We begin our countdown with a list:  Maryland, Oregon, Washington, Wyoming, Utah, Arizona, Colorado, Maine, Pennsylvania, North Carolina, South Carolina, Arkansas, Missouri, Iowa, Minnesota, South Dakota, Nebraska, Kansas, Alabama, Mississippi, Ohio, West Virginia, Connecticut, Vermont, Rhode Island.

Between January 1, 2009 and February 15, 2009, all 28 of these state legislatures will convene and begin to grapple with the fallout from the looming economic crisis. 
 
A study announced this week by the National Conference of State Legislatures finds that the states collectively face a $32 billion budget gap after already closing a $40 billion gap since the current fiscal year began. The projections for the next fiscal year, which begins July 1 for most states, reveal another $65 billion gap. 

An excellent interactive map accompanies the report, and makes it plain that state governments are facing a perfect storm of declining tax revenues and ballooning expenses that threaten the viability of essential state programs and services.  Among the hardest hit programs will be Medicaid.

Most of you can probably see where I am going with this

The Deficit Reduction Act of 2005 gave each of the 50 states a strong incentive to pass a state false claims act—specifically, any state that has a statute complying with the terms of the DRA is entitled to an enhanced federal medical assistance percentage (FMAP) for all cases settled through the state FCA.       

To date, 22 states and the District of Columbia have passed statutes that comply with the terms set forth by the DRA, with the vast majority of those states coming on board in the last three years. The benefits reaped by those states have been in the hundreds of millions of dollars. 

Apparently, this is money that Maryland, Oregon, Washington, Wyoming, Utah, Arizona, Colorado, Maine, Pennsylvania, North Carolina, South Carolina, Arkansas, Missouri, Iowa, Minnesota, South Dakota, Nebraska, Kansas, Alabama, Mississippi, Ohio, West Virginia, Connecticut, Vermont, and Rhode Island have not needed up until now.   

In the current economic crises, however, I think the incentive fees offered for passing a state FCA will be too strong to ignore; thus, I am predicting that no less than 10 new state false claims act will be passed during the 2009 legislative session.  I would not be surprised if the number were higher.  I am also predicting that all 50 states will comply by the end of the 2012 legislative session.  

This model statute, drafted some years ago by Jeb White at Taxpayers Against Fraud, would comply with the requirements of the DRA.       

It will be my great pleasure to mark each state off of the list, one by one, as false claims legislation is passed—the question is, who will be first?