United States of America and State of Minnesota ex rel. Ashley Mothershed v…
United States of America and State of Minnesota ex rel. Ashley Mothershed v. Mayo Clinic Ambulance
- Donovan Frank
- 0:22-cv-00602
- U.S. District Court · District of Minnesota
- 15
In United States of America and State of Minnesota ex rel. Ashley Mothershed v. Mayo Clinic Ambulance, Magistrate Judge Docherty granted in part and denied in part Plaintiff-Relator Mothershed's motion to force Mayo to hand over billing records, setting the discovery time period from November 1, 2018 to March 8, 2022, allowing broad discovery into one billing fraud theory but narrowing the other, and refusing to require production of records about a dismissed fraud theory.
Whistleblowers (called 'relators') who file False Claims Act lawsuits on behalf of the government, ambulance services and other healthcare providers subject to such suits, and parties in complex federal civil litigation where the scope of document discovery is disputed.
What happened
In United States of America and State of Minnesota ex rel. Ashley Mothershed v. Mayo Clinic Ambulance (Case No. 22-cv-602), Ashley Mothershed, a former employee of Mayo Clinic Ambulance's billing department, sued Mayo under the federal and Minnesota False Claims Acts, alleging that Mayo submitted fraudulent billing claims to government health programs. Specifically, she alleged that Mayo (1) billed for medically unnecessary ambulance trips, (2) billed non-emergency transports as emergency transports ('upcoding'), and (3) billed basic life support services as the more expensive advanced life support services (also 'upcoding'). The medical-necessity claim was previously dismissed by District Judge Frank, leaving only the two upcoding theories active. The current dispute was about how much information Mothershed could demand from Mayo during the evidence-gathering (discovery) phase of the case.
The parties disagreed on two main issues: how far back in time discovery should reach, and how broadly the surviving fraud theories should be defined. Mothershed wanted records going back to 2012 — the full ten-year window allowed by the statute of limitations — and covering all upcoded claims of either type. Mayo wanted to limit records to the period of Mothershed's employment (November 2020 to May 2022) and to the specific, narrow examples described in the lawsuit. Mothershed also wanted Mayo to produce records about its internal investigations into her billing complaints generally, including about the dismissed medical-necessity theory, arguing that such records were relevant to show Mayo knew about fraudulent activity.
Magistrate Judge Docherty granted the motion in part and denied it in part. On timing, he rejected both extremes: he found that Mothershed's complaint lacked specific factual allegations supporting fraud dating back to 2012 or 2015, but also found it was reasonable to look beyond just her employment period. He set the discovery window from November 1, 2018 (two years before she started) to March 8, 2022 (the date the original lawsuit was filed), with the possibility of expanding the period if the documents produced show earlier fraud. On the scope of the upcoding claims, he allowed broad discovery into the emergency upcoding scheme because the complaint described a general pattern backed by specific examples going beyond just hospital-to-hospital transfers — but he limited discovery on the ALS upcoding scheme to the narrow scenario actually described in the complaint (where an EMT-Basic assessed the patient and no ALS service was actually performed). He denied the request for records about the dismissed medical-necessity theory, finding that Mayo's knowledge about other billing issues was not shown to be relevant to the surviving upcoding claims.
The detailed version
Case
United States of America and State of Minnesota ex rel. Ashley Mothershed v. Mayo Clinic Ambulance, No. 22-cv-602 (DWF/JFD), United States District Court, District of Minnesota.
Decision-maker
Magistrate Judge John F. Docherty. (District Judge Donovan W. Frank previously ruled on the motion to dismiss.)
Background
Ashley Mothershed worked in Mayo Clinic Ambulance's billing department during two stints: approximately November 2020 through June 2021, and September 2021 through May 2022. She filed this qui tam action — a lawsuit brought by a private citizen (called a 'relator') on behalf of the government, with the relator sharing in any recovery — under the federal False Claims Act (FCA), 31 U.S.C. § 3729 et seq., and its Minnesota counterpart. Her Second Amended Complaint (SAC) alleged three fraud schemes: (1) billing for medically unnecessary ambulance transports, (2) upcoding non-emergency transports as emergency transports, and (3) upcoding basic life support (BLS) ambulance services to the higher-reimbursed advanced life support (ALS) services. Judge Frank previously dismissed the medical-necessity theory on Mayo's motion to dismiss; the two upcoding theories survived.
Discovery dispute
During the evidence-gathering (discovery) phase, the parties disagreed about the temporal and substantive scope of discovery. Mothershed sought discovery covering March 8, 2012 through the present — more than 13 years — citing the FCA's 10-year statute of limitations under 31 U.S.C. § 3731(b)(2). Mayo sought to limit discovery to the period of Mothershed's employment, approximately November 2020 to May 2022. On substantive scope, Mayo sought to limit emergency upcoding discovery to hospital-to-hospital transfers only, and ALS upcoding discovery to cases where an EMT-Basic (rather than a paramedic) performed an assessment with no ALS intervention. Mothershed sought broader discovery covering all instances of either type of upcoding. Mothershed also sought, via Request for Production No. 23, all documents about Mayo's internal investigations into any of her billing complaints, including those relating to the dismissed medical-necessity theory.
Legal standards applied
Under Federal Rule of Civil Procedure 26(b)(1), discovery must be relevant and proportional to the needs of the case. The moving party bears the initial burden of showing relevance; if shown, the burden shifts to the opposing party to demonstrate lack of relevance or undue burden. The court noted the particular tension in FCA qui tam cases between avoiding a 'roving commission' into a defendant's billing practices and not discouraging whistleblowing by limiting discovery too tightly to the relator's employment period.
Temporal scope ruling
The court rejected Mothershed's request for discovery going back to 2012 or 2015. It found that: (a) the SAC's references to 'systemic' or 'ongoing' fraud were cursory, without specific factual allegations tying fraudulent billing to particular years before 2020; (b) paragraph 56's comparative billing statistics (2013–2022 data showing Mayo billed 95.72% of transports as emergency) were too speculative to establish relevance — the disparity with two other companies did not plausibly establish fraud; (c) paragraph 146's reference to a conversation about a seminar 'over ten years ago' pertained to the dismissed medical-necessity theory; and (d) general allegations of 'systemic' fraud do not, without specific factual support, justify extended discovery periods. However, the court found it reasonable to go beyond Mothershed's employment period, setting November 1, 2018 (two years before her start date) as the discovery start date. It set March 8, 2022 (the original complaint filing date) as the end date, reasoning that without specific allegations about when the disputed billing practices ended, the complaint date was an appropriate upper boundary. The court expressly left open the possibility that Mothershed could move to expand the temporal scope if produced documents reveal earlier fraud.
Substantive scope — emergency upcoding
The court rejected Mayo's proposal to limit discovery to hospital-to-hospital transfers. The SAC alleged a broader scheme based on Mothershed's personal knowledge: Mayo's Regulatory Officer reportedly directed the billing department to classify nearly every transport as emergency; examples in the SAC included dialysis transports, immediately-dispatched calls, advance-scheduled transports, and transports not dispatched in immediate response to a 911 call. Because the SAC described a general pattern of fraudulent behavior supported by specific examples beyond just hospital-to-hospital transfers, the court allowed discovery into the broader emergency upcoding scheme.
Substantive scope — ALS upcoding
The court agreed with Mayo's narrower framing here. The only specific examples of alleged ALS upcoding in the SAC (paragraphs 126–27) described situations where an EMT-Basic assessed the patient and neither an ALS assessment nor an ALS intervention was performed. Other allegations were conclusory. The court therefore limited ALS upcoding discovery to that specific scenario.
Request for Production No. 23
The court denied Mothershed's request for documents about Mayo's investigations into her billing complaints beyond the surviving upcoding claims. Under the FCA, a relator must prove the defendant acted knowingly with respect to the particular false claims at issue. The court found Mothershed had not shown how Mayo's knowledge about general billing deficiencies or the dismissed medical-necessity theory was relevant or proportional to the surviving upcoding claims. Mayo had already agreed to produce responsive documents related to complaints that implicated the surviving upcoding claims.
Disposition
Motion to Compel (Dkt. No. 106) GRANTED IN PART and DENIED IN PART. Discovery period set: November 1, 2018 to March 8, 2022. Emergency upcoding discovery: broad scheme allowed. ALS upcoding discovery: limited to EMT-Basic assessments with no ALS assessment or intervention. Request for Production No. 23: limited to surviving upcoding claims only.
Reviewer note from the AI+
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