States’ Roles Today

States have become vigorous prosecutors of frauds that victimize their taxpayers. For many years, these states have had state-specific false claims acts with qui tam provisions similar to those found in the federal False Claims Act. Congress created an incentive for more states to enact false claims acts in 2005 through passage of the Deficit Reduction Control Act. Now, a state that has a false claims act or enacts a false claims act with provisions which are substantially similar to the federal False Claims Act, is entitled to an increased share—10% of the federal share—of any recovery for Medicaid program losses.

Click here to view a map of the states with False Claims Laws.

Increasingly whistleblowers and their attorneys are employing the provisions of state false claims acts to report and combat fraud. This is often done in conjunction with the provisions of the federal False Claims Act, but many cases are brought under state false claims acts only.

State enforcement has increased dramatically in the last few years as more and more states increase their fraud fighting resources. One of the primary state resources is the Medicaid Fraud Control Unit (MFCU, pronounced “muh-foo-koo”). These investigative/prosecutorial units are responsible for combating fraud in the Medicaid program. Qui tam lawsuits are a significant source of cases for this endeavor. More information regarding MFCUs can be found at the website of the National Association of Medicaid Fraud Control Units: www.namfcu.net.

Since Medicaid is a joint federal/state program, MFCUs and United States Attorney’s Offices across the country are now joining forces more regularly than at any previous time to root out health care fraud. Attorneys here at the Whistleblower Action Network have helped develop this strategic partnership, which has recovered hundreds of millions of dollars for Medicaid.

The Merck case brought by Whistleblower Action attorneys was one of the first instances in which federal and state prosecutors employed a completely coordinated prosecution strategy. The state-federal-relator coordinated approach used in this case now stands as the new model for anti-fraud enforcement in nationwide Medicaid fraud cases. Read more about the groundbreaking Merck case. 

Similarly, in the Omnicare, CVS and Walgreens drug switching cases, Whistleblower Action attorneys worked with teams of investigators and prosecutors from the Federal Bureau of Investigation, the Food and Drug Administration, and multiple states attorneys general in an investigation that paved the way for over $120 million in Medicaid fraud settlements. This multi-jurisdictional approach pioneered an investigative methodology for Medicaid fraud cases.