Whistleblowers drive increase in FCA lawsuits

WASHINGTON – The False Claims Act has led to a growth industry of sorts and it’s unlikely to slow down any time soon, says health care attorney Jeff Baird. 

The U.S. Department of Justice recently announced $2.68 billion in settlements and judgments under the FCA, its highest number in a single year, with more than $1.8 billion related to health care. The vast majority are driven by whistleblower lawsuits, says Baird, chairman of the Health Care Group at Brown & Fortunato.    

“There are attorneys now that specialize in filing whistleblower lawsuits – it’s what they do,” he said. “But, in addition, you have virtually every employee that works for a health care provider aware of whistleblower lawsuits.”  

‘Capitalism at its finest’ 

An employee – or more likely, ex-employee – who knows a company is doing something it shouldn’t be doing will not have a hard time finding a whistleblower attorney and if the attorney thinks it’s a good case, they’re “off and running,” says Baird. 

“If it’s a good lawsuit with some substance to it, then the whistleblower can make a lot of money,” he said. “It’s human nature and capitalism at its best.” 

While there are some whistleblower lawsuits that should never have been filed, for the most part, they bring to light practices that shouldn’t be happening, says Baird. 

‘Flavor of the month’ 

In addition to investigations instigated by whistleblowers, the government also does its own FCA investigations, typically driven by a huge spike in claims, says Baird, pointing to investigations of non-invasive ventilators and orthotics, the latter resulting in Operation Brace Yourself in 2019. 

“If CMS observes that for a particular product, a company or several companies are just billing the heck out of a product, that’s going to invite scrutiny,” he said. “I call it the flavor of the month. Right now, the hot spots are intermittent catheters and continuous glucose monitors.” 

‘Things are gonna slip up’ 

Whether it’s health care, ball bearings or frozen yogurt, for companies with numerous employees and lots of moving parts, it’s not always easy to stay on top of everything, says Baird. Ideally, a company learns from its mistakes. 

“If you go to the Office of Inspector General’s website, you can link to corporate integrity agreements,” he said. “It’s a public record and it’s a veritable who’s who of large, publicly traded companies that have gotten their hands slapped. You might scratch your head thinking, ‘How in the world can they make a mistake like this,’ but the answer is, you’re just not going to stay on top of everything. Things are gonna slip up.” 

‘No magic bullet’ 

There is no magic bullet for a provider to protect itself against an FCA allegation, says Baird.  

“All a provider can do is take steps that will reduce the risk of such an allegation being brought,” he said. “Note that most FCA allegations are from current/ex-employees who are whistleblowers.” 

Baird recommends providers take several steps:  

• Hire a good health care regulatory attorney and follow his/her advice, 
• Implement a robust compliance program with a compliance officer who is intimately involved with operational decisions,  
• Conduct periodic mock audits, 
• And Train employees on how to fulfill their responsibilities in a legally compliant manner.