Puerto Rico Tackles Medicaid Fraud with the Passing of its own False Claims Act

The Commonwealth of Puerto Rico recently announced the enactment of House Bill 1627, simultaneously enacting a Puerto Rican False Claims Act and authorizing the establishment of a Medicaid Fraud Control Unit. The new law allows whistleblowers to report any fraudulent act against the Puerto Rican government.  

The act allows Puerto Rico to join the 49 states and the District of Columbia as having a False Claims Act in place to recover fraudulently-obtained taxpayer money.  Only the state of Wisconsin does not presently have a similar law due to the 2015 repeal of its version of the False Claims Act.

The Puerto Rican bill was officially signed into law Monday, July 23, by Governor Ricardo Rosselló.  His office, La Fortaleza, promoted the Act as a “recovery mechanism” for cases where false claims are identified.

The signing of the bill establishes the Fraudulent Claims to Programs, Contracts and Services of the Government of Puerto Rico Act, which is derived from the federal False Claims Act. Claims made under the Act will be handled by the Medicaid Fraud Control Unit at the Puerto Rico Department of Justice.  The False Claims Act provisions will not go into effect until 180 days after enactment so claims can’t be made until at least January 19, 2019.

Government officials in Puerto Rico have reacted positively to the bill’s enactment, and have also commented on its necessity, including Secretary Wanda Vasquez who stated:

dealing with the loss of public funds assigned to our Island is of paramount importance to ensure the confidence of the Government of the United States in our Government agencies. A strong message is also sent to those who defraud and profit at the expense of the need of other people.

Rafael Rodriguez, the secretary of the Puerto Rico Department of Health, also seemed optimistic about the bill, commenting that it:

will allow the Government to continue to recover credibility at the federal level, to process more aggressively those who misuse these funds and ensure that the funds allocated are available to better meet the needs of bona fide beneficiaries.

The signing of the bill, together with the establishment of Puerto Rico’s first Medicaid Management Information System earlier this year in April, represent some of the recent efforts made by Puerto Rican government officials to combat surging fraud amongst the disaster relief efforts directed to Puerto Rico in recent years.

Click here to read a translated version of the Act.

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