Economics Expert Witness and Health Care Economics Expert Witness Allowed

Plaintiff sued defendant related to allegedly illegal reimbursements for prescription drugs. Both parties hired experts to provide testimony on their behalf and both filed Daubert motions to exclude.  The court denied both motions.

Facts:  This case (United States of America et al v. Kmart Corporation – United States District Court – Southern District of Illinois – July 21st, 2017) involves a claim that the defendant (Kmart) overcharged Medicaid and other federal programs for generic medications.   The plaintiff (Relator) hired Dr. Joel Hay (economics expert witness) to examine Kmart’s reimbursement data and measure the damages allegedly sustained by the Government.   Kmart hired Dorothy DeAngelis (health care economics expert witness) to rebut the damages theory outlined by the Relator and his expert witness.  Both parties filed motions to exclude their opponents experts.

Discussion: Kmart alleges that Dr. Hay’s opinions are not admissible because his damages calculation methods are not reliable or relevant, which will not assist the trier of fact in reaching a verdict.  In addition, Kmart maintains that Dr. Hay’s methodology is not based on a correct understanding of the payment structure of Medicare Part D.

Regarding qualifications, Kmart argues that Dr. Hay’s experience as a pharmaceutical economist does not extend to data analysis and Medicare Part D claims.   Relator maintains that Dr. Hay is a founding member of the American Society for Health Economics, has authored numerous studies within the field, and has served as an expert in many other cases.  The court opines that Dr. Hay is indeed qualified offer expert witness testimony in this case.

Kmart also argues that Dr. Hay’s opinions are unreliable for two reasons.  First, they maintain that Dr. Day did not incorporate the Medicare Part D structure into his methodology.  Second, they argue that his opinions on damages outside of Medicare Part D are also inadmissible.  The court finds that Dr. Hay’s analysis is relevant and reliable and that any arguments on this issue is subject to vigorous cross-examination.  Even though Kmart disagrees with Dr. Hay’s methodology, that does not make it inadmissible.

Relator has also moved to exclude the expert testimony of Dorothy DeAngelis because they are not relevant and do not help the trier of fact.  Relator argues that DeAngelis’s testimony discussing the alleged over billing is not a claim before the court.  In response, Kmart argues that DeAngelis’s testimony is directly relevant to the case. The court finds that this expert’s opinion is related to the facts at issue in this case.  Her report discusses the many issues such the Medicare Part D program and how plan sponsors are reimbursed.

Relator also argues that DeAngelis’s opinion are related to a legal question, which is inadmissible.  The court disagrees that her opinions are a legal opinion.  The court then opines that there are two competing ways of calculating damages in this case and that a disagreement on these methods does not create a legal conclusion on DeAngelis’s opinion.

Conclusion:  The court rules that the motions to exclude the expert opinions of Dr. Joel Hay and Dorothy DeAngelis are denied.