Corporate Compliance

Senate panel reviewing False Claims Act Correction Act

Compliance Monitor, March 5, 2008

Healthcare companies may find themselves in the odd position of siding with the Department of Justice (DOJ).

In testimony at last Wednesday's Senate Judiciary Committee hearing on the False Claim Act, the DOJ's Michael Hertz said the department did not support the False Claims Act Correction Act of 2007 in its current form. Hertz said the False Claims Act has been "an extremely effective weapon in the government's fight against fraud and we see no pressing need for major amendments at this time."

Senate Judiciary Committee chairperson Senator Patrick Leahy (D-VT), on the other hand, said the bill would correct judicial interpretation problems and strengthen the False Claims Act.

More than 600 false claims cases are still pending against healthcare and drug companies, and 150 of those involve overcharging the government for pharmaceuticals, according to Leahy's remarks.

In September 2007, Senator Charles Grassley (R-Iowa) and Senator Richard Durbin (D-Ill) sponsored the False Claims Act Correction Act of 2007.

If passed, the new law would:

  • Remove the requirement that false claims be presented to a government employee
  • Clarify the dismissal of parasitic claims filed based upon publicly disclosed information
  • Clarify that false or fraudulent claims against non-U.S. Government funds under the trust and control of the U.S. government are subject to recovery under the FCA
  • Clarify when a government employee may act as a qui tam relator under the FCA
  • Amend the statute of limitations in FCA cases


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