Our colleagues at Epstein Becker Green have issued a client alert: “OIG Issues Updated Guidelines for Evaluating State False Claims Acts: Is More State Litigation on the Horizon?,” by George B. Breen, Wendy C. Goldstein, and Daniel C. Fundakowski.

Following is an excerpt:

On March 15, 2013, the U.S. Department of Health and Human Services’ Office of Inspector General (“OIG”) released the Updated OIG Guidelines for Evaluating State False Claims Acts (“2013 Guidelines), which replaces the original version released in 2006.

The 2013 Guidelines describe OIG’s methodology for determining whether a state’s Medicaid false claims law satisfies the four requirements in Section 1909(b) of the Social Security Act (“Act”) that are necessary to qualify for a 10-percentage-point increase in the state share of Medicaid-related false claims recoveries. While Section 1909 of the Act does not require a state to enact false claims act legislation, only states that have enacted a qualifying law will be eligible for the 10-percentage-point increase in its share of Medicaid false claims recoveries.

Unquestionably, these recent changes have expanded provider liability under the federal False Claim Act, making it easier for relators to bring cases against health care providers, who may now be facing a more rigid regulatory regime. This recognition, coupled with a financial incentive, may spur state efforts to re-tool false claims statutes to comply with Section 1909 of the Act. Attendant with increased interest in Medicaid false claims actions will inevitably come increased compliance scrutiny. Accordingly, assessing compliance programs to ensure conformity with state payor programs is advised.

Read the full alert here.