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Searching for Articles by Robert J. Reinertson
Robert J. Reinertson
Wausau Office
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Free Parking, Yes, But No Stark Law Claim

Posted on June 21, 2017, Authored by Robert J. Reinertson, Filed under Health Care

A federal court recently dealt a victory to a health care provider over whistleblower allegations that free parking and valet service at a medical office building violated the Stark Law and the Anti-Kickback Statute.  In Bingham v. BayCare Health System (No. 8:14-cv-73, M.D. Fla.), a federal district judge adopted the report and recommendation of a magistrate judge that judgment be granted to the provider, BayCare.  The plaintiff, Bingham, is a real estate appraiser in Tennessee with no affiliation with BayCare.  It has been reported that Bingham has filed several whistleblower-type cases in the past and has received substantial settlements. BayCare is a non-profit corporation which operates a hospital.  BayCare entered into a ground lease with a real estate developer to construct a medical office building on the hospital campus.  The tenants of the building are limited liability companies that employ physicians who have practices in the building.  The building is classified as tax-exempt. Bingham alleged that BayCare violated federal law by providing the following remuneration to the physicians in the building in order to induce the physicians to refer patients to BayCare: Free parking for the physicians, their staffs, and their patients; Free valet parking for the physicians, their staffs, and their patients; and Tax savings which allowed the physicians to benefit from BayCare’s tax exemption.  Bingham also claimed that BayCare submitted false claims to Medicare and Medicaid for services provided to the patients who were allegedly referred illegally. The ground lease is between BayCare as landlord and the developer as the tenant.  The ground lease granted parking rights to the “Tenant and Tenant’s subtenants and Invitees”.  The subtenants are the tenants of the building, i.e. the limited liability companies.  BayCare provided valet services at the building through a contract with a third-party vendor. The Stark Law forbids a physician from referring Medicare or Medicaid patients to a hospital if he or she has a “financial relationship” with the hospital.  No remuneration can be given directly from the hospital to the physician for referrals. The issue in this case was whether a financial relationship existed between BayCare and the physicians who work in the building where the parking and valet services are provided.  Bingham claimed that a direct financial relationship existed between BayCare and the physicians because, in his view, the subtenants are the physicians and the invitees are their patients.  However, the judge ruled that the subtenants and the physicians are not parties to the ground lease and that the tenants have separate office leases with the tenant-developer through which the parking rights are conferred.  That means the physicians receive parking benefits through their employers, the limited liability companies.  It also means there is not a direct compensation arrangement between BayCare and the doctors. The judge also found that while valet parking was available and BayCare paid the third-party vendor for those services, there was no evidence the physicians in the building actually used the service.  And, there was no evidence that patients who used the valet service were referred to BayCare by physicians in the building. The judge went on to find that there also was no indirect compensation arrangement between BayCare and the physicians, because the physicians’ employment agreements with their employers are based on salary and productivity factors, neither of which are based on referrals.  In addition, the office leases between the developer and the subtenants provide that rent is calculated in part on square footage, which means higher rent for bigger spaces.  There was no evidence that physicians receive compensation from their employers based on the volume of patient referrals. For some of the same reasons, the court also dismissed Bingham’s claims regarding the Anti-Kickback Statute, which prohibits a hospital from providing remuneration to induce patient referrals.  Also, much of the court’s discussion was fact-intensive, finding that there was no evidence that BayCare, the tenant, nor the subtenants had the requisite intent to induce the doctors to refer patients, even if parking and valet services were available free of charge at the medical office building. This decision is instructive because the leasing arrangements involved in this case are not uncommon.  But, because whistleblowers have the opportunity to benefit financially by bringing cases under the Stark Law and the Anti-Kickback Statute, there will likely be no shortage of ways plaintiffs will frame their claims.

Federal Judge Refuses to Block New OSHA Anti-Retaliation Rule from Taking Effect Tomorrow

Posted on November 30, 2016, Authored by Robert J. Reinertson, Filed under Employment

A federal judge has refused to issue a preliminary injunction to block OSHA’s new anti-retaliation and discrimination rule from taking effect as scheduled.  This means that tomorrow, December 1, the rule prohibiting employers from retaliating or discriminating against employees for reporting workplace injuries and illnesses will take effect. Multiple plaintiffs have sued OSHA in federal court in Texas seeking to prevent the new rule from going into effect.  The rule has been particularly controversial because it is OSHA’s position that it will limit post-incident drug testing and workplace safety incentive programs and allow it the opportunity to undertake more aggressive enforcement activities. The other part of the rule, which requires electronic reporting of workplace injuries and illnesses, will take effect as scheduled on January 1, 2017.  This has also been controversial due to OSHA’s plan to post company injury and illness information on its website. Even though the judge declined to issue a preliminary injunction, the Texas lawsuit will continue as the plaintiffs seek to have the new rule declared unlawful and set aside permanently.  However, it is important to remember that compliance with the rule must begin immediately. Ruder Ware’s employment and labor team is knowledgeable about the new OSHA rule and can assist you with questions and implementation.

Forfeitures for Ordinance Violations - When Are They Excessive?

Posted on June 2, 2017, Authored by Robert J. Reinertson, Filed under Local Governments and School Districts

An age-old problem faced by municipal officials is what to do about residents and landowners who fail to take care of their properties and allow junk, debris, and other unsightly items to accumulate.  This often leads to citizen complaints and even health and safety issues. When municipalities take enforcement action against such properties, they usually seek a court order for remediation and for forfeitures as provided under their ordinances.  These ordinances usually set a minimum and a maximum amount of forfeiture for the violation, with each day of violation being a separate offense.  It is not uncommon for violations to exist for many months or even years.  Courts are then asked to answer the question: what is the appropriate amount of forfeiture to impose against the violator? Last week the Wisconsin Court of Appeals released a decision which dealt with this question.  While the opinion is unpublished, it does explain the law in Wisconsin and offers insight into how judges view municipal forfeitures.  The case, Town of Ixonia v. Knopps (No. 2016-AP-766), involved a town’s lengthy efforts to force a landowner, Knopps, to clean up junk, debris, and rubbish on his residential property.  The town sued Knopps for violating its junk storage and nuisance ordinances.  The junk storage ordinance provided for forfeitures of $5 to $500 for each day of violation, while the nuisance ordinance provided for forfeitures of $10 to $200 for each day of violation. The circuit court granted judgment declaring the property in violation and allowing the Town to clean up the property.  After the Town cleaned up the property, it came back to court seeking forfeitures for 773 daily ordinance violations.  The circuit court determined that by applying the minimum forfeitures, along with “add-ons” allowed by state statute, the amount for the junk storage violations would be $22,763.40 and the amount for the nuisance violations would be $27,633.30, for a total forfeiture of $50,396.70. However, the circuit court also decided that this amount would be an excessive fine prohibited by the Wisconsin and U.S. Constitutions.  It instead imposed a total judgment of $3,631.00. The Town appealed the forfeiture issue.  The appeals court judge agreed with the circuit court that the amount sought by the Town was unconstitutionally excessive and affirmed the $3,631.00 judgment. The appeals judge based his decision on what is known as the “proportionality test”.  Under this test, the following factors are to be considered: (1) the nature of the offense; (2) the purpose for enacting the regulation; (3) the fine commonly imposed upon similarly situated offenders; and (4) the harm resulting from the offender’s conduct. Taken together, the above factors require that “the amount of the forfeiture must bear some relationship to the gravity of the offense that it is designed to punish”.  The appeals judge found the following factors to be especially significant:        Knopp was a poor and disabled man who was simply incapable of maintaining his property in the condition called for under the Town’s ordinances. Knopp was not engaging in this behavior for profit, such as running an unlicensed junk yard. The “massive accumulation” of daily violations was at least partly due to the length of time it took the Town to abate the violations.  The judge felt that 773 days of violations may not compare with “similarly situated offenders”. Though it took a while, the remediation of the property was successful and no permanent harm resulted. In short, the judge concluded that “it would be disproportionate to the offense and shocking to the conscience for a poor disabled man to be penalized by such a large forfeiture that he could well lose his home”. Unfortunately, the opinion does not describe how the circuit court calculated the $3,631.00 forfeiture it imposed and which the appeals judge affirmed.  Apparently neither party challenged the basis for the alternative calculation.  However, there are some takeaways from this decision: A person who is unable to maintain his or her property because of poverty or physical ailment or disability will be treated differently from a person or business flouting the law by making money off junk-filled property. Unsightly property that is successfully cleaned up, either by the landowner or the municipality, will probably be considered as posing no permanent harm, no matter how long the process takes.  This likely would be different, however, if the property conditions lead to injuries, pollution, or hazardous waste releases. Municipalities should not expect a court to impose maximum forfeitures or daily forfeitures for long periods of time, unless the circumstances are particularly egregious. The principles discussed in the Town of Ixonia case apply to other local ordinance enforcement efforts, such those directed at zoning and land use violations. Feel free to contact us with any questions on this case or its applicability to specific situations.

Wisconsin Supreme Court Rules on Appleton School District Open Meetings Law

Posted on June 29, 2017, Authored by Robert J. Reinertson, Filed under Local Governments and School Districts

In a unanimous and much-anticipated decision released today, the Wisconsin Supreme Court ruled that a committee of school personnel formed to review materials for a high school course under a procedure set forth in school board rules is a “governmental body” subject to the Wisconsin Open Meetings Law. The case (Krueger v. Appleton Area School District Board of Education, 2017 WI 70), involved a committee that was formed by two department heads in response to an objection to a course reading list lodged by the father of a student in the class.  The father wanted to attend the committee’s meetings, but his request was denied.  He filed suit claiming that the committee was subject to the Open Meetings Law.  The circuit court and the Court of Appeals ruled in favor of the school board, finding that the committee was an “ad hoc” group, not a “governmental body”, and so was not subject to the Open Meetings Law.  Crucial to the Court’s decision was the school board had a rule that required selection of educational materials be delegated “to the professionally trained and certified personnel employed by the school system”.  In the Court’s view, this was the board’s formal authorization for the department in question to review and recommend educational materials for board approval according to procedures laid out in a board-approved “assessment, curriculum, and instruction handbook”. A governmental entity is subject to the Open Meetings Law if it is (1) “a state or local agency, board, commission, committee, council, department or public body corporate and politic” that is (2) “created by constitution, statute, ordinance, rule or order . . . or a formally constituted subunit of any of the foregoing”.  The Court concluded that the school review committee was a “committee” for purposes of the Open Meetings Law because it had defined membership charged with reviewing and selecting educational materials for board approval, as authorized by the board through its rule and handbook.  The Court also concluded that the committee was created "by rule" because the rule and the handbook that the school board had adopted delegated authority to district employees to form review committees. We will be analyzing this case in depth and will write further on this subject.  In the meantime, however, there are several points to consider: While this case deals with a school district, it is applicable to all units of government that may have or may set up committees, subcommittees, or other groups in a similar manner or under similar authority. The Court acknowledged that the creation of a governmental body is not triggered “merely by any deliberate meetings involving governmental business between two or more officials”, and that loosely organized ad hoc gatherings of government employees, without more, are not governmental bodies. As noted above, the district’s rule and handbook were very important to the Court’s decision.  The applicability of this decision to a particular local governmental entity’s governing rules and procedures should be analyzed. The Court, in closing, noted the district’s argument that subjecting committees like the one involved here would adversely affect the functioning of government.  The Court stated that “mere inconvenience” cannot exempt a body from the Open Meetings Law, and that such concerns should be addressed to the legislature.

OSHA’s New Guidelines for Employer Anti-Retaliation Policies

Posted on January 18, 2017, Authored by Robert J. Reinertson, Filed under Employment

Most employers and employees know that the Occupational Safety and Health Administration (OSHA) is the federal agency charged with overseeing safety and health in U.S. workplaces.  Many are surprised, however, to learn OSHA is also responsible for enforcing 22 whistleblower protection statutes that don’t necessarily have anything to do with worker safety and health.  These 22 statutes, ranging from the Affordable Care Act to the Wendell H. Ford Aviation Investment and Reform Act, and everything in between, are designed to protect employees from retaliation for reporting a variety of concerns and issues in the workplace.  Retaliation can include any adverse employment action, including harassment, lack of promotion, demotion, discipline, and termination.   OSHA has just issued its long-awaited “Recommended Practices for Anti-Retaliation Programs”.  These guidelines, intended for private, public, and non-profit employers of all sizes, are the product of a 12-member advisory commission after receiving a number of comments from employer and employee advocacy organizations. The recommended practices are centered around what OSHA calls five “key elements to an effective anti-retaliation program”:             ●          Management leadership, commitment, and accountability             ●          Procedures for listening to and resolving employees’ concerns             ●          Procedures for receiving and responding to reports of retaliation             ●          Anti-retaliation training             ●          Program oversight OSHA maintains these recommended practices are voluntary and do not create new legal obligations.  OSHA also has stated that neither adopting nor failing to adopt the practices is any indication of an employer’s good faith or lack of good faith in a particular case.  Regardless of whether or not employers adopt the new recommendations from OSHA, it is always advisable to have anti-retaliation provisions in effect and to periodically review employee handbooks and policies to make sure that such provisions are up-to-date. Here is a link to the new OSHA guidelines:     

Inspector General Audit Could Impact Skilled Nursing Facilities

Posted on September 12, 2017, Authored by Robert J. Reinertson, Filed under Health Care

Skilled nursing facilities (SNF) may see even more scrutiny from the Centers of Medicare and Medicaid Services (CMS) because of a recent audit conducted by the Office of Inspector General of the U.S. Department of Health and Human Services.  The audit looked into abuse and neglect of Medicare recipients residing in SNFs and the associated oversight role of CMS. In an “Early Alert” memorandum announcing the results of the audit, the Inspector General concluded that (1) a significant percentage of abuse and neglect incidents are not being reported and (2) the CMS lacks sufficient procedures to ensure that incidents are identified and reported.  Under federal law, federally funded long-term care facilities must immediately report any reasonable suspicion of a crime committed against a resident.  The reports must be submitted to law enforcement authorities and to the CMS-designated State Survey Agency.  “Immediately” means within two hours if the incident caused serious bodily injury and within 24 hours if it did not.  (While it is beyond the scope of this article, nursing facilities have been under a November 28, 2017 deadline to implement policies and procedures for reporting crimes, pursuant to a Final Rule to revise Medicare and Medicaid participation requirements for nursing facilities that CMS published on October 4, 2016.) According to the memorandum, the Inspector General identified 134 Medicare recipients who received emergency room care for injuries from abuse and neglect at SNFs from January 1, 2015 through December 31, 2016.  The audit also found that 28% of these incidents were not reported to law enforcement, in violation of the law.  CMS is responsible for oversight and compliance with Medicare health and safety standards.  CMS delegates a variety of these tasks to the State Survey Agencies.  The Inspector General determined that CMS procedures are not adequate to ensure that abuse and neglect of Medicare recipients in SNFs are identified and reported.  The Inspector General recommended to CMS that it change its procedures to provide better protection of Medicare beneficiaries, including implementing regulations to impose penalties for violations of the reporting requirements and to direct State Survey Agencies to report violations of reporting requirements to CMS. CMS will likely take action in response to the memorandum and SNFs will likely eventually feel the fallout.  Facilities should make sure they are compliant and maintain compliance with all current and impending crime reporting regulations.  The Inspector General’s memorandum may be accessed through this link:

Federal Court Reverses NLRB “Positive Work Environment” Handbook Decision

Posted on August 1, 2017, Authored by Robert J. Reinertson, Filed under Employment

The National Labor Relations Board (NLRB) created controversy a couple of years ago when it ruled that handbook policies maintained by T-Mobile USA requiring employees to maintain a positive work environment were illegal because they could be seen as having a chilling effect on employees’ unionizing and collective bargaining rights.  Last week, the U.S. 5th Circuit Court of Appeals reversed the NLRB on three of the four policies in question.  The Court found that the NLRB used the wrong standard of review when it ruled that a reasonable employee reading the policies could construe them to prohibit conduct protected by the National Labor Relations Act, rather than would construe them that way. These were the policies involved: Workplace Conduct Policy.  T-Mobile’s policy expected all employees “to behave in a professional manner” and to “maintain a positive work environment” by communicating “in a manner that is conducive to effective working relationships”.  The Court’s decision noted that late night TV host Stephen Colbert mocked the NLRB decision by joking that “the government says I can’t legally ask [my employees] to be happy”. The Court of Appeals found that a reasonable employee would understand this rule to “express a universally accepted guide for conduct in a responsible workplace.” Act With Integrity Policy.  T-Mobile’s policy expected all employees to “exercise integrity, common sense, good judgment, and to act in a professional manner”.  The policy listed acts of unacceptable behavior, including arguing or fighting with co-workers, subordinates, or supervisors, failing to treat others with respect, and failing to demonstrate appropriate teamwork. The Court of Appeals found that a reasonable employee would be fully capable of engaging in debate over union activity or working conditions without inappropriately arguing or fighting. Acceptable Use Policy.  This T-Mobile policy prohibited employees from allowing non-approved persons access to any “non-public” company information without prior written consent from T-Mobile.  The NLRB felt that a reasonable employee would construe it to prohibit protected activity such as accessing and sharing wage and benefit information contained in his or her e-mail. The Court found that the policy only applied to the sort of proprietary business information that an employer may properly restrict its employees from sharing outside the company. The Court did find that T-Mobile’s policy prohibiting employees from recording people or confidential information using cameras, phones, or recording devices in the workplace was illegal.  The Court felt that the policy was so broad that a reasonable employee would interpret it to discourage protected activity, such as, for example, photographing a wage schedule posted on a corporate bulletin board.  In the Court’s views, such an employee would consider the policy as written as forbidding a means of engaging in protected union-related activity. This decision provides employers with some clarification on what many thought were common-sense handbook policies.

OSHA Extends Deadline for Electronically Submitting Worker Injury and Illness Records

Posted on May 18, 2017, Authored by Robert J. Reinertson, Filed under Employment

The Occupational Safety and Health Administration (OSHA) announced on May 17, 2017 that the deadline for employers with 250 and more employees to electronically submit information from their 2016 Form 300A to OSHA is being extended.  Under the electronic reporting rule that went into effect on January 1, 2017, the original deadline was to be July 1, 2017. OSHA stated that it will announce the new deadline at a later date.  This is the notice currently on the OSHA website: “OSHA is not accepting electronic submissions of injury and illness logs at this time, and intends to propose extending the July 1, 2017 date by which certain employers are required to submit the information from their completed 2016 Form 300A electronically. Updates will be posted to this webpage when they are available.” As of right now, the other electronic reporting deadlines remain intact: Employers with 250 or more employees: Submit 2016 Form 300A by the new date to be announced by OSHA.  Submit 2017 Forms 300A, 300, and 301 by July 1, 2018. Thereafter, submit Forms 300A, 300, and 301 by March 2 of each year. Employers with 20 to 249 employees in Designated Industries (those industries listed in Appendix A to Subpart E of Part 1904 of the rule): Submit 2016 Form 300A by July 1, 2017. Submit 2017 Form 300A by July 1, 2018. Thereafter, submit Form 300A by March 2 of each year. All other employers electronically submit reports to OSHA only upon notification from OSHA. The electronic reporting rule is currently being challenged in federal court in Oklahoma.  National Association of Home Builders of the United States v. Perez, No. 5:17-CV-00009 (W.D. Okla.).