DOJ and HHS Launch Enhanced False Claims Act Working Group: Heightened Enforcement Ahead for Key Healthcare Sectors

The U.S. Department of Justice (“DOJ”) and the U.S. Department of Health and Human Services (“HHS”) have announced the formation of a newly strengthened False Claims Act (“FCA”) Working Group, signaling a more coordinated and aggressive enforcement effort targeting healthcare fraud, waste, and abuse. This initiative builds on longstanding collaboration but introduces new areas of scrutiny and cross-agency strategies designed to proactively identify fraud, accelerate investigations, and broaden the government’s impact.

Key Working Group Priorities

The DOJ-HHS FCA Working Group has outlined six core enforcement priorities, combining historical targets with emerging enforcement fronts:

• Medicare Advantage: Overbilling, risk adjustment fraud, and other abuses.
• Drug, Device, and Biologic Pricing: Scrutiny of discounts, rebates, service fees, formulary placement, and price reporting.
• Barriers to Patient Access: Practices that create barriers to patient access to care, such as insufficient provider networks.
• Kickbacks: Unlawful remuneration tied to pharmaceuticals, devices, durable medical equipment (“DME”), and federally reimbursed products.
• Materially Defective Medical Devices: Products that compromise patient safety.
• Manipulation of Electronic Health Records (“EHR”): Practices designed to drive inappropriate utilization of Medicare covered products and services.

The group also plans to evaluate payment suspensions under 42 U.S.C. § 405.370 and dismissal of qui tam complaints under 31 U.S.C. § 3730(c)(2)(A) in appropriate cases, reflecting DOJ’s refined approach to managing whistleblower actions. At the same time, the announcement strongly encourages whistleblowers to report potential False Claims Act violations directly to DOJ and HHS, underscoring their continued reliance on insider reports to identify fraud in the priority areas.

Augmenting Recent Enforcement Trends

The establishment of the Working Group builds on and reinforces the Civil Division’s June 2025 announcement of updated enforcement priorities. It is a clear signal that the new administration is executing a broader, more integrated strategy to strengthen civil enforcement, particularly in the healthcare sector. Under this strategy, the DOJ is moving beyond a reactive model driven primarily by whistleblower complaints and instead emphasizing proactive case development using data, regulatory insight, and cross-agency coordination.

Senior DOJ officials have indicated that the Working Group will play a leading role in this shift, helping the government evaluate novel legal theories early in the investigative process, streamline decision-making, and focus enforcement resources on cases with high impact. By leveraging HHS’s regulatory data and program integrity tools, the group aims to detect fraud that may otherwise evade traditional referral channels. This reflects the administration’s intent to expand the False Claims Act’s reach while improving the speed and sophistication of civil enforcement across priority areas such as Medicare Advantage, pricing practices, patient access, and product safety.

Clients at Heightened Risk

Healthcare providers, payors, manufacturers, and digital health companies face heightened risk, especially those engaging in any of the identified high-priority areas. Specific at-risk segments include:

• Medicare Advantage Organizations (“MAOs”) and healthcare providers and entities that contract with MAOs and assume delegated responsibility.
• Health insurance companies.
• Pharmaceutical, biotech, and medical device manufacturers.
• Hospitals, provider networks, and health systems involved in federal healthcare programs.
• Electronic Health Record vendors and IT service providers overseeing CMS-facing systems.
• Healthcare entities engaged in contracting or rebate arrangements involving federal payers.

These entities face scrutiny not only over fraud, but also compliance failures in pricing, reporting, safety, and patient access.

Avoiding Government Scrutiny

In response to this expanded enforcement initiative, healthcare organizations should act promptly to identify and address potential vulnerabilities. A critical first step is conducting targeted internal risk assessments focused on the areas prioritized by the new Working Group. These include Medicare Advantage coding and risk adjustment practices, drug, and device pricing arrangements (including rebates and formulary placement), and barriers to patient access such as inadequate provider networks. Special attention should also be given to product safety risks, including those arising in the manufacture or distribution of medical devices and drugs. Additionally, companies should assess whether electronic health records are being used in ways that could improperly influence utilization or billing under Medicare. These reviews should be informed by robust data analysis and supported by clear documentation and operational accountability.

Organizations should also evaluate the strength and effectiveness of their compliance programs. This involves ensuring policies and training reflect current enforcement priorities and legal standards, particularly regarding kickbacks, reporting obligations, and program integrity safeguards tied to federal healthcare reimbursement. Where gaps are identified, prompt remediation and documentation will be important in mitigating potential liability.

Finally, given the renewed encouragement for whistleblowers to report directly to DOJ and HHS, companies must ensure that internal reporting systems are well-publicized, trusted, and supported by clear non-retaliation protections. Strengthening internal reporting channels may help organizations detect issues early and address them before they escalate into government investigations.

Given the complexity of these enforcement priorities, engaging experienced counsel may be critical. Organizations should seek legal advisors with deep expertise in the False Claims Act, HHS program regulations, and product safety enforcement, as well as experience navigating DOJ investigations and qui tam litigation. The right counsel can help assess risk, guide compliance efforts, and respond effectively to emerging enforcement activity.