The US Department of Justice (DOJ) has announced a significant expansion of its health care fraud enforcement efforts with the formation of the West Coast Health Care Fraud Strike Force. This initiative is spearheaded by the newly created National Fraud Enforcement Division of DOJ, established by President Trump via executive order in January 2026 and led by recently confirmed Assistant Attorney General (AG) for Fraud Colin McDonald.
The West Coast Health Care Fraud Strike Force (Strike Force) unites federal prosecutors with law enforcement agencies, including the Federal Bureau of Investigation, the Drug Enforcement Administration, the US Department of Health and Human Services Office of Inspector General (HHS-OIG), and local law enforcement agencies, to address what Assistant AG McDonald describes as an “urgent and undeniable” threat of health care fraud in Arizona, Nevada, and Northern California.
Over the last several months, there have been highly publicized enforcement takedowns in Southern California, especially in the hospice and home health space. By contrast, the newly announced Strike Force reflects a notable geographic and substantive shift in DOJ’s enforcement posture. Rather than concentrating primarily on Southern California, the Strike Force is centered on Northern California, Arizona, and Nevada, with DOJ specifically identifying Silicon Valley and the Northern District of California as hubs for increasingly sophisticated, technology-driven fraud schemes.
The Strike Force is poised to respond to DOJ’s view that fraud activity is “migrating” beyond the previously reported Southern California hotspots.
Key Takeaways
- DOJ has launched the West Coast Health Care Fraud Strike Force, targeting fraud schemes across Arizona, Nevada, and Northern California.
- This initiative brings increased enforcement resources, data analytics, and regional coordination to address a surge in health care fraud in these districts, including those that may involve improper use and exploitation of technologies in digital health.
- Providers and medical technology companies operating in any of the targeted regions should anticipate heightened scrutiny in light of DOJ’s expanded fraud arsenal.
Details of the Strike Force
Driven by concerns of escalating health care fraud in key West Coast districts, federal authorities have intensified their focus on identifying and prosecuting fraud, waste, and abuse within federal health care programs. Using the National Fraud Enforcement Division as a vehicle, Assistant AG McDonald has stated that “[n]o longer will [DOJ] be uninterested in low levels of fraud; we will be interested in all of it,” emphasizing adherence to the “whole-of-government initiative.”
The newly formed Strike Force is the Trump administration’s response to rising health care fraud concerns, with data analytics compiled by DOJ evidencing a migration of fraud schemes to Arizona and Nevada and the rise of technology-driven schemes in Northern California. When announcing the formation of the Strike Force, Assistant AG McDonald highlighted the following recent prosecutions to underscore the urgency of the initiative:
- In Arizona, two wound graft company owners received sentences of 15.5 and 14 years, respectively, for a $1.2 billion Medicare and Medicaid fraud scheme, resulting in the seizure of $126 million in assets.
- Also in Arizona, the owner of a medical billing company was charged for an alleged scheme involving $650 million in Medicaid fraud related to the exploitation of patients at substance abuse treatment clinics.
- In San Francisco, executives of a digital health technology company were convicted for a $100 million scheme to commit health care fraud and distribute controlled substances over the internet.
- In Silicon Valley, the president of a medical technology company received an eight-year sentence in a landmark COVID-19 health care fraud and securities case.
The Strike Force will be staffed by at least 10 prosecutors who will be tasked with combining data analytics with traditional investigative techniques to “identify, investigate, and prosecute these crimes with speed and efficiency,” serving as a force multiplier to enhance DOJ’s efforts to pursue potential fraud, waste, and abuse.
Expanded Use of ‘Data Analytics’
The formation of the Strike Force also embodies DOJ’s continued shift toward data-driven enforcement, with analytics serving as a central tool in identifying potential fraud before it is reported through traditional channels. We expect DOJ and its partner agencies to leverage increasingly sophisticated techniques, including claims-pattern analysis to detect billing outliers and review utilization data, as these tools enable enforcement authorities to proactively investigate anomalies.
While DOJ’s increasing reliance on data analytics enables more proactive enforcement, it does not displace the continued importance of whistleblower complaints, which remain a critical source of investigative leads. For providers, this underscores the importance of ensuring that billing practices, documentation, and utilization patterns can withstand statistical scrutiny in addition to legal review.
Looking Ahead
Historically, DOJ Health Care Fraud Strike Forces have resulted in thousands of prosecutions and generated billions in recoveries. As this Strike Force begins operations, several developments warrant close monitoring:
- Whether DOJ will seek to further expand this model along the West Coast, including into Southern California where hospice enforcement actions have recently escalated;
- Whether the Strike Force will result in parallel federal and state investigations, including through increased DOJ coordination with state attorneys general and Medicaid fraud control units; and
- Whether Assistant AG McDonald’s stated intent to pursue “all levels” of fraud will result in a shift toward a higher volume of smaller-dollar cases in addition to traditional large-scale prosecutions.
In light of DOJ’s emphasis on voluntary disclosure and cooperation, providers should be prepared to move quickly when potential misconduct is identified. Early steps may include preserving relevant records, conducting a privileged internal investigation, assessing overpayment and repayment obligations, implementing corrective action, and evaluating whether voluntary self-disclosure to DOJ, HHS-OIG, Centers for Medicare & Medicaid Services, or state authorities is appropriate.
These decisions are highly fact specific, but the Strike Force’s data-driven mandate increases the importance of documenting good-faith compliance efforts before a government inquiry begins.
Health care operators in the target geographies should prioritize proactive compliance measures—including routine audits, employee training, reviews of billing protocols, and documentation practices tailored to the primary risk areas of Strike Force scrutiny—to mitigate enforcement risks and demonstrate good-faith efforts to prevent and detect fraud.
Conclusion
DOJ’s establishment of the Strike Force marks a decisive escalation in the administration’s fight against health care fraud and abuse. With expanded resources, data analytics, and cross-agency coordination, enforcement authorities are poised to address both traditional and emerging fraud threats in the near term. Health care providers in the targeted states should take this opportunity to evaluate their compliance posture and prepare to respond to government inquiry given the marked intensification of federal scrutiny.