Renew tool that fights fraud

Combating the growing avalanche of health care fraud in our state and across the country requires using the right law enforcement tools. One of the most useful tools in the battle against health care fraud is the Washington Medicaid False Claims Act.

Statutes like it at the federal level and in more than 30 states and cities have been successful for decades and have operated to save literally tens of billions of taxpayer dollars.

These laws succeed because they incentivize and reward whistleblowers who bring original information about health care fraud to authorities.

Washington state’s Medicaid Fraud False Claims Act has returned nearly $3 for every $1 spent in investigating and prosecuting health care fraud cases just in the last three years since it was adopted.

But that record of success will stop unless the Legislature votes to reauthorize it in what should be a legislative no-brainer. Only businesses with an interest in committing health care fraud want to keep these laws off the books. The law promotes public health, protects honest health care companies and helps us crack down on practitioners and companies that rip off our state’s Medicaid system.

Incentivized integrity works. Federal and state False Claims Act laws are the most effective tools we have to ferret out fraud and protect taxpayer money. These laws are premised on the very simple idea that incentivizing private individuals with insider knowledge of fraud to come forward and blow the whistle helps deter future frauds and makes taxpayers and public programs whole. The federal law has brought in nearly $50 billion in recoveries since 1986, with a growing percentage of that going to states that pass these laws.

It’s good policy and good politics. Washington faces tremendous budgetary constraints, and many times must either raise taxes, or cut benefits to our oldest, sickest and poorest citizens. Every dollar lost to fraud negatively affects a state’s budget and allows liars, cheats and thieves to get rich off honest taxpayers. Reauthorization of the Medicaid Fraud False Claims Act is not only good policy for Washingtonians, it is good politics.

Washington wants a seat at the table. Without a state false claims act law, Washington will not have a say at the negotiation table when the federal government settles a health care fraud case. Washington will in essence have to take the scraps offered by the Department of Justice. Washington will also lose its eligibility under the Deficit Reduction Act (DRA) incentive program. Under the DRA, states with a law deemed as effective as the federal False Claims Act with regard to Medicaid fraud protection, receive a 10 percent share increase in Medicaid recoveries obtained. Washington’s current law is DRA compliant.

Our firm has represented scores of whistleblowers across health care and several other industries, including several in the Pacific Northwest. Their complaints have resulted in the recovery of more than a billion dollars to taxpayers. Without the Washington Medicaid False Claims Act, a law which should be amended to include all types of taxpayer fraud, those whistleblowers will not come forward and health care fraud will go undetected in this state.

Shayne C. Stevenson is a partner at Seattle’s Hagens Berman lawfirm. He leads its whistleblower practice, representing whistleblowers under False Claims Act statutes and whistleblower programs for the IRS and other federal agencies.