On January 16, 2026, the Department of Justice (DOJ) announced that False Claims Act (FCA) settlements and judgments topped $6.8 billion in fiscal year (FY) 2025, which ended September 30, 2025.¹ This figure marks the largest single-year recovery since the FCA was enacted. The government also opened 401 new investigations.² Cumulative FCA settlements and judgments since 1986, when Congress significantly strengthened the statute, now surpass $85 billion.³ The FY 2025 recoveries represent a substantial jump from the $2.9 billion collected in FY 2024 and the $2.68 billion collected in FY 2023.⁴ Healthcare-related matters accounted for over $5.7 billion of the FY 2025 total, returning funds to Medicare, Medicaid, and TRICARE.⁵

Qui Tam Lawsuits

The FCA’s qui tam, or whistleblower, provisions allow private citizens to file suit on behalf of the federal government alleging fraud.⁶ Whistleblowers who bring successful cases typically receive between 15% and 30% of any resulting recovery.⁷ Whistleblowers filed a record 1,297 qui tam lawsuits in FY 2025 (of which 458 were healthcare cases), surpassing the previous high of 980 set in FY 2024.⁸ Of the $6.8 billion collected in FY 2025, approximately $5.3 billion stemmed from whistleblower-initiated cases.⁹ Despite recent legal challenges to the constitutionality of the FCA’s qui tam provisions,¹⁰ the growing volume of qui tam filings suggests that insiders remain willing to report suspected fraud.

Medicare Advantage Fraud

DOJ maintained its focus on false claims in managed care, especially the Medicare Advantage (MA) program. Under MA, insurers receive a fixed payment per enrollee, adjusted by risk factors that reflect anticipated healthcare costs.¹¹ This payment structure creates incentives for plans to report higher-risk diagnoses, prompting federal scrutiny of risk adjustment practices.¹² Notable FY 2025 settlements included:

Seoul Medical Group Inc. and its subsidiary Advanced Medical Management Inc., along with the company’s former president and owner, agreed to pay in excess of $60 million to settle claims that they caused the submission of fabricated diagnosis codes for spinal conditions.¹³ Renaissance Imaging Medical Associates Inc., a radiology group affiliated with Seoul Medical, separately agreed to pay $2.35 million for allegedly generating radiology reports that falsely supported spinal condition diagnoses.¹⁴

Independent Health Association and its affiliate, Independent Health Corporation, agreed to pay approximately $98 million to resolve allegations that they submitted unsupported and invalid diagnosis codes to inflate Medicare reimbursement.¹⁵ According to the government, an Independent Health subsidiary mined medical records after treatment and solicited physicians for information to add improper diagnoses.

DOJ also intervened in a qui tam action against insurers Aetna Inc., Elevance Health Inc., and Humana Inc., as well as insurance brokers eHealth Inc., GoHealth Inc., and SelectQuote Inc..¹⁶ The complaint alleged that the insurers funneled hundreds of millions of dollars in illegal kickbacks to brokers to blindly steer Medicare beneficiaries into their MA plans without regard to plan suitability. The government further alleged that Aetna and Humana pressured brokers to limit enrollment of beneficiaries with disabilities, whom the insurers viewed as less profitable.¹⁷

Prescription Drug Fraud

DOJ continued targeting misconduct involving drug pricing, dispensing practices, and illegal remuneration, including enforcement actions tied to the opioid crisis:

The largest generic drug manufacturer in the U.S., Teva Pharmaceuticals USA Inc., agreed to pay $425 million to resolve allegations that it subsidized Medicare patient copays for the multiple sclerosis drug Copaxone while repeatedly raising the drug’s price.¹⁸ Teva also agreed to pay an additional $25 million to settle claims that it colluded with other generic manufacturers to fix drug prices.¹⁹

A jury found Omnicare, the largest long-term care pharmacy in the U.S., and its parent company CVS liable for dispensing medications without valid prescriptions to elderly and disabled residents of assisted living facilities.²⁰ The jury determined that Omnicare and CVS billed federal healthcare programs for over three million false claims, culminating in an August 2025 judgment of $948.8 million that included treble damages and civil penalties.²¹

Walgreens and affiliated subsidiaries agreed to pay up to $350 million to resolve allegations that they filled controlled substance prescriptions lacking legitimate medical purpose, including prescriptions for excessive opioid quantities and the dangerous drug combination known as the “trinity” (an opioid, a benzodiazepine, and a muscle relaxant).²²

McKinsey & Co., Inc. agreed to pay $323 million to settle claims arising from its consulting work for Purdue Pharma L.P., which allegedly resulted in false claims for medically unnecessary OxyContin prescriptions.²³

Unnecessary Services and Substandard Care

DOJ also pursued providers that billed federal healthcare programs for medically unnecessary services or care that fell below acceptable standards:

Vohra Wound Physicians Management LLC and its founder agreed to pay $45 million to settle allegations that they submitted false claims to Medicare for inflated and medically unnecessary wound care services.²⁴ The government alleged that the defendants operated a nationwide scheme to bill Medicare for surgical debridements that were not warranted.

American Health Foundation and three affiliated nursing homes agreed to pay $3.61 million to resolve claims that they billed Medicare and Medicaid for grossly deficient skilled nursing services, including failures to maintain infection control protocols and adequate staffing levels.²⁵

Conclusion

As noted by an industry insider, “[b]oth the headline numbers and the underlying activities discussed in the 2025 DOJ report powerfully illustrate the scope and depth of FCA health care fraud enforcement activities and reflect the risks faced by those in the industry.”²⁶ DOJ’s unprecedented FY 2025 results offer several indicators of where enforcement efforts may be headed. MA risk adjustment fraud appears likely to remain a top priority, as MA enrollment continues to grow and the financial incentives for diagnosis code manipulation persist. The settlements with Independent Health, Seoul Medical Group, and the pending litigation against major insurers, signal that DOJ will continue scrutinizing both plans and the third parties that support risk adjustment activities.

Prescription drug enforcement also shows no signs of abating. The Omnicare/CVS verdict and the Walgreens settlement demonstrate DOJ’s sustained attention to opioid-related dispensing violations, while the Teva and McKinsey settlements reflect continued interest in drug pricing schemes and the role of consultants and other third parties in healthcare fraud.

The record-breaking recoveries and surge in qui tam filings suggest that FCA enforcement will remain a fixture of the healthcare regulatory landscape. Whether this level of activity continues in future fiscal years remains to be seen, but DOJ’s FY 2025 results underscore the statute’s enduring role as the government’s primary civil tool for combating healthcare fraud.