HCFAC Report: FY21 Healthcare Fraud

If you are in healthcare, you’ve likely heard of the recently released Annual Report of the Departments of Health and Human Services and Justice. The Health Care Fraud and Abuse Control Program had a lot to report for the 2021 fiscal year, and the results were fascinating but not surprising.

After the onset of the COVID-19 pandemic, healthcare professionals knew that some trends were likely to stay, and not all were positive. Along with the innovations in making healthcare more accessible via technology, healthcare fraud increased exponentially compared to previous years.

The Federal Government was able to successfully prosecute or negotiate more than $5 billion in healthcare fraud judgments and settlements. 

Let’s dive into some of the interesting data points from the report and take a look at how the instances of fraud, waste, and abuse could decline in 2022.

The data at a glance

In 2021, the DOJ opened 831 new criminal healthcare fraud investigations, 462 of which were prosecuted. In the end, the DOJ achieved 312 convictions for healthcare fraud crimes. They also opened 805 civil fraud investigations, 1,432 of which were still pending at the end of 2021.

Investigations by the HHS’s Office of Inspector-General (OIG) resulted in 504 criminal actions resulting Medicare and Medicaid fraud and 669 civil actions. These crimes included false claims submission and unjust referral enrichment lawsuits.

They also excluded 1,689 individuals and entities from ever participating in Medicare, Medicaid, and other federal programs. These exclusions were caused by criminal or fraudulent activities.

The FBI also pulled their weight by disrupting 559 criminal fraud organizations, and they were able to disrupt and take down a total of 107 healthcare fraudulent enterprises.

COVID-19 fraud findings

Because fraud has been rising due to the pandemic, new risks and vulnerabilities have been identified. They include: 

  • Additional unnecessary services like offering COVID-19 tests to Medicare beneficiaries in exchange for personal information like Medicare information. This is often done via telemarketing, texts, social media platforms, and door-to-door visits.


  • Unnecessary laboratory testing: Performing additional tests when conducting COVID-19 tests. Some of these tests aren’t related to COVID-19.


  • Healthcare technology schemes.


  • Fraudulent COVID-19 healthcare relief funds such as filing false claims and fraudulent applications for federal relief funds.


Wins to The Healthcare Fraud Effort

More than $5 billion in judgments and settlements were won in 2021. Due to the efforts of OIG and DOJ, almost $1.9 billion was returned to the Federal Government or private individuals. 

A large part of this was due to the fraud, waste, and abuse mitigation strategies. These include data analysis and studies, targeted investigations, development of the Fraud Prevention System (FPS) models and edits, and implementation of new policies. 

Some of the more positive results from the report is the effectiveness of the program and the ROI that we are seeing as a result of these efforts. The ROI of the HCFAC program over the last three years is $4 for every $1 spent. Imagine what that number will look like five years from now. For more information on healthcare fraud settlements in 2021, and to take a deeper look at what the fraud landscape looks like, check out the report here.