TRENTON – A bill sponsored by Senator John H. Adler which would establish the “New Jersey False Claims Act” to protect against abuse and fraud within Medicaid and other State claims programs was approved by the Senate Budget and Appropriations Committee by a vote of 14-0.
“We need better oversight over State assistance programs,” said Senator Adler, D-Cherry Hill. “Medicaid and other claims programs right now are open to massive abuse. We need to protect the State’s and the taxpayers’ interest in these programs. We cannot leave New Jersey vulnerable to waste, fraud and abuse.”
The bill, a Senate Committee substitute for S-360 and S-1829, would allow private individuals in New Jersey to bring an action, either by themselves or working with the State Attorney General, against any person who knowingly causes the State to pay a false claim. If a person is found guilty in court, the bill would create civil penalties, between $5,000 and $10,000 for each verified count of a false claim, as well as imposing three-times the cost of any losses the public entity would have sustained because of the false claim.
“These are tough penalties which will make people think twice before they attempt to defraud the State,” said Senator Adler.
The bill also sets up a whistleblower incentive to come forward with any information about false claims. If a false claim is proven in court, the whistleblower would be entitled to 15 to 25% of the proceeds recovered for New Jersey if the Attorney General brings the case, and 25 to 33 % of the proceeds if the case is brought by the whistleblower.
“Through the financial incentives, we will give people the motivation to come forward and help New Jersey uncover wrongdoing,” said Senator Adler. “At the same time, the incentives will encourage greater participation so that New Jersey can recover more misspent funds.”
The bill now heads to the full Senate for consideration.