The Department of Justice (DOJ) reported that its False Claims Act (FCA) recoveries for civil cases raked in approximately $2.7 billion for fiscal year 2023, representing a $450 million jump from 2022 recoveries.  Of the $2.7 billion recovered by the DOJ for 2023, approximately $1.8 billion (67%) came from the health care sector.

The real headline, however, may be the record-setting number of new FCA cases initiated in 2023 ­–– 500 initiated by the government and 712 initiated by private relators, for a total 1,212 new cases, over 250 more than the next-highest year (2022). Previous trends aside, this signals busy times ahead for the FCA.

Statements in the DOJ press release and remarks from Principal Deputy Assistant Attorney General Brian M. Boynton at the Federal Bar Association’s annual qui tam conference show a continued focus on health care, including on the use of pandemic funds, alleged kickbacks, cybersecurity, and Medicare Advantage.  The DOJ also stated its intent to scrutinize the involvement of private equity and venture capital firms in the submissions of alleged false claims. 

Overall, the DOJ’s announcements and a record-setting year of newly initiated FCA investigations suggests that enforcement is on the rise again, particularly in health care, and that the agency is expanding its review of suspected fraud, including the players involved.

Trends in Recoveries

DOJ touts the highest number of settlements and judgments in a single year since 1986, totaling 543. Since amendments took effect almost 40 years ago to encourage whistleblowers to file false claims actions on behalf of the government, the DOJ has recovered more than $75 billion through the FCA, both through whistleblower suits and from enforcement actions initiated directly by the government. But in the years immediately after the pandemic, some wondered if recoveries may be dropping.

The 2023 recovery announcement showed stronger than expected returns to the government. The usual suspects—kickbacks, medically unnecessary services, and fallout related to opioids—continue to provide a large swathe of the alleged fraud resulting in FCA recoveries. The recoveries also included relatively new sources of alleged fraud related to pandemic funds, investment in health care, cybersecurity, and Medicare Advantage.

Pandemic Fraud

The pandemic led to the creation of various streams of revenue from the government to support businesses. One of those, the Paycheck Protection Program (PPP), led to the possibility of fraud related to seeking those loans. In its press release, the DOJ indicated that it resolved approximately 270 FCA matters and recovered nearly $48.3 million involving the PPP.  Many of the cases involve small businesses and individuals that engaged in egregious conduct, such as purchases of sports cars with the loans meant to fund payroll, rent, utility payments, and other business-related costs.

Also related to the pandemic, the DOJ noted cases against lab companies that allegedly used COVID-19 tests to bill Medicare for a wider array of medically unnecessary tests that were not properly ordered.

Investment in Health Care

Boynton, in his remarks at the qui tam conference, noted that private equity firms or venture capital firms may influence provider behavior, such as “by providing express direction for how a provider should conduct their business, or more indirectly by providing revenue targets or other indirect benchmarks intended to prioritize reimbursement,” which he noted could give rise to FCA liability. 

Boynton noted that given the increasing role of private equity in the health care field, he anticipates that their impact on health care billings, and thus potential FCA exposure, will likewise grow. While emphasizing that these actors are “not inherently problematic,” and “can play positive roles,” Boynton noted “they can undermine medical judgment, inappropriately influence the doctor/patient relationship, and cause the submission of false claims,” and if so, the government would scrutinize and pursue that conduct.


In announcing its recoveries for 2023, the DOJ highlighted results from its Civil Cyber-Fraud Initiative, an effort that began in 2021 to use the FCA to promote cybersecurity compliance by government contractors and grantees.

One of the settlements mentioned by DOJ in 2023 involved a web design company that created, hosted, and maintained a federally-funded children’s health insurance website in Florida. According to the DOJ, the company failed to provide sufficient security for the site, resulting in an attack that potentially exposed the private information of nearly 500,000 applicants for health insurance.

Medicare Advantage

The DOJ has stated that Medicare Part C, or Medicare Advantage (MA), is a particular focus for fraud enforcement. This follows recent MA enrollment statistics showing that plans now serve more than half of all Medicare-eligible patients: 30.8 million out of a possible 60 million. As a result, the DOJ sees fraud in MA as a critically important enforcement priority.

In its 2023 FCA announcement, the DOJ highlighted two MA related enforcement actions that resulted in almost $200 million in recoveries. Both involved the alleged knowing submission of inaccurate diagnosis codes by MA plans to increase their reimbursements from Medicare. The DOJ also indicated that it is continuing to litigate other alleged fraud enforcement actions from other MA plan operators.

Reed Smith will continue to follow developments in FCA enforcement. If you have any questions about this or any other aspect of FCA compliance, please do not hesitate to reach out to the authors or to your health care lawyers at Reed Smith.