The budget bill passed by the Senate Nov. 4 includes a provision that would require healthcare providers paid by Medicaid to train and educate staff about the federal False Claims Act.
If the provision remains in the final budget bill passed by Congress--the House's budget bill contains no such provision--hospitals essentially would be required to train a new generation of potential whistle-blowers under their own roofs and at their own cost. The education requirement would apply only to providers receiving at least $1 million in annual Medicaid reimbursement, said lobbyist John McMickle, a partner in the Washington office of Winston & Strawn.
The proposed bill, the Deficit Reduction Omnibus Reconciliation Act of 2005, also would encourage states to implement their own false claims acts by increasing their share of false claims recoveries. Fifteen states, the District of Columbia, New York City and Chicago have false claims acts.
Sen. Chuck Grassley (R-Iowa), who helped revise the Civil War-era law in 1986, called the False Claims Act "the single most important tool U.S. taxpayers have to recover the billions of dollars stolen through fraud every year" in a letter sent to President Bush. The False Claims Act has recovered nearly $16 billion since 1986, with more than $1.5 billion in fiscal 2005.
"We think nothing will suppress fraud more than deputizing healthcare workers in the effort to fight fraud," said Patrick Burns, a spokesman with the whistle-blower support group Taxpayers Against Fraud. "And that's essentially what the False Claims Act does."
Healthcare consultant Andy Schneider, a principal in Medicaid Policy, said the effective date for complying with the training mandates would be Jan. 1, 2007, and would require hospitals, HMOs and other eligible Medicaid participants to establish policies and procedures for all employees, managers, contractors and agents. The information must be included in employee handbooks and taught to new employees upon hiring.
"If hospitals already include this information in their compliance programs, then it won't have much effect," Schneider said. "But if they don't, then it's going to change a lot of compliance programs. And training agents and contractors may be new ground for a lot of them."
John Boese, a healthcare defense lawyer with Fried Frank Harris Shriver & Jacobson who authored a book on the False Claims Act, called the breadth of the proposed training requirements "extraordinary" and the cost significant.
Thomas Nickels, vice president of federal relations at the American Hospital Association, said most hospitals currently have compliance programs that include employee education and offer whistle-blower protections. "But to mandate this under federal law could be burdensome, costly and duplicative for us," Nickels said.