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Defending Pharmaceutical State Medicaid Fraud Actions: Use of Medicaid Regulatory Framework, Government Knowledge and Other Defenses

HOUSTON, November 19, 2010 -- In a recent issue of BNA Health Care Fraud Report, Baker Botts lawyers Travis Sales and Brandon Goodwin addressed the issues involved in defending pharmaceutical state medicaid fraud actions. Sales and Goodwin noted in their article that the False Claims Act (‘’FCA‘’) turns 150 years old in 2013 and, since its enactment, has evolved into an aggressive tool that empowers the federal government to recover damages for fraudulent billing reimbursement requests.

Typically, they wrote, claims under the FCA have been filed by individuals with insider knowledge of false claims and commonly involve health care, military, or other government spending programs. Since 1986, the federal and state governments have recovered more than $24 billion dollars under the False Claims Act. In fact, the recovery efforts have proven so lucrative for the federal government, that in 2005 Congress began to increase Medicaid funding by 10 percent in states that enacted their own false claims statutes. To date, 10 states have adopted statutes analogous to the FCA, focusing exclusively on Medicaid fraud.

“This federal incentive program has significantly impacted the pharmaceutical industry,” Sales and Goodwin stated in the article. “In the health care arena alone, the federal government is recovering $15 for every $1 spent on FCA health care investigations and prosecutions. In light of this alluring source of income, states are exploring new ways to cover the costs of managing state Medicaid programs.”

The complete BNA article is available here.

Travis Sales has extensive experience with pharmaceutical products liability as well as commercial and insurance matters. He has represented pharmaceutical companies in defense of state Medicaid fraud claims brought by Attorneys General. He has represented defendants in a nationwide consumer class action suit involving claims of antitrust and RICO violations, fraud and deceptive trade practices in connection with alleged overcharges for a well-known prescription medicine.

Brandon Goodwin represents clients in a broad range of complex civil litigation matters in both state and federal courts. Mr. Goodwin’s recent engagements have included representing clients in the pharmaceutical, energy and insurance industries.

About Baker Botts L.L.P.
Baker Botts L.L.P., dating from 1840, is a leading international law firm with offices in Abu Dhabi, Austin, Beijing, Dallas, Dubai, Hong Kong, Houston, London, Moscow, New York, Palo Alto, Riyadh and Washington. With more than 700 lawyers, Baker Botts provides a full range of legal services to international, national and regional clients. For more information, please visit

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