The Office of Inspector General (OIG) for the U.S. Department of Health and Human Services (HHS) is the largest inspector general's office in the federal government. Its primary mission is to protect the integrity of HHS programs—such as Medicare and Medicaid—and the health and welfare of the people served by those programs. The office can trigger civil demands for reimbursement or make criminal referrals for fraud and abuse.
Core Functions
The OIG operates through a nationwide network of audits, investigations, and inspections. Its work generally falls into three categories:
Fighting Fraud: Identifying and prosecuting "bad actors" who submit false claims or kickbacks.
Improving Efficiency: Auditing HHS programs to eliminate waste and ensure taxpayer dollars are spent effectively.
Patient Safety: Protecting beneficiaries from neglect or poor quality of care in nursing homes, hospitals, and other facilities.
Criminal Charges
The Office of the Inspector General (OIG) does not directly file charges itself. However, the OIG starts investigations agnostic to whether the case will ultimately become criminal. Its charge is to investigate allegations of fraud and misconduct.
Whether the case is prosecuted criminal is outside the scope of the OIG's job. Instead, it can and often does refer the case and sends its findings to the Department of Justice. The DOJ then assigns agents (usually FBI) to conduct a further investigation to decide whether criminal charges should be filed. To learn more about this CLICK HERE for a page where the Department of Justice discusses:
Summaries of our investigative findings in cases involving administrative misconduct that meet either of the following criteria:
- Cases in which no criminal prosecution resulted but the OIG found misconduct by a member of the Senior Executive Service, an employee at the GS-15 grade level or above, or an Assistant U.S. Attorney; or
- Cases involving high profile investigations, or in which there may otherwise be significant public interest in the outcome of the investigation.
These pages do raise issues as to why one case proceeded only civilly (money paid) vs. criminally. At one page the DOJ discusses a $ 3.5 Million dollar case that proceeded NOT ONLY CRIMINALLY but by CIVIL means as well. So bear in mind that it is not necessarily an either/or situation. Here is the link but the following is a quote from that page.
On April 6, 2026, Jack Kidd / Arapaho Communications, LP entered into an agreement with the Department to pay $3,500,000 to resolve allegations that Kidd / Arapaho Communications, LP knowingly submitted inflated invoices to BOP misrepresenting the volume of natural gas delivered to United States Penitentiary, Canaan (USP Canaan) ...
Kidd previously pleaded guilty and paid restitution in the amount of $11,397,374 related to the fraudulent scheme involving USP Canaan and FCI Aliceville in Alabama. The investigation was conducted by the OIG’s Fraud Detection Office with assistance from the OIG’s El Paso Office and Cyber Investigations Office.
It is our advice that when an OIG investigation is initiated (and you often learn of this by receiving an OIG supboena), that you consider this the start of both a civil and criminal investigation.
Other Powers of the OIG
The OIG has the power to "exclude" individuals and entities from participating in federally funded healthcare programs. If a doctor or a company is placed on the OIG Exclusion List, they cannot receive any federal payments for their services, which is often a "death penalty" for a healthcare business.
Common Areas of Focus
Anti-Kickback Statute: Ensuring medical decisions are made based on patient needs, not financial incentives.
Stark Law: Preventing physicians from referring patients to services in which the physician has a financial interest.
Grant Oversight: Monitoring how billions of dollars in research grants (like those from the NIH) are used.
The OIG can destroy a medical practice simply by auditing and imposing reimbursement limitations. The OIG also makes decisions as to whether to settle a case civilly or make a criminal referral.
You will oftentimes see state prosecutions that are tied to investigations of the Office of the Inspector General. In April of 2026 Indictments were file by the office of Ohio Attorney General Dave Yost accusing eight Medicaid providers of stealing a combined $181,512 from the government health-care program for the needy. The OIG publicized this case and was likely part of the investigation. See: OIG was involved in this investigation.
The same OIG website publicized the FEDERAL conviction of a former teacher Jeanett Valenzuela Ayub pleaded guilty in federal court today, admitting that she conspired with others to launder millions of dollars of health care fraud proceeds. In total, Valenzuela admitted that she and her co-conspirators billed Medicare nearly $51 million for bogus prescriptions and were paid approximately $20 million, ultimately laundering at least $14 million dollars of Medicare proceeds and paying $3.7 million in unlawful kickbacks.
Daniel Horowitz - physician lawyer can assist you with OIG inquires and investigations. Call him at (925) 283-1863.
