False Claims Act cases typically involve product substitutions, failure to inspect or test products, illegal contracting practices, or falsely certifying compliance with government requirements (where the requirements are a condition of reimbursement). Defense contracting and health care fraud involving federally funded programs such as medicare and medicaid represent the most common areas for litigation. In the realm of defense contracting, over charging and defective pricing schemes are common, as are violations of Truth In Negotiations Act (TINA). TINA requires a contractor to truthfully disclose all relevant cost information and provide a certification to that effect to the government. Intentionally inflating costs to obtain a higher price may violate the FCA. Defense contractors have also falsely attested to eligibility for minority contracting set-asides, or schemed with subcontractors to inflate the charges to the government for goods or services. In health care, the forms of fraud vary considerably. Fraudulent schemes that violate the FCA include charging for services not provided, claiming services provided were more intense and expensive than they actually were (upcoding), furnishing medically unnecessary services, lying to the government about the cost of treating Medicare and Medicaid patients, and bribing or providing kickbacks to induce referrals. Targets have included for-profit hospitals, dialysis centers, pharmaceutical manufacturers and distributors, clinical laboratories, and insurers the government contracts with to run the Medicare program. The False Claims Act Applied A U.S. Senate report estimates that the government loses over $100 billion in fraud each year. Medicare and Medicaid fraud cost $31 billion per year and the Defense Department estimates that defense contract fraud is even higher. The FCA has helped to uncover numerous cases of fraud, saving taxpayers billions, and providing whistleblowers with large rewards for their initiative. General Electric paid over $100 million in bribes to the head of the Israeli air force to guarantee the air force would purchase GE planes. General Electric then charged those bribes to the U.S. government under a military supply contract. The work of a whistleblower helped to reveal the scheme. In 1994 one health care chain, National Medical Enterprises, had to repay the United States nearly $379 million for illegal and fraudulent bills. Between 1995 and 1998, four nationwide clinical laboratories have repaid the government over $800 million for fraudulent billing. In 1998 Blue Cross/Blue Shield of Illinois (Health Care Services Corporation) paid $144 million for falsifying records, shredding records, and failing to review claims Medicare had paid it to review. National Medical Care, owned by W.R. Grace, paid $386 million in civil damages and another $101 million in criminal penalties for kickbacks and unnecessary kidney dialysis treatments. The government has brought FCA cases against New York City's Department of Social Services for falsely claiming it was providing services to foster care families who never received help from their offices. The government has also gone after military contractors for rigging their bids on competitive contracts; suppliers for furnishing products inferior to those they contracted to provide; and aerospace and munitions manufacturers for failing to adequately test their products before installing them in rockets and aircraft. The government has recovered over $3.4 billion in Qui Tam actions since the 1986 amendments. The number of cases filed has increased from 33 in 1987 to 483 in 1999, with a total of over three thousand cases filed since 1986. Originally only a small percentage of the cases, health care fraud now exceeds sixty percent of the total cases filed. On average, a whistleblower shares nearly eighteen percent of the damage award in cases where the government intervenes, and twenty-eight percent in cases where the government chooses not to participate.

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