On July 2, 2025, the U.S. Department of Justice (DOJ) and U.S. Department of Health and Human Services (HHS) announced the reestablishment of the DOJ-HHS False Claims Act Working Group. Originally formed in December 2020 at the tail end of the first Trump Administration, this partnership focuses on advancing enforcement of the False Claims Act (FCA) as a primary tool to combat healthcare fraud. While some may view the announcement as merely formalizing long-existing cooperation between DOJ and HHS, the announcement is still significant in that it signals the Administration’s commitment to investigating and prosecuting individuals and entities that commit healthcare fraud. This reinvigoration of the FCA Working Group aligns with President Trump’s plans to “aggressively” enforce the FCA, as detailed in our earlier February 24, 2025 alert.
OIG Approves Multi-MSO Telehealth Arrangement That Meets AKS Safe Harbor
On June 6, 2025, the U.S. Department of Health and Human Services Office of Inspector General (OIG) issued a favorable advisory opinion concerning a proposed telehealth staffing and services arrangement involving a management services organization (MSO), a physician-owned practice and third-party telehealth platforms. The proposed arrangement involved a situation in which the platforms would not have access to all commercial insurers, therefore the parties would bill the platforms’ patients through the requestor PC’s commercial contracts. The OIG concluded that the proposed arrangement would not generate prohibited remuneration under the federal anti-kickback statute (AKS), and the OIG would not impose administrative sanctions, as the proposed arrangement could meet the personal services and management contracts safe harbor.
The proposed arrangement is one of many ways national parties have sought to innovate with entity structures and relationships to expand telehealth offerings. When new providers seek to offer telehealth services, they can struggle to add commercial insurer plans. Third parties have offered to assist by managing those providers and offering commercial contracting relationships. The OIG’s advisory opinion suggests that such novel relationships can still meet a safe harbor for the AKS and provides an avenue for two or more MSOs to work together in offering telehealth or other healthcare services while still meeting a safe harbor.
Read on to learn more about the OIG’s opinion and what it means for providers that want to expand telehealth.
Healthcare Fraud Enforcement in a Second Trump Administration: Trends, Priorities, and Implications
On May 12, 2025, the U.S. Department of Justice’s Criminal Division released a policy memorandum outlining its enforcement priorities for the upcoming year. The top priority for the division will be investigating and prosecuting white collar crimes related to waste, fraud and abuse — particularly healthcare fraud. This emphasis on prosecuting healthcare fraud reflects the administration’s broader goals of eliminating waste in federal programs, such as Medicare, Medicaid and TRICARE, and ensuring that taxpayer dollars are used efficiently and effectively.
Read on to learn more about the DOJ’s enforcement priorities and what proactive measures healthcare companies and providers should consider.
DOJ Announces Initiative to Use False Claims Act to Investigate DEI Practices
On May 19, 2025, the U.S. Department of Justice announced its new Civil Rights Fraud Initiative, which aims to use the False Claims Act (FCA) to investigate and pursue claims against entities that tolerate antisemitism, allow men to enter women’s spaces or compete in female athletic competitions, or engage in unlawful diversity, equity and inclusion practices. A central focus of the initiative appears to be pursuing claims against entities that certify compliance with civil rights laws while “knowingly” engaging in what the memorandum calls “racist preferences, mandates, policies, programs, and activities, including thorough [DEI] programs” that provide benefits based on race, ethnicity or national origin. The DOJ encourages private parties to engage as part of this process by filing lawsuits and litigating claims under the FCA as qui tam relators.
Read on to learn more about the initiative and how it could impact federal contractors, educational institutions and other entities that received federal funding.
DOJ Targets Neurofeedback Billing in $15 Million Behavioral Health Fraud Case
On March 6, 2025, federal prosecutors charged a Minnesota couple with orchestrating a $15 million healthcare fraud scheme involving overbilling and submission of false claims for neurofeedback and other behavioral health services performed by a network of behavioral health clinics. This newly unsealed federal indictment underscores the Department of Justice’s increasing focus on fraud involving neurofeedback and other emerging behavioral health treatments.
Read on to learn more about the federal indictment and what it portends for behavioral health practices and potential investors.
Fifth Circuit Concurrence Adds Voice to FCA Constitutionality Questions
A first appellate circuit judge has questioned the False Claim Act’s constitutionality. In the Fifth Circuit’s decision last month in United States ex rel Montcrief v. Peripheral Vascular Assocs., P.A., No. 24-50176, — F. 4th –, 2025 WL 939890 (5th Cir. Mar. 28, 2025), Judge Stuart Kyle Duncan separately wrote a concurring opinion to express skepticism regarding the constitutionality of the qui tam provision of the False Claims Act. Adding to a decision issued by a Florida federal district court last fall, Judge Duncan said that the qui tam provision of the False Claims Act violates the Appointments Clause of the Constitution because it allows private citizens to exercise the power of the executive branch despite not being appointed or confirmed as an officer of the United States.
First Circuit Adopts “But For” AKS Standard, Leaving Third Circuit Alone in Causal-Link Standard
On Feb. 18, 2025, the U.S. Court of Appeals for the First Circuit adopted the “but for” causality standard for violations of the federal Anti-Kickback Statute (AKS) that give rise to violations of the federal False Claims Act (FCA). In United States v. Regeneron, the First Circuit held that for a violation of the AKS to constitute a false claim subject to the FCA, the government must demonstrate that the illicit kickback was the “but for” cause of a submitted claim.
This holding ended an intra-circuit split between two district court opinions including the lower court’s ruling in this case and aligns the First Circuit with the Sixth and Eighth circuits’ interpretations. The holding leaves the Third Circuit as the only circuit allowing the government to rely on a “causal link” standard between an AKS violation and the submission of a false claim subject to the FCA.
CMS Nearly Doubles Prior Stark Self-Disclosure Dollar Record in 2024
The Centers for Medicare & Medicaid Services (CMS) recently released data on its 2024 settlements of voluntary self-disclosures related to past violations or potential violations of the physician self-referral law (the Stark Law). In 2024, CMS settled an agency record 314 self-disclosures (an amount that the following chart shows towering over other years), with settlement amounts totaling over $24,700,000 in the aggregate.
Fourth Circuit Upholds OIG Advisory Opinion Process
On January 23, 2025, the United States Court of Appeals for the Fourth Circuit rejected a challenge to Advisory Opinion 22-19 (the “Advisory Opinion”) issued by the United States Department of Health and Human Services, Office of Inspector General (“OIG”). The case, Pharmaceutical Coalition for Patient Access v. United States, centered on whether the Advisory Opinion was appropriate when it found a proposed patient assistance program for Medicare Part D beneficiaries by the Pharmaceutical Coalition for Patient Access (the “Coalition”) could violate the Anti-Kickback Statute (“AKS”). In rejecting this challenge to the Advisory Opinion, the Fourth Circuit signaled the judiciary’s continued respect afforded to government agencies, including OIG’s issuing of advisory opinions, even in a post-Chevron world.
Department of Justice Suggests “Aggressive” Enforcement of False Claims Act
On February 20, 2025, during a speech to the Federal Bar Association’s annual qui tam conference, Michael Granston, Deputy Assistant Attorney General for the Commercial Litigation Branch at the U.S. Department of Justice (DOJ), said that the Trump Administration will seek to “aggressively” enforce the False Claims Act (FCA). In particular, Granston stated that active FCA enforcement is consistent with the Trump Administration’s priorities of increasing government efficiency and “rooting out waste, fraud and abuse.”