Washington State Legislature Passes Medicaid Fraud False Claims Act

On March 8, 2012, the Washington State Legislature passed legislation creating a Medicaid fraud false claims act with strong bipartisan support.  If signed into law, the bill (SB 5978/HB 2571) would give the state a new means of pursuing Medicaid fraud and would allow individual citizens – qui tam relators – to bring whistleblower lawsuits for Medicaid fraud on behalf of the government, as long as the individuals are the original source of the information.

Similar to the federal False Claims Act (FCA), the newly passed legislation in Washington would allow qui tam whistleblowers to receive awards based on the amount of funds recovered through lawsuits and settlements.   The bill would empower the Washington Attorney General’s office to bring such cases on behalf of the government.

Specifically, whistleblowers who report fraud will be able to receive 15% to 25% amount recovered if the attorney general intervenes and proceeds with the case, and awards of 25% to 30% if the attorney general does not proceed and the relator conducts the lawsuit alone.  Additionally, the law would create civil penalties for fraud ranging from $5,500 to $11,000 per claim, as well as treble damages.

The legislation contains several provisions that distinguish it from the federal FCA, most notably the lack of a statute of limitations, which could allow claims that extend farther back in time than current federal laws permit.

According to one of the main sponsors of the legislation, Sen. Cheryl Pflug (R), “without this tough enhancement of our False Claims Act, our state [would be] powerless against the corporate culprits who defraud taxpayers through false Medicaid claims.”

Washington governor Christine Gregoire (D) is expected to sign the legislation.  If signed, Washington would join 29 other states that have enacted similar laws.

The Employment Law Group® law firm focuses in the areas of employment law and whistleblower protection law, has helped many clients file suit against employers that fraudulently billed the U.S. government, and has established favorable precedents under the retaliation provision of the False Claims Act.

Tagged: False Claims Act (FCA), Whistleblower Laws (Federal)