DOJ Issues Guidance for Cooperation Credit in False Claim Act Investigations


By: Michael Bruyere

The Provider Self-Disclosure Protocol was created in 1998 to encourage providers to voluntarily disclose self-discovered evidence of potential fraud. According to  OIG-HHS, self-disclosure (now commonly referred to as voluntary disclosure) gives providers the opportunity to avoid the costs and disruptions associated with a government-directed investigation and civil or administrative litigation.
From a provider’s perspective, implementing the Protocol initially was fraught with the perils of exposure to significant civil monetary penalties, including  the so-called “Death Penalty” or exclusion of the provider from certain federally funded programs, such as Medicare. Similarly, the original Protocol and subsequent revisions were unclear as to how a disclosing party would receive credit or favorable consideration in exchange for informing DOJ of potential misconduct.
On Tuesday, DOJ released its much-anticipated formal guidance for companies considering voluntary disclosure of potential misconduct. See “The Department of Justice has taken important steps to incentivize companies to voluntarily disclose misconduct and cooperate with our  investigations; enforcement of the False Claims Act is no exception,” according to Assistant Attorney General Jody Hunt.
“Cooperation credit,” according to DOJ, may be earned by participating in the disclosure Protocol or taking appropriate remedial measures once a violation has been identified. Examples of credit-earning actions include disclosing misconduct to the government beyond the scope of any ongoing investigation, preserving records and information above minimum requirements set by law or business practices, or facilitating the review by providing access to special or proprietary technologies.
Providers may expect to receive cooperating credit, most commonly, in the form of “a reduction in the damages multiplier and civil penalties.”
Any provider that discovers potential misconduct must immediately and thoroughly investigate the conduct and take whatever remedial steps are necessary to limit or eliminate any consequences to the federal government. DOJ’s guidance announced Tuesday should be scrutinized by compliance personnel and include in ever provider’s compliance program for voluntary disclosures.  The new guidance is a step toward allowing providers to better evaluate the risks versus benefits of essentially inviting the government to examine billing history and practices.  And the new credit opportunities also underscore the need for a provider to fully appreciate whether the suspected misconduct is actually a violation of federal law or simply a practice that requires improvement.
If you have any questions or would like more information, please contact Michael Bruyere at [email protected].