The Florida Legislature is currently considering a pair of bills designed to update Florida’s False Claims Act, section 68.081, et seq, Florida Statutes (“Florida FCA”). Modeled after the Federal False Claims Act (“Federal FCA”), the Florida FCA authorizes private individuals or whistleblowers to bring “qui tam” suits, in the name of the state government, to seek damages against persons entities that have defrauded the state. As an incentive to bring these suits, the Florida FCA allows a successful whistleblower, called a “relator,” a share of the damages received. Like its federal counterpart, the Florida FCA is designed to protect taxpayers by encourages private citizens who know about fraud to “blow the whistle.”
Recent Changes to Federal FCA
In the past few years, the Federal FCA has undergone significant revision. In three major pieces of legislation – the Fraud Enforcement and Recovery Act of 2009 (“FERA”), the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd Frank”), and the Patient Protection and Affordable Care Act of 2010 (“PPACA”) – Congress broadened the liability provisions of the Federal FCA, strengthened its anti-retaliation provisions, amended its “original source” requirements for bringing suit, and made other changes.
The Florida FCA, meanwhile, has remained unchanged. This poses a problem in large scale government fraud cases, such as healthcare fraud, where fraudsters routinely victimize federal and state government simultaneously, ripping off Medicare (the federal program) and Medicaid (the state program) at the same time. It makes little sense to impose different standards of liability in such cases.
The Proposed Bills
To remedy these issues, the Florida Legislature is currently considering House Bill 935 and Senate Bill 1494, both designed to bring Florida’s FCA into conformity with the Federal FCA and increase protection for State Government. The bills propose the following significant changes, among others:
1. The bills clarify that fraudsters need not present false claims directly to the government to be liable. Liability also attaches when false claims are presented to government contractors or subcontractors, provided that the provided that the government has provided the funds or will reimburse the funds that are sought by the false claim.
2. The bills modify the standard of intent to conform to the Federal FCA.
3.The bills expand the scope of the Florida FCA to cover fraud against “any department, division, bureau, commission, regional planning agency, board, district, authority agency or other instrumentality of the state.”
4. The bills expand coverage for “reverse false claims.” This includes conduct in which the fraudster, rather than submitting an affirmative false claim, improperly retains money deu to the state or under-reports a duty to pay funds to the state.
5.The bills limit the types of “public disclosures” of the fraud that would disqualify a whistleblower from bringing a claim.
6.The bills modify the definition of “original source,” a requirement for bringing claims in some instances.
7. The bills expand the power of the Department of Legal Affairs to conduct civil investigations of false claims cases.
If enacted into law, the new changes will become effective July 1, 2013.
To view House Bill 935, click here.
To learn more about False Claims Act cases, click here.