The U.S. Department of Justice filed a lawsuit in May against three of the country’s largest private health insurers for violating the False Claims Act, specifically in the form of “kickbacks.” Hundreds of insurance brokers at eHealth, GoHealth, and SelectQuote are accused of engaging in a far-reaching kickback scheme with CVS Health, Aetna, Elevance Health, and Humana.
The suit alleges that the insurers violated the False Claims Act by instructing their brokers to steer patients to select Medicare Advantage plans with the highest kickbacks (disguised as sponsorship or marketing payments) from 2016 to 2021. The complaint was filed in Boston federal court and is one of the largest whistleblower cases in history. The Department of Justice (DOJ) seeks unspecified damages and heavy penalties for those involved.
DOJ’s claim is filed under the False Claims Act
In May 2025, the U.S. Department of Justice, acting on tips from whistleblowers, filed a lawsuit under the False Claims Act, alleging kickbacks involving the Medicare Advantage program. The government’s case is a long time coming; it originated from a 2021 lawsuit filed under the False Claims Act.
The False Claims Act is a federal statute that protects whistleblowers reporting fraud and abuse in both public and private corporations, agencies, healthcare providers, and other entities. The law provides protections for whistleblowers and imposes criminal and civil penalties on companies that engage in bribery and kickbacks, fraudulent accounting, and the inflation of services for Medicare and Medicaid reimbursement, as well as the falsification of patient records to defraud the government. It also permits whistleblowers to obtain a portion of any monies received by the U.S. government.
Details of the DOJ claim
Medicare Advantage insurance plans are offered by private insurance companies, such as Humana and Aetna, at a set rate to older adults enrolled in Medicare who seek additional coverage and benefits not offered through Traditional Medicare (Medicare Part A and Part B). As alleged, many Medicare recipients work with insurance brokers to learn about plan details, compare the benefits offered in Medicare Part D, Part E, Part F, and other plans, to find insurance coverage that meets their needs and their budget. Brokers are expected to help beneficiaries find the right plans and act in the beneficiaries’ best interests. Instead, as alleged by DOJ, brokers guided Medicare recipients to the plans that offered the highest kickbacks.
The suit notes that these kickbacks were referred to as “co-op,” “marketing,” or “sponsorship” payments and that the brokers incentivized their agents to sell Medicare Advantage plans based on the kickbacks, while refusing to sell plans that offered little or no kickback payments.
According to the DOJ, Humana and Aetna, two of the country’s largest brokers of Medicare Advantage plans, threatened to withhold kickback payments to brokers as a pressure tactic to enroll fewer patients with disabilities. Insurers were alleged to deem patients with certain disabilities and chronic conditions as less profitable.
Why did the DOJ join the claim?
U.S. Attorney Leah Foley of Massachusetts, one of the lead attorneys representing the federal government, stated, “The alleged efforts to drive beneficiaries away specifically because their disabilities might make them less profitable to health insurance companies are even more unconscionable.”
The case was initially filed under seal while the DOJ investigated the matter. Upon concluding the investigation of whistleblower allegations, the Department of Justice determined that there was sufficient cause to join the case, which it did at the beginning of May 2025.
The government reserves the right to join a False Claims Act suit, depending on the situation, and has first right to investigate. At the conclusion of the government’s investigation, it can opt to join the suit and pursue treble damages, or decline to join, and allow the whistleblower to pursue the claim on their own. In some cases, the government may advise the filing party that the investigation yielded little or no indication of fraud.
The Qui Tam aspect of the False Claims Act
The initial whistleblower claim was filed under the qui tam, or “whistleblower,” protection of the False Claims Act. Within the context of the False Claims Act, a qui tam action permits the private individual or individuals (referred to as “relator” in the legal proceedings, and a “whistleblower” in more common parlance) to file a lawsuit on behalf of the federal government against an individual or entity who defrauded the government. If the suit is successful, the relator may be entitled to a portion of the money recovered by the government.
If you have information about government defraudation, call Griffin Durham at (404) 891-9150 for a consultation about your eligibility to file a False Claims Act suit.