Roberts, Breen, and Landes Quoted in Article About How Reform Law Boosts Incentives, Protections for Whistleblowers

Among the less scrutinized but potentially more far-reaching provisions of the health reform law are ones that make it easier to become — and be protected as — a whistleblower and share in financial recoveries under the False Claims Act. The key aspect for providers, employers and other entities to remember, attorneys with Epstein Becker Green stress, is not just what the reform law does in itself but how it works in conjunction with other statutes to boost the incentives for whistleblowers and the need for policies to deal with that.

"The environment is increasingly accepting of whistleblower claims," said Allen Roberts. The reform law contributes to the broadening in how the "mainstream" federal False Claims Act is being applied, partly by protecting whistleblowers "who may invoke rights" that will come into play as such provisions as mandated coverage and insurance exchanges take effect, he says.

One way in which the reform law has altered the whistleblowing landscape is by bringing greater definition to what is an "overpayment" subject to being recouped, explained George Breen at the firm's Health Employment and Labor Summit in Washington, D.C., June 7. The new law, he said, made clear an overpayment that could become the subject of a whistleblower action is any excess payment not reported and returned within 60 days of discovery, which raises issues of what constitutes discovery or identification of an overpayment (HRW 7/12/10, p. 1).

It is certain, though, Breen continued, that the reform law made it easier to file a false-claims case. The law makes clear, according to Breen, that a person does not have to be the original source of information about overpayments to become a "relator" (i.e., person eligible to get a share of recoveries) in a false-claims case. Specifically, the reform statute amends False Claims Act language that bars courts hearing whistleblower cases based on publicly disclosed allegations or transactions by adding the words "unless opposed by the Government, if substantially the same allegations were publicly disclosed."

Roberts notes that the "relaxation" of the requirements for becoming a relator is not just a product of the reform law, which governs whether there has been a public disclosure, but also of other laws. Moreover, it has been limited by a Supreme Court decision in May 2011, he asserts. The decision in the Schindler Elevator case, he explains, "limits opportunities for whistleblowers who seek to trade on" publicly available reports, such as those obtained through a Freedom of Information Act request.

Another way the reform law has altered the whistleblower climate is through an amendment to the Fair Labor Standards Act, said Jeffrey Landes at the June 7 conference. The amendment gives an employee the right — and protection when he or she exercises it — to challenge the action of employers relating to the implementation of the reform law in such areas as exchanges, mandated employer coverage and receipt of premium-tax credits, among other things.