A federal judge has thrown out Centene Corp.’s abuse-of-process claim against a former employee who alleged she was fired after complaining about the managed care company’s business practices.
Centene is the parent company of Sunflower State Health Plan Inc., one of three for-profit companies managing KanCare, Kansas’ privatized version of Medicaid.
The employee, former Sunflower executive Jacqueline Leary, filed a federal whistleblower lawsuit against Centene and Sunflower in October, alleging Sunflower had ordered employees to shift KanCare members away from high-cost health care providers. Leary called the practice unethical and possibly illegal.
Centene and Sunflower fired back in a counterclaim two months later, contending Leary had demanded a $3 million payment in return for not reporting the companies to the Kansas attorney general’s Medicaid fraud unit.
Calling her allegations “spurious,” Centene and Sunflower alleged Leary was trying to extort them.
In dismissing the abuse-of-process claim, U.S. District Judge John Lungstrum on Tuesday ruled that even if Leary’s lawsuit was filed to extort or harass the defendants, “the mere filing or maintenance of a lawsuit, even for an improper purpose, is not a proper basis for an abuse of process action; abuse of process contemplates some overt act done in addition to the initiating of the suit.”
Lungstrum, however, declined to throw out Centene’s and Sunflower’s additional counterclaim against Leary for defamation. That was based on the companies’ contention that Leary, after her termination, told an executive at a Topeka hospital that Centene and Sunflower had directed her to do “something inappropriate” and that she was fired after she contacted their compliance department.
Lungstrum ruled that dismissal of the defamation claim was not proper because it and Leary’s whistleblower claim arose out of the same set of facts and the evidence underlying both will overlap.
Attorneys for Leary and for Centene and Sunflower could not immediately be reached for comment.
Leary was vice president of contracting and network development for Sunflower before she was terminated in January 2014. Her central allegation is that Sunflower, motivated by financial losses, ordered her to steer Sunflower members away from health care providers that had contracted to be reimbursed at rates higher than 100 percent of standard Kansas Medicaid rates.
Sunflower maintains that Leary was fired for poor job performance. It notes that the Occupational Safety and Health Administration investigated her claims and concluded she was not fired in retaliation for expressing concerns about Sunflower’s business practices.
Kansas’ $3 billion KanCare program put private companies in charge of managing the state’s Medicaid program. The program was launched by Gov. Sam Brownback in early 2013 and moved nearly all of the state’s Medicaid enrollees into health plans run by Sunflower and two other managed care organizations, Amerigroup and UnitedHealthcare.
Dan Margolies, editor of the Heartland Health Monitor team, is based at KCUR.
