The West Coast Strike Force and the next phase of health care fraud enforcement

On April 30, the U.S. Department of Justice's National Fraud Enforcement Division, in coordination with the U.S. Attorneys for the Northern District of California, Nevada, and Arizona, launched a new West Coast Health Care Fraud Strike Force (West Coast Strike Force). The announcement signals a significant expansion of federal enforcement resources and came three weeks after the creation of the DOJ's new National Fraud Enforcement Division. Those announcements were followed by news that the federal government has paused $1.3 billion in Medicaid funding for California pending further review of alleged fraud in federal health programs. All of this builds on an already historic year of health care fraud enforcement in 2025.

The new West Coast Strike Force will operate out of San Francisco, Las Vegas and Phoenix, and will focus on fraud against Medicare and Medicaid programs and in the hospice, sober home and wound care industries. This regional strike force model was first deployed in Florida in 2007 and subsequently expanded to eight other areas, resulting in the prosecution of more than 6,200 defendants over the past 20 years. Under the model, federal agents from the Federal Bureau of Investigation, Department of Health and Human Services, and Drug Enforcement Administration coordinate with other federal, state and local agencies, using both traditional investigative methods and data analytics to identify potentially fraudulent billing practices and geographic fraud "hot spots."

Latest step in ramp-up of health care fraud enforcement

The West Coast Strike Force is the latest in a series of federal and state initiatives demonstrating an unmistakable increase in health care fraud enforcement. During the DOJ's 2025 National Health Care Fraud Takedown, the department filed criminal charges against 324 defendants across 50 federal districts in coordination with 12 state attorneys general. The cases involved approximately $14.6 billion in intended loss and spanned a wide range of schemes, including hospice, telehealth and durable medical equipment fraud. That figure reflects just a single coordinated enforcement action in mid-2025, not the total universe of 2025 cases.

As highlighted in the West Coast Strike Force announcement, those efforts included the trial conviction and eight-year prison sentence for the president of a Silicon Valley-based medical technology company. United States v. Schena, No. 23-2989. This was the first criminal securities fraud case related to COVID-19 charged by the Justice Department, the first criminal COVID-19 health care fraud case brought to trial, and a significant prosecution delineating the scope of the Eliminating Kickbacks in Recovery Act. 

Federal and state enforcement has only increased in scope and speed in 2026, with California a major focus. In April 2026 alone:  

·         The California Attorney General charged 21 defendants in a $267 million Medi-Cal hospice fraud scheme involving the alleged use of stolen identities and shell hospice companies billing for services that were never provided.

·         Federal prosecutors in the Central District of California (which has its own regional health care strike force) charged eight defendants--ranging from health care professionals to operators--for participating in an alleged $50 million scheme involving hospice companies that billed Medicare for patients who were not terminally ill.

Drawing on our experience as Assistant U.S. Attorneys in the Northern District of California, we identify four prevailing themes in healthcare fraud enforcement:

First, federal and state healthcare enforcement authorities are increasingly turning to sophisticated data analytics to drive investigations, even in the absence of traditional whistleblower complaints. Regulators now routinely use billing and utilization data to identify outlier providers, unusual prescribing or referral patterns, geographic clusters of providers and rapid revenue growth. Those analytics tools are becoming a primary mechanism for initiating investigations and, in some cases, supporting civil or criminal charges.

Second, government program fraud continues to dominate the enforcement landscape. Companies receiving reimbursement or funding through Medicare, Medicaid, Affordable Care Act programs, or other federal healthcare initiatives should expect heightened scrutiny from both federal and state regulators. Enforcement attention is expected to remain especially intense in sectors such as telehealth, remote prescribing, behavioral health and substance abuse treatment, where investigators have identified recurring fraud schemes and rapidly expanding reimbursement activity.

But no sector has drawn more sustained attention recently than hospice care. Federal prosecutors, state attorneys general, and healthcare regulators have devoted substantial resources to investigating hospice providers, and industry participants should assume that billing practices and operational models will continue to face close review. Investigators are focusing heavily on patient eligibility determinations and certifications of terminal illness, as well as statistical indicators such as unusually long lengths of stay and elevated live-discharge rates. Enforcement agencies also continue to scrutinize relationships between hospice providers and marketers, recruiters and referral sources, particularly where compensation arrangements raise kickback concerns.

Finally, providers operating in these areas should also be prepared for parallel proceedings, which have increasingly become the norm in healthcare enforcement matters. Conduct that triggers government scrutiny may simultaneously lead to criminal investigations, civil False Claims Act exposure and administrative enforcement actions. As a result, healthcare companies frequently face overlapping inquiries from the Department of Justice, state attorneys general, Medicaid Fraud Control Units, and administrative agencies, often involving coordinated investigative activity. Where government agencies are coordinating their investigations, companies must similarly coordinate legal and compliance strategy across multiple fronts simultaneously.

What this means for health care industry players

The creation of the West Coast Strike Force underscores a broader enforcement reality facing the industry: healthcare technology companies, providers and their investors are likely to remain major targets for both federal regulators in the years ahead. At the same time, threatened reductions in federal funding may prompt increased state-led investigations and regulatory actions, particularly in states such as California that have expanded their healthcare fraud and consumer protection authority.

These developments are especially significant in the Northern District of California, which encompasses Silicon Valley and San Francisco and serves as a hub for digital health, telemedicine and artificial intelligence companies.

Against that backdrop, companies should be taking proactive steps now to strengthen compliance infrastructure and position themselves to respond effectively to government inquiries. Enforcement agencies continue to view the Department of Health and Human Services Office of Inspector General's "seven elements" framework as the benchmark for an effective compliance program, including written policies and procedures, designated compliance leadership, employee training, auditing and monitoring systems, internal reporting mechanisms, disciplinary standards and corrective action processes.

Regulators are also increasingly focused on the integrity of government program eligibility determinations, making targeted internal audits particularly important for companies participating in Medicare, Medicaid or other federally funded healthcare programs. Investigators expect companies to invest in qualified billing and coding personnel, maintain ongoing employee training, conduct regular internal claims audits and ensure that documentation accurately supports reimbursement submissions.

Companies should carefully examine relationships with marketers, consultants, recruiters and referral sources for potential Anti-Kickback Statute exposure, an area that continues to generate substantial civil and criminal enforcement activity.

Finally, when problems are identified, prompt remediation is critical. In this vein, healthcare companies and their counsel should pay close attention to the Department of Justice's revised Corporate Enforcement and Voluntary Self-Disclosure Policy, which applies nationwide. The policy creates potential pathways to reduced penalties and, in some cases, declinations or non-prosecution agreements. But to receive those benefits, companies must voluntarily disclose misconduct, cooperate with investigators and undertake meaningful remediation efforts. As enforcement risks continue to evolve, self-disclosure considerations are increasingly becoming part of the strategic decision-making process for healthcare companies confronting potential compliance issues. As always, companies that invest early in compliance infrastructure and remediation efforts will be far better positioned if and when regulators come knocking.