In a single week in October, the Department of Justice (DOJ) and the Department of Health and Human Services (HHS) Office of Inspector General (OIG) reshaped the incentives around healthcare fraud. They created a one-stop shop for disclosing potential criminal healthcare misconduct, launched a program that pays fraud whistleblowers faster, and unveiled a False Claims Act (FCA) self-disclosure pilot with reduced repayment multipliers.

Together, these initiatives put a premium on speed. The government wants companies to race whistleblowers to the government, and it is trying to incentivize companies with favorable disclosure terms that generally disappear if they lose the race. Because a choice under one initiative can shape the options under the others, healthcare and life sciences companies should treat these initiatives as a single conversation.

One-Stop Shop for Disclosure of Criminal Healthcare Matters

On October 15, the DOJ National Fraud Enforcement Division (Fraud Division) and HHS-OIG announced a joint self-disclosure protocol that removes guesswork about where to report potential misconduct. Previously, misconduct with criminal, civil, and administrative components required separate disclosures to multiple agencies. Under the new policy, a single disclosure of potential criminal conduct to the Fraud Division qualifies for benefits under both DOJ’s Corporate Enforcement Policy (CEP) and HHS’s Health Care Fraud Self-Disclosure Protocol (SDP), saving time when every day counts. Conduct with only civil or administrative components should still go directly to HHS-OIG under the SDP.

The stakes of qualifying are significant. Under the CEP, a company that voluntarily self-discloses, fully cooperates, and timely and appropriately remediates may qualify for a presumption of declination, absent aggravating circumstances. Under the SDP, benefits may include expedited resolution, a lower settlement multiplier, and resolution of exclusion risk without an integrity agreement.

HHS Inspector General T. March Bell called the new policy “a critical tool” that provides “a clear pathway to voluntarily report potential misconduct,” adding, “[w]e encourage companies to come forward and disclose criminal conduct to the Justice Department.” Assistant Attorney General Colin M. McDonald of the Fraud Division agreed that “[c]ompanies that discover fraud within their own operations should not have to navigate a maze of agencies before reporting it.”

The joint protocol, however, offers no new path for conduct that carries only civil FCA exposure. DOJ filled that gap a week later.

A New Civil FCA Self-Disclosure Option

On October 22, DOJ announced the Healthcare False Claims Act Self-Disclosure Pilot Program (FCA pilot program), a six-month initiative from DOJ’s Civil Division and HHS. The pilot program offers eligible companies defined repayment terms and coordinated resolution of federal FCA liability and specified HHS administrative exposure.

The financial incentive is a repayment of 1.25 to 1.6 times the “base self-disclosure repayment,” which is essentially a single damages calculation. This is a reduction from the 3x multiplier set forth in the FCA and from the 2x multiplier commonly applied in negotiated FCA resolutions. Under the pilot program, the multiplier applied depends on factors such as timing of the disclosure, the scope of the misconduct, and remediation.

The pilot also provides a federal FCA release for the disclosed conduct with no factual admissions. HHS-OIG will not require a Corporate Integrity Agreement as part of a resolution of its exclusion authorities, and the Centers for Medicare & Medicaid Services (CMS) will not impose civil monetary penalties or seek revocation as part of a pilot resolution.

The pilot rewards companies that move first. Complete submissions are due by 11:59 p.m. on April 22, 2027. Late or partial submissions will not be reviewed, and conduct already known to the government is ineligible. Companies aware of FCA liability have an incentive to race both the calendar and potential whistleblowers. Whistleblowers, meanwhile, now have a new financial incentive to report early.

Faster Rewards for Fraud Whistleblowers

Between the announcements of these new self-disclosure initiatives, DOJ launched the Fraud Whistleblower Incentive Program (WHIP) on October 20. Unlike typical whistleblower programs that pay only after a final recovery, WHIP offers discretionary awards of $10,000 to $30,000 for qualifying information that leads to criminal charges.

An allegation alone will not earn a WHIP award. Whistleblowers must participate voluntarily, provide truthful and complete original information in writing, cooperate fully, and supply information leading to criminal charges in covered areas. Active participants in the fraud are ineligible.

While DOJ has identified hospice, home healthcare, day care, and special services fraud as particular priorities, WHIP reaches beyond healthcare. It covers federal healthcare offenses and related crimes, as well as fraud involving programs or benefits administered by several federal agencies.

Taken together with the joint protocol, WHIP creates a practical tension and a ticking clock: DOJ is encouraging companies to investigate and report promptly while making it more attractive for individuals to report to prosecutors themselves instead of first reporting concerns to their companies internally.

The Interplay Between These Initiatives

Companies should consider the available disclosure pathways together to determine what is best for any given circumstance.

The joint protocol covers criminal exposure; the FCA pilot program covers only civil FCA exposure. The FCA pilot program allows companies that disclose to the Fraud Division under the joint protocol to skip a duplicative pilot submission, though a civil release may require disclosure of supplemental information to DOJ. DOJ has not addressed how it will handle an FCA pilot program disclosure that reveals potential criminal conduct. Choosing the right channel is therefore critical, yet it may turn on factors such as intent that are hard to assess early in an investigation, when the pressure to disclose quickly is greatest.

Both the joint protocol and FCA pilot programs require that the conduct be previously unknown to DOJ, and WHIP raises the odds that DOJ hears about conduct from a whistleblower first. In general, a company controls how quickly it escalates and investigates concerns, but that is not the case when a whistleblower calls the government. The CEP offers a safety valve for this situation: A company that self-reports within 120 days of an internal whistleblower report may still qualify for a declination, even if the whistleblower has already contacted DOJ. But that protection requires an internal report, a step WHIP may encourage whistleblowers to skip.

Losing the race to DOJ does not necessarily eliminate the benefits of self-reporting. The “near miss” provisions of the CEP give credit for a company’s good-faith disclosure, even if it does not formally qualify as a voluntary self-disclosure under the CEP because, for example the government was already aware of the conduct. 

What Companies Should Do Now

October’s announcements do not make self-disclosure the right answer in every case, but they make a prompt, informed decision more important. DOJ is giving companies clearer reasons to come forward and whistleblowers new reasons to report them first. Companies should prepare for both.

That starts with revisiting how quickly compliance concerns reach legal and compliance leadership and are investigated. An effective response preserves relevant records, assesses the facts with counsel, stops and remediates problematic conduct, and develops a defensible financial analysis. And it should weigh criminal, civil, administrative, and state-law exposure together as part of a single conversation.