Senator Grassley working to beef up state False Claims Acts

June 7, 2010  |  Class Actions, Whistleblower/Qui Tam

Senator Chuck Grassley, longtime proponent of strengthening the federal False Claims Act in order to  fight fraud against the government, is now working to ensure that recent changes to that statute are made part of fourteen state False Claims Acts patterned after the federal model.  Many states have enacted legislation similar to the federal statute in response to a federal incentive that allows states with whistleblower statutes to increase their share of Medicaid recoveries by 10 percent.

To be eligible for the incentive, the states must pass legislation that satisfies several outlined criteria.  Although many states have enacted their own False Claims Acts, only fourteen states are entitled to the 10 percent incentive.  Now that the federal statute has been amended, Senator Grassley has asked the Attorney General and the Inspector General for the Department of Health and Human Services to review those state False Claims Acts to make certain that they are compatible with the new changes to the federal Act.  In addition, Grassley has asked that guidance be provided to the states to assist in fine tuning current state laws to make sure that the states remain eligible for the ten percent federal incentive.

According to Grassley: “This kind of effort at the state and federal level is more important than ever as Medicaid programs are expanded and face new burdens and growing fiscal challenges.”

In May 2009, President Obama signed the Fraud Enforcement Recovery Act, which strengthened the federal False Claims Act substantially by eliminating liability loopholes and reducing statutory confusion.  Related, though less radical, changes were made again in March of 2010 as part of the Patient Protection and Affordable Care Act.  These are the changes that Senator Grassley wants to see incorporated in the parallel state legislation.

In 1986, Grassley was the primary Senate sponsor of amendments to the federal False Claims Act that updated the law’s whistleblower provisions.

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