By: Anne Novick Branan
Joe, the Practice Manager at a local medical group, cringed as he spied Susan, one of the nurses at the practice, marching toward him with an anxious, yet determined, look on her face. About two months ago, Susan confided in Joe that she heard that certain physicians in the medical group were accepting expensive sports event tickets from diagnostic centers to which the physicians frequently referred patients. She told him that it was wrong and maybe even illegal for the physicians to accept such gifts. To appease Susan, Joe had told her that he “would look into it,” but never quite got around to doing anything about it. Joe resented Susan for creating this problem for him and started screaming at her over every little thing she did wrong at work. Susan approached Joe today to ask what happened about the issue she raised and to complain that he was harassing her since she reported this problem to him. When Joe had no good answers for Susan and Joe’s mistreatment of her continued, Susan started make phone calls to lawyers about how she could blow the whistle on the medical group.
Unfortunately, scenarios like the one described above are not uncommon in the health care arena. The threat for health care providers from qui tam actions, also known as whistleblower lawsuits, under the federal False Claims Act (“FCA”) and similar state false claims statute, is very real these days. Recent statutory changes in the FCA strengthening protection of whistleblowers, combined with the government’s intensified interest in stopping health care fraud, increase the likelihood of success for the whistleblower in such suits. Plus, tough economic times and the lure of potentially sizable financial rewards have increased employees’ willingness to embark on the difficult journey involved in bringing a qui tam case. Indeed, whistleblowers continue to play an important role in helping the United States government fight fraud and recover funds.
Under the FCA qui tam provision, persons with evidence of the submission of false claims to a federal program, like the Medicare program, can sue the wrongdoer on behalf of the United States. The government has the right to intervene in such actions, but if the government declines, the private plaintiff may proceed on his or her own. Employees who bring qui tam actions can receive between 15 and 30% of any monies recovered by the government. The FCA specifically protects employees who become whistleblowers from retaliation by their employers.
Employers are best advised to take steps to prevent its employees from becoming qui tam relaters. One factor in an employer’s favor is that employees leave a lot behind when they decide to become whistleblowers. Pursuing such complex litigation can be a lengthy, expensive and emotionally-draining process and can damage the employee’s ability to find work in the health care field. For employers, there is a tremendous cost in defending such litigation, paying substantial financial penalties and risking damage to their reputations. There is much health care companies can do to discourage well-meaning employees who raise compliance concerns from escalating the concern to a qui tam or retaliation action against the employer. Such proactive measures by employers should include:
- Establish A Strong, Effective Compliance Program. An employer’s most powerful defense against whistleblowers is to implement an effective corporate compliance program that promotes a culture of ethical conduct and compliance. While a culture of compliance may seem like a cliché, it is clearly missing in many workplaces. A well-designed and implemented compliance program provides the framework for an organization to respond to compliance issues. To avoid qui tam litigation, employers develop policies and implement processes to (1) provide anonymous procedures for reporting compliance concerns; (2) promptly and impartially investigate legitimate employee compliance complaints; (3) respond appropriately to confirmed compliance violations; and (4) protect individuals who report concerns from retaliation. To be effective, such policies must have the commitment of top management and must be adequately communicated to employees. Employees who do not believe management is committed to compliance, and those who fear retaliation for bringing issues to light, are less likely to help a company solve its problems and more likely to take their complaints to Uncle Sam.
- Treat Reporting Employees Carefully. When an employee comes to the employer with a compliance concern, it is in the employer’s best interests to de-escalate the situation from the outset and to forge the most positive relationship with the individual as possible. However, supervisors who are threatened by employee compliance reports may treat the employee with hostility, suspicion or retaliation. Reporting employees should be assured that the company will take the complaint seriously and act appropriately to address any compliance deficiency. It is important to report back to reporting employees periodically so they know the company is addressing their concerns.
- Develop Training Programs for Managers and Supervisors about Dealing with Potential Whistleblowers. Managers and supervisors are the first line of defense in preventing retaliation against reporting employees. Respondents to the Ethics Resource Center’s 2013 National Business Ethics Survey indicated that employees initially report issues to their managers or supervisors over 60% of the time and that 21% reported being retaliated against for reporting such misconduct. Even the most robust compliance policies for dealing with employee compliance complaints will not stand up unless supervisors and managers are trained on the fine points of how to recognize a potential whistleblower and respond to such complaints with sensitivity. All too often, managers and supervisors get this wrong and companies want to make sure they get it right. Those with supervisory responsibilities need to know how to receive and handle reports without retaliating, and how to spot and halt retaliation they may observe, even more subtle forms of retaliation such as “disinviting” the employee to routine meetings or giving negative performance reviews. The human resources department should also be trained on how to handle employment issues related to potential whistleblowers, conduct exit interviews and identify people in the annual review process who are not happy with the company’s ethical climate.
A proactive approach to potential whistleblowers can save health care employers the substantial aggravation and expense that result from defending qui tam or retaliation litigation. Employers will certainly reap positive benefits from investing resources in their compliance programs to effectively address responding to reports of compliance concerns and the protection of reporting employees.