DOJ and HHS Relaunch False Claims Act Working Group, Sharpen Healthcare Enforcement Priorities

On July 2, 2025, the U.S. Department of Justice (DOJ) and the Department of Health and Human Services (HHS) jointly announced the reestablishment of the DOJ-HHS False Claims Act (FCA) Working Group. While the two agencies have long collaborated on healthcare fraud enforcement, the formal relaunch of the Working Group signals a renewed and intensified focus on False Claims Act investigations, particularly in sectors where federal healthcare dollars and compliance risk intersect. In comments announcing the relaunch, Brenna Jenny, Deputy Assistant Attorney General for the DOJ Civil Division's Commercial Litigation Branch, explained the DOJ was "reinvigorating" the Working Group founded in 2020 to "formalize and enhance" collaboration between DOJ and HHS. The move builds on a series of recent DOJ enforcement initiatives, including the Civil Rights Fraud Initiative and expanded whistleblower incentive programs. It also aligns with the Trump Administration's broader agenda to "aggressively" enforce the FCA as a central tool in combating fraud against the federal government.

Key Enforcement Priorities

The Working Group outlined six enforcement priorities that will guide upcoming FCA investigations and referrals from HHS to DOJ:

• Medicare Advantage: Including alleged risk score inflation, unsupported diagnoses and failures in data integrity and reporting.
• Drug, Device and Biologics Pricing: Scrutinizing discounts, rebates, formulary placement fees and price reporting arrangements.
• Barriers to Patient Access to Care: Focusing on network adequacy violations and other access limitations in Medicare and Medicaid managed care plans.
• Kickbacks: Relating to drugs, devices, durable medical equipment (DME) and services paid for by federal healthcare programs.
• Materially Defective Medical Devices: Particularly those implicating patient safety or clinical efficacy.
• Manipulation of Electronic Health Records (EHRs): Involving improper documentation practices used to support medically unnecessary services or inflate claims.

In addition, the Working Group reaffirmed its focus on previously announced DOJ civil fraud priorities, including civil rights violations by federal fund recipients and discriminatory barriers to care.

Implications of Re-Establishment

While DOJ and HHS have historically collaborated on FCA cases, this announcement represents a formalization and elevation of that partnership. Notably, the Working Group will:

• Coordinate payment suspensions under 42 C.F.R. § 405.370, which may occur upon credible allegations of fraud—even before. the DOJ intervenes in an FCA qui tam action.
• Consider dismissal of non-intervened qui tam suits under 31 U.S.C. § 3730(c)(2)(A), potentially curbing resource-draining or meritless litigation.
• Leverage interagency data sharing and advanced analytics to detect outliers and refine case targeting.

The combination of data-driven enforcement, centralized oversight, and structural coordination may accelerate FCA investigative timelines and increase scrutiny on high-risk segments of the healthcare and life sciences industries.

What This Means for Industry Stakeholders

Companies operating in or adjacent to federal healthcare programs, especially those in the Medicare Advantage, life sciences, health technology and managed care sectors, should view this announcement as a clear signal of continued enforcement escalation. In particular, the focus on novel theories (e.g., network adequacy) and rarely used tools (e.g., payment suspensions) suggests agencies are seeking not only to punish wrongdoing but to reshape compliance expectations.

Strategic Takeaways and Recommended Actions for Healthcare and Life Sciences Clients

The reconstitution of the DOJ-HHS FCA Working Group signals a recalibrated and intensified focus on FCA enforcement, particularly in high-value federal healthcare programs and fast-evolving commercial models. The Working Group's use of centralized oversight, interagency referrals and data analytics underscores the need for companies to adopt proactive, data-literate and operationally-embedded compliance strategies.

Below are key considerations and actions clients should prioritize:

1. Anticipate Heightened Scrutiny Across the Healthcare Continuum

Entities in Medicare Advantage, Medicaid managed care, the pharmaceutical supply chain and the digital health ecosystem should expect an uptick in FCA investigations, driven by whistleblower activity and advanced agency analytics. This is especially true for areas identified as enforcement priorities, such as pricing practices, network adequacy and EHR manipulation. Even longstanding business models—rebate structures, risk adjustment submissions or data-driven utilization strategies—may now face renewed legal risk.

Best Practice: Reassess enterprise risk profiles through the lens of current FCA priorities and determine whether business functions that rely heavily on federal healthcare funding (e.g., managed care finance, provider contracting or data submission units) warrant enhanced internal controls, third-party review, or updated SOPs.

2. Strengthen Internal Reporting Mechanisms and Whistleblower Protections

The FCA's qui tam provisions remain a powerful incentive for relators. With DOJ encouraging meritorious filings and potentially exercising greater discretion to dismiss weak ones, companies may see more selective but also more sophisticated whistleblower claims.

Best Practice: Evaluate the effectiveness of your internal complaint pathways. Consider: (i) reinforcing anonymous reporting tools; (ii) providing clear, C-suite-endorsed messaging that encourages internal reporting; and (iii) demonstrating transparency about how concerns are investigated and resolved. Companies that can demonstrate robust, good-faith responses to internal complaints are often better positioned when facing a government inquiry.

3. Audit and Monitor High-Risk Claims and Data Submissions

The Working Group's enhanced use of interagency data analytics means companies must anticipate scrutiny of outlier patterns—whether in coding intensity, pricing anomalies, the usage patterns of physician clients, Sunshine Act-reported payments to healthcare providers or network adequacy metrics. CMS and DOJ will increasingly cross-reference clinical, financial and operational data to validate claims or identify red flags.

Best Practice: Implement periodic internal audits, particularly focused on risk adjustment coding practices and support documentation, EHR templates and default settings that could drive billing, outlier patterns associated with healthcare provider customers, network adequacy metrics (e.g., time/distance standards, appointment availability) and pricing and discount arrangements subject to price reporting or Medicaid best price rules. Knowing how your company benchmarks against industry comparators and what your internal data show—and why—will be critical in mitigating data-driven investigations.

4. Review Pricing, Rebates and Contracting Models for FCA Exposure

Enforcement priorities now squarely include financial arrangements that touch formulary placement, rebates, service fees and other pricing tactics. Life sciences and PBM contracts—especially those involving innovative or performance-based payment models—may raise novel questions under the FCA.

Best Practice: Conduct a legal review of current pricing strategies and third-party agreements with providers, PBMs and payors. Ensure all arrangements: (i) are supported by fair market value assessments; (ii) are documented with appropriate business justifications; and (iii) include sufficient guardrails to avoid any appearance of intent to induce referrals or drive volume.

5. Mitigate Risks Associated with EHR System Usage and Documentation Practices

Manipulation of EHRs to justify claims or medical necessity remains an area of concern. Providers and health tech companies alike should be alert to systemic issues in how EHR platforms may facilitate upcoding, auto-population or documentation inflation.

Best Practice: Review: (i) EHR functionalities (e.g., defaults, prompts or auto-fill features); (ii) training materials provided to clinical staff or billing teams; and (iii) audit trails related to clinical documentation that supports federal claims. Companies should consider whether EHR configurations align with actual care delivery, and whether documentation supports billed services on a claim-by-claim basis.

6. Prepare for Increased Use of Government Remedies Beyond Civil Settlement

The announcement indicates greater willingness to use payment suspensions. This tool can create significant disruption even before liability is established.

Best Practice: Develop a government investigation response plan that includes: (i) pre-established protocols for document holds, internal fact-gathering and leadership briefings; (ii) external counsel engagement plans; and (iii) assessment of business continuity strategies in the event of a payment suspension or licensing impact.

Looking Ahead

The relaunch of the DOJ-HHS FCA Working Group is not simply a symbolic step but reflects an institutionalized shift in how healthcare fraud investigations are prioritized, structured and pursued. As scrutiny intensifies, healthcare and life sciences clients will be well-served by revisiting their compliance posture, aligning operational behaviors with enforcement priorities and preparing for a landscape where data, whistleblower claims and interagency coordination play a defining role in enforcement outcomes. White & Case will continue to monitor developments in FCA enforcement and assist clients in navigating the compliance, litigation and strategic considerations that follow.

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