HB 735 (BR 1536) - Ji. Lee, R. Adkins, H. Moberly Jr, T. Riner
AN ACT relating to the prevention of Medicaid fraud.
Create various sections of KRS Chapter 205 to define "benefit," "claim," "documentary material," "fiscal agent," "fraud," "knowingly," "managed care," Medicaid recipient," Medical Assistance Program," "provider," "recipient," "service," "signed," and "unlawful act"; create new sections of KRS Chapter 205 to establish that proof of a person's intent to commit an unlawful act shall not be required in a civil or administrative proceeding to show that the person acted knowingly in respect to Medicaid fraud; establish unlawful acts related to receiving Medicare, including knowingly making a false statement or misrepresenting facts to permit an individual to receive a benefit or payment under Medicaid, concealing or failing to disclose information that results in a person receiving a benefit or payment that is not authorized, applying for or receiving a benefit or payment on behalf of another and uses the payment for another purpose, misrepresenting material facts concerning the conditions or operation of a facility in order to obtain licensure or certification; receiving a gift, money, donation, or other consideration as a condition of providing a service or product if the services is paid for in whole or part by the Medicaid program, presenting a claim for payment under Medicaid for a product or service provided by a person who is not licensed to the provide the service, presenting a claim for a service that has not been approved by the treating health care provider, is inadequate or inappropriate, or has been adulterated, debased, or mislabeled, entering into an agreement or conspiracy to defraud the state by obtaining an unauthorized payment or benefit, obstructing an investigation by the Attorney General or an alleged unlawful act, and making use of a false record to conceal, avoid, or decrease an obligation to pay or transmit money or property to the state under the Medicaid program; establish that it is unlawful for a managed care organization that contracts with Medicaid to fail to provide contracted services required information to the Department for Medicaid Services, or engages in a fraudulent activity in connection with the enrollment of an individual in the managed care plan or in connection with marketing of the organization's services to an individual eligible for the Medicaid program; require the cabinet for Health and Family Services to provide the Attorney General with access to all documentary materials for the investigation of Medicaid fraud; identify individuals to whom the Attorney General may disclose documentary material; provide immunity for individuals providing access to documentary material to employees of the Attorney General and other state and federal authorities involved in the investigation of Medicaid fraud; require the Cabinet to establish by administrative regulation sanctions for a provider found liable for Medicaid fraud; subject licensed professions found liable for Medicaid fraud to disciplinary action by their respective licensure boards; provide that the application of a civil remedy for an unlawful act related to Medicaid shall not preclude any other remedy available by law; permit the Attorney General to recover expenses incurred in obtaining injunctive relief or civil remedies related to investigation of unlawful acts related to Medicaid; require the General Assembly, in appropriating money recovered by the investigation and prosecution of Medicaid fraud, to consider the requirements of the Attorney General and other affected state agencies; permit the Attorney General to institute an action for an order to restrain a person who is believed to be committing or is about to commit an unlawful act related to Medicaid; establish the monetary liability for a person found liable for an unlawful act related to Medicaid, which includes three times the amount of the value of any monetary or in-kind benefit provided by Medicaid, interest on the amount of the payment, and a civil penalty not less than $5,000 or more than $15,000 if the unlawful act results in an injury to an adult defined in KRS 209.020 or a child; set the civil penalty for a unlawful act related to Medicaid not less than $5,000 or more than $10,000 if the act does not result in injury; provide criteria for determining the amount of the civil penalty; limit the liability to two times the amount of the monetary benefit received if the person furnished the Attorney General with all information about the unlawful act not later than the thirtieth day after the date on which the person first obtained the information, if the information is provided prior to the investigation by the Attorney General; permit the Attorney General to require a person to file a written statement under oath or affirmation, examine a person under oath, or to serve a civil investigative demand requiring the production of documentary material and permit inspection and copying of the material; permit the Attorney General to use the documents, including the presentation before a court; permit the Attorney General to file a petition for an order to compel the person to file a statement or submit to the examination by the Attorney General; establish criteria and the delivery methods for a investigative demand; require documentary material demanded to be produced for inspection and copying at the office of the Attorney General or as agreed by the person served and the Attorney General; permit an individual to file a petition to extend the return date for demand for documents; permit the Attorney General to bring an action as relator under Section 3730 of Title 31 of the United States Code with respect to an act in connection with the Medicaid program; define "claim," "original source," and "proceeds of the action"; permit a person to bring a civil action for an unlawful act related to Medicaid in the name of the person and the state; require the person being the action to serve a copy of the complaint on the Attorney General; require the complaint to be filed under seal and examined in camera, and remain under seal for sixty days or the date on which the state elects to intervene, whichever is earlier; prohibit serving the complaint on the defendant until the court orders the services; permit the Attorney General to file a motion requesting that the complaint remain under seal for an extended period; prohibit the defendant from being required to file an answer to a complaint until it is unsealed and served on the defendant; require the state to proceed with the action or notify the court that the state declines to take over the action within sixty days after the Attorney General receives the complaint or any extended period granted by the court; permit the person bringing the action to continue if the state does not proceed; permit the Attorney General to contract with a private attorney to represent the state in a civil action brought by a person for the state; require the state to have the primary responsibility for prosecuting the civil action if the state proceeds with an action filed by a person for the state; permit the person bringing the action to continue as a party to the action; permit the state to dismiss or settle the action notwithstanding the objections of the person bringing the action; permit the court to limit the participation of the person bringing the action for the state; permit the court to stay the discovery by the person bringing the action if the state shows that certain actions of discovery would interfere with the state's investigation or prosecution of a criminal or civil matter arising out of the same facts; limit the stay to sixty days, which may be extended by the court; authorize the state to proceed with an alternative remedy; provide that the person bringing the action has the same rights in the alternative proceeding as the person would have had if the action had continued in court; require a finding of fact or conclusion of law made in an alternative proceeding to be final on all parties to an action if the finding has been finally determined on appeal to the appropriate court, no appeal has been filed and the time for filing an appeal has expired, or the finding is not subject to judicial review; authorize the person bringing the action for the state to be entitled to receive at least 15%, but not more than 25% of the proceeds of the action; provide that the amount that the person bringing the action for the state is entitled to may not be more than 10%, if the action is based on disclosure of specific information relating to allegations or transactions in a criminal or civil hearing, in a legislative or administrative report, hearing, audit, or investigation, or from the news media; provide payment for reasonable expenses, attorney's fees, and costs from the proceeds of the action; establish conditions under which the court may limit the share of the proceeds of the person bringing the action; permit the court to dismiss the person from the civil action; prohibit a person from bringing an action that is based on allegations or transactions that are a subject of a civil suit or an administrative penalty proceeding in which the state is already a party or that is based on the public disclosure of allegations or transactions in a criminal or civil hearing, in a legislative or administrative report, hearing, audit, or investigation, or news media, unless the person bringing the action is an original source of the information; exclude the state from liability for expenses that a person incurs in bringing an action regarding alleged Medicaid fraud in the name of the person and the state; provide for reinstatement of employment and not less than two times the amount of back pay with interest and compensation for any special damages if a person is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms of employment by the person's employer because of a lawful act in the furtherance of an action related to the allegation of Medicaid fraud; authorize the office of the Attorney General to retain a reasonable portion of recoveries related to a person filing an action for the person and the state, not to exceed the amounts appropriated by the General Assembly for the administration of actions filed by a person for the person and the state; establish time limitation for filing civil suits related to Medicaid fraud.
Feb 27-introduced in House
Feb 28-to Judiciary (H)