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Anti Kickback
False Claims Act: Overview
The US government spends hundreds of billions of dollars every year, much of which goes to private entities that profit from government payments or contracts. Medicare, Medicaid, and TRICARE pay doctors, hospitals, and other healthcare providers for medical treatment. The Department of Defense pays contractors like Raytheon and Boeing to build aircraft and weapons systems. While healthcare and defense account for the bulk of government spending, taxpayer funds also go to thousands of other contractors who provide goods and services to government agencies and the military.
The sheer volume of government contracts and payments make it effectively impossible for the federal government to police all these contracts for fraud and abuse. Instead, the government relies on whistleblowers to report false claims against the government under the False Claims Act.
Types of Fraud Against the Government
The False Claims Act provides both legal protection and financial incentives to individuals who have knowledge of false claims for payment from the government. A false claim, under this law, is any act that results in government payment for fraudulent or unlawful claims. Examples of fraudulent or unlawful claims include:
- Overcharging the government (above fair market value) for goods, services, or labor
- Charging the government for goods, services, or labor that are not actually provided or are short of contractual obligations
- Receiving Medicare, Medicaid, or other government healthcare payments for treatment that is not medically necessary or is not in compliance with established regulations
False claims are not always overt or simple. In general, anyone who knowingly acts or conspires to cheat the government is probably liable under the False Claims Act. This includes less obvious practices such as:
- Upcoding— Physicians, hospitals, or healthcare providers intentionally using diagnosis codes that are reimbursed by Medicare at a higher rate when another, less lucrative diagnosis code would be appropriate can be considered Medicare Fraud.
- Cross-Charging—Defense contractors charging labor and material costs expended on a fixed-price contract to a cost-plus contract is a type of Defense Contractor Fraud.
- Anti-Kickback Statute Violations—If a pharmaceutical company or medical device manufacturer offers kickbacks—incentives intended to influence healthcare providers to prescribe or recommend their drug or device—both parties can be held liable for all Medicare, Medicaid, and TRICARE payments tainted by those kickbacks under the False Claims Act.
Becoming a Whistleblower—Protection and Reward
If you have knowledge of these practices or any other false claim against the government, you may have grounds to file a qui tam claim on behalf of the government. A qui tam claim uses the False Claims Act to sue in federal court to recover payments made for fraudulent or unlawful claims. By initiating a qui tam lawsuit, you become a "relator," the legal term for whistleblower, and are entitled to legal protection from retaliation as well as a generous reward.
Reporting fraud by becoming a whistleblower is an act of patriotism and an important public service. Whistleblowers help reclaim millions in taxpayer funding stolen through fraud and abuse. As a reward, the False Claims Act entitles the relator to 15-30% of the recovered amount, which in large cases can reach into the tens of millions of dollars. In addition, qui tam claims are sealed, which means that they are not made public until the government has completed its investigation in order to protect the anonymity of the whistleblower. The False Claims Act also makes it illegal for an employer to retaliate against a whistleblower and allows relators to sue for any damages incurred because of retaliation.
About the Author
If you have knowledge that your employer or another party has been defrauding the government, please visit the qui tam attorneys of Chaikin, Sherman, Cammarata & Siegel, P.C. online to learn more about becoming a whistleblower.
Operation Strategy question?
SOME COUNTRIES HAVE STRICT LAWS REGARDING POLLUTION, ANTI-TRUST ACTIVITIES, AND BRIBERY BY THEIR DOMESTIC FIRMS. YET MANY COUNTRIES HAVE NO SUCH LAWS. INDEED, FIRMS AND INDIVIDUALS IN THOSE COUNTRIES MAY WELL EXPECT TO RECEIVE A KICKBACK (RETURN OF CASH) FOR ORDERS PLACED OR DELIVERED.
HOW ETHICAL IS IT FOR A FIRM BASED IN THE FORMER TO MEET THE LATTER'S KICKBACK EXPECTATIONS?
HOW ETHICAL IS IT FOR THE FORMER TO RESTRICT THE ACTIVITIES OF DOMESTIC FIRMS BUT NOT OF FOREIGN FIRMS OPERATING IN THEIR COUNTRY?
have to do with safety
Hmmm, it depends on what you want?
Safety or freedom??
They don't come together.
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