How to lower the likelihood of a qui tam lawsuit
How to lower the likelihood of a qui tam lawsuit
Some compliance officers are unhappy about increased scrutiny, lack of trust from hospitals
If you’re a compliance officer, you’re supposed to correct wrongdoing and deprive a potential whistle blower of any ammunition. But some hospitals are concerned you might be the one to turn whistle blower.
Their fear is understandable. Compliance officers are in the best position to obtain damaging information, so hospitals are trying to restrict their ability to file a qui tam suit. Yet critics worry that the means they’re using to block that threat will only antagonize compliance officers and raise serious legal questions.
"It shows a lack of trust," says Debbie Troklus, compliance officer at the University of Louisville (KY) and a vice-president of the Health Care Compliance Association. "It also sounds like a threat."
No one knows whether a compliance officer has yet filed a qui tam suit, but health care attorney Bob Wolin says he has already represented two hospitals where the compliance officer threatened to turn whistleblower. Neither one ultimately filed a suit, but the institutions — one a single hospital and the other a health system — took the threats very seriously.
In both cases, the compliance officer was facing termination, says Wolin, at Baker Hostetler in Houston. It wasn’t until negotiations over severance pay that the whistleblower issue came up. "They didn’t say it directly," Wolin recalls. "They didn’t want it to be considered extortion. But anyone with an IQ over 40 could figure out what they meant." In one case, the threat involved cost reports, while the other concerned reimbursement regarding the number of full-time employees the hospital billed for.
Wolin now recommends hospitals insert special clauses in the contracts their compliance officers sign. One clause requires them to give any money they earn from a qui tam suit to charity, and indemnify the provider against any losses resulting from disclosure of confidential information (See box, right). Wolin believes some potential whistleblowers will be discouraged by the clause, as will any attorney who fears he won’t get his cut. He recommends combining the charitable donation clause with non-disclosure restrictions against blabbing to the press, and a bar against removing company documents.
However, some question the legality of such a restriction, and Wolin himself admits the provision has never been tested in court. More important, you can’t legally prevent someone from filing a suit. However, Wolin believes hospitals have nothing to lose by putting the clause in, and you just might discourage someone who’s wavering over filing a suit.
But a hospital that uses this tactic runs "perilously close" to violating federal laws that prohibit obstructing someone from providing the government with information regarding a health care offense, warns Los Angeles attorney Mark Allen Kleiman, who has represented several whistle blowers. However, Wolin replies you can always insert a sentence in the contract that specifies the hospital is not attempting to prevent the compliance officer from providing information to an appropriate government agency.
A relator who wants to conceal his or her identity can always find someone to file the case for him, because the person launching the suit does not have to be the original source, Kleiman notes. But restricting an employee from taking company documents will make that process harder, says Wolin.
In any event, putting that clause in a contract may antagonize a compliance officer or discourage a potential one from taking the job. Troklus says compliance officers aren’t the type of people most likely to become whistle blowers. But she also says the best way to keep them from going to the government in the first place is to give them the support they need. "For a compliance officer who takes his job seriously, I think anyone who became a whistleblower is someone who became very frustrated," Troklus adds. "No one was listening to them." In whistleblower cases, such as the nearly half-billion dollar settlement against lab Smith Kline Beecham, the relators typically claim they made an effort to alert management to the problems before they decided to step forward.
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