Matt Curley was interviewed by Becker’s Hospital Review in connection with an article dated February 10, 2016, about how healthcare providers can take practical steps to reduce the risk of employees and third parties pursuing whistleblower lawsuits when they encounter potential compliance issues. The comments below expand upon that interview.
Healthcare providers receiving reimbursement from government payers know there is a significant risk of encountering whistleblowers under the False Claims Act. Last year, there were more than 600 new whistleblower lawsuits filed under the False Claims Act. And, during the previous five years, there have been nearly 3400 new False Claims Act lawsuits filed by whistleblowers.
Whistleblowers received nearly $600 million in FY 2015 year as their share of the proceeds of False Claims Act judgments and settlements. That amount brought total recoveries during the previous five years to nearly $2.5 billion.
With the often times protracted, expensive, and disruptive government investigations that can follow the filing of a whistleblower lawsuit under the False Claim Act, practical measures that can reduce the possibility of whistleblower activity are certainly worth consideration.
What Motivates a Whistleblower?
Many believe that the possibility of participating in rich relator-share recoveries is the primary motivation behind whistleblowing activity. The decision-making surrounding whether to initiate a whistleblower action, however, is often much more complex than merely a measure of dollars and cents. Whistleblowers often times seek recourse under whistleblowing statutes such as the False Claims Act when they feel as though their concerns are not being heard within the organization. Many times, employees will raise issues or concerns within the organization for months or even years before resorting to blowing the whistle outside the company.
Whistleblowers often view themselves as risking their careers and incurring significant disruptions in their lives when they decide to pursue a whistleblower lawsuit. They also may believe that they are among those at risk if the government initiated an investigation. If they have considered these risks and still made the decision to pursue a whistleblower lawsuit, they typically are very committed to seeing it through to the end and may feel as though they have no other choice.
For example, the whistleblower who filed the qui tam action against Halifax Health is reported to have worked at the hospital for 20 years. She remained employed at Halifax even after filing a False Claims Act lawsuit, which ultimately resulted in an $85 million settlement five years later
Practical Steps to Prevent Whistleblowers
Most healthcare providers regardless of size have some sort of compliance policies in place that will guide how the company should respond when compliance concerns are raised within the organization. An important part of that response can be providing some level of feedback to the person who has raised the compliance concerns, if that is possible.
Providing feedback to an individual who has raised compliance concerns communicates to that person that their concerns have been heard and taken seriously and can serve to reinforce the company’s commitment to compliance. Providing feedback to an individual who raises compliance concerns also helps to invest that person in the compliance efforts of the company. There is no doubt that a company with a workforce invested in compliance is going to have a much better chance of preventing whistleblowers.
Effective compliance training also can be a means of dissuading would be whistleblowers from raising complaints outside of the organization. In large organizations, delivering effective compliance training can be a challenge. Many organizations rely on on-line training as the most practical means of reaching their employees. To the extent possible, organizations should determine whether in-person training is feasible and attempt to incorporate live training into their compliance programs. In-person training often times will provide a better means of exploring real-life compliance issues presented through hypothetical facts or even drawn from publicized enforcement actions against other providers.
Many statutes, like the False Claims Act, provide protections for whistleblowers from retaliation in connection with their whistleblowing activities. It is critically important for an organization to have policies in place that prohibit retaliation against those individuals who have or are suspected to have raised compliance concerns.
Not only will retaliation expose an organization to potential legal claims by the whistleblowers, it also may significantly impact any government investigation of the whistleblowers allegations if the government perceives that the organization has retaliated against the whistleblower.
Third Parties as Whistleblowers
In the recent past, it was common to equate whistleblowers with corporate insiders employed by the organization. It is becoming increasingly more common to see consultants, independent contractors, and other third parties blowing the whistle under the False Claims Act. Organizations engaging consultants and independent contractors should closely review engagement agreements and determine whether additional protections against whistleblowing activities can be inserted into those agreements.
These sorts of protections could include:
- Beefed up confidentiality provisions in the consulting agreement
- Alternative dispute resolution provisions that require arbitration of disputes
- Requiring the consultant to report any compliance issues encountered during the course of their engagement to the appropriate company compliance personnel; and
- Requiring consultants to return documents and other information obtained during the course of the engagement at the conclusion of the engagement.