On April 30, 2026, the Department of Justice’s (“DOJ”) National Fraud Enforcement Division (“Fraud Division”) announced the formation of the West Coast Health Care Fraud Strike Force, a multi-district enforcement initiative spanning Arizona, Nevada, and the Northern District of California. [1] Announced by Assistant Attorney General Colin McDonald, the new Strike Force signals a significant escalation of federal health care fraud enforcement in the broader West Coast region and warrants close attention from health care providers, technology companies, and other industry participants operating in the area.

Background

The DOJ’s Strike Force model deploys interagency teams of investigators and prosecutors to target the most egregious offenders in the highest-intensity regions across the country. To date, this model has led to the prosecution of over six thousand defendants who collectively billed federal health care programs and private insurers nearly $50 billion. Strike Force teams concentrate their efforts in regions with the highest rates of federal health care spending. The existing Los Angeles Strike Force, for example, operates in the Central District of California, the nation’s most populous federal district and the district with the highest level of Medicare spending.

The new West Coast Strike Force will be staffed by dedicated health care prosecutors and backed by a recently announced $300 million grant program for state and local prosecutors to join the federal fraud mission. Given the DOJ’s proven track record of leveraging sophisticated data analytics—now including AI—cross-district coordination, and data gathering from a variety of information sources, this investment signals that enforcement activity in these regions will intensify considerably in the coming years, bringing with it increased scrutiny, investigations, and criminal liability for industry participants who are found to be committing fraud.

Types of Fraud in the Crosshairs

The Fraud Division identified several categories of health care fraud driving this expansion. Based on the announcement and recent cases brought by the DOJ in the region, its focus areas will likely include:

  • Prosecution of Medical Device and Wound Care Companies: Following the conviction of two wound graft company owners in the District of Arizona, the DOJ plans to continue to leverage data analytics to identify medical device and wound care companies suspected of submitting fraudulent billing claims. These types of claims typically center around medically unnecessary applications, illegal kickbacks, and upcoding or other billing manipulation.
  • Substance abuse treatment fraud.  Building on the success of the DOJ’s 2021 Southern California Sober Homes Initiative, [2] federal authorities will continue targeting schemes in which billing companies and treatment clinics engage in the submission of false claims for addiction services that were never provided or were medically unnecessary. These fraud schemes frequently exploit vulnerable populations, particularly individuals struggling with substance use disorders, through kickback arrangements with sober living homes and the systematic falsification of treatment records.
  • Digital health and health care technology fraud. Enforcement efforts have expanded to address fraud in the digital health sector, including schemes involving telemedicine platforms and the illegal online distribution of controlled substances. Given that the Northern District of California is a hub for health care technology and digital health innovation, prosecutors will be well positioned to pursue emerging fraud schemes in this region.
  • COVID-19 related fraud. The DOJ continues to pursue criminal cases involving health care fraud and securities fraud connected to the COVID-19 pandemic, signaling that pandemic-related schemes remain an enforcement priority.

What This Means for Industry Participants

Health care providers, digital health companies, medical billing operations, and pharmaceutical distributors operating in Arizona, Nevada, and Northern California face heightened scrutiny under the Department of Justice’s expanded footprint. Organizations in these sectors should work with experienced attorneys to review their compliance programs, conduct internal risk assessments, and evaluate whether voluntary self-disclosure may be appropriate in light of this heightened enforcement environment.

[1] See Press Release, Off. of Pub. Affs., U.S. Dep’t of Just., Fraud Division Launches West Coast Strike Force to Target Health Care Fraud Schemes Across Arizona, Nevada, and Northern California (Apr. 30, 2026);
Colin McDonald, Assistant Att’y Gen. for the Nat’l Fraud Enf’t Div., U.S. Dep’t of Just., Assistant Attorney General Colin McDonald Announces New West Coast Strike Force (Apr. 30, 2026)

[2] See Press Release, U.S. Att’ys Off., Cent. Dist. of Cal., Justice Department Announces Series of Cases to Combat Addiction Treatment Kickback Schemes in Orange County (Dec. 16, 2021)