False Claims Act Guide for Healthcare Whistleblowers
Healthcare whistleblowers who witness fraud and corruption can file award claims under the qui tam provisions of the False Claims Act.
By Ben Kostyack
Updated: September 27, 2023
How the False Claims Act Protects Healthcare Whistleblowers
Every year, millions of dollars are lost to healthcare fraud in the United States. In 2020, the Department of Justice recovered over $1.8 billion from False Claims Act cases involving fraud and corruption in the healthcare industry.
Healthcare whistleblowers can file qui tam lawsuits on behalf of the United States when they witness healthcare providers committing frauds. Under the False Claims Act, qui tam relators can receive substantial financial rewards if they bring clear evidence of fraud to the government’s attention.
Using this guide, qui tam whistleblowers who work in the healthcare industry will learn how to identify fraud, confidentially and anonymously report crimes, and file for whistleblower awards.
There are many different types of frauds that occur in the healthcare industry. The most common types of fraud are Medicare/Medicaid fraud, unbundling/upcoding and kickbacks/bribes.
Medicare / Medicaid Fraud
Medicare and Medicaid fraud are two of the most common forms of healthcare fraud and appear in many forms. In most cases, Medicare and Medicaid fraud arise from fraudulent billing schemes, improper marketing tactics, or the offering of kickbacks or bribes to beneficiaries. Many times, Medicare and Medicaid fraud appear when providers try to take advantage of older beneficiaries. This can also appear as submitting bills for services not medically necessary or medical equipment that is not needed.
Unbundling / Upcoding
Unbundling and upcoding are common forms of healthcare fraud in which medical providers seek more funds than they are entitled to. Federal and state programs such as Medicare and Medicaid have set forth billing codes for healthcare providers to use. Specific codes are used for medical services and devices and determine the amount of reimbursement the government owes the provider. Upcoding and unbundling occurs when medical providers use fraudulent codes that result in greater reimbursement funds from the government.
Kickbacks are a common form of healthcare corruption and come in many forms. Kickbacks can be bribes paid to public officials, gifts sent to certain parties that interfere with unbiased business decisions, and more. Kickbacks made to foreign officials are a direct violation of the Foreign Corrupt Practices Act (FCPA).
Kickbacks can often result in poor quality services, overutilization, and increased costs. In one case, Swiss-based pharmaceutical company Novartis paid over $300 million in fines and penalties to the Department of Justice (DOJ) and Securities and Exchange Commission (SEC) for violating the Foreign Corrupt Practices Act.
Federal Anti- Kickback Statute
The Anti-Kickback Statute (AKS) was designed to prevent corruption in areas such as the healthcare industry. The AKS protects federal healthcare programs such as Medicare and Medicaid from fraud and abuse. Qui tam whistleblowers can report violations of the AKS under the False Claims Act.
Obtaining Qui Tam Rewards Under the False Claims Act
Under the qui tam provisions of the False Claims Act, healthcare whistleblowers can file for significant monetary rewards. Whistleblowers who witness frauds related to violations of Medicare/Medicaid, unbundling/upcoding, and the anti-kickback statute can use confidential and anonymous reporting channels to file reward claims using an experienced qui tam attorney.
Both U.S. citizens and non-U.S. citizens can file award claims using the False Claims Act. If you have information about healthcare fraud, It is imperative to seek representation from an experienced whistleblower attorney as soon as possible. There are statutes of limitations on qui tam laws that can disqualify whistleblowers from awards if certain deadlines are not met.
Anonymously Reporting Healthcare Fraud
Under the False Claims Act’s seal provision, qui tam healthcare whistleblowers can initially file their claims under seal, meaning their identities are hidden from public view.
The whistleblower’s information can only be viewed by government prosecutors, courts, and the whistleblower’s legal team. Initially, a False Claims Act whistleblower’s case will be under seal for 60 days. However, the government can choose to extend this period if they see good reason. Many cases stay under seal for a year or more.
Statute of Limitations on Reporting
Statutes of limitations apply to all qui tam actions filed on behalf of the government as well as whistleblower retaliation claims.
Under Title 31, Section 3731(b) of the United States code, it is stated that qui tam actions may not be brought:
More than 6 years after the date the fraud was committed, or
More than 3 years after the date the facts related to the fraud are known or should be known by the United States.
Whistleblower retaliation lawsuits under the False Claims Act must be filed at least 3 years from the time of the retaliation.
However, the “First-to-File” rule of the False Claims Act creates the need to contact an experienced whistleblower attorney right away. The “First-to-File” rule states that when multiple whistleblowers file qui tam actions for the same misconduct, only the first to file their claim will be eligible to receive awards. Whistleblowers who file after the first-to-file is submitted are not eligible for awards.
What Happens After I Report Fraud?
After you file your qui tam lawsuit, the government will look at your case.
They will then decide whether or not to intervene in your case. If the government decides to intervene in your case, the United States will take over the litigation and prosecute the fraudsters. The whistleblower still remains a party in the case, but the United States conducts the litigation. Results are usually more favorable for the qui tam whistleblower when the government intervenes in their case.
If the government does not decide to intervene in the case, the whistleblower has the right to continue with their case. These cases are harder to litigate, as the defendant will more than likely use all available resources to aggressively fight the case.
Reporting Coronavirus Healthcare Fraud Using the False Claims Act
Using the False Claims Act, healthcare workers and whistleblowers who witness coronavirus frauds can earn financial rewards by using confidential reporting channels. Coronavirus fraud can take many forms, including PPP loan fraud, withholding of personal protective equipment (PPE), and overbilling on medical procedures and devices. Under the qui tam provisions of the False Claims Act, frontline workers and those fighting the COVID-19 pandemic can file lawsuits using an experienced whistleblower attorney.
On July 25, a bipartisan group of senators, led by Senator Chuck Grassley (R-IA), introduced the False Claims Amendments Act of 2023. The bill makes a number of technical fixes to the False Claims Act (FCA) in order to ensure it remains the government’s most effective anti-fraud tool. Most notably, the ...
On June 26, Connecticut Governor Ned Lamont signed into law a bill expanding the state’s False Claims Act. The bill, “An Act Concerning Liability for False and Fraudulent Claims,” expands the law to cover non-healthcare related fraud. Prior to the signing of the bill, Connecticut was one of several states ...
This post originally appeared in the NYU Law Compliance and Enforcement Blog. On June 1, 2023, the Supreme Court issued a unanimous decision in the consolidated case of U.S. ex rel. Schutte v. SuperValu, Inc. (“SuperValu”) and U.S. ex rel. Thomas Proctor v. Safeway, Inc. (“Safeway”), holding that subjective intent is relevant for determining whether a ...
A whistleblower in healthcare is someone who reports a violation of the False Claims Act by engaging in frauds such as upcoding and unbundling, kickbacks, Medicare or Medicaid fraud, or abusing government relief funds.
Healthcare whistleblowers may receive a reward of between 10 and 30 percent under the qui tam provisions of the False Claims Act. Both U.S. and non-U.S. citizens can apply for rewards and become eligible if their information leads to a successful sanction against a fraudster.
Whistleblowers who want to report PPP loan fraud should get in touch with a qui tam attorney. Using the False Claims Act, healthcare workers and whistleblowers who witness coronavirus frauds can earn financial rewards by using confidential reporting channels.
Rules for Whistleblowers
The ultimate guide to blowing the whistle and getting rewarded for doing what's right.
Information submitted in the client intake form or in email from anyone seeking legal help is covered under the attorney client and work product privileges to the fullest extent of the law. We also highly encourage you to learn about our intake process before submitting an intake. Looking to join the team? Please visit our careers page to explore and apply to openings, fellowships, and internships at our firm.
Your communications are secured and sent over 256-bit SSL encryption. To protect your identity and confidentiality, do not use any devices owned or controlled by a private corporation or governmental entity. It is also recommended to protect your online identity by establishing a new email account that does not identify you and to avoid the use of other online platforms that may disclose your identity.
Subscribe to our newsletter to receive whistleblower news and resources crafted by the partners and associates at KKC.
The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation. All information submitted in the client intake form or in email from anyone seeking legal assistance is considered covered under the attorney client and work product privileges to the fullest extent of the law. While we treat your information as confidential, a lawyer-client relationship is created only by express written agreement signed by both you and Kohn, Kohn & Colapinto.