10th National Institute on the Civil False Claims Act-American Bar Association – Day 3 – June 6, 2014

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Panel Topic: State Enforcement Efforts

 State Attorney General View: State attorneys general have formed a national association for centralized and coordinated action on Medicaid fraud cases. Lawyers who have Medicaid cases need to understand that they cannot recover for the states’ share of Medicaid fraud without the involvement of the states—they are separate sovereigns. Relators should consider involving the state AG offices early in Medicaid fraud cases. The national association appoints steering committees to review cases and make determinations about proceedings and also to conduct and coordinate investigations. A declination does not necessarily mean that the case does not have merit—is often an issue with limited resources and state AG offices having to pick and choose between meritorious cases.

Relators’ View: Where possible, consider collaborating with state AGs to pursue Medicaid cases—try to find a state with a unique interest and good law. Let the state AG lead the investigation and prosecution if possible. Consider not including the state claims in a federal case and instead bringing them independently, particularly where the federal government may move slowly. Even if the Department of Justice the case declines, state AG offices offer a lot of opportunities.

Defense View: The traditional model was a federal case that addressed the states’ interest in the course of the litigation. That model was better for defendants because they were more “orderly” for the defendant—they had a single party on the other side to achieve global resolution. Now that states are more active, defendants are having to deal with multiple parties, which can be difficult. However, this situation gives defendants an opportunity to find the lawyer on the other side who is the most reasonable to deal with. Involvement of the states seriously changes the dynamic of the lawsuit. The involvement of the states makes the case much more difficult for defendants. Defendants really prefer to achieve global settlements—partial settlements are not really settlements. Although aggregation can sometimes work against defendants, generally defendants prefer global resolution rather than piecemeal settlement.