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 today by a vote of 38-0.
“The federal government has had something in place since 1863 to recoup money paid out fraudulently,” said Senator Adler, D-Cherry Hill. “New Jersey is usually well ahead of the federal government when it comes to issues of fairness for our taxpayers. In this instance, we have to play catch-up to eliminate fraud in State government.”
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 strict penalties should make anyone think twice before trying to defraud the taxpayers of New Jersey,” 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.
“The whistleblower incentive program will make sure that we have eyes and ears watching out for the taxpayers’ interest,” said Senator Adler. “New Jersey’s regulators cannot be everywhere at once, but working with honest individuals, we can uncover fraud wherever it may exist.”
The bill now heads to the Assembly for consideration.