Fix the gaping hole in whistleblower protections: Public health and patient safety

The coronavirus pandemic has exposed a gaping hole in private sector whistleblower laws: There are none covering the disclosure of violations of patient safety or threats to public health. It often takes a crisis for Congress to recognize the need to enact effective whistleblower laws. We are in such a crisis today. The need is urgent.

Employees at hospitals, nursing homes, and community health clinics lack federal whistleblower protections if they file complaints about patient safety or threats to the public health. In the wake of the spread of COVID-19 sickness, this loophole must be closed. Doctors and nurses must be able to safety report patient care violations whenever they are witnessed. Support staff in hospitals need to freely disclose contamination that threatens public safety. Every employee in a health care establishment, including research laboratories, testing facilities, and corporations manufacturing personnel protective equipment, must be able to report public health concerns free from the threat of retaliation.

Congress must close this loophole in federal whistleblower laws in its legislative response to the coronavirus. The legislative solution for these gaps in federal protection are well established and in other contexts have proven to be highly effective. The most recent whistleblower laws, i.e. those covering auto safety and securities violations, can be a model for a public health whistleblower law.

The basic framework is well defined.

First you need a whistleblower office lodged in the federal regulatory agency with jurisdiction over some or all of the public health issues covered under the law. Whistleblower offices, such as one operated by the U.S. Securities and Exchange Commission, have proven to be highly effective at publicizing protected reporting channels, coordinating whistleblower claims, and responding to the numerous requests for assistance raised by whistleblowers.

In the case of public health, the logical department would be the Department of Health and Human Services (“HHS”). HHS has jurisdiction over the majority of federal governmental functions responsible for protecting the public or patient health, including the U.S. Public Health Service, the Agency for Healthcare Research and Quality, Centers for Disease Control, the Agency for Toxic Substances and Disease Registry, the Food and Drug Administration, and the National Institutes of Health. The HHS Office of Inspector General already has jurisdiction over government employee whistleblowing within the Public Health Service, and also has law enforcement authority.

Second, the law should follow the structure of the most effective modern whistleblower laws, such as those covering auto safety, tax evasion, securities violations, and government contracting. These laws have been highly praised by the officials with responsibility for enforcing the underlying laws, leading members of Congress and in objective academic studies that have demonstrated the importance of whistleblower reward laws. For example, in discussing the success of the False Claims Act, the former Assistant Attorney General stated that the law was “the most powerful tool the American people have to protect the government from fraud.” This was not an overstatement.

Since the False Claims Act was modernized in 1986, Congress has simply used that law as a model in enacting the other effective whistleblower laws that both incentivize the reporting of wrongdoing, and provide the best protection for those who risk their jobs and careers to serve the public interest.

Third, the central feature in all of these laws is a procedure to incentivize the reporting of high-quality tips that law enforcement can use to successfully prosecute violations. The trick that makes these laws work is to change the whistleblower-compensation model. Under traditional whistleblower laws employee compensation was tied to the amount of harm they suffered. The more severe the retaliation, the larger potential recovery. This model is backwards. Whistleblowers should not have to suffer to be rewarded. In fact, the public retaliation they often face has a chilling effect on reporting, even if an employee ultimately prevails in a case.

Starting with the False Claims Act, Congress switched the compensation model. Instead of paying workers for their suffering, compensation was based on the quality of information provided to the government. The law promotes reporting of information of actual crimes, and evidence that could be admitted in court to hold wrongdoers accountable. The better the evidence, the greater the reward. Thus, the interests of the whistleblower and those of law enforcement were harmonized. Additionally, the program is self-funding, and the taxpayers always win. Specifically, whistleblower rewards are paid directly from the fines and penalties obtained from the wrongdoer. They are never paid by the taxpayer. Because the amount of a reward is based on a percentage of collected proceeds obtained from the wrongdoer (generally between 10-30 percent), the taxpayers are always the biggest winners in a successful whistleblower case. The government obtains money, the criminals are held accountable, and the whistleblower is rewarded. It is a win-win-win for the public interest.

Next, the law must have strong protections for confidentiality and for permitting anonymous reporting. This has worked remarkably well in the whistleblower laws incorporated into the Dodd-Frank Act. Simply stated, the best protection against retaliation is for the bosses not to know who the whistleblower is. Employers cannot retaliate against whistleblowers if they do not know there even is a whistleblower, let alone his or her identity. The strict confidentiality requirements now incorporated into the securities and commodities exchange acts achieve this purpose. They need to be incorporated into a public health whistleblower law.

Finally, as a safety net, the law needs to include a standard anti-retaliation provision. There must be adequate protections if an employer learns who the whistleblower and takes revenge. All of the modern whistleblower laws have included employment protections, although these are far less effective in incentivizing whistleblowers than the reward provisions.

Unfortunately, old-fashioned anti-retaliation laws are focused on employment controversies. In these cases the conduct of the whistleblower becomes the issue (i.e. did the whistleblower commit workplace infractions that justified the adverse action), not the misconduct of the employer. These cases almost always pit a lone whistleblower against the resources of large corporate law firms. Most whistleblowers are completely out-gunned and lose their cases. Reward laws keep the focus on the misconduct of the wrongdoers – the issue is whether the law was violated, or the public health compromised, not whether or not the whistleblower came to work late.

Congress is in the process of spending trillions of dollars in fighting the hardships caused by the coronavirus pandemic. They need to take some time and enact a law to promote the reporting of threats to the public health and patient safety. The basic structure of any such law is well established and proven to be successful. This is needed both in today’s battle against COVID-19, and tomorrows future health crises.

Stephen M. Kohn is a founding partner in the whistleblower law firm of Kohn, Kohn and Colapinto and the Chairman of the Board of Directors of the National Whistleblower Center.