Health Law Advisor

One week after the U.S. Department of Justice on June 23, 2026, announced the results of its annual National Health Care Fraud Takedown—taking aim at Medicaid fraud and partnering with all 50 state Medicaid Fraud Control Units (MFCUs)—the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) denied recertification for New York’s MFCU and froze $60 million in annual federal funds for New York’s MFCU, effective July 1.

On the final day of the American Health Law Association’s Annual Meeting in New York, officials from the U.S. Department of Justice (DOJ), the Centers for Medicare & Medicaid Services (CMS), and the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) gave their own take on their agencies’ ramped-up enforcement efforts regarding health care fraud in mid-2026.

On March 4, the Department of Health and Human Services (“HHS”) Office of the Inspector General (“OIG”) issued a favorable result in OIG Advisory Opinion No. 26-03, regarding a Requestor’s proposal to offer discounts to certain ambulatory surgery centers (“ASCs”) on intraocular lenses (“IOLs”) and supplies in cataract surgery. The discounts would be contingent on physician practices—with ophthalmic surgeons performing cataract surgery at the ASCs—purchasing and entering into subscription agreements for the Requestor’s software product (the “Proposed Arrangement”).

On July 7, 2025, the Office of Inspector General (“OIG”) for the Department of Health and Human Services published Advisory Opinion 25-08 (“AO 25-08”), an unfavorable and strongly worded opinion interpreting the “arranging for” language in the Anti-Kickback Statute (“AKS”).

The AO involves a proposed arrangement for a medical device company (the “Requestor”) to pay a third-party vendor to access an electronic billing portal operated by the vendor that is used by some of the Requestor’s customers for certain billing operations. In issuing the unfavorable opinion, the OIG said the proposed arrangement “presents anti-competitive risks and risks of inappropriate steering” and characterized the arrangement as being “for the purpose of accessing referrals” from hospital customers that are clients of the vendor.

The Requestor in this AO is a medical device company that supplies "bill-only" products to hospitals. “Bill-only” products are items that are not part of a hospital’s regularly purchased inventory but rather are purchased in real time, such as when a surgeon is selecting the right size or component of a device to use during a surgery. According to the AO, what typically happens with “bill-only” products is that a representative of the medical device company delivers a selection of items to a hospital customer the day before or the day of a patient’s procedure so that the surgeon can select the specific items needed for that specific patient. Some of these “bill-only” items are used in procedures reimbursable by federal health care programs.

On June 30, 2025, the U.S. Department of Justice (“DOJ”), together with the U.S. Department of Health and Human Services Office of Inspector General (“HHS OIG”) and other law enforcement partners, announced the results of the 2025 National Health Care Fraud Takedown—hailed as the largest in history.

This year, DOJ’s Health Care Fraud Unit reported that 324 defendants were charged for their alleged involvement in various health care fraud schemes that involved over $14.6 billion in intended loss—more than doubling the prior record of $6 billion set in 2020 during the first Trump administration. By way of comparison, last year, the 2024 Takedown charged 193 defendants with allegedly committing more than $2.5 billion in fraud. And two years ago, the 2023 Takedown charged 78 defendants with more than $2.5 billion. To say there was a significant increase between the Biden administration and the second Trump administration would be an understatement.  

That this administration would “follow the money” should not come as a surprise. As noted, the prior record was set during President Trump’s first term in 2020. In that Takedown, DOJ and HHS OIG reported 345 defendants allegedly submitted more than $6 billion in false and fraudulent claims to federal health care programs and private payers. The bulk of that 2020 Takedown, $4.5 billion, was related to telehealth.

On June 25, 2025, the Office of the Inspector General (“OIG”) of the U.S. Department of Health and Human Services (“HHS”) released a short video containing the highlights of the Medicaid Fraud Control Units (“MFCUs”) Annual Report for Fiscal Year 2024 (“2024 Annual Report”). While the 2024 Annual Report was released in March 2025, HHS OIG just released the two-minute video summarizing the key aspects of the report.

MFCUs—which investigate and prosecute statewide Medicaid provider fraud, and beneficiary abuse and neglect—recovered $1.4 billion in FY 2024, which equates to $3.46 for every $1 spent. Criminal recoveries were the highest amount in the past 10 years, $961 million, and more than double the rolling 5-year average. HHS OIG attributes this massive increase to the California MFCU, which recovered $513 million on its own.