FCA Amendments of 1986

The False Claims Act (FCA) has been on the books since the Civil War, but by the mid-20th century, its impact had faded. That changed in 1986, when Congress passed a major amendment that revitalized the law and transformed it into the powerful whistleblower tool we know today. At Barrett Johnston, we often trace modern healthcare fraud enforcement back to this pivotal year.

Prior to 1986, the FCA was weakened by restrictive court rulings and low financial incentives for whistleblowers. Fraud against government programs was widespread, particularly in defense contracting and healthcare, but insiders had little reason to risk their careers to come forward.

The 1986 amendments, championed by Senator Charles Grassley and Representative Howard Berman, overhauled the law in several ways:

-Increased whistleblower rewards, allowing relators to receive 15–30% of recovered funds.
-Strengthened anti-retaliation protections, making it illegal for employers to fire, demote, or harass whistleblowers.
-Expanded liability, making it harder for companies to escape responsibility through loopholes.
-Lowered the burden of proof, giving the government more flexibility in pursuing fraud cases.

These changes ushered in a new era. Since 1986, whistleblowers have helped the U.S. recover tens of billions of dollars in fraudulent claims, with healthcare making up the largest share.

These 1986 amendments illustrate how public policy can empower ordinary people to hold massive corporations accountable. This turning point gave whistleblowers real tools — and real protections — to stand up against fraud that harms patients and drains taxpayer resources.