In a unanimous, bipartisan vote, the Joint Legislative Audit Review Committee (JLARC) today approved the final version of an independent audit report encouraging the Legislature to renew the state’s Medicaid Fraud False Claims Act (FCA).

The Medicaid Fraud False Claims Act Sunset Review notes that the Attorney General’s use of the FCA has been highly effective in the three years since its original passage. Since the act’s passage, civil fraud recoveries have increased 28 percent, and the state has recovered $3 for every $1 invested in enforcement under the act.

Attorney General Bob Ferguson has plans to re-introduce his agency request bill reauthorizing the act, sponsored by Sen. Ann Rivers (R-La Center). A companion bill, House Bill 1067, is sponsored by Rep. Laurie Jinkins (D-Tacoma).

Without action from the Legislature, the current act will expire June 30, 2016.

“Medicaid fraud diverts taxpayer funds meant for legitimate health care needs,” Ferguson said. “This report recognizes the enormous benefit the Medicaid False Claims Act has brought to our state, and what a powerful tool it is in holding fraudsters accountable.”

Since 2012, the Attorney General’s Office has recovered $6.1 million that it otherwise would not have been able to without its authority under the FCA.

The report highlights that the FCA allows the state to pursue additional fraud cases through civil actions.  Without it, the AGO’s primary tool to fight Medicaid fraud would be criminal prosecutions, which require a higher burden of proof and do not afford the extraordinary damage and penalty provisions of the FCA.

Fraud referrals obtained through inside whistleblowers under the FCA are relied upon by the AGO to detect and deter complex medical fraud schemes. The report found no evidence of abuse of the act’s whistleblower, or qui tam, provision, a potential concern raised by some detractors when the law was originally before the Legislature.

If the FCA is not renewed, Washington could lose significant federal dollars. The federal government provides a $3-to-$1 match for all state moneys provided to the AGO to enforce the False Claims Act.

The state would also lose its full partnership with the National Medicaid Fraud Control Unit, reducing its ability to be fully represented in large, national Medicaid fraud cases. Whistleblower protections provided by the FCA would also disappear.