Health Law Advisor

On August 13, 2026, the Assistant Attorney General for the U.S. Department of Justice (“DOJ”) National Fraud Enforcement Division (the “NFED”), Colin M. McDonald, released a memorandum outlining NFED’s enforcement priorities. The memorandum is the first memo of this kind from NFED.  The establishment of NFED earlier this year represented a watershed moment for federal fraud prosecution, as it established DOJ’s first-ever division dedicated exclusively to combating fraud against taxpayer dollars and taxpayer-funded programs.  With a stated goal of having 500 prosecutors and staff by August 24, NFED seeks to deploy “cutting-edge data analysis” across a “whole-of-government” effort.  The establishment of NFED signals a fundamental shift in federal fraud enforcement, one that seeks to compress investigation timelines and narrow the window for voluntary disclosures.  Breaking down data barriers, eliminating silos, and establishing partnerships with U.S. Attorneys’ Offices, federal agencies, and state and local partners, the NFED’s priorities are a warning call to companies to expect more efficient detection, investigation, and prosecution than in the past.  The creation of the NFED signals a desire on the part of the Trump administration (“Administration”) to meaningfully escalate federal fraud enforcement sophistication and resources.

On May 19, 2025, the U.S. Department of Justice (DOJ) announced a new Civil Rights Fraud Initiative that will leverage the federal False Claims Act (FCA) to investigate and litigate against universities, contractors, health care providers, and other entities that accept federal funds but allegedly violate federal civil rights laws.

The initiative will be led jointly by the DOJ Civil Division’s Fraud Section and the Civil Rights Division—with support from the Criminal Division, federal civil rights agencies, and state partners. 

The initiative implements President Donald Trump’s Executive Order 14173, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity” (January 21, 2025), directing agencies to combat unlawful discrimination through the FCA, and complements Attorney General (AG) Bondi’s February 5 memorandum, “Ending Illegal DEI and DEIA Discrimination and Preferences.”

On January 21, 2025, President Trump issued an executive order titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity” (the “EO”), which aims to eliminate diversity, equity, and inclusion (DEI) policies and programs across the federal government and within companies that do business with the federal government. Importantly, the EO revokes Executive Order 11246, which, since 1965, has mandated affirmative action in employment from government contractors and required implementation of affirmative action programs.^[i]

Federal contractors and grant recipients have until April 21, 2025 (90 days from the issuance of the EO) to comply with the EO’s provisions. 

Below, we summarize the False Claims Act (FCA) implications of the EO.^[ii] Briefly stated, federal contractors and grant recipients, including certain health care organizations, should pay close attention to the EO’s required certifications since they directly tie to potential FCA liability premised on false certification of compliance with the federal anti-discrimination laws.

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On December 27, 2024, the U.S. Court of Appeals for the Second Circuit held in U.S. ex rel. Camburn v. Novartis Pharmaceuticals Corporation that a relator adequately pleads a False Claims Act (“FCA”) cause of action premised on violation of the Anti-Kickback Statute (“AKS”) by alleging, with sufficient particularity under Federal Rule of Civil Procedure 9(b) (“Rule 9(b)”), that at least one purpose (rather than the sole or primary purpose) of the alleged kickback scheme was to induce the purchase of federally reimbursable health care products or services.^[1] In doing so, the Second Circuit joins seven other Circuit Courts—the First, Third, Fourth, Fifth, Seventh, Ninth, and Tenth Circuits—in adopting the “at least one purpose” rule. This ruling lowers the bar in the Second Circuit for relators pleading AKS-based FCA claims. 

Interplay Between FCA and AKS Violations

Under the AKS, “a claim that includes items or services resulting from a violation [of the AKS] … constitutes a false or fraudulent claim” under the FCA.^[2]

The AKS prohibits persons from, among other things, “knowingly and willfully” soliciting or receiving “any remuneration (including any kickback, bribe, or rebate) directly or indirectly, overtly or covertly, in cash or in kind—

Massachusetts employers with six or more employees are required to annually submit the new Health Insurance Responsibility Disclosure (“HIRD”) form, regardless of whether they offer health insurance to their employees or not. The Massachusetts Department of Revenue (DOR) recently issued guidance on the new HIRD reporting requirements. An individual is considered to be an employee if the employer has included such individual in the quarterly wage report to the Department of Unemployment Assistance during the past 12 months. The new HIRD form only consists of a single ...