Reinforcing Rule 9(b) Particularity: Specific Claim Identification in Healthcare False Claims Act Suits

Introduction

U.S. ex rel. Erik Olsen v. Tenet Healthcare Corp. (6th Cir. Apr. 22, 2025) arises from allegations by three Detroit‐area physicians that Tenet Healthcare Corporation and its subsidiary Detroit Medical Center (“DMC”) routinely billed federal and state healthcare programs for inpatient services that were never delivered. Relators—Drs. Erik Olsen, William Berk, and Sajith Matthews—filed a qui tam suit under the Federal False Claims Act (“FCA”) and the Michigan Medicaid False Claims Act (“MMFCA”), claiming that systemic understaffing and “boarding” of patients in emergency departments led to fraudulent inpatient billing. The district court dismissed the amended complaint for failure to plead with the particularity demanded by Federal Rules of Civil Procedure 8(a), 9(b), and 12(b)(6). The Sixth Circuit affirmed, clarifying the requirements for pleading healthcare‐fraud claims under the FCA.

Summary of the Judgment

The Sixth Circuit affirmed the dismissal of relators’ FCA and MMFCA claims. Although the complaint described a broad fraudulent scheme—boarding patients in ER hallways without inpatient care while billing at higher rates—it failed to identify a single specific false claim submitted to the government. Under settled Sixth Circuit precedent, a relator must plead the “who, what, when, where, and how” of each false claim or at least provide representative examples showing that particular invoices or reimbursement requests were knowingly false. General allegations of systemic wrongdoing and data summaries were insufficient. Because relators could not show personal, first‐hand knowledge of billing submissions or pinpoint any false claim, the complaint fell short of Rule 9(b)’s heightened standard, warranting dismissal.

Analysis

Precedents Cited

Bledsoe I & II (6th Cir. 2003, 2007): Define the elements of an FCA claim and apply Rule 9(b) to require particularized allegations (time, place, content, intent, injury).
Sanderson v. HCA (6th Cir. 2006): “Liability attaches not to the underlying fraudulent activity, but to the claim for payment.” Fraud must be tied to a claim.
United States ex rel. Snapp, Inc. v. Ford (6th Cir. 2008): Facial plausibility under Rule 12(b)(6) paired with Rule 9(b)’s specificity.
Bell Atlantic v. Twombly & Ashcroft v. Iqbal (U.S. 2007, 2009): Complaints must state a plausible claim and not rest on conclusory allegations.
Clausen v. LabCorp (11th Cir. 2002): General allegations of scheme plus inference of false billings fail without concrete examples or documents.
United States ex rel. Prather v. Brookdale (6th Cir. 2016) & Hirt v. Walgreen (6th Cir. 2017): Narrow exception when relator’s personal duties give direct knowledge of claims submission may satisfy Rule 9(b) even without naming a specific invoice.

Legal Reasoning

The court applied a de novo review and accepted all well‐pleaded allegations. It emphasized that the FCA imposes liability only when a false claim is “presented, or caused to be presented,” to the government. Under Rule 9(b), relators must link their allegations of fraudulent conduct to particular claims for payment. Even in a broad, complex scheme, a relator must offer at least one representative example of a knowingly false claim or show that the relator’s job duties gave direct access to billing records and claims submissions. Here, relators described six troubling patient‐care episodes but did not identify who submitted the bills, when or how they were submitted, or what misrepresentations they contained. The court held that systemic data—total hours boarded, aggregate inpatient‐day tallies—cannot substitute for particulars about individual claims.

Impact

This decision reinforces that FCA and MMFCA qui tam actions against healthcare providers must clear Rule 9(b)’s high bar for particularity. Future relators in healthcare‐fraud cases should:

Identify at least one representative claim or invoice, with dates, defendant, services billed, and alleged misrepresentation;
Demonstrate direct knowledge of or access to billing processes if they wish to rely on the “personal knowledge” exception;
Gather documentary evidence—billing records, submission logs, internal directives—to support allegations;
Be prepared to amend early‐filed sealed complaints once government or discovery yields specifics.

By clarifying that generalized data and patient care narratives are insufficient, the ruling promotes both fairness to defendants and the integrity of FCA enforcement.

Complex Concepts Simplified

Qui Tam Action: A lawsuit brought by a private individual (relator) on behalf of the government under the False Claims Act. If successful, the relator may receive a share of the recovery.
Rule 9(b) Particularity: A requirement that fraud allegations specify the “who, what, when, where, and how” of each false statement or claim, so defendants have clear notice of the charges.
Boarding: Keeping patients in an emergency room bed even after they qualify for inpatient admission, usually due to lack of available inpatient beds.
Inpatient vs. Outpatient Billing: Inpatient care typically reimburses at higher rates than observation or ER care; improper billing of boarded patients as inpatients can lead to overpayment.
Representative Claim: A single example of a false billing submission that typifies the broader alleged scheme and satisfies Rule 9(b).

Conclusion

U.S. ex rel. Olsen v. Tenet Healthcare reaffirms the Sixth Circuit’s strict application of Rule 9(b) in healthcare‐fraud qui tam suits. While systemic practices and data may illustrate a scheme, relators must tie allegations directly to one or more materially false claims submitted for payment. Absent detailed knowledge of billing processes or representative invoices, general narratives of understaffing or prolonged ER boarding will not withstand a Rule 12(b)(6) motion. This decision will guide relators to gather precise billing evidence before pursuing FCA or MMFCA claims and will protect healthcare providers from speculative or overly broad fraud pleadings.