AN ACT Relating to fraud in the obtaining of health care benefits; adding a new chapter to Title 48 RCW; and prescribing penalties.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. This chapter may be known and cited as "the health care false claim act."

NEW SECTION. Sec. 2. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Claim" means any attempt to cause a health care insurer to make the payment of a health care benefit.

(2) "Deceptive" means presenting a claim to a health care insurer that contains a statement of fact or fails to reveal a material fact, leading the health care insurer to believe that the represented or suggested state of affairs is other than it actually is.

(3) "False" means wholly or partially untrue or deceptive.

(4) "Health care benefit" means the right under a contract, certificate, or policy of insurance to have a payment made by a health care insurer for a specified health care service.

(5) "Health care insurer" means any insurance company authorized to provide health insurance in this state, any health care service contractor authorized under chapter 48.44 RCW, any health maintenance organization authorized under chapter 48.46 RCW, or any legal entity which is self-insured and providing health care benefits to its employees.

(6) "Health facility or agency" means a health facility or agency, as defined in RCW 70.37.020.

(7) "Knowing" and "knowingly" means that a person is in possession of facts that are substantially certain to cause the payment of a health care benefit. "Knowing" or "knowingly" does not include conduct that results from an error or mistake unless the person's course of conduct indicates a systematic or persistent tendency to cause inaccuracies to be present.

(8) "Person" means an individual, corporation, partnership, association, or other legal entity.

NEW SECTION. Sec. 3. (1) A person shall not make or present or cause to be made or presented to a health care insurer a claim for payment of health care benefits knowing the claim to be false.

(2) No person shall knowingly present to a health care insurer a claim for payment of health care benefits that falsely represents that the goods or services were medically necessary in accordance with professionally accepted standards. Each claim that violates this subsection shall constitute a separate offense. A health facility or agency shall not be liable under this subsection unless the health facility or agency, pursuant to a conspiracy, combination, or collusion with a physician or other provider, falsely represents the medical necessity of the particular goods or services for which the claim was made.

(3) No person shall knowingly make a false statement or false representation of a material fact to a health care insurer for use in determining rights to health care benefits. Each claim that violates this subsection shall constitute a separate violation.

(4) No person shall conceal the occurrence of any event affecting his or her initial or continued right to receive a health care benefit. A person shall not conceal or fail to disclose any information with intent to obtain a health care benefit to which the person or any other person is not entitled, or to obtain a health care benefit in an amount greater than that to which the person or any other person is entitled.

(5) A person who violates this section is guilty of a class C felony punishable under chapter 9A.20 RCW.

(6) This section does not apply to statements made on an application for coverage under a contract or certificate of health care coverage issued by a health care insurer.

NEW SECTION. Sec. 4. A person who solicits, offers, pays, or receives a kickback or bribe in connection with the furnishing of goods or services for which payment is or may be made in whole or in part by a health care insurer, or who receives a rebate of a fee or charge for referring an individual to another person for the furnishing of health care benefits is guilty of a class C felony punishable under chapter 9A.20 RCW.

NEW SECTION. Sec. 5. (1) A person shall not enter into an agreement, combination, or conspiracy to defraud a health care insurer by presenting, or aiding another to present a false claim for payment of health care benefits.

(2) A person who violates this section is guilty of a class C felony punishable under chapter 9A.20 RCW.

NEW SECTION. Sec. 6. A person who is convicted of a second or subsequent offense under this chapter is guilty of a class B felony punishable under chapter 9A.20 RCW.

NEW SECTION. Sec. 7. (1) In a prosecution under this chapter, it shall not be necessary to show that the person had knowledge of similar acts having been performed in the past by his or her agent, nor that the person had actual notice that the acts of the agent occurred, to establish the fact that a false statement or representation was knowingly made.

(2) It shall be a rebuttable presumption that a person knowingly made a claim for a health care benefit if the person's actual, facsimile, stamped, typewritten, or similar signature is used on the form required for the making of a claim for the health care benefit.

(3) If a claim for a health care benefit is made by means of computer billing tapes or other electronic means, it shall be a rebuttable presumption that the person knowingly made the claim if the person has advised the health care insurer in writing that claims for health care benefits will be submitted by use of computer billing tapes or other electronic means.

(4) In any civil or criminal action under this chapter the certificate of an authorized agent of a health care insurer setting forth that documentary material compiled by the agent is an authentic record shall create a rebuttable presumption that the record or compilation is authentic.

NEW SECTION. Sec. 8. (1) The attorney general, an assistant attorney general on behalf of the attorney general, or a prosecuting attorney may conduct an investigation of any alleged violations of this chapter.

(2) If the attorney general or a prosecuting attorney has reasonable cause to believe that a person has information or is in possession, custody, or control of any document or other tangible object relevant to an investigation for violation of this chapter, the attorney general or a prosecuting attorney may serve upon the person, before bringing any criminal action, a written demand to appear and be examined under oath, and to produce the document or object for inspection and copying. The demand shall be served upon the person in the manner required for service of process in this state. The demand shall:

(a) Describe the nature of the conduct constituting the violation under investigation; and

(b) Describe the document or object with sufficient definiteness to permit it to be fully identified; and

(d) Prescribe a reasonable time at which the person must appear to testify, answer any written interrogatories, and produce any document or object that is the subject of the demand; and

(e) Advise the person that timely objections to complying with the demand may be filed with the attorney general or prosecuting attorney making the demand; and

(f) Specify a place for the taking of testimony and production and designate the person who shall be custodian of the document or object; and

(g) Contain a copy of subsection (3) of this section.

(3) If a person objects to or otherwise fails to comply with the written demand served pursuant to subsection (2) of this section, the attorney general or a prosecuting attorney may file in the superior court of the county in which the person resides or in which the person maintains a principal place of business within this state an action to enforce the demand. Notice of hearing the action and a copy of all pleadings shall be served upon the person, who may appear in opposition. If the court finds that the demand is proper, that there is reasonable cause to believe that there may have been or is presently occurring a violation of this chapter, and that the information sought or document or object demanded is relevant to the investigation, the court shall order the person to comply with the demand, subject to what modification the court may prescribe.

(4) Except as required by federal law, any procedure, testimony taken, or material produced shall be kept confidential by the attorney general or a prosecuting attorney until charges are filed against a person pursuant to this chapter for the violation under investigation. Confidentiality may be waived by the person under investigation who has testified, answered interrogatories, produced material, or made disclosure.

(5) For purposes of enforcing this chapter, the attorney general may appoint investigators who shall be peace officers and whose duties include, but are not limited to, the following:

(a) To execute and serve search warrants, arrest warrants, subpoenas, administrative warrants, and summonses issued under the authority of the state;

(b) To seize property pursuant to the laws of this state;

(c) To exercise the powers provided in this subsection when working in conjunction with state and local law enforcement agencies.

NEW SECTION. Sec. 9. A person who receives a health care benefit or payment from a health care insurer which the person knows he or she is not entitled to receive or be paid, or a person who knowingly presents or causes to be presented a claim that contains a false statement, shall be liable to the health care insurer for the full amount of the benefit or payment made.

NEW SECTION. Sec. 10. Any person convicted of a violation of section 3, 4, or 5 of this act, in addition to any fines or sentences imposed, including any order of probation, may be ordered to make restitution to the health care insurer.

NEW SECTION. Sec. 11. This act shall not be construed to prohibit or limit a prosecution of or civil action against a person for the violation of any other law of this state.

NEW SECTION. Sec. 12. Sections 1 through 11 of this act shall constitute a new chapter in Title 48 RCW.