DOJ Announces 2026 National Health Care Fraud Takedown

DOJ Announces 2026 National Health Care Fraud Takedown 

On June 23, the US Department of Justice (DOJ) announced its 2026 National Health Care Fraud Takedown, resulting in charges against 455 defendants, including 90 doctors and other licensed medical professionals, in alleged schemes involving more than $6.5 billion in false claims and significant patient harm. The cases span 56 federal districts across 45 states and territories. 

The Takedown reflects what the DOJ described as a “whole-of-government approach” involving multiple federal and state partners. The DOJ also described significant international cooperation, including apprehensions in Cyprus tied to an alleged $3.7 billion scheme, in Estonia tied to a previously charged $10.6 billion scheme, and in the Philippines tied to a previously charged $1.2 billion telemedicine fraud scheme.

The DOJ also reported a wide range of related enforcement actions, including: 1,079 Centers for Medicare & Medicaid Services provider suspensions; 1,403 billing-privilege revocations; 48 civil monetary penalty settlements totaling more than $73 million; more than 1,400 provider exclusions; 25 US Department of Health and Human Services, Office of Inspector General actions seeking more than $10 billion; civil charges against 13 defendants involving $14.8 million in alleged schemes; civil settlements with 31 defendants totaling $23 million; and 928 US Drug Enforcement Administration administrative cases seeking revocation of controlled-substance authority.

Major fraud areas targeted in this year’s Takedown include fraudulent wound care and allograft schemes, patient harm, Medicaid fraud, transnational criminal organizations, and illegal opioid distribution, with the DOJ crediting the use of data analytics as key to the enforcement effort.

Read the DOJ’s press release here.

An indictment is merely an allegation, not a finding of guilt. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

False Claims Act Case Against Harvard to Proceed Over Alleged NIH Grant Fraud

On June 23, the US District Court for the District of Massachusetts granted in part and denied in part a motion to dismiss a False Claims Act (FCA) complaint alleging that Harvard University and one of its researchers received more than $250 million in National Institutes of Health (NIH) grant funding based on false statements in grant applications and progress reports.

The lawsuit was brought by relator Dr. David S. Zielinski, the former executive director of Harvard’s Clinical and Translational Science Center, Harvard Catalyst. According to the complaint, Harvard Catalyst allegedly received approximately $117.5 million in NIH funding for 2008-2013, $106 million for 2013-2018, and approximately $93 million for 2018-2023, and, at the time the complaint was filed, was expected to receive more than $76 million for the 2023-2030 cycle. The complaint alleges that the defendants failed to carry out NIH-funded work as proposed across multiple grant cycles, including by leaving certain grant aims incomplete or unattempted, and, in later periods, deviating from approved aims without prior NIH approval. 

The defendants sought dismissal, arguing that the complaint did not adequately identify requests for NIH grant funds, did not sufficiently explain why those requests were false, did not make plausible allegations, and did not show that the alleged misrepresentations mattered to NIH’s funding decisions. The court rejected those arguments, holding that the complaint adequately alleged that the defendants sought government funds through grant applications and progress reports, that those submissions were allegedly false, and that compliance with the approved grant aims, budget, and award terms could have mattered to NIH’s decision to provide funding. The court did, however, dismiss Count III — the “reverse false claims” count — which concerned whether the defendants improperly avoided an obligation to repay the government. The court held that this repayment theory was not separate from the same alleged false requests for payment and false statements underlying the other claims.

The case is United States ex rel. Zielinski v. President & Fellows of Harvard College, Case No. 24-10667-MJJ, in the US District Court for the District of Massachusetts.

The claims in this action are allegations only, and there has been no determination of liability.

Unsealed Whistleblower Complaint Alleges Kickback Schemes by Major Pharma Companies

A whistleblower lawsuit recently unsealed in the US District Court for the Central District of California alleges that Novartis Pharmaceuticals Corp. and several other drug companies violated the FCA and the Anti-Kickback Statute (AKS) through an alleged nationwide scheme to increase prescriptions of Xolair and successor biologics. 

According to the complaint, the alleged scheme began with Xolair’s 2003 launch and its respiratory and immunology biologics. The complaint alleges that the defendants used speaker programs, educational grants, travel, cash-equivalent payments, and other financial or in-kind incentives to influence prescribing and to protect market share. The complaint also alleges that the defendants promoted Xolair and successor biologics for unapproved uses and coupled that promotion with reimbursement strategies allegedly designed to increase government payments. It is alleged that those practices caused false claims to be submitted to Medicare, Medicaid, TRICARE, and other federal health care programs, and that the alleged conduct resulted in hundreds of millions, if not billions, of dollars in improper reimbursement.

The case is pending in U.S. District Court for the Central District of California, Case No. 26-cv-553.

The complaint contains allegations only. There has been no determination of liability.

CVS Health Defeats Whistleblower’s ‘Worthless Services’ FCA Suit

CVS Health Corp. prevailed in a whistleblower’s FCA suit alleging that the company billed Medicare and Medicaid for biologic drugs that had allegedly been rendered worthless by flawed shipping practices. On June 22, the US District Court for the Eastern District of Pennsylvania granted summary judgment for CVS, holding that relator Stan Ellis failed to prove that the drugs purchased by the government were medically worthless.

Ellis, a salesperson for a company that sells cold-chain packaging supplies, filed the action in 2016, alleging that CVS caused government health care programs to pay reimbursement claims for drugs that were allegedly compromised by cold-chain shipping failures. Specifically, the complaint alleged that CVS used EPS Styrofoam packing systems that exposed temperature-sensitive drugs to freezing conditions, and that CVS knew from testing and manufacturer guidance that freezing posed risks for drugs such as Humira, Enbrel, and Copaxone.

The court previously dismissed some of Ellis’s claims in 2023 but allowed his worthless-services theory to proceed. At summary judgment, however, the court concluded that Ellis’s evidence did not show that freezing necessarily affected drug potency, which the court identified as the relevant measure of worthlessness.

The court drew a line between flawed shipping practices and FCA falsity. The court emphasized that flaws in CVS’s packaging procedures, evidence of freezing risk, or possible noncompliance with temperature-handling guidance did not themselves prove a false claim unless the drugs were shown to have lost their therapeutic value. The court found that manufacturer stability studies showed that the drugs could withstand colder temperatures for longer than Ellis alleged, and that Ellis himself acknowledged the studies showed the drugs were resilient to temperature changes. The court also rejected Ellis’s broader theories that CVS’s shipping methods made the drugs systematically vulnerable or unmarketable, reasoning that those theories would extend the worthless-services doctrine too far.

The case is Ellis v. CVS Health Corp., Case No. 16-cv-1582, in the US District Court for the Eastern District of Pennsylvania.

Rhode Island Opioid Treatment Provider Agrees to Pay $10.2 Million to Resolve False Claims Act Allegations

Rhode Island opioid treatment provider Journey to Hope, Health and Healing and former owner and CEO, Kenneth L. Richardson Jr., agreed to pay $10.2 million to resolve allegations that they billed Medicaid and Medicare for treatments they did not provide.

Two former employees brought claims under the qui tam provisions of the FCA, after which the DOJ and the State of Rhode Island intervened and, in April 2023, filed a complaint in intervention. The complaint alleged that Journey altered, backdated, and falsified records to make it appear patients received required treatment plans and counseling. The complaint also alleged that Journey maintained counselor caseloads so high that it was physically impossible to provide required counseling services.

According to the DOJ’s press release, Journey and Richardson agreed to pay $10.2 million to settle the FCA claims. The press release notes that the whistleblowers will receive approximately $2.04 million of the settlement. The court approved the jointly filed stipulation of dismissal on May 29.

The case is Quaresma et al. v. The Journey to Hope et al., Case No. 1:20-cv-00451, in the US District Court for the District of Rhode Island.

Read the DOJ’s press release here.

The claims resolved by the settlement are allegations only, and there has been no determination of liability.

Utah Businessman Sentenced to Probation After Cooperating in $89 Million Medicare Fraud Scheme

Utah businessman, Jordan Bunnell, was sentenced by the US District Court for the District of New Jersey to three years’ probation, including 14 months of home detention and location monitoring, after cooperating with prosecutors and pleading guilty in March 2023 to conspiracy to violate the AKS, conspiracy to commit health care fraud, and conspiracy to commit wire fraud. 

According to the government, Bunnell and a co-conspirator owned and operated a telemedicine company, laboratory, and marketing call center that created orders for medically unnecessary genetic tests billed to Medicare and other federal health programs. It is alleged that telehealth providers approved orders with little or no patient contact, and the labs submitted claims that were often not medically necessary. The scheme allegedly generated approximately $89 million in fraudulent claims to Medicare and TRICARE between 2018 and 2019 and approximately $33 million in reimbursements.

The case is United States v. Bunnell, Case No. 2:23-cr-00256, in the US District Court for the District of New Jersey.

Sixth Circuit Upholds 30-Month Sentence for Anti-Kickback Violation in Door-to-Door Medical Marketing Scheme

The US Court of Appeals for the Sixth Circuit affirmed Samuel Harris’s 30-month sentence after a jury convicted him on three AKS counts arising from a door-to-door genetic testing marketing operation.

According to the opinion, Harris and his brother created Secure Health after Harris worked at DirectMed, a company that had canvassed neighborhoods for cancer-related genetic swab tests before shutting down over legal concerns. Secure Health sent salesmen door-to-door, paid telemedicine providers to sign test orders, forwarded tests to Crestar, and received per-patient referral payments while Crestar billed Medicare or Medicaid.

Following a 26-day trial, a jury convicted Harris for AKS violations. On appeal, the Sixth Circuit held that the district court did not abuse its discretion in declining to give an advice-of-counsel instruction because Harris did not disclose that employees were paid per patient and, alternatively, any post-memorandum shift to per-patient payments was inconsistent with any good-faith reliance on counsel. The court also rejected Harris’s mistrial and evidentiary challenges.

The case is United States v. Samuel Harris, Case No. 25-5540, in the US Court of Appeals for the Sixth Circuit.