DOJ and HHS Announce Formation of False Claims Act Working Group and Results of National Health Care Fraud Takedown

As we reported in our recent client alert, the Trump administration has made clear that it is committed to using the False Claims Act (FCA) to prosecute healthcare fraud. Two recent Trump administration moves give important insight into what that will look like for industry participants. In quick succession, the administration announced the creation of a new interagency False Claims Act Working Group and then announced a National Health Care Fraud Takedown, charging 324 defendants with allegations of over $14.6 billion of healthcare fraud. In this alert we cover key aspect of these two moves and what they signal for the future.

The FCA Working Group

The Department of Justice (DOJ) and the Department of Health and Human Services (HHS) jointly announced the formation of an interagency FCA Working Group (Working Group) on July 2, 2025. According to the government, the Working Group will be jointly led by the general counsel of HHS, the chief counsel to the HHS Office of Inspector General (HHS-OIG), and DOJ’s deputy assistant attorney general of the Commercial Litigation Branch. Close observers will recall that the Working Group is essentially a reconstitution of a group established during the first Trump administration, and the Working Group’s mission is comparable to its earlier mission: to facilitate HHS referrals to DOJ regarding potential FCA violations in specific areas:

• Medicare Advantage
• Drug, device, or biologics pricing, including arrangements for discounts, rebates, service fees, and formulary placement and price reporting
• Barriers to patient access to care, including violations of network adequacy requirements
• Kickbacks related to drugs, medical devices, durable medical equipment, and other products paid by federal healthcare programs
• Materially defective medical devices that impact patient safety
• Manipulation of Electronic Health Records systems to drive inappropriate utilization of Medicare covered products and services
• Previously announced FCA enforcement priorities, including:
• Violations of antidiscrimination laws
• Healthcare providers fraudulently billing for non-covered services, like gender-affirming care

Beyond optimizing the referral process, the Working Group will also discuss policy considerations such as whether DOJ should intervene to dismiss qui tam FCA complaints and whether HHS should suspend payments to Medicare contractors based on credible fraud allegations.

The National Health Care Fraud Takedown

Just days before rolling out the Working Group, DOJ staged the 2025 National Health Care Fraud Takedown, announcing charges against hundreds of defendants across 50 federal districts in cooperation with 12 state attorney general Offices. The government alleges that the sum of all the fraud charged in these cases exceeds a massive $14.6 billion and $48.5 million in corresponding potential civil liability. Beyond sheer size, the takedown was notable in particular for two enforcement actions focused on telemedicine, genetic and diagnostic testing. Specifically, the government charged:

• 49 defendants with the submission of over $1.17 billion in allegedly fraudulent Medicare claims resulting from telemedicine and genetic testing schemes.
• Another 170 defendants with various healthcare fraud schemes involving over $1.84 billion in allegedly fraudulent claims connected to diagnostic testing, medical visits, and treatments that were unnecessary, provided in connection with kickbacks and bribes, or never provided at all.

Health Care Fraud Data Fusion Center

The DOJ also announced the creation of the Health Care Fraud Data Fusion Center (Center). The Center will combine experts from the DOJ, HHS, and HHS’s Office of the Inspector General to leverage cloud computing, artificial intelligence, and advanced analytics to detect healthcare fraud. The Center will build on the work of the DOJ’s Health Care Fraud Unit Data Analytics Team to identify trends like aberrant billing levels and newly emerging healthcare fraud schemes. It is fair to assume that the government expects the Fusion Center to drive an increase in data-driven enforcement actions.

The Trump administration’s DOJ is carrying forward a long tradition of using the FCA as a central tool to combat healthcare fraud but adding its particular priority enforcement areas and investigative tools. Companies in the healthcare and life sciences sectors can take proactive steps to strengthen compliance and mitigate enforcement risk, including:

• Reassessing your compliance program to ensure it aligns with current expectations from government regulators and enforcement agencies.
• Considering investments in data analytics, where appropriate, to identify patterns of risk and detect potential fraud.
• Reviewing internal reporting systems to ensure they are accessible, trusted by employees, and designed to encourage internal whistleblowing before issues escalate to DOJ.
• Ensuring strong whistleblower protections, including robust anti-retaliation policies that are clearly communicated and consistently enforced.
• Verifying your company’s ability to respond quickly to allegations of misconduct, through prompt investigation, resolution, and documentation of corrective actions.

Staying informed of these evolving priorities is essential for minimizing FCA exposure in an increasingly aggressive enforcement environment.