United States District Court, C.D. California
Present The Honorable CHRISTINA A. SNYDER
CIVIL MINUTES - GENERAL
(IN CHAMBERS) - DEFENDANT THOMAS E. PRICE'S MOTION TO
STAY (Dkt. 13, filed May 8, 2017)
Court finds these motions appropriate for decision without
oral argument. See Fed. R. Civ. P. 78; C.D. Cal.
L.R. 7-15. Accordingly, the hearing date of July 3, 2017 is
vacated, and the matters are hereby taken under submission.
INTRODUCTION & BACKGROUND
January 30, 2017, plaintiff Prime Healthcare
Services-Montclair, LLC brought the instant action against
Silvia Mathews Burwell, in her official capacity as Secretary
of the U.S. Department of Health and Human Services
(“HHS”). Dkt. 1. On May 25, 2017, plaintiff filed
a first amended complaint naming Thomas E. Price, the current
HHS Secretary, as defendant. Dkt. 15 (“FAC”). On
May 8, 2017, defendant filed the instant Motion to Stay. Dkt.
13 (“MTS”). On June 12, 2017, plaintiff filed an
opposition to the motion. Dkt. 25.
Healthcare Services, Inc. operates plaintiff and related
entities in California (collectively, the “Prime
Hospitals”). Plaintiff alleges that on November 18,
2010, a Medicare beneficiary, B.E., complained of chest pain
and was admitted to Montclair Hospital Medical Care. FAC
¶ 30. Plaintiff alleges that because of B.E.'s
symptoms and medical history, the treating physician
determined that inpatient admission was necessary.
Id. ¶ 32. A Medicare Administrative Contractor
(“MAC”)-which generally makes payments for proper
claims for reimbursement-challenged the reasonableness of
B.E.'s medical services. Id. ¶¶ 8-9.
An Administrative Law Judge (“ALJ”) upheld the
ruling of the MAC, and the Medicare Appeals Counsel failed to
issue a ruling in the statutory time provided. Id.
¶10. Plaintiff seeks review of the ALJ determination
that plaintiff was overpaid for B.E.'s medical services
by $3, 918.27. Id. ¶¶ 20-25.
district court has discretionary power to stay proceedings in
its own court. See Landis v. North American Co., 299
U.S. 248, 254 (1936). Accordingly, the court “may, with
propriety, find it is efficient for its own docket and the
fairest course for the parties to enter a stay of an action
before it, pending resolution of independent proceedings
which bear upon the case.” Leyva v. Certified
Grocers of Cal. Ltd., 593 F.2d 857, 863 (9th Cir. 1979).
In exercising its discretion in determining whether to grant
a stay, a court must weigh the competing interests of the
various parties that may be affected by the decision to grant
or refuse to grant the stay. Lockyer v. Mirant
Corp., 398 F.2d 1098, 1110 (9th Cir. 2005).
Specifically, the court must consider: (1) the possible
damage or harm that may result from granting the stay; (2)
the hardship or inequity that a party may suffer in being
required to go forward with the case; and (3) “the
orderly course of justice measured in terms of the
simplifying or complicating of issues, proof, and questions
of law which could be expected to result from a stay.”
Id. In addition, “[a] stay should not be
granted unless it appears likely the other proceedings will
be concluded within a reasonable time in relation to the
urgency of the claims presented to the court.”
Leyva, 593 F.2d at 864. The proponent of a stay has
the burden of proving that a stay is justified. Clinton
v. Jones, 520 U.S. 681, 708 (1997).
instant action is one of 26 similar actions brought in this
district by plaintiff and related entities in California
seeking review of similar adverse ALJ rulings (collectively,
the “Judicial Review Actions”). The Prime
Hospitals have also brought at least six cases in the Eastern
District of California and three cases in the Southern
District of California seeking review of ALJ
Prime Hospitals and the United States are opposing parties in
two additional actions originating in this district. In the
first action, U.S. ex rel Bernsten v. Prime Healthcare
Services, Inc., No. 11-cv-08214-PJW (C.D. Cal.), the
United States alleges that the Prime Hospitals submitted
Medicare claims for unnecessary inpatient admissions in
violation of the False Claims Act (the “FCA
Action”). The FCA Action was filed in 2011, and the
United States intervened in June 2016. According to
defendant, the Medicare claim at issue in this action may be
within the universe of claims at issue in the FCA action.
second action, Alvarado Hospital, LLC, et al. v.
Price, No. 15-cv-06312-R (C.D. Cal.), the Prime
Hospitals allege that an agreement was reached with the
Department of Health and Human Services to permit the Prime
Hospitals to participate in an existing dispute resolution
process with respect to claims for reimbursements under
Medicare (the “Settlement Action”). The Prime
Hospitals contend that the United States breached this
agreement by refusing to go forward with this dispute
resolution process. The Settlement Action potentially
includes the Medicare claim at issue in this action. The
Settlement Action was transferred to the United States Court
of Federal Claims, and the transfer order is currently on
appeal in the Federal Circuit. See No. 2016-1356
(Fed. Cir. 2016).
instant motion, defendant seeks to stay this action pending
the resolution of the FCA Action and Settlement Action. MTS
at 2. The government has filed similar motions to stay in
each of the other Judicial Review Actions. In nine of those
cases, courts have already ruled on the motions to stay; in
each of those nine cases, the government's motion to stay
has been denied.
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