United States v. Amerigroup Illinois, Inc.

230 F.R.D. 538, 62 Fed. R. Serv. 3d 1358, 2005 U.S. Dist. LEXIS 20115, 2005 WL 2234747
CourtDistrict Court, N.D. Illinois
DecidedSeptember 15, 2005
DocketNo. 02 C 6074
StatusPublished
Cited by12 cases

This text of 230 F.R.D. 538 (United States v. Amerigroup Illinois, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. Amerigroup Illinois, Inc., 230 F.R.D. 538, 62 Fed. R. Serv. 3d 1358, 2005 U.S. Dist. LEXIS 20115, 2005 WL 2234747 (N.D. Ill. 2005).

Opinion

MEMORANDUM OPINION AND ORDER

COLE, United States Magistrate Judge.

INTRODUCTION

United States of America ex rel. Cleveland Tyson and the State of Illinois ex rel. Cleveland Tyson (the “plaintiffs”) filed this qui tam suit under the False Claims Act (“FCA”), 31 U.S.C. §§ 3729 et seq. and Illinois Whistleblower Reward and Protection Act (“Illinois Whistleblower Act”). 740 ILCS §§ 175/1 et seq. The FCA establishes civil penalties for any person who files “a false or fraudulent claim for payment or approval” by the United States. 31 U.S.C. § 3729(a)(1). The provisions of the Illinois Whistleblower Act are similar. 740 ILCS § 175/3. Under its contract with the Illinois Department of Public Aid (“IDPA”),1 AMG-IL had to submit quarterly statements certifying that, to its knowledge, there had been no fraud, abuse, or misconduct on the part of its employees, providers, or representatives. The contract defined “abuse” as “a manner of operation that results in excessive or unreasonable costs to the Federal and/or State health care programs.” {Second Amended Complaint, Ex. A, at 2). The Second Amended Complaint alleges that AMG-IL did not report its limited enrollment practices in its quarterly certifications, which were a precondition to its receiving payment from the federal and state programs involved. This omission allegedly resulted in and constituted false or fraudulent claims for payment in violation of the applicable statutes.

The Relator is a former employee of AMG-IL, a health maintenance organization operating in the state of Illinois. On March 30, 2000, AMG-IL entered into a contract with IDPA to provide health care services to individuals, who are eligible for Medicaid. Under the contract, AMG-IL was paid per enrollee, with the amount predetermined by actuarial data of the population group to be served. According to the Second Amended Complaint, AMG-IL engaged in systematic discrimination against the potential enrollees based upon their health status: it provided healthcare services to a group of healthier, less expensive patients than the parties intended under the terms of the contract. As a result, AMG-IL spent less of the predetermined amount it was paid and retained a greater profit. IDPA, on the other hand, had to provide more healthcare and spend more money than it had bargained for.

It is alleged that AMG-IL pursued this scheme through several strategies. For example, it allegedly refused to enroll pregnant women in its plan. In March of 2002, the IDPA discovered that there were far fewer live births to Medicaid beneficiaries enrolled in AMG-IL’s plan than those who were not enrolled. It is also alleged that AMG-IL discouraged prospective enrollees who needed specialized medical care and retroactively disqualified prematurely born infants from its plan.

The plaintiffs have asked me to exercise what they properly characterize as the “wide discretion” and “broad case management powers” a court has in regulating discovery to compel an answer to a contention interrogatory, more than a month in advance of the expert discovery phase of the case. The interrogatory seeks disclosure of the several potential counter-theories of damages that the defendants are admittedly considering:2

[540]*540Describe with specificity AMG-IL’s theory or theories and method or methods for calculating damages in the event that (a) AMG-IL is found liable in this case for discriminating against women who were pregnant and (b) AMG-IL is found liable in this case for discriminating against people with serious health conditions (other than pregnancy), such as cancer, HIV, liver cirrhosis, or being a substance abuser.

As the plaintiffs have hypothesized, there are several methods that AMG-IL might argue the jury should employ to calculate damages. One is the difference between what the IDPA contracted to receive and what AMG-IL actually provided. But, because AMG-IL did not keep a record of those individuals it avoided enrolling in its plan, the parties are left to compare the amount of care AMG-IL actually provided with the amounted of care the parties expect AMG-IL would provide. The plaintiffs contend that such a measurement might be made by comparing the level of services AMG-IL provided with:

1) the level of services in the general Medicaid population
2) the level of services other Illinois Medicaid managed care organizations provided
3) the level of services Amerigroup’s managed care organizations provided in other states

The plaintiffs claim that basic “fairness” and “efficiency” — those ineffable and elusive goals that drive so much of the Federal Rules of Civil Procedure — demand that AMG-IL disclose its damage theories and methodologies now, rather than waiting until expert discovery, which begins after the close of discovery on October 31, 2005. Immediate disclosure is essential, the plaintiffs contend, so that they can “begin analyzing the data before expert discovery begins in order to be able to comply with the current schedule for providing an expert report.” (Motion To Compel at 3). Without the information, the plaintiffs insist that they will be forced to embark on a broad-based, “very burdensome,” “fishing expedition for sensitive and closely-guarded information from third parties,” including other managed care organizations in Illinois and Amerigroup’s healthcare plans in other states. (Id. at 2-4; Reply Memorandum at 4). So massive and diffuse would the effort be that the plaintiffs might be required “to seek healthcare encounter information for every person on Medicaid in Illinois during the years in question.” (Motion to Compel at 2-4)(Emphasis supplied).

Granting the motion, the plaintiffs argue, would obviate the need for much, if not all, of this intrusive discovery. The defendants have objected on the ground that disclosure in advance of expert discovery is premature, would violate the work product privilege, and would impermissibly disclose the opinions of one or more non-testifying experts in violation of Rule ■26(b)(4)(B), which forbids disclosure in pretrial discovery of the facts found or opinions formulated by an opponent’s non-testifying experts except upon a showing of exceptional circumstances. Braun v. Loril-lard, Inc., 84 F.3d 230, 236 (7th Cir.1996).

If, notwithstanding AMG-IL’s answer to the interrogatory, the admittedly broad based, expensive, and burdensome discovery directed to third parties that the motion is designed to eliminate, would in all likelihood occur, sound discretion mandates that the motion be denied. For the reasons discussed below, granting the motion would not, under the circumstances of this case, result in the fairness and efficiencies that are the sole justifications for the motion. Moreover, granting the motion would disrupt the orderly flow of discovery contemplated by the Federal Rules of Civil Procedure3

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Bluebook (online)
230 F.R.D. 538, 62 Fed. R. Serv. 3d 1358, 2005 U.S. Dist. LEXIS 20115, 2005 WL 2234747, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-amerigroup-illinois-inc-ilnd-2005.