FILED

NOT FOR PUBLICATION

JUL 13 2021

UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

THOMAS E. PARKER, Jr., Qui Tam No. 20-35825 Plaintiff for and on behalf of the United States of America and the State of D.C. No. 3:18-cv-05395-RBL Washington,

Plaintiff-Appellant, MEMORANDUM*

and

UNITED STATES OF AMERICA, ex rel; STATE OF WASHINGTON, ex rel,

Plaintiffs,

v.

SEA-MAR COMMUNITY HEALTH

CENTER, a Washington Public Benefit Corporation,

Defendant-Appellee.

Appeal from the United States District Court for the Western District of Washington Ronald B. Leighton, District Judge, Presiding

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. Argued and Submitted July 6, 2021 Seattle, Washington

Before: HAWKINS, CLIFTON, and IKUTA, Circuit Judges.

Parker appeals from the dismissal of his False Claims Act lawsuit. We have

jurisdiction under 28 U.S.C. § 1291 and affirm the district court.

Parker claims that Sea Mar Community Health Center, a federal qualified

health center, is defrauding Medicaid through how it schedules and bills for oral

prophylaxis cleanings. Sea Mar moved to dismiss Parker’s lawsuit. Dismissal

under Rule 12(b)(6) may be based on either: (1) lack of a cognizable legal theory,

or (2) insufficient facts under a cognizable legal theory. Godecke ex rel. United

States v. Kinetic Concepts, Inc., 937 F.3d 1201, 1208 (9th Cir. 2019) (quoting

Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1988)). As False

Claims Act lawsuits sound in fraud, the complaint must satisfy Federal Rule of

Civil Procedure 9(b). Winter ex rel. United States v. Gardens Reg’l Hosp. & Med.

Ctr., Inc., 953 F.3d 1108, 1116 (9th Cir. 2020). Parker is required to plead “with

particularity the circumstances constituting fraud,” Fed. R. Civ. P. 9(b), and to

plead “‘the who, what, when, where, and how of the misconduct charged,’

including what is false or misleading about a statement, and why it is false,” United

States v. United Healthcare Ins. Co., 848 F.3d 1161, 1180 (9th Cir. 2016) (quoting

2 Ebeid ex rel. United States v. Lungwitz, 616 F.3d 993, 998 (9th Cir. 2010)). We

review the district court’s dismissal of a case de novo. Winter, 953 F.3d at 1116.

Parker fails to state a legally cognizable theory that “unbundling” routine

dental cleanings from dental exams and billing the cleanings under the supervising

dentist’s National Provider Identifier (“NPI”) rather than the NPI of the dental

hygienist who performed the cleaning constitutes “a false statement or fraudulent

course of conduct.” United States ex rel. Hendow v. Univ. of Phoenix, 461 F.3d

1166, 1174 (9th Cir. 2006). Nothing in the statute, regulations or guidance

prohibits scheduling dental exams and cleanings in separate visits and billing each

as an encounter. Contra Wash. Admin. Code § 182-548-1450(3) (2017) (requiring

fluoride treatments and sealants be provided on the same day as an encounter-

eligible service). There is also nothing prohibiting billing under the supervising

dentist’s NPI. To the contrary, a dentist must supervise a dental hygienist

performing in-clinic cleanings, Wash. Admin. Code § 246-817-550(9), and the

billing guidelines note that “a dental hygienists may bill an encounter only when

s/he provides a service independently – not jointly with a dentist.” Parker fails to

plead a legally cognizable theory that the alleged billing and scheduling of

cleanings by Sea Mar are fraud against Medicaid as Sea Mar’s billing procedures

comport with Washington law.

3 The complaint also fails to plead scienter as to the alleged fraudulent nature

of the unbundling and using the dentist’s NPI to bill cleanings performed by a

dental hygienist. As these practices are not prohibited by statute, regulations, or

guidelines, Sea Mar could not have submitted the claims with the “knowledge of

the falsity and with intent to deceive.” See Hendow, 461 F.3d at 1175.

Finally, Parker does not adequately plead the materiality of the alleged

wrongdoing by Sea Mar. It would be clear on the face of the Medicaid claims if

Sea Mar were scheduling cleanings separate from dental exams as the claim form

requires the procedure code for all services provided. As the Washington Health

Care Authority paid the claims without objection, there “is strong evidence” that

the alleged unbundling, even if below the standard of care, is not material. See

Universal Health Servs., Inc. v. United States ex rel. Escobar, 136 S. Ct. 1989,

2004 (2016). It is also clear on the face of the claim forms that a dentist’s NPI was

being used to bill services typically performed by dental hygienists, such as dental

cleanings. Again, the Washington Health Care Authority knowingly paid these

claims. Plaintiff failed to adequately rebut the strong evidence that any alleged

false statements or fraudulent course of action was material to the government

payor.

AFFIRMED.

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