False Claims Act

On February 8, 2006, President George W. Bush signed the Deficit Reduction Act of 2005 into law. The Deficit Reduction Act contains many provisions reforming Medicare and Medicaid that are designed to reduce program spending.

As an entity that offers Medicaid and Medicare coverage, CareSource® is required to comply with certain provisions of the Deficit Reduction Act. One such provision requires us to provide you with information about the Federal False Claims Act, state False Claims Acts and other state laws regarding Health Insurance Fraud. In addition, the law requires you and your contractors and agents to adopt our policy on fraud, waste and abuse when handling CareSource business.

The Federal False Claims Act

Using the False Claims Act (the Act), you can help reduce fraud against the federal government. The Act allows everyday people to bring “whistleblower” lawsuits on behalf of the government, known as “qui tam” suits, against groups or other individuals that are defrauding the government through programs, agencies or contracts.

The False Claims Act applies when a company or person:

  • Knowingly presents a false or fraudulent claim for payment,
  • Knowingly uses a false record or statement to get a claim paid,
  • Conspires with others to get a false or fraudulent claim paid, or
  • Knowingly uses a false record or statement to conceal, avoid or decrease an obligation to pay or transmit money or property.

“Knowingly” means acting with actual knowledge or with reckless disregard or deliberate indifference to the truth or falsity of information.

The time period for a claim to be brought under the False Claims Act is the later of:

  • Within six years from the date of the illegal conduct, or 
  • Within three years after the date the government knows or should have known about the illegal conduct, but in no event later than ten years after the illegal activity.

West Virginia State Law

West Virginia has not enacted a false claims statute with a qui tam provision comparable to the federal False Claims Act. However, West Virginia law does permit the West Virginia Attorney General to prosecute any individual or entity that:

  • Solicits, offers, pays or receives any unlawful remuneration, including any kickback, rebate or bribe, directly or indirectly, with the intent of causing an expenditure of moneys from the medical services fund;
  • Makes or presents or causes to be made or presented to the Department of Health and Human Resources a claim under the medical programs of the Department of Health and Human Resources knowing the claim to be false, fraudulent or fictitious; or
  • Enters into an agreement, combination or conspiracy to obtain or aid another to obtain the payment or allowance of a false, fraudulent or fictitious claim under the medical programs of the Department of Health and Human Resources.

The complete set of West Virginia laws governing Medicaid fraud and abuse may be found at West Virginia Code §9-7-1, et seq.

CareSource Policy

It is the policy of CareSource to detect and prevent any activity that may violate the federal False Claims Act or the state Medicaid fraud laws cited in this policy. If any employee, provider, delegated entity, subcontractor or agent has knowledge or information that any such activity may have taken place, he or she should contact the Program Integrity department. Information may be reported anonymously.

In addition, federal and state law and CareSource policy prohibits any retaliation or retribution against persons who report suspected violations of these laws to law enforcement officials or who file “whistleblower” lawsuits on behalf of the government. Anyone who believes that he or she has been subject to any such retribution or retaliation should also report this to the Program Integrity department.