On January 16, 2026, the U.S. Department of Justice (DOJ) released its annual False Claims Act (FCA) enforcement statistics, announcing that FCA settlements and judgments exceeded $6.8 billion in the fiscal year (FY) ending September 30, 2025, marking “the highest in a single year in the history of the False Claims Act.” 

What You Need to Know:

  • Health Care Dominance: Health care and life sciences drove the vast majority of the total recovery (over $5.7 billion, or approximately 83 percent).
  • Whistleblower Impact: Recoveries in health care and life sciences qui tam cases where the government declined to intervene exceeded those where it participated, signaling a major shift in litigation dynamics.
  • Aggressive Government Posture: Even though total government-initiated matters were down overall, with 401 new matters compared to 423 new matters in FY 2024, the number of health care-related matters grew substantially, with a record 183 new government matters, compared to 87 in FY 2024.[1]

Record-Breaking Recoveries in the Health Care Sector

DOJ’s report illustrates the government’s continued focus on FCA enforcement in the health care and life sciences space. In fact, the percentage of FCA recoveries in the health care and life sciences sectors compared to total FCA recoveries in FY 2025 increased significantly from the percentage in FY 2024 (83 percent versus 60 percent).

DOJ also reported 1,698 new FCA matters overall in FY 2025, with 1,297 new qui tam matters, the highest number in a single year. While the 401 new non-qui tam matters DOJ opened across all sectors in FY 2025 were lower than in FY 2023 (506) and FY 2024 (425), health care trended in the opposite direction, with 183 new government-initiated matters, also the highest in reported history (compared to 96 in FY 2023 and 87 in FY 2024).

The primary drivers of the reported enforcement actions include managed care (particularly Medicare Advantage), prescription drugs, and claims involving unnecessary services or substandard care.

Some of these recoveries resulted from trial verdicts subject to appeal, not negotiated resolutions, including a $948.8 million judgment against a long-term care pharmacy involving allegations of fraudulently dispensing drugs without a valid prescription, as well as a $1.6 billion trial verdict arising from allegations that prescription drug claims were induced by false and misleading claims about safety and efficacy. While those circumstances may inflate the final figures, the trajectory suggests that heightened enforcement is likely.

The Rise of Whistleblower-Led Litigation

Of the $5.7 billion in total recoveries in the health care sector, $4.5 billion was recovered from qui tam matters (both declined and intervened matters), representing 79 percent of the total recoveries and the highest in reported history. A critical trend for corporate counsel to note is the unprecedented success of relators (i.e., whistleblowers) proceeding without government intervention. For the first time, more funds were recovered in health care FCA cases where the government declined to intervene ($2.27 billion) than in cases it joined ($2.23 billion).

At the same time, total relator share awards (across all FCA matters) were down compared to recent years, landing at roughly $330 million, the lowest level since FY 2021, when awards totaled $264 million.

This suggests that DOJ’s enforcement landscape continues to be shaped by the lawsuits presented to it, even when the department chooses not to expend its own resources initially. Simultaneously, courts nationwide continue to grapple with the constitutionality of the FCA’s qui tam provisions, adding a layer of legal complexity and uncertainty to these proceedings.

Emerging Enforcement Priorities and Political Context

While the FY 2025 numbers largely reflect investigations initiated prior to the current administration taking office, early indicators suggest a continued and expanding focus on fraud enforcement, including the combination of record health care recoveries, record government-initiated health care matters, and DOJ’s own description of health care as a “leading source” of recoveries.

Additionally, DOJ’s creation of the Division for National Fraud Enforcement in January 2026 and its relaunch with the U.S. Department of Health and Human Services (HHS) of the DOJ-HHS FCA Working Group in July 2025 tee up priority areas that align with the FY 2025 recovery drivers—including Medicare Advantage, drug/device/biologics pricing, network adequacy/access issues, kickbacks tied to federally reimbursed products, defective medical devices, and electronic health record manipulation. That coordination is noteworthy because it tends to translate into faster investigative referrals, more data-driven case generation and prosecution, and an overall more aggressive regulatory environment.

DOJ’s announcement also highlights the use of the FCA in non-traditional areas that align with stated administrative priorities, including:

  • Customs and Tariffs: DOJ’s press release emphasizes improper avoidance of duties and references a cross-agency Trade Fraud Task Force, while its FY 2025 fact sheet gives concrete duty-evasion examples and flags a $54.4 million customs fraud resolution as the largest of its kind under the FCA.
  • Cybersecurity: DOJ highlighted ongoing work ensuring contractors and grantees comply with cybersecurity requirements, and the FY 2025 fact sheet reports over $52 million recovered across nine cybersecurity fraud settlements in FY 2025 alone.
  • Diversity, Equity, and Inclusion (DEI) Initiatives: New government-initiated matters in FY 2025 included those aligned with the administration’s stated policy objectives. Among these objectives are FCA actions against entities that receive federal funds but are alleged to knowingly violate civil rights laws.

What Health Care and Life Sciences Organizations Should Do Now

For health care and life sciences companies, the “wait and see” approach regarding the administration’s strategy is no longer viable. DOJ has signaled a continued, aggressive focus on utilizing the FCA consistent with the priorities seen during President Trump’s first term, as well as the administration’s Civil Division enforcement priorities announced last year. In this environment, the best defense is getting ahead of DOJ’s priorities, both the traditional health care enforcement themes and the expanding set of “non-traditional” FCA theories. While time will tell whether the novel FCA theories pass muster, early indicators suggest that, regardless, combatting fraud in the health care and life sciences space will remain a focus. Accordingly, health care and life sciences companies should do the following:

  • Expand Compliance Audits: While Medicare Advantage risk adjustment and diagnosis code practices remain a top enforcement priority, along with drug pricing/marketing arrangements, regulated companies are advised to move beyond traditional billing, coding, and regulatory checks. It is also prudent to evaluate internal operations regarding high-risk contracting representations (including cybersecurity, DEI initiatives, and trade law compliance) to ensure they align with current enforcement standards and requirements.
  • Prepare for Relator-Driven Litigation: DOJ’s declination of a particular matter is not a safe harbor. Last year’s figures demonstrate that declined cases can produce enormous outcomes, which makes internal reporting, rapid triage measures, and privilege-protected investigation protocols as important as ever.
  • Verify Cybersecurity Representations: Review all contractual obligations related to cybersecurity capabilities and ensure that your organization’s actual technical posture matches the representations made to the government. DOJ’s FCA theories in this area are becoming increasingly straightforward (i.e., certifications, contract terms, and representations), which means that stringent contracting compliance protocols can lead to significant risk reduction.

* * * *

For additional information about the issues discussed in this Insight, please contact the attorney(s) listed on this page or the Epstein Becker Green Health Care and Life Sciences attorney who regularly handles your legal matters.


ENDNOTE

[1] Annual FCA enforcement statistics reported from prior years are based on the FY 2025 statistics released on January 16, 2026. The enforcement statistics that were released in previous years vary slightly from the current statistics.

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