Statistician & SAS 9.3 win big ruling in TN False Claims Act case

by Kurt Schulzke

Today was a banner day for statistics and SAS 9.3 in federal False Claims Act cases. In United States ex. rel. Martin v. Life Care Centers of America (1:08-cv-251), the U.S. District Court for the Eastern District of Tennessee denied, on the basis of its own detailed analysis of proffered expert testimony, a defense motion to exclude the government’s testifying expert statistician, Dr. Constantin T. Yiannoutsos.

The government hired Yiannoutsos to “estimate the number of claims submitted for non-covered services to Medicare or TRICARE that were provided by skilled nursing facilities (“SNF”) owned or operated by Life Care and to estimate the total overpayment by Medicare and TRICARE.”

To prepare his report and testimony, Yiannoutsos used SAS 9.3 to analyze six government data sets relating to 127,641 unique Medicare beneficiaries and 392,562 claims, all of which had a “positive claim paid amount” with values ranging from $0.05 to $44,617.87, plus 4,074 TRICARE beneficiaries and 10,960 unique claims, all with a “positive claim paid amount” with values ranging from $1.72 to $109,433.77. This was definitely a “big data” case calling for a robust statistical solution.

Over defense objections to Yiannoutsos’ government-imposed sample size (400) and his own statistical methods and approach to the project, the court found in his favor, clearing him to testify if the case proceeds to trial:

Based on the reports submitted, the Court finds that Dr. Yiannoutsos is an expert proposing to testify as to scientific knowledge of statistics, which will ultimately assist the trier of fact to determine facts at issue. See Fed. R. Civ. P. 104(a); United States v. Jones, 107 F.3d 1147, 1152 (6th Cir. 1997). The number of claims and the loss associated with those claims are certainly facts of consequence in this action, even if they are not specific elements under the FCA. These facts indicate the size and scope of the Government’s case, which further supports them being deemed relevant. Accordingly, consistent with Daubert, the Court finds that the proposed testimony and evidence is relevant to the instant case and would be helpful to the fact finder. As the Court has now concluded that Dr. Yiannoutsos’ testimony is both reliable and relevant, Defendant’s Motion will be DENIED.

 The full order appears below.

U.S. ex rel Life Care Centers of America 1:08-cv-251

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