(a) The OIG may grant an award to a person who reports activity that constitutes fraud, waste, or abuse of funds in the Medicaid program or reports overcharges in the program if the OIG determines that the disclosure results in the recovery of a damage or penalty imposed under §32.039, Texas Human Resources Code, and described in this subchapter. Unless the person is the original source of the information as defined in §36.113(b), Texas Human Resources Code, the OIG may not grant an award to a person in connection with a report if:
  (1) The OIG or the OAG had independent knowledge of the activity;
  (2) The OIG or the OAG had an open complaint or investigation on the provider or person;
  (3) the state or any agent of the state was a party to civil or criminal proceedings in which the allegations were disclosed;
  (4) the allegations were disclosed in a legislative or administrative report, hearing, audit, or investigation; or
  (5) the allegations were disclosed by the news media.
(b) A person who brings an action under Chapter 36, Subchapter C, Texas Human Resources Code is not eligible for an award under this section.
(c) A person who makes a report under this section must make known at the time of the report of the complaint that they are reporting the potential fraud, waste, or abuse in accordance with this section.
(d) The OIG determines, at its discretion, the amount of an award. The award may not exceed five percent of the amount of the administrative damage or penalty collected under this subchapter that resulted from the person's disclosure. In determining the amount of the award, the OIG considers how important the disclosure was in ensuring the fiscal integrity of the program. The OIG may also consider whether the individual participated in the fraud, waste, abuse, or overcharge.
(e) The OIG pays an award made under this section only after collecting the funds to be awarded. Recovery of funds, including overpayments, damages and penalties, and any other collections from the provider or person committing the fraud, waste, or abuse, is applied in the following order:
  (1) the overpayment;
  (2) refund of the federal share of any overpayment, damages, or penalties;
  (3) the OIG's method of finance from the collected damages and penalties;
  (4) the OIG's investigative costs from the collected damages and penalties;
  (5) other costs of recovery from the collected damages and penalties;
  (6) an award from the collected damages and penalties; and
  (7) any other accounts receivable against the person or provider.
(f) The priority of application and distribution of the collected funds under subsection (e) of this section may be altered, at the discretion of the OIG, due to state or federal statute or other policy determinations.
(g) The OIG calculates awards based on the collected state general revenue portion of the penalties and damages. If HHSC enters into global or national settlements where the federal government or other agencies receive a portion of the amount of damages or penalties, the award is calculated only on the remaining state general revenue share collected.
(h) The OIG does not award a distribution unless the OIG has met its method of finance threshold for the biennium, as defined in the General Appropriations Act, from damages and penalties collected under this subchapter.
(i) The person reporting a complaint has no discretion or authority over the OIG decision to allow a payment plan or to decide the terms of the payment plan.

Source Note: The provisions of this §371.1619 adopted to be effective October 14, 2012, 37 TexReg 7989; amended to be effective May 1, 2016, 41 TexReg 2941