Lt. Governor Brown Statement Applauding Senate Passage of Maryland False Health Claims Act

Medicaid fraud bill passes Senate Chamber with overwhelming majority


ANNAPOLIS, Md. (March 23, 2010) – Lt. Governor Anthony G. Brown released the following statement today after the Maryland Senate passed SB 279 – the Maryland False Health Claims Act of 2010 – by a vote of 37-8.

“On the day President Obama signed the most significant reforms to our health care system, I applaud the Maryland Senate for supporting reform here at home. This reform targets those who cheat our system and steal Medicaid dollars that belong to those most in need. If enacted this session, this law will recover millions of dollars for Maryland taxpayers when we need it most.

“I thank President Miller, Senator Frosh and Senator Middleton for their leadership to ensure our efforts to fight fraud, waste and abuse are successful. This is a proud week for advocates of health reform and we are taking substantive steps forward in our campaign to improve the quality of care for all Marylanders and lower costs for taxpayers.

“We have a great deal of work ahead of us, and I look forward to working with Speaker Busch, Delegate Vallario, Delegate Conway and the entire House Chamber to pass this bill for Governor O’Malley’s signature later this year.”

Thirty-seven senators voted in support of the bill. Last year, similar legislation was introduced and defeated by a single vote in the Senate. During the first week of the 2010 legislative session, Lt. Governor Brown articulated that passing the Maryland False Health Claims Act would be one of his highest priorities during the 90-day session. The Lt. Governor convened numerous meetings early in the session with hospitals, doctors, insurers and consumer advocates and other stakeholders, including the Community Behavioral Health Association of Maryland, to craft the best bill possible.  Numerous amendments to the bill were accepted and eventually led to securing the support of the Maryland Hospital Association – an opponent of the bill last year. The amendments reflect an effort on the part of all involved in the negotiations to strike the right balance between the interest of the State and taxpayers in combating fraud without subjecting health care providers to frivolous, unwarranted lawsuits.

SB 279 will protect Maryland and its Medicaid budget against theft. Under current law, the state can do little to recover dollars paid out through false claims. The State’s only recourse is to bring administrative actions against suspected perpetrators, but this laborious, painstaking process limits any recovery to actual losses only, with no penalties or damages to deter repeat offenders.

The Federal False Claims Act (FCA), enacted in 1986, has returned over $24 billion to government coffers. Additional studies have shown that for every $1 spent on fraud enforcement, the government has recovered $15. However, the reach of the Federal FCA is limited because it can only pursue the largest cases. States that have enacted their own FCAs have increased recoveries by as much as 100 percent. Virginia, for example, recovered $100 million in the two years after it enacted an FCA. Prior to enacting a FCA, the Commonwealth had only recovered approximately $20 million.

Lt. Governor Brown’s portfolio includes health care, economic development and higher education. Brown, the former Majority Whip of the House of Delegates, has led the O’Malley-Brown Administration’s efforts to pass difficult legislation throughout the administration’s first term. Last year, Brown championed the administration’s bills to take guns out of the hands of domestic abusers. In 2008, Brown led efforts to improve mental and behavioral health services for veterans and worked to pass the BRAC Community Enhancement Act to better leverage public-private partnerships in preparation for the arrival of 60,000 new jobs across the state.


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