DOJ's NFED Expands Federal-State Partnerships Targeting Medicaid Fraud

The U.S. Department of Justice's (DOJ or Department) National Fraud Enforcement Division (NFED or Fraud Division) on July 30, 2026, announced charges of Medicaid fraud across the Southeast resulting from federal-state investigative partnerships in the region. The charges stem from 17 cases across seven states – Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina and South Carolina. DOJ also announced federal-state cooperation agreements with each of the seven states, along with federal-state anti-fraud task forces in Florida, Mississippi and North Carolina.

The Southeastern agreements echo a June 2026 agreement DOJ entered into with Ohio law enforcement, which it described as a "National Model of Federal-State Cooperation," as well as the recently announced Eastern District of Pennsylvania Anti-Fraud Initiative, supported by the Pennsylvania Attorney General, as explained in a recent Holland & Knight alert. The federal-state partnerships reflect DOJ's increasing use of data analytics and expanding focus on healthcare spending and Medicaid enforcement.

Background

Combating fraud, particularly in healthcare, remains a key federal enforcement priority. In April 2026, DOJ established the NFED to centralize enforcement efforts. In June 2026, DOJ announced the 2026 National Health Care Fraud Takedown, an effort that involved the participation of 50 state Medicaid Fraud Control Units – a historic high.

Meanwhile, DOJ has ramped up its focus on Medicaid fraud. For example, in May 2026, DOJ announced that it was expanding its Health Care Fraud Section by allocating funding to hire 15 new attorneys dedicated to combating Medicaid fraud. DOJ also announced plans to deploy these prosecutors across the country to districts "where the threat of Medicaid fraud is the greatest."

What's Changing

The Fraud Division entered into the federal-state "cooperation agreements" with Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina and South Carolina, along with federal-state anti-fraud task forces with Florida, Mississippi and North Carolina. Although DOJ has provided few details about the cooperation agreements, it stated that it established data-sharing agreements with certain secretaries of state and state treasurers. These data-sharing agreements will enable the Fraud Division to access the state agencies' publicly available corporate registration and public benefits payment data.

Though the specific access DOJ will have to the states' data is unclear (e.g., direct access to state databases, periodic receipt of bulk data files or other arrangements), the press release signals that DOJ intends to incorporate state datasets into centralized fraud analytics efforts rather than merely obtaining records when a particular investigation arises. This could have an operational effect that allows DOJ to integrate large datasets for more efficient data analytics and pursue more proactive Medicaid-focused cases.

The southeastern agreements echo the June 2026 DOJ agreement with Ohio authorities. In June 2026, DOJ announced a partnership with Ohio's Secretary of State, Attorney General's Medicaid Fraud Control Unit and Auditor's Office to combat fraud through, among other things, data sharing. Dr. Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services (CMS), called it "a national fraud-fighting model." Similarly, on August 4, 2026, the DOJ announced the aforementioned District Anti-Fraud Initiative in the Eastern District of Pennsylvania supported by the Pennsylvania Attorney General.

Looking Ahead

The July 2026 Southeastern agreements are a clear signal that DOJ is ramping up its efforts to combat fraud through 1) apparently permanent task forces and similar arrangements, 2) an emphasis on data analytics and 3) a particular focus on Medicaid fraud.

First, the state-federal agreements are not the only arrangements DOJ has recently created to target fraud. They come just months after DOJ created the NFED. Moreover, DOJ has made clear that it hopes to expand its partnerships to additional states, calling Ohio's agreement a national model.

Second, DOJ has demonstrated a clear focus on data analytics. This is not limited to its data-sharing agreements. In its June 2026 Health Care Fraud Takedown press release, DOJ emphasized how its "cutting-edge use of data analytics" allowed it to target actors based on payments for allografts, for example. The data-sharing agreements formally incorporate seven states into these data-driven efforts.

In addition, DOJ's increased use of data analytics could shorten enforcement timelines. A recent press release emphasized that the Health Care Fraud Unit opened an investigation "within five days of the financial intelligence [data] review" and that "the defendant was arrested less than seven months later." This is consistent with recent announcements regarding efforts to move cases quickly and measure performance accordingly. Indeed, DOJ recently announced that it would prioritize review of "new benefits fraud qui tam actions" and, "to the maximum extent practicable, complete its review" thereof within 120 days. Efficiencies created by sophisticated data analytics will support this goal.

Third, the Department's public announcements demonstrate a substantial focus on Medicaid-related enforcement. DOJ has repeatedly highlighted coordination with Medicaid Fraud Control Units, CMS participation in fraud-detection efforts, Medicaid fraud prosecutions and accelerated review of False Claims Act matters involving federally funded and state-administered benefits programs. The available public record therefore suggests that Medicaid program integrity efforts are a significant component of the broader initiative rather than a peripheral concern.

What Companies Should Consider Now

DOJ's growing emphasis on data analytics means that companies should consider proactively running their own analyses to identify patterns or anomalies that could catch DOJ's or state prosecutors' attention. Companies should pay close attention to unusual spikes – such as abnormally high billing or utilization. Outliers will tend to get scrutiny, and companies should be prepared to explain their performance. Similarly, once part of an investigation, companies should not delay in working with counsel to consider whether additional expertise in data analytics is appropriate to identify and investigate red flags.

Companies should also be prepared to move more quickly if they opt to self-disclose – as discussed in a recent Holland & Knight alert on DOJ's first healthcare declination under its new policy – to stay ahead of DOJ's increasingly rapid enforcement timelines and growing reliance on sophisticated data analytics.

For more information or questions, please contact the authors.

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