Kentucky State False Claims Act is Introduced by House Speaker Greg Stumbo
What was that I was saying recently about things being quiet on the legislative front?
Kentucky legislator Greg Stumbo (D-Prestonsburg) introduced H.B. 401 in this legislative session, otherwise known as the Kentucky False Claims Act. Rep. Stumbo is not only a member of the Kentucky House of Representatives, he is the Speaker of the House, which means he knows how to get things done. As such, it passed out of the Kentucky House of Representatives by a vote of 91-1 and is now in the Kentucky Senate. Speaker Stumbo really summed it all up quite well when he said:
“With this one bill, we can improve oversight of critical state-run programs like Medicaid; we can be better stewards of each taxpayer dollar; and we can give pause to those criminals who think they can get away with stealing the tax payers’ money,” he said. “There is only so much our law enforcement and auditing officials can do and a limit to how far they can reach; this will put every citizen on the look-out for fraud.”
He is quite right about that of course — and in my experience with state-level FCA legislation, if you have people in your state legislature that understand how the law works, that is always a good sign. If the person serves as Speaker of the House, that is even better. No one should ever assume that state legislators will understand how FCA litigation works. Years of practicing in this area of law — and years of testimony before many state legislatures — has demonstrated to me clearly that qui tam litigation is, in many ways, counter-intuitive to the trained legal mind.
The above-quote by Speaker Stumbo shows that he clearly “gets it” and understands the importance of qui tam legislation; that is to say, he understands that compliance with any rule or regulation can be determined by looking at five factors. In no certain order, those factors are: (1) the likelihood that transgressions of the law will be detected; (2) the likelihood that transgressions will be prosecuted when observed; (3) the substance of the behavior the law forbids; (4) the nature and quality of the evidence required to prove a violation; and (5) the severity of the potential sanctions.
Not only does Speaker Stumbo understand this, he clearly understands that while government has proven very capable of addressing factors three through five, it has proven somewhat less capable with factors one and two, and he understands that qui tam legislation fills the gap…Even better, he has learned from the past, when Kentucky was unable to maximize its recovery for want of a state false claims act.
No word yet from the Kentucky state Senate, but lets keep our fingers crossed.
