The Affordable Care Act represents the most comprehensive reform of our health care system in over a generation. Millions of Americans are eligible to receive federal tax credits that can be used to purchase health insurance from an online marketplace.
Insurance companies that participate in these marketplaces receive billions in federal funding, and that brings with it the potential for fraud. To combat this problem, federal law now provides enhanced financial rewards to whistleblowers who come forward with evidence of fraud involving the market for health insurance.
What Types of Fraud Might Be Perpetrated In Connection with a Health Care Exchange?
Any person who has evidence of fraud against the government involving a health care exchange may take advantage of the Affordable Care Act’s new fraud provisions, which could entitle them to a significant share of the government’s financial recovery. Examples may include:
- Individuals who purchased health care using federal tax credits, but whose claims were unfairly denied. The Affordable Care Act ensures that all Americans with health insurance will be guaranteed certain benefits, rights, and protections relating to their insurance coverage. For example, the law prohibits insurance companies from imposing unreasonable annual limits on benefits, denying coverage due to a pre-existing condition, or denying coverage for basic health services. If a claim is denied because the insurance company ignores these guarantees, the claimant may recover for exposing the fraud by filing a lawsuit.
- Employees who learn that their company violated federal regulations. The Affordable Care Act comprehensively regulates insurance coverage. In addition, insurance companies must provide extensive disclosures that employees may participate in a health care exchange. If an employee learns that his or her company violated any of these provisions, or denied its policyholders the new guarantees described above, that employee may file a lawsuit to expose the fraud and share in any recovery.
- Insiders who learn that an insurance company manipulated the Affordable Care Act’s Premium Stabilization Programs. The Affordable Care Act establishes three programs, often referred to as “the three Rs,” to ensure that insurance premiums remain affordable: Reinsurance, Risk Corridors, and Risk Adjustment. Although each program operates differently, all three involve the transfer of money from the federal government to insurance providers that operate in health care exchanges. If an insider learns that an insurance company has submitted false information to gain access to these funds, or to get more of the funds than it is entitled, that individual may act to expose the fraud.
The False Claims Act Encourages Individuals to Uncover Fraud Against the Government
If you have any evidence of these types of misconduct, or of other misconduct involving violations of the ACA or false statements to the government, you may have a claim under the federal False Claims Act.
The False Claims Act is the government’s primary tool in the fight against fraud. The law encourages individuals who discover fraud against the government to bring suit on behalf of the government and to receive a portion of the government’s damages.
If a person who files such a “false claims” suit receives a favorable judgment or settlement in their case — thus allowing the government to recover money lost in the fraud — the person could receive 15 to 30 percent of that money that is recovered in the case. Ordinarily, the government’s recovery could include up to three times the amount of money it paid out under the false claim, plus an automatic penalty of $5,500 to $11,000 per false claim.
Recently, the Affordable Care Act expanded this provision to deter any potential for fraud involving health care exchange. Now, if any fraud occurs in connection with a health care exchange, the government may recover up to six times its damages.
Taking Action Against Fraud
Before you take any legal action, we recommend you consult with an attorney who has experience handling False Claims Act cases, and who can offer useful advice on how best to proceed and investigate your claims. If you decide to proceed with a qui tam case, your attorney can help you prepare as strong a case as possible.
The more prepared you are before filing suit, the higher your chance of success. It is also important not to discuss the fraud with anyone but your attorneys prior to filing your suit. If others hear of the fraud and file a qui tam suit before you, your suit is at risk of being dismissed. Also, if the government discovers the fraud on its own and starts its own lawsuit or investigation before you file your false claims suit, your suit will be at risk for dismissal.
We represent individuals who have discovered fraud committed against the government in a wide range of federal False Claims Act cases. We have the resources, experience, and skill to investigate even the largest and most complex matters and take them all the way through trial. Learn more about our work in helping expose fraud against the government and obtain recoveries for individuals who bring such fraud to light.