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With a new administration settled into the White House, healthcare and life sciences companies are looking closely for any changes in how their industry will be regulated by key federal enforcement agencies.
The False Claims Act (FCA) is the primary tool used by the U.S. Department of Health and Human Services (HHS) as well as the Department of Justice (DOJ) to investigate and punish those who knowingly submits false claims to the government. In recent years, enforcement agencies have pursued healthcare and life sciences companies aggressively for violations. In the fiscal year ending September 30, 2024, the DOJ obtained nearly $3 billion in settlements and judgments from civil cases involving fraud and false claims against the U.S. government. Over half of these monetary penalties were paid by healthcare and life sciences organizations.
Clearly, healthcare and life sciences companies need to ensure they are compliant with all federal rules when it comes to billing government-sponsored health plans and fully complying with the FCA. Earlier this month, Buchanan hosted the 2025 Buchanan Life Sciences + Healthcare Summit where a panel discussed regulatory updates and enforcement trends.
Here are the top five trends and updates discussed:
1. FCA Enforcement actions remain a priority under the Trump administration
Despite staffing cuts at HHS and DOJ, it's clear that violations of the FCA will remain a top priority under the Trump administration. In many cases, FCA violations are brought to the attention of regulators through whistleblowers. These whistleblowers are also involved throughout the case, limiting the amount of work required by regulatory staff. The whistleblowers also receive a percentage of any fine which may increase the number of FCA claims. Therefore, it is expected that FCA settlements and judgments will continue to be handed down at a similar rate seen under past administrations
As a result, it is still crucial for healthcare and life sciences companies to take a proactive approach to compliance. When submitting claims to the U.S. government, thorough documentation is critical. If an accidental violation of the FCA is discovered, healthcare and life sciences companies can also consider self-disclosing it to regulators. In the past, regulators have shown a willingness to be reasonable toward well-intentioned companies that self-report violations. However, this process should only be pursued with the collaboration and support of experienced legal counsel.
2. UPIC investigations are rising
The healthcare and life sciences industries are experiencing a significant spike in the amount of investigations referred to the U.S. Attorney's Office by Unified Program Integrity Contractor (UPIC) audits. Notices of a UPIC audit must be taken extremely seriously. Once companies are notified of an audit, auditors begin their investigation by asking for detailed billing information, patient records, and can even request interviews with healthcare providers and patients. Additionally, UPIC audits often leverage data analytics to scan large amounts of information to identify billing outliers that should be investigated. Healthcare and life sciences companies that find themselves the target of a UPIC audit must tap experienced legal counsel right away, so they can work closely with auditors and mitigate the risk of facing costly actions from HHS.
3. Regulators are targeting high-cost treatments
Investigators are focusing their attention on certain high-cost medical procedures that can quickly drain Medicare and Medicaid. Certain skin substitutes and biologics used for wound care treatments, for example, are under intense scrutiny by regulators. These treatments, which can cost upward of $15,000 per patient per visit require many applications over a long period of time before the patient recovers. Polymerase Chain Reaction (PCR) tests are also attracting the attention of auditors. These tests are often preferred by physicians because they are very accurate and can be conducted more quickly than comparable alternatives. However, they are much higher cost and, because they can be conducted quickly and repeatedly, can lead to soaring bills in short periods of time. As a result, any healthcare company that regularly bills Medicare or Medicaid for high-cost, repeated procedures like skin substitutes or PCR tests should take steps today to protect themselves against a potential audit or investigation.
4. FCPA uncertainty will persist under Trump administration
The Foreign Corrupt Practices Act (FCPA) is a controversial U.S. law that prohibits the bribery of foreign officials to obtain or retain business. In February 2025, the White House announced a pause on all FCPA enforcement for a period of 180 days in an effort to boost the global economic competitiveness of American companies operating abroad. However, the administration has since reversed this ruling, indicating that it will exercise its full power to enforce the FCPA going forward. This back and forth has caused some confusion and uncertainty for American healthcare and life sciences companies operating abroad. It is important to note that the FCPA carries a three-year statute of limitations. Therefore, American companies should still exercise caution when it comes to the FCPA and consult their attorneys when conducting business with foreign entities.
5. New working group will target Medicaid Advantage fraud
In July, HHS and DOJ announced they are strengthening their collaboration to advance priority enforcement areas through the formation of the DOJ-HHS FCA Working Group. In the announcement, the working group indicated that one of its top priority enforcement areas would be Medicare Advantage. However, little additional detail was given as to what specific parts of Medicare Advantage it would be targeting. Healthcare companies are now largely on their own to interpret how exactly their interactions with Medicare Advantage plans will be scrutinized. As a result, healthcare providers that serve patients under Medicare Advantage should take extra care in their documentation of these claims to prepare for heightened scrutiny.
Experienced Legal Counsel Across the Enforcement Spectrum
As regulatory oversight of the healthcare and life sciences industries continues to evolve, these companies must invest in their compliance protocols to best protect themselves from an investigation. At Buchanan, our attorneys have experience assisting healthcare and life sciences companies, before, during and after they've been investigated by HHS or DOJ. More often than not, the best offense is a good defense, and healthcare and life sciences companies should closely examine their compliance procedures today to avoid costly investigations and settlements in the future.
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