Policy No.: CP006_03 LC Date Originated: Revision Date(s): 8/08, 3/11, 11/14. Date:

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1 Title: Federal False Claims Act Previous Title (if applicable): Department Applicability: All Lines of Business: All Originating Dept.: Compliance Policy No.: CP006_03 Supersedes Previous Policy No. (if applicable): LC Policy Review Frequency: Annually Date Originated: Date Approved by P&P Committee: Originating Dept. Approval: [Signature on file] Medical Director Approval (if applicable): CIO Approval (if applicable): COO Approval (if applicable): Revision Date(s): 8/08, 3/11, 11/14 Policy Posted on Internet? Provider Member CFO Approval (if applicable): CEO Approval (if applicable): [Signature on file] Policy Statement As a health plan that receives federal funds, Santa Clara Family Health Plan (SCFHP) is responsible for establishing and disseminating detailed information regarding the Federal False Claims Act (FCA), and related whistleblower protection laws to all employees, associates, agents, and contractors. Complaints which violate the FCA are promptly reported, investigated, and remedied, as appropriate and required by law. 2. Purpose The purpose of this policy is to provide information regarding the FCA and the whistleblower protections under such laws to employees, associates, agents, and contractors and to ensure compliance with the FCA regarding false claims and statements. 3. Definitions A. Knowing and knowingly 1. means that a person with respect to information: a. has actual knowledge of the information; b. acts in deliberate ignorance of the truth or falsity of the information; or Authority Cites: 31 U.S.C (as amended March 23, 2010); 42 U.S.C a(a);public Law (amended Feb.8,2006); CA Government Code ; DHCS Contract Exhibit E Attachment 2 Item # 32 1

2 c. acts in reckless disregard of the truth or falsity of the information ; and 2. Require no proof of specific intent to defraud Authority Cites: 31 U.S.C (as amended March 23, 2010); 42 U.S.C a(a);public Law (amended Feb.8,2006); CA Government Code ; DHCS Contract Exhibit E Attachment 2 Item # 32 2

3 B. Claim means any request or demand for payment submitted to another party if the federal, state or local government directly or indirectly covers the cost of any portion of the claim C. Fraud means an intentional deception or misrepresentation made by a person with the knowledge that the deception or misrepresentation could result in some unauthorized benefit to himself/herself or another person. D. Federal False Claims Act (FCA) is a law aimed at preventing fraud against the government including fraudulent billing, fraudulent submission of claims and any statement or record that is material to a false claim that support payment to any federally funded contract or program including Medicare and Medi-Cal. E. Material means having a natural tendency to influence, or be capable of influencing, the payment or receipt of money or property F. Qui Tam Provision (more commonly referred to as the whistleblower provision) permits a private person, (the relator or also known as a, whistleblower ) to bring a civil action of behalf of the Government, when he or she has information that the defendant knowingly submitted or caused to be submitted to the Government false or fraudulent claims. The Whistleblower may also maintain a claim based on publicly disclosed information, as long as he or she has independent knowledge that materially adds to the publicly disclosed allegations. The purpose of a qui tam suit is to recover the funds received as a result of the false claims. If the suit is successful, the whistleblower may receive a percentage of the funds received. 4. Procedures A. Preventing and Detecting False Claims 1. All employees, contractors, vendors, and agents are required to participate in the prevention, detection and reporting of fraud. All individuals who engage in financial documentation and billing are responsible for ensuring information is accurate and does not constitute fraud as defined above. Entities responsible for the monitoring of program and services are also responsible for verifying that documentation and billing is accurate and reflective of the services provided. 2. If an employee, contractor, or agent of SCFHP believes that a bill is fraudulent, s/he contacts her/his supervisor, Director, the Compliance Officer, or reports the concern through SCFHP s compliance hotline 3

4 B. Protection for Reporting Fraudulent Claims 1. The FCA provides protection from retaliation by an employer to employees who act as whistleblowers. An employee may not be discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of their employment as result of an action under the FCA. 2. If an individual feels that retaliation has occurred, a complaint regarding the retaliation is to be filed with SCFHP s Human Resource Department within forty-five days. If the employee can demonstrate that s/he was retaliated against, the FCA provides conditions for reinstatement, if applicable and may be awarded back pay and compensation for any costs or damages s/he incurred. 3. The FCA provides for financial remedies to the employer when an action is brought forth for the purpose of harassment, and/or the case is determined to have no merit. In these instances, the whistleblower may be responsible to recompense for legal fees and the costs of defense. C. Timeframes for filing a Claim under the FCA A civil suit may be brought either: 1. three years after the violation was discovered by the responsible federal official ( but no more than 10 years after the violation was committed) or 2. six years after the violation was committed, whichever is later D. Penalties Under the FCA 1. Violations can result in significant fines and penalties. Financial penalties to the person or organization includes recovery of three times the amount of the false claims(s), plus and additional penalty of $5, to $11, per claim. 2. If a health plan is convicted of a FCA violation, the Office of Inspector General may seek to exclude the health plan from participation in federal health care programs. 3. A person violating the FCA may also be liable to the US Government for the costs of a civil action brought to recover any such penalty or damages 5. Confidentiality of Information In accordance with SCFHP s Confidentiality Policy, and all applicable state and federal laws, any and all information that is required to be kept confidential, shall be kept confidential. 6. Recordkeeping 4

5 Each department is responsible for retaining and maintaining documents/records/paperwork for a minimum of ten (10) years for their own department (refer to policy LC Record Retention). 5