ANNAPOLIS, Md. (April 3, 2010) – Lt. Governor Anthony G. Brown applauded the House Judiciary committee for their favorable recommendation of the Maryland False Health Claims Act of 2010. The House Appropriations Committee is scheduled to take up the bill for consideration on Monday. Brown testified on the bill – SB 279 – last month and has convened numerous stakeholder meetings with hospitals, physicians, community providers, and other health care professionals in an effort to reach consensus on the bill. Brown cited the support and work of many of these stakeholders, including the Maryland Hospital Association, as the final push needed to move the bill forward.
“I commend Chairman Vallario and the entire committee for moving the Maryland False Health Claims Act forward. I look forward to working with the Chairman Conway, the Appropriations Committee and the entire House to pass this important law that will save taxpayers millions of dollars each year and help us fight fraud,” said Lt. Governor Brown. “We make progress because we forge partnerships. The support of many of the stakeholders went a long way to pass this bill out of committee, and I personally look forward to working closely with all of our hospitals and community providers to ensure that we pass this bill this year.”
“We’re pleased to be one step closer to securing this important tool that will help us fight fraud and abuse on behalf of taxpayers and the families who depend on Medicaid,” said John M. Colmers, Secretary of the Maryland Department of Health and Mental Hygiene. “By listening and working together we reached consensus on a balanced, robust and durable remedy and deterrent to Medicaid fraud and abuse.”
Last night, the committee approved the bill passed by the Senate with the package of amendments which came out of the stakeholder negotiations led by the Lt. Governor and have the strong support of the Maryland Hospital Association and community health providers. The amendments reflect an effort on the part of all involved in the negotiations to strike the right balance between the interest of the State and taxpayers in combating fraud without subjecting health care providers to frivolous, unwarranted lawsuits.
“Health care is about people taking care of people, and there is no room in that mission for fraud. Maryland's hospitals are pleased to support this False Claims Act bill, which now recognizes the difference between true fraud and mistakes, and prevents frivolous lawsuits that divert millions of dollars from patient care,” said Carmela Coyle, President of Maryland Hospital Association.
The amendments address three areas of concern raised by stakeholders which involve the issue of what constitutes fraud, the impact large damage awards could have particularly on small providers and the function of the provision in the bill allowing whistleblowers to bring suits on behalf of the State.
“Senate Bill 279, as amended, strikes the right balance of allowing the state to vigorously pursue health care fraud while protecting providers – particularly small organizations – from the threat and cost of unnecessary litigation,” said Lori Doyle, Director of Public Policy for the Community Behavioral Health Association of Maryland.
SB 279 will protect Maryland and its Medicaid budget against theft. Under current law, the state can do little to recover dollars paid out through false claims. The State’s only recourse is to bring administrative actions against suspected perpetrators, but this laborious, painstaking process limits any recovery to actual losses only, with no penalties or damages to deter repeat offenders.
The Federal FCA, enacted in 1986, has returned over $24 billion to government coffers. Additional studies have shown that for every $1 spent on fraud enforcement, the government has recovered $15. However, the reach of the Federal FCA is limited because it can only pursue the largest and most global cases of fraud. States that have enacted their own FCAs have increased recoveries by as much as 100 percent. Virginia, for example, recovered $100 million in the two years after it enacted an FCA. Prior to enacting an FCA, the Commonwealth recovered approximately $20 million.