Capital Thinking Magazine

things to know about the amended false claims Act
by harry silver
1. You no longer have to present a false claim to the government to be subject to the FCA.
2. You no longer have to do business with the government to be subject to the FCA.
3. Proof of intent to defraud the United States is now irrelevant under the FCA.
4. The retention of funds obtained by means of an inadvertent overpayment is subject to the FCA.
5. Whistleblowers may initiate an FCA suit in return for 15%-30% of any recovery by the government.
6. A judicial determination of an FCA violation requires the imposition of potentially ruinous financial penalties.
7. The possibility of a percentage of a huge recovery has encouraged whistleblower suits.
8. Protection of whistleblowers against retaliation has been extended to contractors and employees of contractors.
9. The use of Civil Investigative Demands by the Department of Justice and the sharing of information with other agencies, states and whistleblowers has been made easier.
10. The lack of an effective compliance program is considered to constitute
“reckless disregard.”

Reform is in the Air

If there’s a word—and a concept—that dominates this issue of Capital Thinking, it’s clearly “reform.” Opening the cover story, for example, Richard Sine writes: “The most dramatic health care reform the nation has ever seen is starting to shape up.” In a related sidebar, Patton Boggs attorney Laurence Freedman notes that “proponents are counting on Medicare and Medicaid fraud recoveries as a major source of funding for health care reform”—a case of reform underwriting reform. A few pages later, Freedman’s colleague Todd Cranford adds that “Congress is intent on moving forward with regulatory reform legislation.” Also in this issue, Patton Boggs attorneys Denise Vanison, William McGinley and Harry Silver look at reform efforts targeted at immigration, campaign finance and false claims.

Reform, of course, is in the mind of the reformer: reasonable people can mount reasonable arguments on either side of any issue. Which may be why anything approaching true reform (whatever that may actually be) takes so long to achieve.
But today’s political and economic climate is clearly made for reform, and eventually some sort of consensus will be reached—at least for a while. As PhRMA CEO Billy Tauzin notes, explaining his group’s support for health care reform,“We collectively decided that if reform was done with our principles in mind...we ought to support progress toward a good bill.”

Our mission, as these discussions continue, is not so much to chronicle the debate, but to provide insights, not only on the direction the debate is taking, but on the impact—financially, legally, ethically—that direction may have on you and your business. Turn the page to watch the debates unfold.

- MIKE WINKLEMAN, Editorial Director

Slouching Toward Reform

Although it’s been slower than expected, a major overhaul of financial regulation is coming soon. And financial institutions are working hard to insert themselves in the debate.

Pinning Down Reform

As business tracks the “moving target” of health care reform, it is also warming to the prospect. But not every company will be affected equally. Plus: Stopping fraud to pay for reform.

[Currency]

An uptapped resource: the SBIC’s $3 billion pool. A possible game-changer for next year’s congressional elections. Giving IP its due. Buying time for commercial real estate.

[Capital Thoughts]

Denise Vanison finds some ways around H-1B. Ed Smith advocates investing not just in infrastructure but in the workforce. James McNair describes innovative trusts that pass on an entrepreneur’s values and his or her wealth.

[Q&A: BILLY TAUZIN]

Much of the health care industry may still be struggling with health care reform, but drugmakers have made their peace. PhMRA’s president and CEO explains how.