DOJ Turns West in Expanding Health Care Fraud Enforcement

The Department of Justice recently announced the expansion of its Health Care Fraud Strike Force program to include the Northern District of California, along with Arizona and Nevada. Recent public comments by the U.S. attorney for the Northern District of California suggest that the Strike Force will focus heavily on Medicare and Medicaid fraud enforcement, consistent with the DOJ’s long-standing prioritization of cases involving federal reimbursement programs.

The Strike Force combines prosecutors from the DOJ Fraud Section’s Health Care Fraud Unit with local U.S. attorneys’ offices and federal investigative agencies, including the Department of Health and Human Services Office of Inspector General, the FBI, the DEA, and other enforcement partners. The initiative will target sophisticated fraud schemes involving digital health platforms, pharmacies, laboratories, behavioral health providers, and telemedicine arrangements.

The addition of Northern California is notable given the region’s concentration of health technology companies, venture-backed providers, AI-enabled health care businesses, and rapidly scaling care platforms. The expansion suggests the DOJ is paying particular attention to businesses that rely on centralized billing, remote prescribing, subscription-based care models, and large-scale Medicare or Medicaid reimbursement.

A Continued Shift Toward Data-Driven Enforcement

The DOJ has repeatedly emphasized that the Strike Force will rely heavily on data analytics to identify billing anomalies, utilization spikes, referral relationships, and other reimbursement patterns that may warrant investigation. Although whistleblower complaints remain central to many investigations, federal agencies increasingly identify potential targets through claims analysis and reimbursement trends before a whistleblower complaint is ever filed.

Increased Focus on Technology-Enabled Care Models and Corporate Accountability

Federal enforcement agencies have increasingly focused on telemedicine arrangements, online prescribing practices, durable medical equipment referrals, and digital marketing structures tied to federal health care programs. Many of these investigations involve allegations that technology platforms or third-party marketers improperly influenced prescribing decisions, generated medically unnecessary services, or created reimbursement arrangements that the DOJ believes implicate the Anti-Kickback Statute, the False Claims Act, or controlled substances laws.

The recent prosecution of Silicon Valley-based digital health company Done Global Inc. reflects many of these themes. In November 2025, federal prosecutors secured guilty verdicts against Done’s founder and CEO, Ruthia He, and its clinical president, David Brody. The DOJ alleged the company structured its telehealth prescribing practices to facilitate unlawful distribution of controlled substances, including Adderall and other stimulants, and submitted fraudulent prior authorization requests and reimbursement-related representations to insurers. According to the DOJ, the conduct resulted in more than $14 million in payments from Medicare, Medicaid, and commercial insurers. In late March 2026, prosecutors recommended a 20-year sentence for He, along with the imposition of restitution and forfeiture orders exceeding $103 million.

The Strike Force’s expansion reflects more than traditional Medicare fraud enforcement. It also signals the DOJ’s growing focus on compliance risks associated with rapidly evolving health care technologies and business structures. Importantly, the DOJ appears increasingly willing to scrutinize not only providers themselves but also management companies, executives, founders, investors, and operational personnel involved in designing or overseeing reimbursement and compliance processes.

Compliance Considerations for Health Care and Digital Health Companies

For health care and digital health companies, the DOJ’s announcement is a reminder that compliance expectations continue to evolve alongside technological innovation and operational growth.

Although the DOJ’s announcement does not represent a substantive change in the law, it reflects an increase in enforcement resources and investigative coordination in jurisdictions the DOJ appears to view as presenting elevated fraud risk. More broadly, it reflects the government’s continued reliance on data analytics, interagency coordination, and centralized enforcement initiatives in health care fraud investigations. Companies participating in federal reimbursement programs should expect increased investigative activity surrounding billing practices, financial arrangements, and operational oversight.

Looking Ahead

The expansion of the West Coast Health Care Fraud Strike Force reflects broader Trump administration priorities favoring aggressive enforcement of fraud affecting federal benefit programs and increased coordination among DOJ components and investigative agencies. The message from Washington is increasingly hard to miss: health care fraud enforcement is no longer being framed solely as a criminal justice issue, but as a broader battle over federal spending, state accountability, and entitlement oversight. On May 13, 2026, Vice President JD Vance announced the deferral of $1.3 billion in California Medicaid funding, a move that underscores how aggressively that policy shift is already taking place.