Highway bills, veterans measures advance today
The Senate today passed a long-term highway funding bill and a short-term highway funding bill. The short-term bill, already passed by the House of Representatives, funds programs for another three months. The House bill includes several veterans priorities that Sen. Chuck Grassley supports, including expanding eligibility for more veterans to access the choice program for their health care and excluding veterans and service members from the employer mandate under Obamacare (the Hire More Heroes Act). The Hire More Heroes Act of 2015 provides incentives for companies to hire more veterans by ensuring they don't count against the 50 employee threshold requiring employers to offer health insurance if the veteran already has medical coverage elsewhere. Grassley made the following comment on the bills passed today.
"When I meet with Iowans, transportation comes up a lot. Farmers, manufacturers and city leaders all want assurance that quality roads and bridges will be available to transport their goods and residents. Economic growth is tied in to transportation. The long-term bill continues in the right direction of providing certainty for state and local governments so they can make solid transportation decisions. That creates the environment for more jobs, enhanced safety, and the ability to expedite projects. Passing a short-term extension gives Congress the chance to continue the negotiations that we hope will get us to final approval of long-term funding. It was important to continue funding in the short term to avoid stopping work on critical projects during construction season.
"The veterans provisions are important to fix gaps in access to health care services. The bill makes several improvements in the choice card program, which helps veterans get the care they need when a veterans facility is unavailable. Congress enacted the choice program to make sure that veterans always have access to the care they deserve, but the Department of Veterans Affairs' implementation of the program has been less than enthusiastic. We've pushed for those improvements to make the choice card more usable as Congress intended, so we need to make sure they're enacted. Even when the VA fixes something administratively, getting the fix into statute is important. For example, the VA already relented on its misinterpretation of distance in the choice program, after pressure from me and other members of Congress, and this bill codifies the correct interpretation so there won't be a misunderstanding in the future. The bill also makes sure employers and veterans are spared some of the negative effects of the President's health care law. It encourages employers to hire veterans without running into the employer mandate."False Claims Act Continues to be Most Effective Tool to Combat Fraud
Prepared Floor Statement by Senator Chuck Grassley of Iowa, Chairman, Senate Judiciary Committee
On the False Claims Act
July 29, 2015
Mr. President,
On July 30, 1778, the Continental Congress passed the very first whistleblower law in the United States. It read:
[I]t is the duty of all persons in the service of the United States . . . to give the earliest information to Congress or other proper authority of any misconduct, frauds or misdemeanors committed by any officers or persons in the service of these states, which may come to their knowledge.
Whistleblowers have always been crucial in helping Congress and the federal Government route out fraud and misconduct. It is simple common sense to reward and protect whistleblowers who report waste, fraud, and abuse. The False Claims Act does that.
In fiscal year 2014 alone, the federal Government recovered nearly $6 billion under the Act. That makes more than $22 billion since January 2009, and more than $42 billion since 1986. These recoveries represent victories across a wide array of industries and government programs. Those programs include mortgage insurance, federal student aid, and Medicare and Medicaid, as well as Defense contracts.
The Department of Justice credits whistleblowers for their important role in this success.
According to the Justice Department, whistleblowers accounted for $3 billion in recoveries under the Act in Fiscal Year 2014. In fact, over 80% of False Claims Act cases are initiated by whistleblowers. Clearly the False Claims Act is working very well.
Of course, the Act has no shortage of critics–typically the groups where you find perpetrators of fraud. But we have learned our lesson that a weak False Claims Act is not in the taxpayer's best interest.
In 1943, Congress bowed to pressure to undo the Act's crucial qui tam provisions.
Amendments passed back then barred actions where the Government already had knowledge of the fraud. The result was to block nearly all private actions. Congress assumed that the Justice Department could do a good job prosecuting fraud all by itself. They were wrong.
Between 1943 and 1986, fraud against the Government skyrocketed. Most of those accused went unpunished.
A 1981 report by the Government Accountability Office said:
"For those who are caught committing fraud, the chances of being prosecuted and eventually going to jail are slim . . . . The sad truth is that crime against the Government often does pay."
So in 1986, I co-authored much needed amendments to the False Claims Act. The 1986 Amendments once again gave citizens the ability to help the government go after fraud in a meaningful way. For example, the amendments provided protections for whistleblowers and eliminated the impossible government knowledge bar. Essentially, a relator's suit was only barred where the fraud had already been publicly disclosed.
The Amendments also clarified that the Act covers false claims made not just directly to a Government agency. It also covers fraud against grantees, States, and other recipients of Federal funds, whether or not the fund obligation is fixed.
These provisions and others were intended to give the False Claims Act teeth again. But courts chipped away at the heart of the False Claims Act and ignored the intent of Congress. The assault on the Act came to a head in the Supreme Court's erroneous opinions in the well-known cases Allison Engine and Totten. The Court held that the Act required proof of intent that the Government itself pay a claim, and that a claim is presented directly to the Government. The problem with this logic is that it creates a loophole big enough to drive a truck through. A third party paid with Government money would get away with fraud because a contractor, not the government agency, paid the claim.
In 2009, we passed the Fraud Enforcement and Recovery Act and made clear that this was not consistent with our original intent. The Act reaches false claims for government money or property, whether or not the wrongdoer deals directly with the Government. It was never the intent of Congress to give a free pass to subcontractors or other parties receiving government funds. In fact, those folks are some of the biggest perpetrators of fraud today.
The Inspector General for the Department of Health and Human Services has reported a 134 percent increase in complaints against Medicare Part D in the last five years. By not stopping fraud against programs like Medicare Part D, the Government is hemorrhaging funds. Taxpayer money is taxpayer money–period.
Fraud does not magically become okay just because a third party is involved.
Of course, the issue of presentment to government officials is not the only sticking point. There has been pushback in the courts and from lobbyists about all sorts of issues, like the "public disclosure bar," settlement practices, and award shares for relators. Through it all Congress has had to stay vigilant in keeping courts and the feds true to legislative intent.
Just recently the Justice Department tried to minimize a relator award in a Medicare and Medicaid fraud suit. The relator contributed significantly to the case. The Judge recognized that Congress intended that "the only measuring stick" for an award is "the contribution of the relator."
That Judge was right. Congress intended to empower, protect, and reward relators who identify fraud against the taxpayers. History teaches us that weakening the relator's rights weakens the government's ability to fight fraud. All that does is let wrongdoers off the hook and cost the taxpayers money. That is not the result we intended with the False Claims Act. It is also not the result the Continental Congress, so concerned about identifying "misconduct, frauds and misdemeanors," would have wanted.
I want to remind my colleagues to stand strong for the most effective tool we have to combat fraud.
-30-Congress Passes Bill Allowing Universities to Collaborate on Financial Aid Best Practices
WASHINGTON - The House of Representatives has passed bipartisan legislation introduced by Judiciary Committee Chairman Chuck Grassley, Ranking Member Patrick Leahy and Senator Mike Lee to extend an expiring antitrust exemption that allows certain colleges and universities to collaborate on issues of need-based financial aid. The legislation unanimously passed in the Senate on July 14, and cleared the House of Representatives by a vote of 378-0. This legislation will now be sent to the President for his signature.
"Every college student, regardless of financial situation, wants a shot at the best education, and schools looking to attract the best and the brightest want to ensure that financial aid goes to those who need it most. Our bill allows colleges and universities to continue working together, free from the threat of antitrust litigation, to ensure that students in need of financial aid are treated fairly and consistently. Expanding opportunities for bright, hardworking students in need of financial assistance is a worthy cause, and I applaud my colleagues in the House for passing our bill," Grassley said.
"Allowing participating universities to focus their resources on ensuring the most qualified students can attend some of the best schools in the nation, regardless of family income, is important. With Congress's swift action to pass the Need-Based Educational Aid Act, participating universities can continue collaborating on need-based financial aid that ultimately benefits students. I am glad we were able to pass this important legislation ahead of a critical deadline," Leahy said.
The Need-Based Educational Aid Act of 2015 extends the Section 568 antitrust exemption, which was set to expire in September, and allows colleges and universities to collaborate on the formula they use to determine a family's ability to pay for college. The antitrust exemption permits higher education institutions to agree to award aid only on the basis of financial need and use a common application for aid. By allowing financial aid professionals to work together in these ways, the exemption helps ensure that the colleges and universities covered by this section of the law admit students without regard to ability to pay. It also prevents needless litigation over the development of principles for determining financial need. This exemption was first enacted in 1994, and has been reauthorized by Congress three times without opposition, most recently in 2008. A 2006 Government Accountability Office report found that the activities permitted by the exemption have not resulted in harm to competition.
Grinnell College participates in the program being reauthorized.
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