Health Law Advisor

Now in its sixth month, the second Trump administration has made clear that the False Claims Act (FCA) will remain a central tool in its efforts to combat fraud, waste, and abuse across federal programs.

On July 2, 2025, the U.S. Department of Justice (DOJ) and the U.S. Department of Health and Human Services (HHS) jointly announced that they will be strengthening their collaboration to advance priority enforcement areas through a DOJ-HHS False Claims Act Working Group (“FCA Working Group”). Originally formed in December 2020 during President Trump’s first term, the FCA Working Group is now being reestablished with renewed vigor to address key FCA enforcement priorities.

As we report annually, FCA settlements and judgments return billions of dollars to the federal treasury, with the health care and life sciences sectors accounting for the majority of those recoveries. While health care FCA statistics dipped last year, we predicted in January a “continued focus”—particularly given that the first Trump administration saw DOJ file a record number of health care-related FCA cases in a single year.

On March 25, 2025, U.S. Senators Bill Cassidy, M.S. (R-LA) and Jeff Merkley (D-OR) introduced the No Unreasonable Payments, Coding, or Diagnoses for the Elderly (No UPCODE) Act (the “Bill”). According to Senator Cassidy’s press release, the Bill aims to improve how Medicare Advantage plans evaluate patients’ health risks, reduce overpayments for care, and save taxpayers money by removing incentives to overcharge Medicare. If passed, this Bill would have a tremendous impact on plans, vendors, and risk-bearing provider groups relative to Medicare Advantage (“MA”).

Background

Traditional Medicare (Parts A and B) reimburses health care providers based on the cost of services already rendered (known as “Fee-for-Service” or “FFS”). Conversely, MA functions as a prospective payment model, whereby Medicare Advantage Organizations (“MAOs”) contract with the Centers for Medicare & Medicaid Services (“CMS”) to administer and insure their respective member population.

While the Supreme Court decision in Loper Bright Enterprises v. Raimondo was making headlines, other courts were considering recent regulations of another agency—the Centers for Medicare and Medicaid Services (CMS)—that are material to Medicare Advantage. On July 3, a judge in Texas partially granted motions for a stay in a lawsuit challenging a CMS rule issued in April (“2025 Final Rule”) impacting plan agreements with agents and brokers to limit administrative payments, standardize compensation payments, and to restrict plan agreements with third-party marketing organizations (“TPMOs”).

For plans and TPMOs, the decision means they can revert to operating under the compensation/administrative services rules as those existed prior to CMS's issuance of the 2025 Final Rule. CMS has already issued revised 2025 fair market value (“FMV”) compensation amounts to reflect the stay that was granted by the court. In a July 18 memo, CMS announced FMV limits that are $100 less than the previously announced FMV standards. CMS also alerted plans that they must submit their annual reporting of compensation amounts to be paid to independent agents and brokers. Plans may continue to pay compensation at or below the FMV limit and may continue to pay separate administrative costs, subject to the requirement that these be paid at their FMV.

On August 19, 2022, the Department of Health and Human Services Office of Inspector General (“OIG”) posted Advisory Opinion 22-16 (“AO 22-16”) to its website, a favorable opinion concluding that the OIG would not impose sanctions in connection with a program that offered $25 gift cards to Medicare Advantage (“MA”) plan enrollees who completed an online educational program about the potential risk, benefits, and expectations related to surgery. AO 22-16 is the latest in a string of recent OIG advisory opinions addressing arrangements involving remuneration to Federal health care program beneficiaries - the ninth such advisory opinion in 2022 alone.

The company that requested this advisory opinion contracts with Medicare Advantage Organizations (“MAOs”) to offer the educational program to MA plan enrollees and charges the MAOs a per-member, per-month fee for the program. MA plan enrollees who take the educational program and complete a survey receive a $25 gift card, which may be for a big box store or online retailer that offers a wide variety of items. The company that offers the educational program sends mailings and email correspondence to MA plan enrollees about the educational program but does not advertise or market the program to individuals who are not enrollees of a MA plan that has contracted with the company. The MAOs are prohibited by their contract with the company from including information about the gift cards offered under the program in marketing materials to prospective enrollees.

Based on their extensive experience advising health care industry clients, Epstein Becker Green attorneys and strategic advisors from EBG Advisors are predicting the “hot” health care sectors for investment, growth, and consolidation in 2020.  These predictions for 2020 are largely based on the increasing confluence of the following three key “drivers” of health industry transformation that is substantially underway:

1. The ongoing national imperative of reducing the cost of health care, via disease prevention and detection, and cost-effective, quality treatment, including more efficient care in ambulatory and retail settings;
2. Extraordinary advances in technologies which enhance disease prevention, detection and cost-effective treatment (e.g., artificial intelligence (AI)-driven diagnosis and treatment, virtual care, electronic medical record (EMR) systems, medical devices, gene therapy, and precision medicine); and
3. The aging baby-boomer population, with tens of millions of Americans entering into their 70s, 80s, and above.