Bill Text: MS HB565 | 2011 | Regular Session | Introduced

Mississippi House Bill 565 (Prior Session Legislation)

Introduced

Bill Title: Medicaid Fraud Control Act; revise several provisions of.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Failed) 2011-02-01 - Died In Committee [HB565 Detail]

Download: Mississippi-2011-HB565-Introduced.html

MISSISSIPPI LEGISLATURE

2011 Regular Session

To: Medicaid; Judiciary A

By: Representative Moak

House Bill 565

AN ACT TO AMEND SECTION 43-13-213, MISSISSIPPI CODE OF 1972, TO REVISE THE PROHIBITION ON MAKING FALSE OR FRAUDULENT CLAIMS FOR MEDICAID BENEFITS TO INCLUDE SPECIFIC DESCRIPTIONS ABOUT WHAT CONSTITUTES THOSE TYPES OF CLAIMS AND IMPOSE CIVIL PENALTIES FOR VIOLATIONS OF THIS SECTION; TO CREATE NEW SECTION 43-13-222, MISSISSIPPI CODE OF 1972, TO AUTHORIZE ACTIONS TO BE BROUGHT BY PRIVATE PERSONS FOR VIOLATIONS OF THE MEDICAID FRAUD CONTROL ACT; TO AMEND SECTION 43-13-223, MISSISSIPPI CODE OF 1972, TO ESTABLISH A STATUTE OF LIMITATIONS FOR CIVIL ACTIONS BROUGHT UNDER THE MEDICAID FRAUD CONTROL ACT; TO CREATE NEW SECTION 43-13-218, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE STANDARD OF PROOF IN ANY ACTION BROUGHT UNDER THE MEDICAID FRAUD CONTROL ACT SHALL BE BY PREPONDERANCE OF THE EVIDENCE; TO CREATE NEW SECTION 43-13-224, MISSISSIPPI CODE OF 1972, TO AUTHORIZE THE ATTORNEY GENERAL TO ISSUE AND SERVE SUBPOENAS IN CONDUCTING INVESTIGATIONS INTO FALSE OR FRAUDULENT CLAIMS UNDER THE MEDICAID FRAUD CONTROL ACT; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 43-13-213, Mississippi Code of 1972, is amended as follows:

43-13-213. (1) A person shall not make, present or cause to be made or presented a claim for Medicaid benefits, knowing the claim to be false, fictitious or fraudulent.

(2) Any person who:

(a) Knowingly presents, or causes to be presented, to an officer, employee, or agent of the State of Mississippi, or any political subdivision or other entity of the State of Mississippi, a false or fraudulent claim for payment or approval;

(b) Knowingly makes, uses, or causes to be made or used, a false record or statement to get a false or fraudulent claim paid or approved by the State of Mississippi;

(d) Has possession, custody, or control of property or money used, or to be used, by the State of Mississippi and, intending to defraud the State of Mississippi or willfully to conceal the property, delivers, or causes to be delivered, less property than the amount for which the person receives a certificate or receipt;

(e) Authorized to make or deliver a document certifying receipt of property used, or to be used, by the State of Mississippi and, intending to defraud the State of Mississippi, makes or delivers the receipt without completely knowing that the information on the receipt is true;

(f) Knowingly buys, or receives as a pledge of an obligation or debt, public property from an officer, employee or agent of the State of Mississippi, who lawfully may not sell or pledge the property; or

(g) Knowingly makes, uses, or causes to be made or used, a false record or statement to conceal, avoid, or decrease an obligation to pay or transmit money or property to the State of Mississippi, is liable to the State of Mississippi for a civil penalty of not less than Five Thousand Dollars ($5,000.00) and not more than Ten Thousand Dollars ($10,000.00), plus three (3) times the amount of damages that the state sustains because of the actions of that person, except that if the court finds that:

(i) The person committing the violation of this subsection furnished officials of the State of Mississippi responsible for investigating false claims violations with all information known to the person about the violation within thirty (30) days after the date on which the defendant first obtained the information;

(ii) The person fully cooperated with any investigation of the violation; and

(iii) At the time that the person furnished the State of Mississippi with the information about the violation, no criminal prosecution, civil action, or administrative action had begun under this title with respect to the violation, and the person did not have actual knowledge of the existence of an investigation into the violation, the court may assess not less than two (2) times the amount of damages that the state sustains because of the actions of the person. A person violating this subsection also shall be liable to the State of Mississippi for the costs of a civil action brought to recover any such penalty or damages.

(3) For purposes of this section, the terms "knowing" and "knowingly" mean that a person, with respect to information:

(a) Has actual knowledge of the information;

(b) Acts in deliberate ignorance of the truth or falsity of the information; or

(c) Acts in reckless disregard of the truth or falsity of the information, and no proof of specific intent to defraud is required.

(4) For purposes of this section, "claim" includes any request or demand, whether under a contract or otherwise, for money or property that is made to a contractor, grantee, or other recipient if the State of Mississippi provides any portion of the money or property that is requested or demanded, or if the state will reimburse the contractor, grantee, or other recipient for any portion of the money or property that is requested or demanded.

(5) Any information furnished under subparagraphs (i) through (iii) of subsection (2) of this section shall be exempt from disclosure under the Mississippi Public Records Act.

SECTION 2. The following shall be codified as Section 43-13-222, Mississippi Code of 1972:

43-13-222. (1) (a) A person may bring a civil action for a violation of the provisions of this article for the person and for the State of Mississippi. The action shall be brought in the name of the State of Mississippi. The action may be dismissed only if the court and the Attorney General give written consent to the dismissal and their reasons for consenting.

(b) A copy of the complaint and written disclosure of substantially all material evidence and information the person possesses shall be served on the Attorney General, on behalf of the state, under the Mississippi Rules of Civil Procedure. The complaint shall be filed in camera, shall remain under seal for at least sixty (60) days, and shall not be served on the defendant until the court so orders. The state may elect to intervene and proceed with the action within sixty (60) days after it receives both the complaint and the material evidence and information.

(c) The state may, for good cause shown, move the court for extensions of the time during which the complaint remains under seal under subsection (2) of this section. Any such motions may be supported by affidavits or other submissions in camera. The defendant shall not be required to respond to any complaint filed under this section until thirty (30) days after the complaint is unsealed and served upon the defendant under the Mississippi Rules of Civil Procedure.

(d) Before the expiration of the sixty-day period or any extensions obtained under paragraph (c) of this subsection, the Attorney General, on behalf of the state, shall:

(i) Proceed with the action, in which case the action shall be conducted by the state; or

(ii) Notify the court that it declines to take over the action, in which case the person bringing the action shall have the right to conduct the action.

(e) When a person brings an action under this subsection, no person other than the Attorney General, on behalf of the state, may intervene or bring a related action based on the facts underlying the pending action.

(2) (a) If the Attorney General, on behalf of the state, proceeds with the action, it shall have the primary responsibility for prosecuting the action, and shall not be bound by an act of the person bringing the action. The person shall have the right to continue as a party to the action, subject to the limitations set forth in paragraph (b) of this subsection.

(b) (i) The state may dismiss the action notwithstanding the objections of the person initiating the action if the person has been notified by the state of the filing of the motion and the court has provided the person with an opportunity for a hearing on the motion.

(ii) The state may settle the action with the defendant notwithstanding the objections of the person initiating the action if the court determines, after a hearing, that the proposed settlement is fair, adequate, and reasonable under all the circumstances. Upon a showing of good cause, the hearing may be held in camera.

(iii) Upon a showing by the state that unrestricted participation during the course of the litigation by the person initiating the action would interfere with or unduly delay the state's prosecution of the case, or would be repetitious, irrelevant, or for purposes of harassment, the court may, in its discretion, impose limitations on the person's participation, such as:

1. Limiting the number of witnesses the person may call;

2. Limiting the length of the testimony of the witnesses;

3. Limiting the person's cross-examination of witnesses; or

4. Otherwise limiting the participation by the person in the litigation.

(iv) Upon a showing by the defendant that unrestricted participation during the course of the litigation by the person initiating the action would be for purposes of harassment or would cause the defendant undue burden or unnecessary expense, the court may limit the participation by the person in the litigation.

(c) If the state elects not to proceed with the action, the person who initiated the action shall have the right to conduct the action. If the state so requests, it shall be served with copies of all pleadings filed in the action and shall be supplied with copies of all deposition transcripts (at the state's expense). When a person proceeds with the action, the court, without limiting the status and rights of the person initiating the action, may nevertheless permit the state to intervene at a later date upon a showing of good cause.

(d) Whether or not the state proceeds with the action, upon a showing by the state that certain actions of discovery by the person initiating the action would interfere with the state's investigation or prosecution of a criminal or civil matter arising out of the same facts, the court may stay the discovery for a period of not more than sixty (60) days. That showing shall be conducted in camera. The court may extend the sixty-day period upon a further showing in camera that the state has pursued the criminal or civil investigation or proceedings with reasonable diligence and any proposed discovery in the civil action will interfere with the ongoing criminal or civil investigation or proceedings.

(e) Notwithstanding any other provision of this subsection, the state may elect to pursue its claim through any alternate remedy available to the state, including any administrative proceeding to determine a civil money penalty. If any such alternate remedy is pursued in another proceeding, the person initiating the action shall have the same rights in that proceeding as the person would have had if the action had continued under this section. Any finding of fact or conclusion of law made in the other proceeding that has become final shall be conclusive on all parties to an action under this section. For purposes of the preceding sentence, a finding or conclusion is final if it has been finally determined on appeal to the appropriate court of competent jurisdiction, if all time for filing such an appeal with respect to the finding or conclusion has expired, or if the finding or conclusion is not subject to judicial review.

(3) (a) If the state proceeds with an action brought by a person under subsection (2) of this section, the person shall, subject to the second sentence of this paragraph, receive at least fifteen percent (15%) but not more than twenty-five percent (25%) of the proceeds of the action or settlement of the claim, depending upon the extent to which the person substantially contributed to the prosecution of the action. Where the action is one that the court finds to be based primarily on disclosures of specific information (other than information provided by the person bringing the action) relating to allegations or transactions in a criminal, civil, or administrative hearing, in a congressional, administrative, Division of Medicaid, Legislative PEER Committee, State Auditor or Government Accounting Office report, hearing, audit, or investigation, or from the news media, the court may award any sums as it considers appropriate, but in no case more than ten percent (10%) of the proceeds, taking into account the significance of the information and the role of the person bringing the action in advancing the case to litigation. Any payment to a person under the first or second sentence of this paragraph shall be made from the proceeds. Any such person shall also receive an amount for reasonable expenses that the court finds to have been necessarily incurred, plus reasonable attorneys' fees and costs. All such expenses, fees, and costs shall be awarded against the defendant.

(b) If the state does not proceed with an action under this section, the person bringing the action or settling the claim shall receive an amount that the court decides is reasonable for collecting the civil penalty and damages. The amount shall be not less than twenty-five percent (25%) and not more than thirty percent (30%) of the proceeds of the action or settlement and shall be paid out of those proceeds. The person also shall receive an amount for reasonable expenses which the court finds to have been necessarily incurred, plus reasonable attorneys' fees and costs. All those expenses, fees, and costs shall be awarded against the defendant.

(c) Whether or not the state proceeds with the action, if the court finds that the action was brought by a person who planned and initiated the violation of this article upon which the action was brought, then the court may, to the extent the court considers appropriate, reduce the share of the proceeds of the action that the person would otherwise receive under paragraph (a) or (b) of this subsection, taking into account the role of that person in advancing the case to litigation and any relevant circumstances pertaining to the violation. If the person bringing the action is convicted of criminal conduct arising from his or her role in the violation of this article, that person shall be dismissed from the civil action and shall not receive any share of the proceeds of the action. That dismissal shall not prejudice the right of the state or the United States to continue the action, represented by the Attorney General or the Department of Justice, respectively.

(d) If the state does not proceed with the action and the person bringing the action conducts the action, the court may award to the defendant its reasonable attorneys' fees and expenses if the defendant prevails in the action and the court finds that the claim of the person bringing the action was clearly frivolous, clearly vexatious, or brought primarily for purposes of harassment.

(4) If the state elects to intervene and proceed with an action, the state may file its own complaint or amend the complaint of a person who has brought an action to clarify or add detail to the claims in which the state is intervening and to add any additional claims with respect to which the state contends it is entitled to relief. For statute of limitations purposes, any such state pleading shall relate back to the filing date of the complaint of the person who originally brought the action, to the extent that the claim of the state arises out of the conduct, transactions, or occurrences set forth, or attempted to be set forth, in the prior complaint of that person.

(5) (a) (i) No court shall have jurisdiction over an action brought under subsection (b) of this section against a member of the Legislature, a member of the judiciary, or a senior executive branch official if the action is based on evidence or information known to the state when the action was brought.

(ii) In no event may a person bring an action under subsection (2) of this section that is based upon allegations or transactions that are the subject of a civil suit or an administrative civil money penalty proceeding in which the state is already a party.

(b) (i) No court shall have jurisdiction over an action under this section based upon the public disclosure of allegations or transactions in a criminal, civil, or administrative hearing, in a congressional, administrative, Legislative PEER Committee, State Auditor or Government Accounting Office report, hearing, audit, or investigation, or from the news media, unless the action is brought by the Attorney General or the person bringing the action is an original source of the information.

(ii) For purposes of this paragraph, "original source" means an individual who has direct and independent knowledge of the information on which the allegations are based and has voluntarily provided the information to the government before filing an action under this section that is based on the information.

(6) The state is not liable for expenses that a person incurs in bringing an action under this section.

(7) Any employee who is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment by his or her employer because of lawful acts done by the employee on behalf of the employee or others in furtherance of an action under this section, including investigation for, initiation of, testimony for, or assistance in an action filed or to be filed under this section, shall be entitled to all relief necessary to make the employee whole. That relief shall include reinstatement with the same seniority status that the employee would have had but for the discrimination, two (2) times the amount of back pay, interest on the back pay, and compensation for any special damages sustained as a result of the discrimination, including litigation costs and reasonable attorneys' fees. An employee may bring an action in the appropriate state court for the relief provided in this subsection.

SECTION 3. Section 43-13-223, Mississippi Code of 1972, is amended as follows:

43-13-223. (1) An action brought in connection with any matter under this article may be filed in the Circuit Court of the First Judicial District of Hinds County or in the circuit court of the county in which the defendant resides, or in the circuit court of the county in which any portion of the offense occurred, and may be prosecuted to final judgment in satisfaction there.

(2) Process issued by a court in which an action is filed may be served anywhere in the state.

(3) A civil action brought under this article may not be brought:

(a) More than six (6) years after the date on which the violation of this article is committed, or

(b) More than three (3) years after the date when facts material to the right of action are known or reasonably should have been known by the official of the state charged with responsibility to act in the circumstances, but in no event more than ten (10) years after the date on which the violation is committed, whichever occurs last.

(4) Subsection (3) shall not apply to actions, civil or criminal, brought by the State of Mississippi.

SECTION 4. The following shall be codified as Section 43-13-218, Mississippi Code of 1972:

43-13-218. In any action brought under this article, the state or the qui tam plaintiff shall be required to prove all essential elements of the cause of action, including damages, by preponderance of the evidence.

SECTION 5. The following shall be codified as Section 43-13-224, Mississippi Code of 1972:

43-13-224. In conducting investigations into false or fraudulent claims under this article, the Attorney General shall have the authority to issue and serve subpoenas to any person in control of any designated documents for the production of those documents, including, but not limited to, writings, medical records, Medicaid provider documents, drawings, graphs, charts, photographs, phone records, subscriber records and other data compilations from which information can be obtained, or translated through detection devices into reasonably usable form. Those subpoenas shall require the named person, his agent or attorney, to appear and deliver the designated documents to a location in the county of his or her residence unless the court for good cause shown directs that the subpoena be issued for the person to deliver those documents to a location outside of the county of his or her residence. Mere convenience of the Attorney General shall not be considered good cause. The Attorney General or his designee shall have the authority to inspect and copy those documents. The subpoenas shall be issued only upon the ex parte and in camera application of the Attorney General to the circuit court of the First Judicial District of Hinds County or in the circuit court of the county in which the defendant resides, or in the circuit court of the county in which any portion of the offense occurred, and only upon a showing that the documents sought are relevant to a civil or criminal investigation under this article or may lead to the discovery of that relevant evidence. Thereafter, the court shall have jurisdiction to enforce or quash the subpoenas and to enter appropriate orders thereon, and nothing contained in this section shall affect the right of a person to assert a claim that the information sought is privileged by law.

SECTION 6. This act shall take effect and be in force from and after July 1, 2011.