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Fraud

State False Claims Act Reviews

The Office of Inspector General (OIG), in consultation with the Attorney General, determines whether States have false claims acts that qualify for an incentive under section 1909 of the Social Security Act. Those States deemed to have qualifying laws receive a 10-percentage-point increase in their share of any amounts recovered under such laws.

To qualify for the financial incentive, a State's false claims act must:

  • establish liability to the State for false or fraudulent claims, as described in the Federal False Claims Act (FCA), with respect to Medicaid spending;
  • contain provisions that are at least as effective in rewarding and facilitating qui tam actions for false or fraudulent claims as those described in the FCA;
  • contain a requirement for filing an action under seal for 60 days with review by the State Attorney General; and
  • contain a civil penalty that is not less than the amount of the civil penalty authorized under the FCA.

Since the effective date of section 1909 of the Social Security Act, the FCA has been amended by the Fraud Enforcement and Recovery Act of 2009 (FERA), the Patient Protection and Affordable Care Act (ACA), and the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act). These three acts, among other things, amended bases for liability in the FCA and expanded certain rights of qui tam relators. In addition, effective August 1, 2016, the civil penalties authorized under the FCA increased pursuant to the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. Going forward, the civil penalties authorized under the FCA will incrementally increase on an annual basis. As such, the civil penalties authorized under a State's false claims act must also increase at the same rate and time as those authorized under the FCA in order for the State to continue to receive the financial incentive.

To request a review of a false claims act, States should submit a complete copy of the law and any other relevant information to: [email protected]

OIG also strongly encourages States with draft legislation to submit their drafts for informal review and discussion before the draft legislation is passed.

State Laws Reviewed by OIG

Approved

Not Approved