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CMS Proposes to Increase Awards for Non-Qui Tam Whistleblowers

Written by Ellyn L. Sternfield

CMS wants to change the way that it rewards non-qui tam whistleblowers who report alleged fraudulent or unlawful conduct related to Medicare or Medicaid. Using an IRS program as a model, CMS recently proposed rule changes to increase the cap on potential non-qui tam whistleblower rewards from a maximum of $1000, to 15% of the final amount collected (capped at $9.9 million) as a result of legal or administrative action. 

As I noted in a Thompson Reuters news article on the CMS proposal, the lack of benchmarks on what constitutes a viable report could overwhelm the agency.  While the IRS program was intended to increase the number of cases the IRS investigates and pursues, CMS is not the agency that actually investigates and prosecutes allegations of health care fraud: DOJ and the HHS OIG play that role.  And right now, DOJ and the HHS OIG act on only a fraction of the health care related qui tam cases filed, in part due to a professed lack of resources.  If the CMS proposal goes into effect, it will be interesting to see what role, if any, CMS actually takes on in the process of screening and investigating the resulting reports of alleged unlawful conduct.     

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Karen S. Lovitch

Member / Chair, Health Law Practice

Karen S. Lovitch is a Mintz attorney who represents health care companies in regulatory, transactional, and operational matters. She advises them on health care regulations such as the Stark Law and the Clinical Laboratory Improvement Amendments of 1988.

Ellyn L. Sternfield

Special Counsel

Ellyn L. Sternfield is a Mintz Special Counsel with an extensive background in government health care enforcement. She provides insight to clients with compliance concerns and helps clients facing potential state or federal investigations.