Two State Laws Are Leading To Larger Whistleblower Recoveries


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Experts believe that little-known laws in California and Illinois are gaining in legal popularity in certain types of healthcare and insurance fraud cases with individuals who blow the whistle on wrongdoing. The statutes may also help whistleblowers secure greater financial recoveries for providing their valuable information.

Unlike the federal False Claims Act, under which the federal government often alleges that Medicare and Medicaid were defrauded, the California and Illinois statues allow individuals, in conjunction with those states’ governments, to pursue similar actions on behalf of the states’ citizens who are insurance policyholders.

And, under the same two statutes, whistleblowers can share in the recoveries by the states – typically receiving between 40 and 50 percent of the settlement, compared to between 15 and 25 percent under the federal False Claims Act.

Consider the recent case of Warner Chilcott. The drugmaker agreed to pay the U.S. and several states $125 million to settle claims that it defrauded Medicare and Medicaid. Of that, California received just more than $3 million. However, using its own insurance statute, California fared far better in a second, separate settlement with Warner Chilcott, where it received $11.8 million.

Although on the books for years, the laws in the two states have not been utilized often. As word spreads, more cases are expected.

Attorney Brian J. McCormick, Jr., a national whistleblower attorney at Ross Feller Casey, LLP in Philadelphia, called the statutes in the two states “little known but powerful tools used to combat insurance fraud.” 

“Like the modern use of the False Claims Act, which remained undeveloped until just the last 20 years or so, consumers and government officials are beginning to recognize the power of California’s and Illinois’ insurance statutes to combat healthcare and insurance fraud,” McCormick said. “It is critically important that anyone considering a whistleblower claim under the False Claims Act also ensure that their lawyer understands and can utilize these state statutes.”

Ross Feller Casey and its dedicated team of False Claims Act lawyers are pursuing several healthcare fraud cases across the country that include claims under California’s Insurance Frauds Prevention Act and Illinois’ Illinois Claims Fraud Prevention Act. Ross Feller Casey lawyers regularly incorporate these statutory rights of action into their federal False Claims Act cases for their whistleblower clients.

If you have information about insurance fraud or government fraud against the U.S., or a state or local government, past or present, you should contact Ross Feller Casey now for a free case review.

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