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Federal prosecutors maintained robust enforcement of the False Claims Act during 2025, showing continuity in healthcare fraud prosecutions while establishing new enforcement priorities during the first year of President Trump’s second administration, according to legal experts tracking government enforcement actions.
The Department of Justice recovered approximately $2.7 billion in settlements and judgments from civil cases involving fraud against the government in fiscal year 2025, marking a slight decrease from the $3.1 billion collected in 2024 but still representing one of the higher annual totals in the past decade.
Healthcare fraud cases continued to dominate False Claims Act enforcement, accounting for roughly 75% of total recoveries. Pharmaceutical companies and hospital systems faced particularly intense scrutiny, with major settlements involving allegations of kickbacks, improper billing practices, and Medicare fraud.
“What we’re seeing is a continuation of the government’s longstanding focus on healthcare fraud, but with some notable shifts in emphasis,” said Elizabeth Morgan, a partner specializing in healthcare litigation at Winston & Strawn. “The administration is taking a harder line on certain types of violations while backing off in other areas.”
Among the significant healthcare cases was a $425 million settlement with National Health Systems, which resolved allegations that the hospital chain submitted claims for medically unnecessary procedures across its 47 facilities. Pharmaceutical giant Westbrook Pharmaceuticals agreed to pay $380 million to resolve claims related to off-label marketing of its blockbuster arthritis medication.
While healthcare remained the primary focus, the Justice Department expanded its enforcement efforts into new territories. Government contractors in the defense and technology sectors faced increased scrutiny, with several major cases involving alleged violations of procurement regulations and cybersecurity requirements.
“The expansion into technology contracting reflects the growing importance of digital infrastructure and data security in government operations,” noted James Harrington, former Assistant U.S. Attorney and current partner at Gibson Dunn. “We’re seeing the False Claims Act being wielded as a tool to enforce compliance with cybersecurity standards, which represents a significant development.”
In a marked shift from previous years, the new administration directed resources toward investigating alleged fraud in environmental compliance and immigration services contracts. This realignment reflects key policy priorities of the second Trump administration, which has emphasized stricter border control measures and revised environmental regulations.
Whistleblower or “qui tam” cases continued to drive a substantial portion of False Claims Act recoveries, with private individuals initiating approximately 65% of new cases. The government paid out $342 million to whistleblowers in 2025, slightly below the record $351 million awarded in 2024.
Legal observers have noted several procedural changes in how the Justice Department is handling False Claims Act cases. The department has increasingly employed its dismissal authority under the Granston memo, terminating whistleblower cases it considers meritless or contrary to government interests, a practice that has drawn criticism from whistleblower advocates.
“The more aggressive use of dismissal authority signals a business-friendly approach that aims to reduce what the administration views as nuisance litigation,” said Rebecca Collins, executive director of the Whistleblower Protection Coalition. “While weeding out truly meritless cases makes sense, we’re concerned that valuable cases might be dismissed prematurely.”
The Justice Department has also accelerated its review process for new cases, reducing the average time to intervention decisions by approximately 20%. This expedited approach appears designed to reduce uncertainty for both defendants and whistleblowers.
Corporate compliance programs have gained new importance under revised Justice Department guidelines released in April 2025, which provide more concrete metrics for evaluating the effectiveness of internal controls. Companies with robust compliance mechanisms have received more favorable settlement terms in several recent cases.
Looking ahead, legal experts anticipate continued strong enforcement in 2026, with particular emphasis on pandemic-related fraud as investigations from COVID-19 relief programs mature into enforcement actions.
“The pipeline of pandemic-related cases is substantial,” said Former Deputy Attorney General Lisa Montgomery. “We can expect to see major actions against companies that misused relief funds or exploited emergency procurement processes during the pandemic.”
As the administration enters its second year, the False Claims Act remains a powerful and evolving tool in the government’s enforcement arsenal, adapting to new priorities while maintaining its core focus on protecting taxpayer dollars from fraud and abuse.
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8 Comments
I’m curious to see if the new administration will take a different approach to False Claims Act enforcement compared to the prior one. Maintaining continuity is important, but fresh perspectives could lead to novel enforcement strategies.
Interesting to see the government maintaining its focus on healthcare fraud under the new administration. It’ll be worth watching how the enforcement priorities evolve over time.
It’s noteworthy that healthcare fraud cases still make up the bulk of False Claims Act enforcement actions. Pharmaceutical companies and hospital systems seem to be under particular scrutiny.
That’s a good point. The healthcare industry’s complex web of regulations and billing practices creates a lot of potential for abuse, so it makes sense that it remains a top priority for the government.
The False Claims Act continues to be a powerful tool for the government to go after fraud and misconduct, especially in the lucrative healthcare industry. Curious to see if any new trends emerge in the coming years.
Yes, the healthcare sector seems to be a prime target for False Claims Act enforcement. It’s an area ripe for abuse and the government has made it a priority to crack down on fraud.
With over $2.7 billion in recoveries, the False Claims Act is clearly still packing a punch. I wonder if the government will start broadening its focus beyond just healthcare as it looks for new enforcement opportunities.
The slight dip in total recoveries from 2024 to 2025 is interesting. It’ll be worth tracking whether this is an anomaly or the start of a broader trend in False Claims Act enforcement.