"Two years ago, hospitals complained that prosecutors were after them for innocent billing mistakes," Grassley said. "In response, some legislators tried to gut the False Claims Act. Today's announcement proves two things. One, outright fraud can masquerade as innocent billing mistakes. Two, prosecutors know the difference, and they need a robust False Claims Act to make their case."
Grassley is a principal co-author of the 1986 amendments to the False Claims Act. Those amendments strengthened the Act's qui tam, or whistleblower, provisions and gave federal prosecutors one of their most effective tools against defrauding the government.
Today, Attorney General Janet Reno announced a settlement between the Department of Justice and HCA-The Healthcare Company, formerly known as Columbia/HCA Healthcare Corp. The company agreed to plead guilty to criminal conduct and to pay more than $840 million in criminal fines, civil penalties and damages for the alleged unlawful billing of Medicare, Medicaid and other federal health care programs.
The settlement is the largest government fraud settlement ever reached by the Justice Department. Many of the civil issues resolved as part of the settlement arose from lawsuits filed by whistleblowers under the False Claims Act.
In 1998, Grassley successfully fought legislation that would have weakened the False Claims Act in the name of protecting hospitals from what they considered heavy-handed fraud prosecutors.
The Justice Department strongly opposed the weakening legislation and maintained that it never prosecuted anyone for innocent billing mistakes. To ensure adherence with that position, the department issued guidelines to all U.S. attorneys on how to use the False Claims Act to prosecute fraud.
"Medicare and Medicaid are public programs," Grassley said. "The taxpayers are footing the bills. We deserve an honest claim against our hard-earned tax dollars. In the HCA case, I'm glad the False Claims Act was there when prosecutors needed it. The False Claims Act remains as useful and as necessary as ever." Grassley praised the Department of Justice, the Inspector General of the Department of Health and Human Services and the FBI for their cooperation in reaching the HCA settlement.