,” and thus lacking a prognosis of six months or less to live at the time of

her certifications and recertifications. Dr. Cooney, the defense expert, also

recognized that Elsin “had been sick for a long time,” but she saw in the medical

records a trend of steady physical and mental decline, decreased mobility, and

increasing pain. Elsin’s physical and psychological ailments, viewed in

combination with one another, complicated the picture of Elsin’s overall health and
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contributed to Dr. Cooney’s judgment that Elsin was terminally ill during each

relevant time period. In the Government’s view, it was properly within the

purview of the jury to decide which doctor’s judgment was correct and, to the

extent the jury found Dr. Liao’s prognosis to be more persuasive, to find that

AseraCare had thereby submitted a false statement when it filed a claim based on a

prognosis that differed from Dr. Liao’s.

      At the conclusion of the parties’ cases, the court instructed the jury to

answer special interrogatories regarding the prognoses of each of the 123 patients

at issue. The jury ultimately found that AseraCare had submitted false claims for

104 patients of the 123 patients at issue during the relevant time periods.

      E.     Grant of New Trial and Second Motion for Summary Judgment

      Following the partial verdict in this first phase of trial, AseraCare moved for

judgment as a matter of law, arguing that the court had articulated the wrong legal

standard in its instructions to the jury. The district court agreed. In the court’s

own words, “[a]s the court worked through AseraCare’s challenges,” it “became

convinced that it had committed reversible error in the instructions it provided to

the jury.” It ultimately concluded that proper jury instructions would have advised

the jury of two “key points of law” that the court had not previously

acknowledged: (1) that the FCA’s falsity element requires proof of an objective

falsehood; and (2) that a mere difference of opinion between physicians, without
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more, is not enough to show falsity. AseraCare had advocated for this legal

standard since the start of trial, but only after hearing all the evidence had the court

become “convinced” that “a difference of opinion is not enough.” The court

ultimately concluded that the failure to instruct the jury on these points was

reversible error and that the only way to cure the prejudice caused thereby was to

order a new trial.

      The court then went one step further, deciding to consider summary

judgment sua sponte under Federal Rule of Civil Procedure 56(f)(3). Specifically,

it informed the parties that it intended to consider “whether the Government, under

the correct legal standard, has sufficient admissible evidence of more than just a

difference of opinion to show that the claims at issue are objectively false as a

matter of law.” The court gave the parties an opportunity to brief the issue,

advising that:

      The Government’s proof under the FCA for the falsity element would
      fail as a matter of law if all the Government has as evidence of falsity
      in the second trial is Dr. Liao’s opinion based on his clinical judgment
      and the medical records that he contends do not support the prognoses
      for the 123 patients at issue in Phase One.

      In its summary-judgment briefing, the Government argued that it was

procedurally improper for the court to raise summary judgment sua sponte after

already deciding to grant a new trial. The district court rejected this argument, and

the Government does not revive the challenge on appeal.
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       Following briefing and a hearing, the court granted summary judgment in

AseraCare’s favor on the basis of the court’s newly adopted legal standard. The

court concluded, “[a]fter careful review of all [the parties’] submissions and the

Phase One [trial] record, . . . that the Government has failed to point the court to

any admissible evidence to prove falsity other than Dr. Liao’s opinion that the

medical records for the 123 patients at issue did not support the Certifications of

Terminal Illness” that were submitted for Medicare reimbursement. Because

“[t]he Government [ ] presented no evidence of an objective falsehood for any of

the patients at issue,” it could not prove the falsity element of its FCA claim as a

matter of law. The court thus granted summary judgment in AseraCare’s favor.

       The Government appeals the district court’s summary judgment order and its

grant of a new trial, contending that the legal standard the court ultimately adopted

reflected a “deeply flawed” understanding of the falsity element of an FCA claim.

The Government thus asks this Court to reject the legal standard for falsity that the

district court adopted, reverse the district court’s grant of summary judgment and

order of a new trial, and reinstate the jury’s Phase One findings: namely, that the

Government successfully proved falsity as to several of the claims at issue.

III.   STANDARD OF REVIEW

       This Court reviews the district court’s grant of summary judgment de novo,

viewing all the evidence and drawing all reasonable inferences in favor of the non-
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moving party. Vessels v. Atlanta Indep. Sch. Sys., 408 F.3d 763, 767 (11th Cir.

2005). By contrast, we review a district court’s ruling on a motion for a new trial

for abuse of discretion. Hewitt v. B.F. Goodrich Co., 732 F.2d 1554, 1556 (11th

Cir. 1984).

IV.   DISCUSSION

      This appeal requires us to consider how Medicare’s requirements for hospice

eligibility—which are centered on the subjective “clinical judgment” of a

physician as to a patient’s life expectancy—intersect with the FCA’s falsity

element. Under this Court’s precedent, “Medicare claims may be false if they

claim reimbursement for services or costs that either are not reimbursable or were

not rendered as claimed.” United States ex rel. Walker v. R&F Props. of Lake Cty.,

Inc., 433 F.3d 1349, 1356 (11th Cir. 2005). There is no allegation that the hospice

services AseraCare provided were not rendered as claimed. Thus, the sole

question is whether the claims AseraCare submitted were reimbursable under the

Medicare framework for hospice care—that is, whether AseraCare’s certifications

that patients were terminally ill satisfied Medicare’s statutory and regulatory

requirements for reimbursement. If not, the claims are capable of being “false” for

FCA purposes.

      Thus framed, our primary task on appeal is to clarify the scope of the

hospice eligibility requirements, which are set out in the federal Medicare statute,
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42 U.S.C. § 1395f, and its implementing regulation, 42 C.F.R. § 418.22. Our

secondary task is to determine whether the district court’s formulation of the falsity

standard was consistent with the law and properly applied. Neither this Court nor

any of our sister circuits has considered the standard for falsity in the context of the

Medicare hospice benefit, where the controlling condition of reimbursement is a

matter of clinical judgment. After careful review of the relevant law, the

underlying record, and the considerations raised by the parties and the amici

curiae, we agree that the instruction given to the jury was inadequate and agree

with the general sense of the legal standard embraced by the district court after the

verdict.

      A.     Legal Standard for Falsity of Hospice Claims

      The Government argues that the district court’s initial jury instructions—that

“[a] claim is ‘false’ if it is an assertion that is untrue when made or used” and that

“[c]laims to Medicare may be false if the provider seeks payment, or

reimbursement, for health care that is not reimbursable”—comprised a complete

and correct statement of the legal standard for falsity. As applied to this case, the

Government argues that it can show falsity by producing expert testimony that a

patient’s medical records do not support a terminal-illness prognosis as a factual

matter. Where the parties present competing expert views on a patient’s prognosis,

the “falsity” of the defendant’s prognosis is put to a jury.
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      AseraCare contests the Government’s characterization of the statutory and

regulatory framework, arguing that the determinative inquiry in an eligibility

analysis is whether the certifying physician exercised genuine clinical judgment

regarding a patient’s prognosis and further arguing that the accuracy of such

judgment is not susceptible to being proven true or false as a factual matter.

      Given the dearth of controlling case law regarding the intersection of the

FCA and the Medicare hospice benefit and the parties’ vigorous disagreement on

the fundamental points of law, we begin by defining the contours of the hospice-

eligibility framework and clarifying the circumstances under which a claim

violates the requirements for reimbursement. We then consider the ways in which

a hospice claim might be deemed “false” for purposes of the FCA.

             1.     Hospice Eligibility Framework

      Our analysis begins with the language of the relevant statute and regulations.

See United States v. Aldrich, 566 F.3d 976, 978 (11th Cir. 2009) (“[T]he ‘starting

point’ of statutory interpretation is ‘the language of the statute itself.’”) (citing

Randall v. Loftsgaarden, 478 U.S. 647, 656 (1986)). “To determine the plain

meaning of a statute or regulation, we do not look at one word or term in isolation,

but rather look to the entire statutory or regulatory context.” Sec. & Exch. Comm’n

v. Levin, 849 F.3d 995, 1003 (11th Cir. 2017).



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          In relevant part, the statute states that payment for hospice care provided to

an individual may be made only if:

          (i)       in the first 90-day period . . . (I) the individual’s attending
                    physician . . . and (II) the medical director (or physician
                    member of the interdisciplinary group described in [42 U.S.C.
                    § 1395x(dd)(2)(B)]) of the hospice program providing . . . the
                    care, each certify in writing at the beginning of the period, that
                    the individual is terminally ill (as defined in [42 U.S.C.
                    § 1395x(dd)(3)(A)]) based on the physician’s or medical
                    director’s clinical judgment regarding the normal course of the
                    individual’s illness, [and]

          (ii)      in a subsequent 90- or 60-day period, the medical director or
                    physician . . . recertifies at the beginning of the period that the
                    individual is terminally ill based on such clinical judgment.

42 U.S.C. § 1395f(a)(7)(A) (emphasis added). 6 “Terminally ill” means that the

individual “has a medical prognosis that the individual’s life expectancy is 6



6
  The statute contains three additional requirements, each of which was in place during the
relevant time period of 2007 through 2012:

    (B)          a written plan for providing hospice care with respect to such individual has been
                 established . . . and is periodically reviewed by the individual’s attending physician
                 and by the medical director (and the interdisciplinary group described in 42 U.S.C.
                 § 1395x(dd)(2)(B)]) of the hospice program;

    (C)          such care is being or was provided pursuant to such plan of care; [and]

    (D)          on and after January 1, 2011 . . . a hospice physician or nurse practitioner has a face-
                 to-face encounter with the individual to determine continued eligibility . . . prior to
                 the 180th-day recertification and each subsequent recertification . . . and attests that
                 such visit took place . . . .

42 U.S.C. § 1395f(a)(7). The Government does not allege that AseraCare failed to meet any of
these additional requirements.


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months or less.” 42 U.S.C. § 1395x(dd)(3)(A). In any case, “no payment may be

made . . . for any expenses incurred . . . which are not reasonable and necessary for

the palliation or management of terminal illness.” 42 U.S.C. § 1395y(a)(1)(C).

      The implementing regulations echo the language of the statute, reiterating

that each written certification of terminal illness “will be based on the physician’s

or medical director’s clinical judgment regarding the normal course of the

individual’s illness.” 42 C.F.R. § 418.22(b). See also 42 C.F.R. § 418.22(a)(1)

(stating “general rule” that hospice provider “must obtain written certification of

terminal illness” for each claimed period of care).

      The regulations go on to identify several requirements for the submission of

claims. First, and most significant to this appeal, “[c]linical information and other

documentation that support the medical prognosis must accompany the

certification and must be filed in the medical record with the written certification.”

42 C.F.R. § 418.22(b)(2). Second, the certifying physician must include with the

certification “a brief narrative explanation of the clinical findings that supports a

life expectancy of 6 months or less.” 42 C.F.R. § 418.22(b)(3). This narrative

explanation “must reflect the patient’s individual clinical circumstances and cannot

contain check boxes or standard language used for all patients.” 42 C.F.R.




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§ 418.22(b)(3)(iv).7 And third, in deciding whether to certify a patient as

terminally ill, a physician is obligated to consider several factors: the patient’s

primary terminal condition and related diagnoses; current subjective and objective

medical findings; current medication and treatment orders; and information about

the medical management of any conditions unrelated to the terminal illness.

42 C.F.R. § 418.102(b); 42 C.F.R. § 418.25(b) (establishing that, “[i]n reaching a

decision to certify that the patient is terminally ill, the hospice medical direct must

consider at least” the diagnosis of the patient, other health conditions, and

“[c]urrent clinically relevant information supporting all diagnoses”). See also 78

Fed. Reg. 48234, 48247 (Aug. 7, 2013) (“[T]he certification of terminal illness is

based in the unique clinical picture of the individual that is reflected in the

comprehensive assessment and other clinical records and documentation . . . .”); 79

Fed. Reg. 50452, 50471 (Aug. 22, 2014) (noting that, in deciding whether to

recertify a patient who has not shown measurable decline, the physician “must

assess and evaluate the full clinical picture” of the patient).

       The language of the statute and implementing regulations makes plain that

the clinical judgment of the patient’s attending physician (or the provider’s medical



7
  The requirement of a brief narrative explanation accompanying the certification was added to
the regulations on October 1, 2009. See 74 Fed. Reg. 39384, 39398–400, 39413 (Aug. 6, 2009).


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director, as the case may be) lies at the center of the eligibility inquiry. Under this

language, a patient is eligible for the Medicare hospice benefit if the appropriate

physician makes a clinical judgment that the patient is terminally ill in light of the

patient’s complete medical picture, as evidenced by the patient’s medical records.

       Importantly, none of the relevant language states that the documentary

record underpinning a physician’s clinical judgment must prove the prognosis as a

matter of medical fact. Indeed, CMS has recognized in crafting the implementing

regulations that “[p]redicting life expectancy is not an exact science.” 75 Fed.

Reg. 70372, 70448 (Nov. 17, 2010). See also 79 Fed. Reg. at 50470 (“[W]e also

have recognized the challenges in prognostication” and therefore expect “that the

certifying physicians will use their best clinical judgment.”). 8 Nor does this

framework state or imply that the patient’s medical records must unequivocally

demonstrate to an unaffiliated physician, reviewing the records after the fact, that

the patient was likely to die within six months of the time the certifying

physician’s clinical judgment was made. Rather, the framework asks a physician




8
  We have held in the context of FCA proceedings that “guidance issued by the governmental
agency charged with administrating the regulatory scheme,” including the Medicare regulatory
scheme, “can be consulted to understand the meaning of that regulation.” United States ex rel.
Walker v. R&F Props. of Lake Cty., Inc., 433 F.3d 1349, 1357 (11th Cir. 2005).


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responsible for the patient’s care to exercise his or her judgment as to the proper

interpretation of the patient’s medical records.

      The Government seeks to elevate the significance of the regulation’s

supporting-documentation requirement, asserting that eligibility “turns on”

whether the clinical information and other documentation accompanying a

certification of terminal illness support, as a factual matter, the physician’s

certification. Specifically, the Government maintains that the testimony of Dr.

Liao, which “was designed to assist the jury in understanding the medical records”

for each patient, created “a factual dispute as to whether ‘[c]linical information and

other documentation’ in the medical record ‘support[ed] the medical prognosis’ of

a life expectancy of six months or less.” (Citing 42 C.F.R. § 418.22(b)(2).)

      We conclude that the Government’s framing of the eligibility inquiry is not

consistent with the text or design of the law. The relevant regulation requires only

that “clinical information and other documentation that support the medical

prognosis . . . accompany the certification” and “be filed in the medical record.”

42 C.F.R. § 418.22(b)(2) (emphases added). This “medical prognosis” is, itself,

“based on the physician’s . . . clinical judgment.” 42 C.F.R. § 418.22(b). To

conclude that the supporting documentation must, standing alone, prove the

validity of the physician’s initial clinical judgment would read more into the legal

framework than its language allows. Read in the context of the statute and
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regulations, the requirement that supporting documentation “accompany” the claim

is designed to address CMS’s mandate that “there must be a clinical basis for a

certification.” 79 Fed. Reg. at 50470 (noting that, although “certification is based

on a clinical judgment,” this “does not negate the fact that there must be a clinical

basis for a certification”). That is, the physician’s clinical judgment dictates

eligibility as long as it represents a reasonable interpretation of the relevant

medical records.

      We also note that, had Congress or CMS intended the patient’s medical

records to objectively demonstrate terminal illness, it could have said so. Yet,

Congress said nothing to indicate that the medical documentation presented with a

claim must prove the veracity of the clinical judgment on an after-the-fact review.

And CMS’s own choice of the word “support”—instead of, for example,

“demonstrate” or “prove”—does not imply the level of certitude the Government

wishes to attribute to it. Cf. Davidson v. Capital One Bank (USA), N.A., 797 F.3d

1309, 1316 (11th Cir. 2015) (We “presume that Congress said what it meant and

meant what it said.”) (quotation marks omitted).

      More broadly, CMS’s rulemaking commentary signals that well-founded

clinical judgments should be granted deference. As noted supra, CMS has

repeatedly emphasized that “[p]redicting life expectancy is not an exact science.”

75 Fed. Reg. at 70448. See also 79 Fed. Reg. at 50470 (same). And in clarifying
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the process for reporting a patient’s “principal hospice diagnosis” on a hospice

claim, CMS stated: “We believe that the certifying physicians have the best

clinical experience, competence and judgment to make the determination that an

individual is terminally ill.” 78 Fed. Reg. at 48247. Furthermore, in response to

public comment, CMS removed the term “criteria” from a proposed regulation

defining the certification requirements, wishing “to remove any implication that

there are specific CMS clinical benchmarks in this rule that must be met in order to

certify terminal illness.” 73 Fed. Reg. 32088, 32138 (June 5, 2008). While there is

no question that clinical judgments must be tethered to a patient’s valid medical

records, it is equally clear that the law is designed to give physicians meaningful

latitude to make informed judgments without fear that those judgments will be

second-guessed after the fact by laymen in a liability proceeding.

      The Government cautions that a narrow reading of the eligibility framework

“would entitle hospice providers to reimbursement for services provided to any

individual, regardless of medical condition, assuming the provider could find a

physician willing to sign the certification.” This point again ignores that the

physician’s clinical judgment, informed by the patient’s medical records, is the

threshold requirement for eligibility. A physician cannot, as the Government

suggests, hold a clinical judgment under the eligibility framework that disregards

the patient’s underlying medical condition. See, e.g., 42 C.F.R. § 418.102(b)
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(identifying factors physicians must consider when arriving at clinical judgments

regarding terminal illness, including “subjective and objective medical findings”

regarding the patient’s condition). Such a clinical judgment would clearly be

illegitimate under the law.

      The Government further warns that, under our reading of the framework, “if

a physician certifies a patient as terminally ill, CMS is required to reimburse the

hospice care provider unless it can determine that no other reviewer of the patient’s

medical records could possibly conclude the patient was terminally ill.” But, as the

Government elsewhere notes, CMS is statutorily prohibited from reimbursing

providers for services “which are not reasonable and necessary for the palliation or

management of terminal illness.” 42 U.S.C. § 1395y(a)(1)(C). See also 79 Fed

Reg. 50452, 50470 (Aug. 22, 2014) (explaining that CMS retains a well-

established right to review claims for hospice reimbursement and to deny claims

that it does not consider to be “reasonable and necessary” under the statutory

standard). The Government’s argument that our reading of the eligibility

framework would “tie CMS’s hands” and “requir[e] improper reimbursements” is

contrary to the plain design of the law.

             2.    Falsity in this case under the FCA

      Having identified the contours of the Medicare framework, it becomes clear

that there are two separate representations embedded in each claim for hospice
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reimbursement: a representation by a physician to AseraCare that the patient is

terminally ill in the physician’s clinical judgment and a representation by

AseraCare to Medicare that such clinical judgment has been obtained and that the

patient is therefore eligible. As such, this case requires us to distinguish between

two possible species of “falsity.” The first relates to the legitimacy of a

physician’s clinical judgment. The second relates to the legitimacy of AseraCare’s

statement that a clinical judgment has been properly made.

       Under the Government’s false-certification theory in this case, AseraCare

“submitted documentation that falsely represented that certain Medicare recipients

were ‘terminally ill’” when, in the Government’s view, they were not. There is no

allegation that AseraCare submitted claims that were not, in fact, based on a

physician’s properly formed clinical judgment, nor is there an allegation that

AseraCare failed to abide by each component of the claim requirements. 9 The

Government’s allegations focus solely on the accuracy of the physician’s clinical

judgment regarding terminality. If, the theory goes, AseraCare represented to

Medicare that a patient was “terminally ill” based on a physician’s clinical



9
   We might, for instance, envision a viable FCA suit alleging that a hospice provider failed to
obtain any clinical judgment at all, or obtained a clinical judgment from someone other than the
patient’s attending physician or the provider’s medical director, or fabricated the certification
itself. No such facts are alleged here.


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judgment, and the Government later persuades a jury that this clinical judgment

was wrong, then AseraCare’s representation was, in turn, “false.” This “falsity”

opens the door to FCA liability. Thus, the Government’s FCA case hangs entirely

on the following question: When can a physician’s clinical judgment regarding a

patient’s prognosis be deemed “false”?

      In light of our foregoing discussion, we concur with the district court’s post-

verdict conclusion that “physicians applying their clinical judgment about a

patient’s projected life expectancy could disagree, and neither physician [ ] be

wrong.” Indeed, the Government’s own witness—Mary Jane Schultz, the former

head of Palmetto’s medical review department—conceded at trial that “two doctors

using their clinical judgment could come to different conclusions about a patient's

prognosis and neither be right or wrong.” Nothing in the statutory or regulatory

framework suggests that a clinical judgment regarding a patient’s prognosis is

invalid or illegitimate merely because an unaffiliated physician reviewing the

relevant records after the fact disagrees with that clinical judgment. Nor does the

law suggest that a hospice provider has failed to comply with Medicare’s

requirements for hospice reimbursement if the only flaw in its claim is an absence

of certitude that, in light of the relevant medical records, the patient will die within

six months. The legal framework signals, and CMS itself has acknowledged, that

no such certitude can be expected of physicians in the practice of treating end-of-
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life illness. All the legal framework asks is that physicians exercise their best

judgment in light of the facts at hand and that they document their rationale.

      It follows that when a hospice provider submits a claim that certifies that a

patient is terminally ill “based on the physician’s or medical director’s clinical

judgment regarding the normal course of the individual’s illness,” 42 U.S.C.

§ 1395f(7), 42 C.F.R. § 418.22(b), the claim cannot be “false”—and thus cannot

trigger FCA liability—if the underlying clinical judgment does not reflect an

objective falsehood.

      Objective falsehood can be shown in a variety of ways. Where, for instance,

a certifying physician fails to review a patient’s medical records or otherwise

familiarize himself with the patient’s condition before asserting that the patient is

terminal, his ill-formed “clinical judgment” reflects an objective falsehood. The

same is true where a plaintiff proves that a physician did not, in fact, subjectively

believe that his patient was terminally ill at the time of certification. A claim may

also reflect an objective falsehood when expert evidence proves that no reasonable

physician could have concluded that a patient was terminally ill given the relevant

medical records. In each of these examples, the clinical judgment on which the

claim is based contains a flaw that can be demonstrated through verifiable facts.

      By contrast, a reasonable difference of opinion among physicians reviewing

medical documentation ex post is not sufficient on its own to suggest that those
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judgments—or any claims based on them—are false under the FCA. A properly

formed and sincerely held clinical judgment is not untrue even if a different

physician later contends that the judgment is wrong. Cf. Omnicare, Inc. v.

Laborers Dist. Council Const. Indus. Pension Fund, 135 S. Ct. 1318, 1327 (2015)

(holding that “a sincere statement of pure opinion is not an ‘untrue statement of

material fact’” under the Securities Act of 1933, “regardless whether an investor

can ultimately prove the belief wrong”).

       Accordingly, in order to properly state a claim under the FCA in the context

of hospice reimbursement, a plaintiff alleging that a patient was falsely certified for

hospice care must identify facts and circumstances surrounding the patient’s

certification that are inconsistent with the proper exercise of a physician’s clinical

judgment. Where no such facts or circumstances are shown, the FCA claim fails

as a matter of law.

       In so holding, we agree with the district court’s conclusion that, in order to

show objective falsity as to a claim for hospice benefits, the Government must

show something more than the mere difference of reasonable opinion concerning

the prognosis of a patient’s likely longevity. 10 And although we appear to be the



10
   Several district courts within and outside the Eleventh Circuit have embraced comparable
reasoning in cases alleging FCA liability on the basis of clinical judgments of terminal illness.
See, e.g., United States ex rel. Wall v. Vista Hospice Care, Inc., 2016 WL 3449833, at *17 (N.D.

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first circuit court to consider the precise question at issue here, a number of

opinions from our sister circuits lends support to our conclusion that the

Government must show an objective falsity. 11




Tex. June 20, 2016) (“Because a physician must use his or her clinical judgment to determine
hospice eligibility, an FCA claim about the exercise of that judgment must be predicated on the
presence of an objectively verifiable fact at odds with the exercise of that judgment, not a matter
of questioning subjective clinical analysis.”); United States ex rel. Fowler v. Evercare Hospice,
Inc., 2015 WL 5568614, at *9 (D. Colo. Sept. 21, 2015) (observing that, if Government’s
complaint had been “based entirely on disagreements with [the provider’s] certifying
physicians,” the complaint “would be insufficient to state a claim”); United States ex rel.
Geschrey v. Generations Healthcare, LLC, 922 F. Supp. 2d 695, 703 (N.D. Ill. 2012) (dismissing
FCA claims because “[r]elators have not alleged facts demonstrating that the certifying physician
did not or could not have believed, based on his or her clinical judgment, that the patient was
eligible for hospice care”). But see Druding v. Care Alternatives, Inc., 164 F. Supp. 3d 621, 623
(D.N.J. 2016) (holding that where plaintiffs alleged that patients were ineligible for hospice
because they did not meet LCD criteria, claims were “legally false . . . because the claim[s] did
not include sufficient clinical facts in the patient’s medical records to justify a terminal
prognosis”).
11
   See United States ex rel. Yannacopoulos v. General Dynamics, 652 F.3d 818, 836 (7th Cir.
2011) (stating that “[a] statement may be deemed ‘false’ for purposes of the False Claims Act
only if the statement presents ‘an objective falsehood’”) (citing United States ex rel. Wilson v.
Kellogg Brown & Root, Inc., 525 F.3d 370, 376 (4th Cir. 2008)); United States ex rel. Loughren
v. Unum Grp., 613 F.3d 300, 310 (1st Cir. 2010), (explaining that an opinion may qualify as a
false statement for purposes of the FCA where the speaker “knows facts ‘which would preclude
such an opinion’”) (quoting United States ex rel. Siewick v. Jamieson Science and Engineering,
Inc., 214 F.3d 1372, 1378 (D.C. Cir. 2000)); Wilson, 525 F.3d at 376–77 (holding that “[t]o
satisfy [the] first element of an FCA claim, the statement or conduct alleged must represent an
objective falsehood” and “imprecise statements or differences in interpretation growing out of a
disputed legal question are [ ] not false under the FCA”) (quotation omitted); United States ex
rel. Burlbaw v. Orenduff, 548 F.3d 931, 959 (10th Cir. 2008) (“At a minimum the FCA requires
proof of an objective falsehood.”); Harrison v. Westinghouse Savannah River Co., 176 F.3d 776,
792 (4th Cir. 1999) (noting that opinions or estimates can be “false” under the FCA if their
speaker knows they are not supported by the facts); Hooper v. Lockheed Martin Corp., 688 F.3d
1037, 1047–49 (9th Cir. 2012) (same). Cf. Omnicare, Inc. v. Laborers Dist. Council Const.
Indus. Pension Fund, 135 S. Ct. 1318, 1323, 1326–27 (2015) (holding in the context of securities
fraud statutes that a statement of opinion can be “false” if the opinion did not reflect the
speaker’s actual belief at the time it was given).

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      The Government urges that the standard we adopt today improperly

“usurp[s] the role of the jury” by precluding the jury from determining, based on

expert testimony, the accuracy of the clinical judgments at issue. In support of this

contention, the Government relies heavily on this Court’s reasoning in United

States ex rel. Walker v. R&F Properties of Lake County, Inc., 433 F.3d 1349 (11th

Cir. 2005). But Walker is clearly distinguishable and does not control our analysis.

      In Walker, an FCA relator contended that her employer, a medical-clinic

operator, billed Medicare for services rendered by non-physicians as if those

services had been rendered “incident to the service of a physician,” as the relevant

statute required. See id. at 1353. In reality, the relator alleged, services had been

provided by nurse practitioners or physician assistants without any physician

involvement. Id. The defendant-clinic did not dispute that physicians were not

present in the clinic when services were rendered. Id. at 1354. It argued instead

that these claims could not have been false as a matter of law because the meaning

of “incident to the service of a physician” was “vague and subject to reasonable

interpretations other than that championed by Walker.” Id. Specifically, the clinic

argued that it interpreted “incident to the service of a physician” to cover services

that were rendered by non-physicians as long as a physician was available by pager

or telephone, even if not actually physically present in the office. Id. The district



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court agreed, finding the statute ambiguous and defendant’s interpretation of the

statute reasonable. Id.

      This Court reversed. Walker, 433 F.3d at 1356. The question presented was

whether a claim based on a reasonable interpretation of an ambiguous statutory

term could never be deemed “false,” or whether instead the meaning of the

ambiguous term—and the corresponding falsity of the claims made thereunder—

could potentially pose factual questions that should be put to a factfinder. Id.

Given the particular facts of the case before us, our Court adopted the latter

approach. Specifically, the relator presented evidence from the Medicare Carrier’s

manual, Medicare bulletins, and seminar programs to “support a finding that, in the

Medicare community, the language of the statute was understood to mean that a

physician had to be physically present in the office suite” in order to justify

reimbursement for the medical service provided by a non-physician. Id. at 1356–

57. We concluded that this evidence created a jury question as to both whether the

Medicare regulation required more physician involvement with a patient than the

defendant clinic had provided and whether the defendant knew of this requirement.

Id. at 1358.

      In Walker, the eligibility criterion at issue was subject to multiple

interpretations because its language was ambiguous, yet ultimately only one of the

two possible interpretations could be deemed correct. By contrast, the key
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eligibility criterion at issue here—“terminally ill”—presents, by design, a question

of debatable clinical judgment that may not, in all circumstances, lend itself to just

one determination as to the proper exercise of that judgment. As the district court

noted below, asking the jury to decide whether medical records supported a finding

of “terminal illness” put the jury in the position of evaluating, and second-

guessing, the clinical judgment of the certifying physician. This is not the role the

factfinder was playing in Walker; indeed, it is a role requiring medical knowledge

and expertise that Congress has clearly reserved for physicians in the hospice-

benefit context. Walker therefore does not compel the conclusion that eligibility

requirements that hinge on clinical judgment present jury questions simply because

they are susceptible to differing opinions, each of which could be reasonable.

      The Government has also filed supplemental authority, citing to out-of-

circuit appellate cases that it says establish that a mere difference of medical

opinion can be sufficient to show that a statement is false. We find these cases

distinguishable. In United States v. Paulus, 894 F.3d 267 (6th Cir. 2018), the

physician-defendant had been convicted of healthcare fraud based on his

performance of allegedly unnecessary coronary stent procedures. In arguing for

reversal of his conviction, the defendant contended that he based his decision to

perform the procedures on his interpretation of angiogram tests showing a high

degree of blockage in the patients’ arteries, and thus his medical judgment on this
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point represented merely an opinion that could neither be truthful nor false. The

Government contended that, to the contrary, the defendant had lied when he said

that he interpreted the angiograms as showing a level of coronary blockage that

would warrant inserting a stent into the heart, and it offered substantial expert

testimony disputing that the level of blockage shown on the angiogram test was at

the level the defendant asserted it was.

       The Sixth Circuit12 agreed with the defendant that “[o]rdinarily, facts are the

only item that fits in [the false statement] category; opinions—when given

honestly—are almost never false . . . .There is no such thing as a false idea.” Id. at

275 (citations and internal quotation marks omitted). Nevertheless, the court

continued, opinions have “never been completely insulated from scrutiny. At the

very least, opinions may trigger liability for fraud when they are not honestly held

by their maker, or when the speaker knows of facts that are fundamentally

incompatible with his opinion.” Id. The court then cited with apparent approval

the district court opinion in the present case for the proposition that “certain good-




12
    The Paulus court indicated its intention to clarify the standard underlying its earlier decision
in United States v. Persaud, 866 F.3d 371 (6th Cir. 2017), which the Government has also cited
in the present case. Paulus, 894 F.3d at 275.


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faith medical diagnoses by a doctor cannot be false.” 13 Id. In the case before it,

however, the Paulus court noted that “coronary artery blockage actually exists as

an aspect of reality,” meaning that an assertion about the degree of blockage can be

objectively true or false. Id. at 276 (quotation marks omitted). And it concluded

that the Government’s expert testimony was sufficient to support an inference that

the defendant had lied when he reported readings of the angiograms that the

experts said were simply not true: “[W]e think it is clear that Paulus was convicted

for misrepresenting facts, not giving opinions.” Id.

       Moreover, whereas in the present case the Government’s expert witness

declined to conclude that Asercare’s physicians had lied about their clinical

judgment or even that their judgments were unreasonable or wrong 14—as opposed

to just different from what the Government’s expert opined—in Paulus, it appears

clear that the Government’s experts there were not so charitable. The Paulus court

noted that the Government had claimed that “Paulus repeatedly and systematically

saw one thing on the angiogram and consciously wrote down another, and then



13
  The court stated, “see also United States v. AseraCare, Inc., 176 F. Supp. 3d 1282 (N.D. Ala.
2016) (holding that certain good-faith medical diagnoses by a doctor cannot be false.”) Paulus,
894 F.3d at 275.
14
   As noted supra, the former head of the Palmetto medical review team, called as a Government
witness, also conceded at trial that “two doctors using their clinical judgment could come to
different conclusions about a patient's prognosis and neither be right or wrong.”


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used that misinformation to perform and bill unnecessary procedures,” and it

explained that “[h]owever difficult it might be for a cardiology expert to prove that

his colleague was lying about what he saw on a scan,” it was up to the jury to

decide the reliability of that testimony. Id. at 267–77. In short, the Government’s

expert testimony in Paulus appeared to suggest that no reasonable doctor could

interpret the scan as had Paulus and that Paulus was actually lying. Thus, Paulus is

not supportive of the Government’s contentions here.15



15
    The Government here also cites United States ex rel. Polukoff v. St. Mark’s Hospital, 895
F.3d 730 (10th Cir. 2018), an FCA case in which the district court had granted the defendant’s
motion to dismiss on the ground that his medical judgment about the need for cardiac PFO
closure procedures to prevent future strokes in his patients was an opinion that was not subject to
being deemed true or false. The Tenth Circuit reversed, found a plausible allegation of falsity,
and directed that the case proceed to discovery. The circuit court noted that the Government had
alleged that the applicable Medicare statute authorized reimbursement only when the he PFO
procedure was reasonable and necessary for the treatment of an illness; that there is agreement in
the medical community that a PFO closure is not medically necessary except where there is a
confirmed diagnosis of a recurrent stroke; that the applicable guidelines allow for consideration
of the procedure only when the patient has had two or more strokes and that the guidelines do not
“contemplate the potential for PFO closures” if the patient has not had a prior stroke; that the
defendant claimed to believe that the procedure should be performed prophylactically to cure
migraine headaches or to prevent strokes even if the patient had never before had a stroke; and,
knowing that Medicare would not pay on that basis, the defendant falsely represented that the
procedure was being performed based on the indications set forth in the guidelines. Id. at 736,
737. In addition, a fellow physician alleged that he had witnessed the defendant perform an
unnecessary procedure and actually create the problem the surgery was intended to remedy by
puncturing intact septa in the patients. Id. at 738.

Obviously, the above facts are quite different from those alleged in this case. It is true that the
Tenth Circuit opinion held that regardless of the physician’s opinion to the contrary, he will be
deemed to have made a false statement when claiming reimbursement if the medical procedure is
determined to have not been reasonable or necessary. “We thus hold that a doctor’s certification
to the government that a procedure is ‘reasonable and necessary’ is ‘false’ under the FCA if the
procedure was not reasonable and necessary under the government’s definition of the phrase.”

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       The Government expresses concern that a requirement of objective

falsehood will produce a troubling under-inclusion problem: that is, by holding

that an FCA claim fails as a matter of law if the plaintiff proves nothing more than

a reasonable difference of opinion as to the patient’s prognosis, hospice providers

with sloppy or improper admission practices may evade FCA liability so long as

they can argue after the fact that their physicians’ clinical judgments were

justifiable. That may well be. To be sure, it will likely prove more challenging for

an FCA plaintiff to present evidence of an objective falsehood than to find an

expert witness willing to testify to a contrasting clinical judgment regarding cold

medical records.

       But if this is a problem, it is one for Congress or CMS to solve. In deciding

how to craft the hospice eligibility requirements, Congress and CMS could have

imposed a more rigid set of criteria for eligibility determinations that would have

minimized the role of clinical judgment. Instead, they were careful to place the

physician’s clinical judgment at the center of the inquiry. Indeed, CMS has

considered and expressly declined to impose defined criteria that would govern the

physician’s exercise of judgment. See 73 Fed. Reg. 32088, 32138 (June 5, 2008).



Id. at 742. As set out in text, however, the hospice-benefit provision at issue here, by design,
looks to whether a physician has based a recommendation for hospice treatment on a genuinely-
held clinical opinion as to a patient’s likely longevity.

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       In any event, absent a showing of an objective and knowing falsehood, the

FCA is an inappropriate instrument to serve as the Government’s primary line of

defense against questionable claims for reimbursement of hospice benefits. For the

above reasons, we agree that the district court’s jury instruction concerning falsity

was lacking and that a new trial was warranted to allow the giving of a more

complete charge: specifically, a charge that would convey that the mere difference

of reasonable opinion between physicians, without more, 16 as to the prognosis for a

patient seeking hospice benefits does not constitute an objective falsehood. We

therefore AFFIRM the district court’s grant of a new trial.

       B.      Grant of Summary Judgment

       Deciding that the district court acted correctly in determining that a new trial

was warranted—with a revised instruction to the jury concerning falsity—does not

end our review of this case. Instead, as noted in the procedural discussion above,

the district court went further and, after granting a new trial, it then sua sponte

granted summary judgment to AseraCare. The court reasoned as follows. Given

its new position on the standard for determining falsity—that falsity cannot be

established based merely on a reasonable disagreement between experts as to



16
    Should there be another trial on this matter, we leave to the district court and the parties the
task of fleshing out just what that “more” needs to include.


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whether clinical records in a patient’s file warranted a prognosis of a terminal

illness that would likely result in the patient’s death within six months—the district

court indicated that it would hear from the Government whether the court record

contained any other evidence sufficient to create a jury question as to whether

AseraCare had made an objectively false representation when claiming

reimbursement for hospice benefits it had provided. Following that response and

concluding that the Government’s evidence of falsity consisted only of Dr. Liao’s

testimony indicating his disagreement with the prognosis arrived at by AseraCare

for most of the patient files he reviewed, the district court found that the

Government’s evidence of falsity was insufficient to allow it to proceed further.

For that reason, the court granted summary judgment.

      Leaving aside the question whether the substance of an opinion, by itself,

can ever be deemed to constitute an objective falsity, the parties agree that an

opinion can be considered objectively false if the speaker does not actually hold

that opinion. See Omnicare, Inc. v. Laborers Dist. Council Const. Indus. Pension

Fund, 135 S. Ct. 1318, 1323, 1326–27 (2015) (holding in the context of securities

fraud statutes that a statement of opinion can be “false” if the opinion did not

reflect the speaker’s actual belief at the time it was given). Further, in examining

whether a physician’s clinical judgment was truly communicated, the latter must

first have actually exercised such judgment. If it can be shown that the physician
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never considered the underlying records supporting the prognosis at issue, but

instead rubber-stamped whatever file was put in front of him, then the physician

has offered no clinical judgment. Moreover, an opinion can enter falsifiable

territory when it is based on information that the physician knew, or had reason to

know, was incorrect. Finally, if no reasonable physician would think that a patient

had a terminal illness based on the evidence before that physician, then falsity can

be inferred, as well as the existence of a knowing violation.

       With the above thoughts in mind, the Government argues that the district

court took too constricted a view of the evidence upon which a determination of

falsity could be made by a jury when it refused to consider other evidence from the

first phase of the trial that the Government asserts tended to show knowledge of

the falsity of the claim, as well as evidence that the Government intended to

present in the second phase of the trial to further show AseraCare’s alleged

awareness 17 that it was submitting claims that did not reflect a physician’s good

faith clinical judgment and prognosis for each patient. In its opposition to the sua

sponte grant of summary judgment, the Government stated:


17
   For purposes of the FCA, “the terms ‘knowing’ and ‘knowingly’ (A) mean that a person, with
respect to information—(i) has actual knowledge of the information; (ii) acts in deliberate
ignorance of the truth or falsity of the information; or (iii) acts in in reckless disregard of the
truth or falsity of the information, and (B) no proof of specific intent to defraud is required.” 31
U.S.C. § 3729(b).


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      It is indefensible for the Court to grant summary judgment on the
      grounds that this case is just about a good faith disagreement between
      experts—and that the United States failed to present evidence that
      AseraCare knew or recklessly disregarded that its claims were false—
      when the Court bifurcated the trial and expressly excluded from Phase
      One any evidence of AseraCare’s knowledge of falsity.

We agree with the Government that before granting summary judgment, the

district court should have considered all the evidence, both in the trial record and

the summary judgment record, to determine whether a triable issue existed

regarding falsity. Here is why we reach that conclusion.

      The Government had been prepared to introduce evidence to show

AseraCare’s knowledge at trial, but was prevented from doing so by the district

court’s decision, over the Government’s strong objections, to bifurcate the trial and

preclude introduction of any evidence showing knowledge of falsity in Phase I.

The Government did, however, introduce evidence in that first phase that seems to

offer some potential basis for inferring knowledge. Specifically, nine witnesses,

whose testimony was purportedly connected in time and location to the patients at

issue, testified that AseraCare had a deliberate practice of not giving physicians

relevant, accurate, and complete information about patients whose certifications for

hospice the doctors were being asked to sign. For example, one former director of

clinical services in Decatur, Alabama, testified that when she declined to admit

ineligible patients to hospice, she was instructed to go back and find whatever she

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needed to admit the patient. Further, she typically did not provide the certifying

physician with any clinical information, but usually just gave him a stack of papers

to sign. Indeed, each of the nine former-employee witnesses reiterated these

themes in their testimony. In large part, because the Government had not

denominated this evidence as proof of falsity during this first phase—but instead as

evidence of context—the district court refused to consider it as evidence of falsity

in this post-verdict summary judgment phase.

      The Government also intended to offer at the second phase evidence from

AseraCare’s internal and external auditors criticizing the company because the

certifying medical directors were not adequately involved in making initial

eligibility determinations and did not consistently receive medical information

prior to the initial certification. In addition to the testimony of other former

employees, the Government also planned to offer testimony from a former

AseraCare physician that employees did not defer to his clinical judgment that

certain patients were unentitled to hospice benefits, but instead proceeded to file

the claims. The district court declined to factor the above evidence into its

evaluation of whether a jury question still remained concerning AseraCare’s

knowledge that it was submitting claims that did not warrant the reimbursement of

hospice benefits.



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      The district court’s refusal to consider any of the above-described additional

evidence on the question of falsity was largely based on the Government’s

response to AseraCare’s discovery interrogatories inquiring what evidence the

Government would offer on that issue. The district court emphasized that the

Government had “painted itself into a corner by failing to disclose during

discovery that it would use anything other than the testimony of Dr. Liao and

medical records to prove the falsity of the claims.”

      It is true that the Government denominated only the Liao testimony as

evidence of falsity during the discovery period. But, in fairness to the

Government, it disclosed all the above evidence in question during discovery,

including the evidence that the district court declined to consider for post-verdict

summary judgment purposes. At the time of disclosure, the Government had no

idea that the district court would later order the bifurcation of trial between falsity

and knowledge phases, and it clearly assumed that all of its evidence would be

heard by the jury in one proceeding, with no need to so starkly pigeon-hole the

category into which a given piece of evidence might fit. As the Government noted

in its opposition to bifurcation, with no contradiction by AseraCare, the elements

of an FCA liability claim had “never been before been bifurcated by a federal

district court.” Nor had the Government ever anticipated such a decision, because,

according to it, such an order was “extraordinary, requiring the United States to
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jump over an arbitrary hurdle that is without precedent . . . [because] [t]he elements

of ‘falsity’ and ‘knowledge of falsity’ are not so distinct and separable that they

may be tried separately without injustice.”

      Moreover, the district court had rejected AseraCare’s initial motion for

summary judgment based on the latter’s argument that the mere disagreement of

experts is insufficient to imply falsity. At the time of trial, the court had already

declined to apply this “reasonable physician” standard to the falsity analysis,

despite granting AseraCare’s § 1292(b) motion for review. As such, the

Government’s failure to present its case in a manner consistent with such a

standard is understandable. Moreover, the court declined to give the instructions

requested by AseraCare to that effect and instead gave only the charge requested

by the Government: “Claims to Medicare may be false if the provider seeks

payment, or reimbursement, for health care that is not reimbursable. For a hospice

provider’s claims to Medicare to be reimbursable, the patient must be eligible for

the Medicare hospice benefit.”

      Accordingly, the Government, which had prepared and presented its case

based on all the above information, was never alerted to the possibility that the

conceptual underpinnings of its case would shift so dramatically once it had won a

jury verdict on that theory. We emphasize that we do not criticize the district court

for its post-verdict change of mind about the appropriate standard for proving
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falsity. To the contrary, this district court judge was diligent, conscientious, and

thoughtful throughout the long and complex pre-trial proceedings and the eight-

week trial whose verdict she ultimately vacated. Given that expenditure of time

and energy, it is commendable that the district court would consider starting over

once she became convinced that she had made a legal error.

      Nonetheless, under all these unusual circumstances, it is only fair that the

Government be allowed to have summary judgment considered based on all the

evidence presented at both the summary judgment and trial stages, and we direct

that this occur. When the goalpost gets moved in the final seconds of a game, the

team with the ball should, at the least, have one more opportunity to punch it into

the endzone.

      Having given the Government the green light to once again try to persuade

the district court that a triable issue exists on both falsity and knowledge, we

emphasize that we do not know that this effort will succeed. For sure, to the extent

that a reasonable jury might credit the Government’s proffered evidence regarding

AseraCare’s practices, that evidence suggests that AseraCare’s certification

procedures were seriously flawed. As noted, a former Director of Clinical Services

testified that one physician she worked with was in the habit of signing

certifications before reviewing any medical documentation whatsoever; clinical

staff typically “just gave him . . . a stack of papers to sign, [and] he just signed the
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papers.” Another former employee testified that signing certifications had become

so rote for one physician that he “would nod off” while signing. This testimony

certainly raises questions regarding AseraCare’s certification process writ large.

But crucially, on remand the Government must be able to link this evidence of

improper certification practices to the specific 123 claims at issue in its case. Such

linkage is necessary to demonstrate both falsehood and knowledge. 18 See

Urquilla-Diaz v. Kaplan Univ., 780 F.3d 1039, 1045 (11th Cir. 2015) (“disregard

of government regulations or failure to maintain proper internal procedures” are

not sufficient to demonstrate FCA violation); Carrel v. AIDS Healthcare

Foundation, Inc., 898 F.3d 1267, 1277–78 (11th Cir. 2018) (a relator cannot prove

that an actual false claim was filed based only on a showing of general practices

untethered to that claim).


18
   Alternatively, the Government could meet its burden under the falsity standard now adopted
by the district court, and endorsed by this Court, if it could establish through expert testimony
that no reasonable physician reviewing the medical records at issue could have concluded that a
particular patient was terminally ill. The Court, however, is unaware that any such evidence
exists. Indeed, as noted, Mary Jane Schultz, the former head of Palmetto’s medical review
department, testified that “two doctors using their clinical judgment could come to different
conclusions about a patient's prognosis and neither be right or wrong.” Also, as noted, Dr. Liao
himself changed his opinion concerning the eligibility of certain patients over the course of the
proceeding but testified at trial that both sets of opinions remained “accurate to a reasonable
degree of certainty.” To explain these reversals, Dr. Liao stated that he “was not the same
physician in 2013 as [he] was in 2010.” As the district court observed, if Dr. Liao can form
contradictory opinions based on the same medical records and yet claim not to have been wrong
on either occasion, then it is difficult to explain how his difference of opinion with AseraCare’s
physicians concerning other patients would demonstrate that no reasonable physician could agree
with AseraCare, absent some additional evidence to warrant that inference.

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      For the above reasons, we VACATE the district court’s post-verdict grant of

summary judgment to AseraCare and REMAND for the court to reconsider that

matter based on the entirety of the evidence, not just that evidence presented at trial

nor just the evidence denominated as being offered to prove falsity.

V.    CONCLUSION

      For the reasons explained above, we AFFIRM the district court’s grant of a

new trial. We, however, VACATE the post-verdict grant of summary judgment to

AseraCare and REMAND for the district court to reconsider that decision in light

of all the relevant evidence proffered by the Government.




                                          57
