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ACT for Health v. United Energy Workers Healthcare Corp.

United States District Court, W.D. Kentucky, Paducah Division

December 21, 2016

ACT FOR HEALTH, d/b/a Professional Management, et al., Plaintiffs/Counterclaim Defendants,
v.
UNITED ENERGY WORKERS HEALTHCARE CORP., et al., Defendants/Counterclaimants,
v.
COLD WAR PATRIOTS NON-PROFIT CORPORATION, Counterclaim Defendant.

          MEMORANDUM OPINION AND ORDER

          Thomas B. Russell, Senior Judge

         ACT for Health, doing business as Professional Case Management, along with its wholly-owned subsidiary, Professional Case Management of Kentucky, LLC (collectively, PCM), filed this action against United Energy Workers Healthcare Corp. and its wholly-owned subsidiary, Kentucky Energy Workers Healthcare, LLC (collectively UEW), bringing claims for unfair competition, for violating Kentucky's laws and regulations regarding the licensure of health care service providers, as well as for tortious interference with contractual and prospective business relationships. Now, PCM asks the Court to issue a preliminary injunction to enjoin UEW from providing allegedly unauthorized home-health care services in Kentucky. For reasons discussed more fully below, PCM's Motion for a Preliminary Injunction, [R. 57], is DENIED.

         I.

         A.

         The instant dispute is between two providers of home-health care services to eligible individuals under the Energy Employees Occupational Illness Compensation Program Act of 2000 (EEOICPA), 42 U.S.C. §§ 7384 to 7385s-16. Administered by the U.S. Department of Labor, the EEOICPA affords “benefits to individuals or their survivors for illnesses incurred from exposure to toxic substances while working for the Department of Energy or certain related entities.” Watson v. Solis, 693 F.3d 620, 622 (6th Cir. 2012). Under the EEOICPA, eligible individuals may receive health-care services, including home-health care services and personal-care services, from designated providers, whom the Department of Labor reimburses. See 42 U.S.C. §§ 7384e, 7384t; 20 C.F.R. §§ 30.400, 30.403.

         The Commonwealth of Kentucky regulates providers of home-health care services, known as “home health agencies, ” and providers of personal-care services, called “personal services agencies, ” differently. To provide home-health care services under Kentucky law, an entity must first obtain a “certificate of need” from the Cabinet of Health and Family Services to establish a “home health agency.” See Ky. Rev. Stat. § 216B.061(1)(a); see also Id. § 216B.015(9), (13). A “home health agency” is, in broad terms, an “organization . . . which provides intermittent health and health related services, to patients in their place of residence, either singly or in combination as required by a plan of treatment prescribed by a licensed physician.” 902 Ky. Admin. Reg. 20:081, § 2. “Health services, ” in turn, means “clinically related services provided within the Commonwealth to two . . . or more persons, including but not limited to diagnostic, treatment, or rehabilitative services.” Ky. Rev. Stat. § 216B.015(14).

         To provide personal-care services, on the other hand, an entity must obtain certification from the Cabinet to operate a “personal services agency.” Ky. Rev. Stat. § 216.712(1); see also 906 Ky. Admin. Reg. 1:180, § 2. Generally speaking, a “personal services agency” is an organization “that directly provides or makes provision for personal services.” Ky. Rev. Stat. § 216.710(8). “Personal services, ” in turn, include:

[a]ssisting with a client's ambulation and activities of daily living as defined in KRS 194A.700; . . . [f]acilitating the self-administration of medications if such medications are prepared or directed by a licensed health-care professional or the client's designated representative; . . . [p]roviding services which may be referred to as attendant care, in-home companion, sitter and respite care services, and homemaker services when provided in conjunction with other personal services; and . . . [p]roviding services that enable the client to live safely, comfortably, and independently.

Id. § 216.710(7)(a). The definition explicitly excludes, among other things, services that “require the order of a licensed health-care professional to be lawfully performed in Kentucky, ” id. § 216.710(7)(b)(6), as well as any “health-care entity or health-care practitioner otherwise licensed, certified, or regulated by local, state, or federal statutes or regulations, ” id. § 216.710(7)(b)(9).

         ACT for Health, doing business as Professional Case Management, furnishes home-health care services to EEOICPA-eligible patients in Kentucky through its wholly-owned subsidiary, Professional Case Management of Kentucky, LLC. [R. 1 at 3, ¶¶ 12- 13 (Complaint).] PCMK is a licensed “home health agency” under Ky. Rev. Stat. § 216B.105(1). [See R. 57-2 at 3 (Home Health Agency License).] United Energy Workers Healthcare Corp., through its wholly-owned subsidiary, Kentucky Energy Workers Healthcare, LLC, also furnishes home-health care services to EEOICPA-eligible patients in Kentucky. [See R. 13 at 1, ¶¶ 2-3 (Answer); R. 14 at 1, ¶¶ 1-3 (Counterclaim).] KEW is a licensed “personal services agency” under Ky. Rev. Stat. § 216.712(1), [see R. 61-2 at 1 (Personal Services Agency License)], and, more recently, a “home health agency” too, at least provisionally, [see R. 61-1 at 54 (In re Kentucky Energy Workers Healthcare, LLC, No. HSAHB CON 16-1008 (September 19, 2016)).]

         PCM alleges that UEW has been providing home-health care services without the necessary licensure as a “home health agency.” [See R. 1 at 5, ¶¶ 19-20.] In support of that proposition, PCM points to a number of claim forms that UEW filed with the Department of Labor between April 2014 and September 2016. [See R. 67 at 1-12 (OMB Form 1500).] In order to bill the Department for care furnished under the EEOICPA, a provider, such as UEW, must itemize and identify each service performed using the Physician's Current Procedural Terminology (CPT) code. See 20 C.F.R. § 30.701(a)-(b). Based on the CPT codes UEW included in its claim forms, it appears as though KEW has been providing skilled in-home nursing care in Kentucky since at least April 2014.[1] [See R. 67 at 1-12 (billing for services provided under CPT codes “T1017, ” “T1030, ” and “S9123”); R. 57-9 at 1-2, ¶¶ 3-6, 8-9 (Fletcher's Declaration).]

         In addition, PCM relies on findings from the Cabinet for Health and Family Services, Office of the Inspector General's investigation into whether UEW had been providing services that exceeded the scope of those allowed for a personal services agency. [See R. 63-3 at 1 (Statement of Deficiencies).] The investigation revealed, in pertinent part, that UEW had provided “focused and comprehensive nursing assessments, lung monitoring medication review, vital sign monitoring, oxygen saturation monitoring, monitoring of skin condition, and education.” [Id. at 2.] Based on a sample of six patients' records, the Inspector General concluded that UEW had been furnishing services far in excess of those authorized under Kentucky law. [See Id. at 1-3.]

         UEW, as might be expected, disagrees with PCM's assessment. UEW does not address PCM's argument about its billing records, other than to say that it maintained those billing records in compliance with 906 Ky. Admin. Reg. 1:180. [See R. 61 at 3-4 (Response).] It does point out, though, that UEW has tendered a plan of correction in response to the investigation, [see R. 61-5 at 1-6 (Plan of Correction)], which the Inspector General subsequently accepted, [see R. 61-4 at 1-2 (Letter from Inspector General)].

         B.

         PCM filed this action against UEW, bringing claims for unfair competition, for violating Ky. Rev. Stat. §§ 216B.010 to .990, as well as for tortious interference with a contract and intentional interference with a prospective business relationship. [See R. 1 at 6-8, ¶¶ 28-50.] Now, PCM asks the Court to issue a preliminary injunction (1) to enjoin UEW “from providing home health care services” beyond the scope of those properly provided by a personal services agency; (2) to require UEW “to produce and supplement, every two weeks, billing record disclosures to confirm that [it is] no longer providing care beyond [its] licensure”; and (3) to oblige UEW to send “notice to [its] patients, and [its] patients' physicians, who require home health care services, ” announcing its “inability to continue to provide ...


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