A new corporate whistleblower program incentivizes reporting of healthcare fraud involving private insurance plans. Under its statutory authority to pay awards for information or assistance leading to civil or criminal forfeiture, the Criminal Division of the United States Department of Justice (DOJ) recently launched the Corporate Whistleblower Awards Pilot Program to “uncover and prosecute corporate crime.”
This program establishes a new mechanism to identify corporate criminal and civil wrongdoing by whistleblowers as such conduct, as explained by the DOJ, “might otherwise go undetected or be difficult to prove.”
It targets four main subject areas, one of which includes healthcare fraud schemes involving private health insurance plans including fraud against patients, investors and other non-governmental entities in the healthcare industry.
What makes this program unique?
As explained by the DOJ in the FAQ, this whistleblower program fills the gap between fraud involving federal healthcare programs (e.g., Medicare and Medicaid) under the False Claims Act (FCA) qui tam provisions and fraud schemes involving private or other non-public healthcare payers where qui tam does not apply. Unlike the FCA’s qui tam provision, however, this program applies to both criminal and civil acts.
Whistleblowers would need to provide, in writing, original information (as defined in the program) to the DOJ. Where the original information provided leads to a net forfeiture of more than $1 million, the whistleblower may be eligible for an award according to the DOJ’s discretion.
The DOJ’s discretionary criteria indicate that DOJ wishes to first incentivize whistleblowers to report their concerns about potential violations through their internal whistleblower, legal or compliance procedures. Doing so and assisting with their company’s internal investigation are factors DOJ considers for increasing the whistleblower’s award.
Conversely, whistleblowers unreasonably delaying their reporting of potential violations, or interfering with internal compliance and reporting systems, are factors DOJ considers for decreasing the amount of the award.
In its FAQ, the DOJ further explained that this program “complements and strengthens DOJ’s existing “voluntary self-disclosure” (VSD) programs, which offer companies and individuals potential benefits when they self-report their misconduct, remediate the harm, identify responsible individuals and fully cooperate with the government’s investigation.” The DOJ wants to incentivize companies to self-disclose misconduct as soon as they learn of it.
What are the implications for healthcare providers?
Ensure your organization has:
- Sufficient controls and audit practices in place to identify potentially fraudulent activity for private or other non-public healthcare payers in addition to federal healthcare programs
- A robust compliance program with whistleblower protections, including non-retaliation policies, and that such programs include prompt and meaningful investigations of reported concerns with follow-up to the whistleblower
For more information on how an effective compliance program should be structured, review the General Compliance Program Guidance issued by the Department of Health and Human Services (HHS) Office of Inspector General (OIG) in November 2023.
Among the seven elements of a compliance program, HHS OIG recommends there be appropriate training and education of requirements and that there be effective lines of communication between the compliance officer and entity personal to reduce the potential of fraud, waste and abuse. Having these measures in place across your organization for all types of payers will reduce your organization’s risk for criminal or civil forfeiture under this new program.
Lastly, if your internal investigation discovers problematic conduct involving private health insurance plans, then the DOJ’s temporary amendment to its Criminal Division’s Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP) allows companies who receive a whistleblower’s report internally to qualify for the presumption of a declination under certain conditions. In such cases, review with your legal counsel to determine your next steps.
Learn more
For more information on the DOJ’s Corporate Whistleblower Awards Pilot Program, visit the DOJ’s website devoted to this new program. See also the associated Fact Sheet and Guidance.
These materials are for general informational purposes only. These materials do not, and are not intended to, constitute legal or compliance advice, and you should not act or refrain from acting based on any information provided in these materials. Neither Ensemble Health Partners, nor any of its employees, are your lawyers. Please consult with your own legal counsel or compliance professional regarding specific legal or compliance questions you have.