[00:00:03] Speaker 00: Good morning. [00:00:03] Speaker 00: May it please the court. [00:00:05] Speaker 00: Alex Little on behalf of Appellant Navarro, I'd like to request three minutes for rebuttal. [00:00:10] Speaker 00: This case is in both incredibly narrow and incredibly broad. [00:00:14] Speaker 00: Let me tell you first why it's narrow. [00:00:16] Speaker 00: The question before the court is whether de novo, [00:00:19] Speaker 00: Paragraph 49H of the indictment sufficiently charges a scheme to defraud or a legal fact that can suffice to put a scheme to defraud under the healthcare fraud statute. [00:00:30] Speaker 00: It is that narrow because under the conditional guilty plea, the government has agreed to allow my client to appeal the narrow question of whether on a partial motion to dismiss, that type of allegation is sufficient to create a 20-year sentence under the healthcare fraud statute. [00:00:47] Speaker 00: It is broad because it implicates due process principles about what are the limits that a federal prosecutor can use a statute to implicate criminal activity or to allege criminal activity. [00:00:56] Speaker 02: That goes to your vagueness argument. [00:00:58] Speaker 00: It does. [00:00:58] Speaker 02: So on the vagueness argument, can you address, I mean, as I counted it up, we have four or five other circuits that have all said, rejected that argument. [00:01:09] Speaker 00: Well, I don't think they've rejected this particular argument. [00:01:11] Speaker 00: I think it depends on how, well, [00:01:13] Speaker 02: But they've rejected the argument that it's unconstitutionally vague. [00:01:17] Speaker 02: You're going to tell me now why you're raising an argument they haven't considered. [00:01:22] Speaker 00: Yes, in particular. [00:01:23] Speaker 00: So let me give you an example to sort of defeat the hypothetical. [00:01:28] Speaker 00: If the indictment said here in paragraph 49H that it was medically necessary, that it was not medically necessary, and because COVID tests required a doctor's order, [00:01:38] Speaker 00: And then you had regulatory guidance that said, actually, in fact, the same regulation we have here, you don't need a doctor's order for a COVID-19 test. [00:01:46] Speaker 00: That would still be dismissed at the motion-dismissed Rule 12 stage, and it could be done because it doesn't sufficiently meet the legal standard. [00:01:55] Speaker 00: It's not a vagueness charge. [00:01:56] Speaker 03: Because, well, I'm having a little trouble hearing you, if you can get a little closer to the mic. [00:01:59] Speaker 00: Yes. [00:01:59] Speaker 00: So let me sort of walk through that again. [00:02:01] Speaker 03: Just the last part. [00:02:02] Speaker 00: Yeah, so with respect to the Rule 12 issue, if, for example, the allegation was, this was not medically necessary because there was no doctor's order. [00:02:10] Speaker 00: We have regulatory guidance which says, in fact, you don't need that sort of doctor's order. [00:02:16] Speaker 00: You wouldn't stop at the health care statute to suddenly stop and say, have they sufficiently alleged it that they said it was medically necessary when there's direct regulatory guidance [00:02:26] Speaker 00: to the opposite. [00:02:26] Speaker 00: So the next question is, if that aspect of due process applies, why would vagueness not apply to that secondary question of what the regulatory guidance is? [00:02:36] Speaker 00: So here, it is clear that COVID-19 was permitted without a doctor's order and without asymptomatic guidance. [00:02:43] Speaker 00: If the indictment had only alleged a failure to do those things, incorrectly as a matter of law, this court would certainly look at that regulation to A3 and say you can't sustain the indictment. [00:02:54] Speaker 04: But isn't that sort of wrapped up in the scienter part? [00:02:57] Speaker 04: So they say the indictment alleges knowingly and willfully. [00:03:01] Speaker 04: or knowingly and intentionally violated, doesn't that address the concern that you're talking about? [00:03:07] Speaker 00: I think that many of the courts got around the problem. [00:03:09] Speaker 00: I think the issue here is the question of falsity. [00:03:12] Speaker 00: And if it cannot be legally false, it's hitting another element, which is whether or not the representation itself is false. [00:03:19] Speaker 00: You could have allegations and indictments that an individual believed something to be false, that believed it to be illegal. [00:03:25] Speaker 00: But if the falsity element as a matter of law couldn't be sufficiently proven, [00:03:29] Speaker 00: by the governance burden, the indictment cannot be sustained. [00:03:32] Speaker 00: And so I think in many of the cases where the health care fraud statute is implicated, there's a question of medical necessity based on facts. [00:03:38] Speaker 00: And they say, well, this is a factual question. [00:03:40] Speaker 00: And the falsity Santa allegation helps us determine that we get over that part of the burden. [00:03:46] Speaker 00: It helps us sort of get over that factual hump. [00:03:48] Speaker 00: It doesn't solve the legal hump. [00:03:50] Speaker 00: And I think here the legal hump is that you've got in subsection A3 of the revised guidance a statement that says that- Well, but don't you just argue to the jury then that this person didn't knowingly or intentionally, because look at this language. [00:04:03] Speaker 04: They thought under this language they could do this, and so you can't find beyond a reasonable doubt that they knowingly violated the statute. [00:04:11] Speaker 00: Judge Cole, I could certainly argue that. [00:04:13] Speaker 00: My client shouldn't have to bear the burden of that trial if it's not legally possible. [00:04:18] Speaker 00: And so it does give a whole host of defenses to defendants to argue that the science or they're not aware of the legal nullity or the legal issue. [00:04:26] Speaker 00: The question the government has is whether it's actually alleged a legal nullity or a legal sort of conflict here. [00:04:35] Speaker 00: And I'll go back to the example. [00:04:36] Speaker 00: If the government had just alleged in that paragraph 49H, this is not medically necessary because you don't have a doctor's order. [00:04:42] Speaker 00: And the regulatory guidance says, we don't need doctor's order. [00:04:45] Speaker 00: Syenter wouldn't save them. [00:04:47] Speaker 00: And so we're in the same place, except the argument is slightly slanted. [00:04:51] Speaker 00: We're now talking about RPPs. [00:04:53] Speaker 00: RPPs respiratory panels are discussed in the same guidance and they are set. [00:04:58] Speaker 00: If it's allowed, you can test this and the language that otherwise covered the government's pointed to I think is notable their responses. [00:05:06] Speaker 00: Well, it says I've always covered. [00:05:07] Speaker 00: You've got to incorporate all the standards that includes medical necessity. [00:05:11] Speaker 00: The problem with that is that same language. [00:05:14] Speaker 00: is used at the beginning of the sentence and the end of the sentence. [00:05:17] Speaker 00: It's used for COVID-19 when we know that a medical necessity does not require a doctor's order under the public health emergency. [00:05:25] Speaker 00: Why in the world, using basic statutory construction terms, would the HHS require a different interpretation of otherwise covered for the RSV and influenza tests? [00:05:37] Speaker 00: We think that resolves the question, indicates that it's at least on its face legally permissible to do this testing. [00:05:44] Speaker 00: And I want to take a step back. [00:05:46] Speaker 00: This is a laboratory. [00:05:48] Speaker 00: You have in your record the government has conceded every test that was billed was done. [00:05:53] Speaker 00: These are real patients, real nasal swabs. [00:05:56] Speaker 00: The tests were put into a machine that was approved by the FDA to do multiple pathogen tests. [00:06:01] Speaker 00: that FDA approval says they can be done with COVID tests, RSV, and influenza. [00:06:08] Speaker 00: And the reason for that is because we want to know whether something isn't COVID. [00:06:11] Speaker 00: There was hysteria. [00:06:12] Speaker 00: There was concerns about the growth. [00:06:14] Speaker 00: If we can say something's RSV or influenza, we have a better sense of containing the COVID itself. [00:06:21] Speaker 00: That's FDA guidance that flows from the same regulatory scheme. [00:06:25] Speaker 02: I understand the explanation you're making in theory, but the facts here are very different from that. [00:06:30] Speaker 02: He was, I mean, wasn't there evidence that he was going around or that, you know, the indictment alleges he was going around and coming up with [00:06:40] Speaker 02: tests that didn't need to be done and bilking millions of dollars. [00:06:46] Speaker 00: Two things about that. [00:06:47] Speaker 00: My client's the wife, the husband, so she was not doing those things. [00:06:52] Speaker 00: But there is an allegation about kickbacks. [00:06:54] Speaker 00: There's an allegation about other aspects which make it fraudulent that are not in 49H and are not an aspect of the appeal. [00:07:00] Speaker 00: I was not the trial attorney. [00:07:02] Speaker 00: If we go back, I think we have factual defenses to those. [00:07:05] Speaker 00: that we would feel very confident to be able to defeat at trial. [00:07:07] Speaker 00: The reason the conditional partial motion to dismiss was you have an issue here that we can't contest that these tests were done without medical orders for the RPP panels. [00:07:17] Speaker 00: It drastically changes the scope of trial and what my client is facing if that is allowed to go to the jury. [00:07:24] Speaker 00: The motion was a motion for jury instructions and to partially dismiss these types of things because as Judge Cole knows, the scope of these allegations at trial matter demonstrably as to how I'm going to argue a case to the jury. [00:07:35] Speaker 00: So there are all sorts of other factual allegations that are not an issue here, and the government actually can appeal, I mean, can take a trial if that becomes an issue, which is why I go back to the narrow question here is whether 49-H permitted or alleged sufficiently the crime of healthcare fraud to subject my client to 20 years in prison. [00:07:56] Speaker 00: We don't think, particularly under A3, the guidance does that. [00:08:00] Speaker 00: A3 says in two different places that you can do simultaneous testing for RSV and influenza when you test for COVID. [00:08:08] Speaker 00: We know that you can test for COVID on populations, which we're here, mostly nursing homes, without a doctor's order. [00:08:15] Speaker 00: I think my time is up. [00:08:16] Speaker 02: Well, if you want to reserve, you still got time. [00:08:19] Speaker 00: Yes, I'm going to reserve. [00:08:20] Speaker 02: Okay, thank you. [00:08:20] Speaker 02: Thank you. [00:08:21] Speaker 02: We'll hear from the government. [00:08:26] Speaker 01: Good morning, Your Honors. [00:08:27] Speaker 01: May it please the Court, Dave Lieberman for the United States. [00:08:30] Speaker 01: The District Court correctly denied the pretrial motion to dismiss. [00:08:34] Speaker 01: Here I'll start with the indictment sufficiency challenge. [00:08:38] Speaker 01: We had to allege a scheme to defraud. [00:08:40] Speaker 01: That element is in the indictment, and then the indictment supported that with [00:08:44] Speaker 01: factual allegations regarding medical necessity. [00:08:47] Speaker 01: Those allegations were more than sufficient to clear the really minimal standard under Rule 7, a short and plain statement of the crime alleged. [00:08:57] Speaker 03: So I think Judge Nelson was asked a question, and I think he was getting at, if I understand correctly, that these were not people who come in, they've got some illness, [00:09:11] Speaker 03: You do a COVID test, and then you do another test because you're trying to figure out what's causing their respiratory problems, which makes sense to me. [00:09:19] Speaker 03: These are asymptomatic people that were just getting, you know, there was a ton of those people getting COVID tests. [00:09:25] Speaker 03: I'm sure I got some. [00:09:27] Speaker 03: And then they're just attacking it on, which doesn't seem to make a lot of sense. [00:09:30] Speaker 03: And then I think, as I understood your opposing counsel's argument, well, those are some facts that aren't really at issue in this appeal, but what is the [00:09:39] Speaker 01: state of play that I thought that was pretty significant that that uh... it it it whether or not it's medically necessary to do these other tests when you're when you're testing asymptomatic people yes let me read to you the exact language from the indictment this is that er three three nine paragraph forty nine h the allegation of medical of lack of medical necessity is that these [00:10:03] Speaker 01: tests were not medically necessary to conduct these respiratory pathogen panel tests on asymptomatic individuals who were being screened for COVID-19 infections. [00:10:18] Speaker 01: That is the allegation that underpins the fraud scheme that we're talking about today. [00:10:25] Speaker 01: That was enough. [00:10:26] Speaker 01: That is a factual allegation, a lack of medical necessity. [00:10:29] Speaker 01: undergirding the scheme to defraud and get us past the Rule 7 pleading stage. [00:10:36] Speaker 01: All of the other points that [00:10:38] Speaker 01: Council has discussed and have raised in some of the defense briefs about what did guidance or say or not say during this time goes to the factual question that the government would have to prove at trial medical necessity may go to see enter May and may in fact support other defenses as I understand it seems that generally their argument seems to be and I guess on rebuttal you can correct me is that this the regulations basically open the door that [00:11:07] Speaker 03: saying that these other tests are medically necessary, or at least that's an interpretation that his client was allowed to make. [00:11:17] Speaker 03: But do I understand correctly that the regulations actually explicitly said it still has to be medically necessary? [00:11:24] Speaker 01: Not quite, Your Honor. [00:11:25] Speaker 01: Let me break it down. [00:11:26] Speaker 01: I think there's a legal portion and there's a factual portion. [00:11:29] Speaker 01: The legal claim that I understand Ms. [00:11:31] Speaker 01: Navarro to be making on the point is that these [00:11:36] Speaker 01: panel tests were medically necessary as a matter of law. [00:11:39] Speaker 01: And our response to this is the Medicare regulation at issue 410-3283, as the district court found, has nothing to do with medical necessity. [00:11:50] Speaker 01: The regulation removed the doctor's order requirement. [00:11:54] Speaker 03: OK, so make sure you say the Medicaid regulations, the regulations that were enacted in response to COVID, that he's saying [00:12:01] Speaker 03: open the door to let... Yes. [00:12:03] Speaker 01: And this is what the district court looked at the regulation and said, this regulation is about removing the doctor's order requirement. [00:12:09] Speaker 03: So the court said that, but I had it in my head that somehow the regulation actually said that. [00:12:15] Speaker 01: In the rulemaking where they published the rule, HHS says in the rulemaking, this is May 2020, that [00:12:24] Speaker 01: The medical necessity requirement is statutory. [00:12:27] Speaker 01: That's true. [00:12:27] Speaker 01: It comes from Title 42 of the US Code. [00:12:30] Speaker 01: It cannot be waived. [00:12:31] Speaker 01: And that makes sense in the legal landscape. [00:12:33] Speaker 01: If medical necessity is a statutory requirement, the regulation cannot somehow extinguish it. [00:12:39] Speaker 01: And so everything else then, I think, becomes a factual dispute for trial. [00:12:45] Speaker 01: If this regulation is irrelevant to the medical necessity dispute that we're having, then these tests, the dispute about medical necessity is a factual dispute for trial. [00:12:57] Speaker 01: That goes to, I think, Judge Cole's question, that perhaps at trial the defense could come in and say, well, a reasonable person or my client read this regulation about doctor's orders and thought, maybe this bore on medical necessity somehow, and for that reason, [00:13:15] Speaker 01: I lack the center necessary under the health care fraud statute. [00:13:19] Speaker 01: That would be a perfectly permissible trial defense. [00:13:23] Speaker 01: But litigating this factual question on it. [00:13:27] Speaker 04: I think maybe I'm misunderstanding your colleague's argument, but I thought their argument was that the phrase medical necessity in the indictment just had so little semantic content that you couldn't even tell what you were being alleged to have done. [00:13:41] Speaker 04: It would be as though it said in 49H, and you've committed medical jabberwocky, and you're like, [00:13:48] Speaker 04: I have no idea. [00:13:48] Speaker 04: I don't even know how to prepare a defense. [00:13:51] Speaker 04: There's so little semantic content to the phrase that I don't know what I'm charged with having done. [00:13:55] Speaker 01: I disagree with that. [00:13:56] Speaker 01: In the language that I cited that we're having a dispute in paragraph eight, it is [00:14:02] Speaker 01: The medical necessity relating to conducting these respiratory panel tests, there are like 17 or 18 different tests. [00:14:08] Speaker 01: For asymptomatic individuals. [00:14:10] Speaker 01: On asymptomatic patients. [00:14:10] Speaker 01: All that was in the indictment. [00:14:12] Speaker 01: Yes, yes. [00:14:13] Speaker 01: ER 339 and then it's repeated in the subsequent subparagraphs. [00:14:17] Speaker 01: That is enough to get us to trial. [00:14:20] Speaker 03: And your theory is that is not medically necessary. [00:14:22] Speaker 03: You would have to prove at trial that their client had Cienter. [00:14:27] Speaker 03: that knew or acted, forgive me, acted willfully and disregarded whether these were medically necessary or not. [00:14:36] Speaker 01: A hundred percent correct, Your Honor. [00:14:39] Speaker 03: And I take their theory to be something about this regulation essentially made medical necessity, essentially decided the medical necessity question or [00:14:52] Speaker 03: I suppose it could be that it muddied everything up so much that it created a vagueness challenge? [00:14:58] Speaker 01: I think you got it right, Your Honor. [00:15:00] Speaker 01: The first level claim that I believe they made is that [00:15:03] Speaker 01: These were medically necessary as a matter of law because of this regulation. [00:15:06] Speaker 01: The district court correctly parsed that regulation and said, nothing in this regulation deals with medical necessity. [00:15:14] Speaker 01: So that first claim, which I understand to be a legal claim, fails. [00:15:19] Speaker 01: Then there's this backup factual claim. [00:15:21] Speaker 01: It created so much confusion among providers and labs. [00:15:24] Speaker 01: that I couldn't have the requisite cienter. [00:15:26] Speaker 01: That is a jury question. [00:15:27] Speaker 01: We litigate questions about intent at trials, not in pretrial motions to dismiss. [00:15:34] Speaker 01: The district court properly, as the reviewing court took this allegation, lack of medical necessity with regard to these panel tests as to asymptomatic populations. [00:15:44] Speaker 01: The district court was required, as this court is required, to accept that factual allegation as true for purposes of a motion to dismiss the indictment. [00:15:52] Speaker 01: I'll just shift briefly to the vagueness point. [00:15:56] Speaker 01: I think my top line response to that is, Judge Cole, your point that because of the Sienta element in the health care fraud statute, concerns about vagueness and fair notice wash away because the government would have to prove at any trial that the defendant knew that the tests or services were medically unnecessary. [00:16:20] Speaker 01: And we cited the Ossenser case, this court has a number of cases noting that when there is a... How would you prove it? [00:16:28] Speaker 03: Because that is the slightly sympathetic aspect of this case, is that the hundreds of millions of dollars is not particularly sympathetic, but the slight is that, you know, if you're asking, if you're sitting here and you're saying, man, I think I should do these tests, but boy, what if a jury was to think that they weren't [00:16:49] Speaker 03: So what would the proof the government put on to say, not only did you do these tests that we've got these three experts that say aren't medically necessary, but you knew they weren't medically necessary. [00:16:59] Speaker 03: How would you prove that? [00:17:00] Speaker 01: We don't think that this is the proper subject of a motion to dismiss, but we previewed our... Well, it goes to the vagueness issue. [00:17:06] Speaker 03: You see what I'm saying? [00:17:09] Speaker 03: How you approve it might be informed whether I think it's vague or not. [00:17:12] Speaker 01: We charted out all of our evidence on the district court docket number 133, our trial brief, and asked to see enter [00:17:19] Speaker 01: We intended to do evidence that Ms. [00:17:24] Speaker 01: Navarro solicited the nursing homes and schools for COVID-19 screening. [00:17:29] Speaker 03: But part of it would be her actions, and I suppose part of it would be just like nobody could think that like testing, I don't know what the numbers were, but it had to be a bunch of these tests for, you know, basically batch testing asymptomatic people is somehow medically necessary, adding this test. [00:17:46] Speaker 03: The whole purpose of this test is to, [00:17:48] Speaker 03: you have these respiratory issues. [00:17:50] Speaker 03: We're trying to figure out if you have COVID, if you don't have. [00:17:52] Speaker 03: If your COVID test comes back negative, but your flu test comes back positive, then we're like, oh, he has a flu. [00:17:57] Speaker 01: Yeah, exactly right, Your Honor. [00:17:59] Speaker 01: We intended to introduce evidence on both fronts, both of which her actions, namely that her lab was adding these extra tests. [00:18:08] Speaker 01: We had nursing home administrators and physicians to testify that they told the lab, we only want COVID-19 screening. [00:18:14] Speaker 01: We have not authorized these other tests. [00:18:16] Speaker 01: And we also intended to use evidence that the manufacturer of this pathogen panel testing [00:18:22] Speaker 01: had advised Navarro that the test should not be used for COVID-19. [00:18:26] Speaker 04: So you weren't alleging the COVID-19 testing itself was fraudulent. [00:18:29] Speaker 04: It was the addition of the other tests? [00:18:32] Speaker 01: Yes. [00:18:33] Speaker 01: I'm not a virologist, but as I understand that these pathogen tests, it was a multitude of tests far beyond COVID or flu. [00:18:43] Speaker 01: I think it was something like 17 or 18 respiratory tests. [00:18:47] Speaker 01: So that is the type of evidence that we would put at trial. [00:18:50] Speaker 01: in addition to expert testimony about medical necessity, as well as the doctors who authorized or ordered these tests from the schools or the nursing homes. [00:19:02] Speaker 01: That's, again, at district court, docket number 133, if you want to review it. [00:19:07] Speaker 01: My red light is on. [00:19:09] Speaker 01: Unless the court has any further questions, the government asks that the court affirm. [00:19:14] Speaker 01: Thank you, Your Honors. [00:19:15] Speaker 01: Do we have time for a level now? [00:19:19] Speaker 00: There are two factual things which are critically important to understand this these are not separate tests This is one nasal swab per patient It's put into a machine to put into a machine with that sort of thing It's not they can then process you charge more for checking for the other there were 21 tests They charge for three the three that were on the chart, and it's in your it's cited We have in the CPT codes which were allowed [00:19:42] Speaker 00: Only those two were charged. [00:19:44] Speaker 00: CMS said you could charge them with COVID. [00:19:47] Speaker 00: The second piece is this was population testing at a nursing home. [00:19:51] Speaker 00: So it wasn't done just to determine, hey, does this person have COVID? [00:19:54] Speaker 00: It was required by the federal government and the state of California to do testing on visitors, workers, and patients because there was concerns about asymptomatic threat. [00:20:04] Speaker 02: It wasn't required to charge for three different tests. [00:20:08] Speaker 00: No, I mean, so I think the question is, yeah, so is it required to charge? [00:20:12] Speaker 00: You don't have to charge for anything. [00:20:14] Speaker 00: They could have done it for free. [00:20:15] Speaker 02: The question was, you have to- I mean, all three tests weren't required. [00:20:19] Speaker 02: The COVID was required. [00:20:21] Speaker 00: Well, all three weren't required to be billed for. [00:20:23] Speaker 00: So there's two different ways to test. [00:20:26] Speaker 00: You can do a single test and a single swab. [00:20:28] Speaker 00: You can do a multi-panel test. [00:20:29] Speaker 00: These are multi-panel tests. [00:20:30] Speaker 00: They're faster. [00:20:31] Speaker 00: Nursing homes want them because they get the results back in an hour as opposed to 12 hours. [00:20:36] Speaker 00: So that's a fact. [00:20:36] Speaker 03: My understanding was the allegation where the nursing homes weren't asking for them, right? [00:20:39] Speaker 03: Like they were asking for COVID tests. [00:20:41] Speaker 00: They were saying, here's our swabs, give us our COVID results back. [00:20:45] Speaker 00: And they were getting results with the COVID results. [00:20:47] Speaker 00: And they were saying, by the way, this patient actually doesn't have COVID, they have RSV. [00:20:50] Speaker 00: This patient doesn't have COVID, they actually have influenza. [00:20:53] Speaker 04: But a lot of them did have anything. [00:20:54] Speaker 03: It's starting to sound like you're basically, there's just some tension with that with what was in the indictment. [00:20:59] Speaker 03: What they were saying is, hey, good news, your patient doesn't have anything. [00:21:04] Speaker 03: in the vast majority of cases because these are asymptomatic people being tested. [00:21:07] Speaker 00: And I think it strikes normal people that that seems unreasonable. [00:21:09] Speaker 00: But CMS said specifically, and this is on page 15 of the brief, because the symptoms for coronavirus, influenza, and RSV are often the same, concurrent testing for all three viruses is more. [00:21:21] Speaker 03: You mean the asymptoms. [00:21:22] Speaker 03: You mean when people don't have any symptoms, it's often the same. [00:21:25] Speaker 00: Yes, and only. [00:21:26] Speaker 03: No, I'm being a little sarcastic. [00:21:28] Speaker 03: That's the problem. [00:21:29] Speaker 03: Like if you have exactly that makes it when the symptoms are the same, then you have to do a panel of tests to figure out which one you have. [00:21:35] Speaker 03: When you have no symptoms and you're just checking, does this person happen to have really early stages COVID or does this person an asymptomatic COVID person that could give it to somebody else? [00:21:45] Speaker 03: What is the reason for doing these other tests? [00:21:48] Speaker 03: That does not, to my mind, justify as a reason. [00:21:52] Speaker 00: So I guess the question is, where does the reason come from? [00:21:54] Speaker 00: Generally, when you have health care statutes and health care fraud, the reason comes from a physician. [00:21:59] Speaker 00: You can't just say, hey, by the way, I want this test. [00:22:01] Speaker 00: A physician has to order the test. [00:22:03] Speaker 00: And the core aspect of this appeal is that the FDA removed that entirely in A3. [00:22:08] Speaker 00: And so I agree. [00:22:09] Speaker 00: Maybe it would be better to say, here's the sort of tests I want if the business officer is the... But they did. [00:22:14] Speaker 04: they did is to test these people for covid that's what they said right but it's not it's not a it's not a doctor and so the question is that's a different allegation of fraud that's an allegation but i guess for me i'm still struggling with i get this all is an argument to the jury if you went to trial but why is it a defect in the indictment i mean she knew what she was charged with [00:22:37] Speaker 04: If the purpose of the indictment is to allow you to prepare your defense she knew what the trial was going to be about and And you'd sounds like there are arguments that could be made to the jury about the knowing and intentional part of [00:22:48] Speaker 04: But she knew. [00:22:49] Speaker 00: The last piece I want to point out is what would she then say in a defense? [00:22:53] Speaker 00: And you asked this question of government's counsels. [00:22:55] Speaker 00: How would she defend against this? [00:22:57] Speaker 00: Medical necessity in every healthcare fraud case you've ever seen in the Ninth Circuit generally looks at the medical records of the patient. [00:23:03] Speaker 00: Does this patient have symptoms? [00:23:04] Speaker 00: Does this patient deserve this sort of treatment? [00:23:06] Speaker 00: Is there a physician who said these sorts of things? [00:23:08] Speaker 00: Does the patient exist? [00:23:10] Speaker 00: CMS changed the rules in D1 of the same regulation, sorry, D2I, that said that the tests in A3, which is the whole statute we've been talking about, do not require a physician to maintain any documentation of medical necessity. [00:23:27] Speaker 00: So how would a lab ever know medical necessity without documentation? [00:23:33] Speaker 00: And so this is a completely different issue than if they had alleged, hey, they asked for stuff and they didn't get the stuff they want. [00:23:39] Speaker 00: That's not a medical necessity question. [00:23:41] Speaker 00: Medical necessity here has to be determined on some sort of allegation that they're worse than if this person had runny eyes, this person looked to have a cough. [00:23:50] Speaker 03: They removed the- [00:23:54] Speaker 03: That wasn't the issue here at all because that's why the asymptomatic aspect is so important. [00:23:59] Speaker 03: In order to prove medical necessity or in order to, you would have to say, or in order for her to say, I thought these are medical, she would have to have some basis to say, when we're doing just regular COVID tests on people that are asymptomatic, it really make, it totally made sense to me to do, aside from the money involved, it totally made sense to me to do a whole bunch of other panel tests and check them for a broken leg. [00:24:24] Speaker 03: Right? [00:24:24] Speaker 03: Like, I mean, I mean, but you see, I totally agree. [00:24:28] Speaker 00: Except the combination of those two things. [00:24:29] Speaker 00: When it references a three says you don't have to keep any records. [00:24:32] Speaker 00: We don't expect you to have any records when you test for. [00:24:34] Speaker 03: But it's not a record issue. [00:24:35] Speaker 03: It's not because these people are asymptomatic. [00:24:37] Speaker 03: You have to. [00:24:37] Speaker 03: It's more like you have to make you have to make that you have to make the argument as a theoretical argument that it makes sense to to test everybody who's asymptomatic for everything, not just covid. [00:24:47] Speaker 03: And and she could have she could have done that. [00:24:49] Speaker 03: She could have done that. [00:24:50] Speaker 03: And maybe the jury would have agreed with it, but it doesn't seem to me like it's a defect in the indictment, and it doesn't seem to me like it means it's vague. [00:24:59] Speaker 03: I'm just struggling. [00:25:00] Speaker 00: I'll end on this. [00:25:02] Speaker 00: That would be true, but they included specifically in A3 that you could test for a diagnostic laboratory test for influenza virus or a similar respiratory condition. [00:25:12] Speaker 00: Why include that language if you're not permitting folks to do exactly what was done here? [00:25:17] Speaker 00: If they hadn't had it, it's totally gone. [00:25:18] Speaker 00: I agree. [00:25:19] Speaker 00: They included that. [00:25:20] Speaker 00: You can't then put somebody in jail for 20 years because that condition is unclear and not clearly defined. [00:25:25] Speaker 02: OK. [00:25:26] Speaker 02: We have the arguments. [00:25:27] Speaker 02: Thank you to both counsel for your arguments. [00:25:29] Speaker 02: The case is now submitted.