Bills would target corrupt state vendors [The Blade, Toledo, Ohio]

Dec. 9—COLUMBUS — Individual Ohioans could sue state vendors for wrongdoing on behalf of the state, and such vendors could be barred from doing business with Ohio in the future under legislation proposed Thursday by a pair of House Democrats.

"This bill would help ensure that those companies that were doing the wrongdoing won't be able to willy-nilly sneak back in," said Rep. Paula Hicks-Hudson (D., Toledo), one of the bill's sponsors.

The bill's backers pointed to Centene Corp., a pharmacy benefit manager operating through subsidiary Buckeye Health Plan. It reached an $88 million settlement with Ohio for allegedly over-billing taxpayers for prescription medications.

"They went right back to doing business with the state of Ohio," said Rep. Jeff Crossman (D., Parma), a bill sponsor. "That's unbelievable to me."

The company went on to get another lucrative contract as a Medicaid managed-care provider, something that became an issue recently when Maumee's Paramount Advantage, the insurance arm of ProMedica, sued the state when it lost out on one of those contracts.

Mr. Crossman said the company should have been forced to step away for a period of time as part of that settlement. The state has the option of debarment now, but it is not mandatory.

The bill would mandate that a vendor that is convicted of corruption or admits to wrongdoing in a settlement would be automatically barred from doing business with the state for one to three years as determined by a Department of State Vendors.

The would-be Ohio False Claims Act would allow individual taxpayers to civilly sue a state vendor or contractor to seek damages for alleged corruption on behalf of the state as a whole. The state would have the option of taking over that litigation. Modeled after a federal law that has been replicated by some other states, the idea of individual lawsuits has been floated before in Ohio without success.

Both lawmakers pointed to the $61 million Statehouse bribery scheme that led to a now-repealed $1 billion bailout of two nuclear power plants owned by a former FirstEnergy Corp. subsidiary as an example of the pervasiveness of corruption.

However, FirstEnergy, which has admitted to bribery as part of a deal with prosecutors, would not be a "vendor" doing business with the state under the terms of the bill.

While a taxpayer may currently have standing to bring a lawsuit against a vendor for harm he experienced, Mr. Crossman noted that damages in such a case would be limited to that individual's circumstance and would not apply to all those affected statewide.

This bill would allow a lawsuit filed by an individual on behalf of the entire state. Mr. Crossman said he was unsure whether the bill would allow retroactive filing of lawsuits for past fraud.

A similar provision was floated several years ago as part of a Medicaid reform package, but it was removed before the package became law. Democrats are in the minority in both chambers of the General Assembly and would need Republican help to enact any legislation.

'These are lawsuits that are frequently brought by whistleblowers that have witnessed corruption or fraud and just want to do the right thing are behalf of the state of Ohio or federvernment...," Mr. Crossman said. "The power of individuals to do the right thing is far more efficient than hiring an army of attorneys or auditors to simply police all the vendors as the state of Ohio is doing."

Attorney General Dave Yost declined to comment on the legislation.

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