Background: Healthcare fraud is estimated to account for 3 - 10% of total healthcare expenditures. In the fiscal year ending 9/30/05 $166 million was awarded to whistleblowers who initiated health-related qui tam suits. Under the US False Claims Act, those who knowingly submit, or cause another person or entity to submit, false claims for payment of government funds are liable for three times the government's damages plus civil penalties of $5,500 to $11,000 per false claim. The US Federal Qui Tam provision, or 'whistle-blower' act, allows an individual to sue on his or her behalf & the government to collect damages. Hypothesis: Whistleblowers have an economic incentive to report fraudulent behavior and will become increasingly engaged over time in qui tam actions; total government recoveries for fraud will rise over time. Methods: US Government, Taxpayers Against Fraud data supplemented primary data collection to develop a reference database of Federal qui tam lawsuits relating to healthcare for the years 1993 - 2005 to assess changes over time, types (e.g., fraudulent cost reports, billing violations, upcoding, kickbacks) & magnitude of fraud by provider/supplier category. We used SPSS and Excel to assess financial settlements from qui tam cases. An economic model was developed and linear regression was conducted. Findings: From 1993 - June 2006, there were 840 qui tam cases relating to the US Medicare program. Aggregated settlements for all cases = $13,132,965,578 (Mean = $15,634,483; Median = $1,200,000). The minimum payment was $3,750; maximum = $875,000,000. Payments made to 242 whistleblowers for whom we had complete data = $904,906,953 in total. Qui tam cases peaked in 2000 and declined through June 2006; total payouts vary by year. Billing violations accounted for 60% of fraud (type of fraud was identified in 48% of cases). Mean (median), settlements were largest for pharmaceutical firms = $167,306,899 (median = $27,000,000). The largest settlement = $875,000,000. Conclusion: Over 12 years, Federal US healthcare fraud settlements relating to qui tam actions have been largest for pharmaceutical firms. The trend for settlements has been uneven over time, growing between 1998 - 2002 and then declining. Whistleblowers have recouped considerable amounts as a result of their involvement in qui tam actions. The number of qui tam actions has decreased during the past five years. The magnitude of the problem suggests that greater attention is needed in designing alternatives such as audit-based systems for identifying fraudulent behavior. Additional research is needed to assess whether a well designed audit system would capture more.