The Whistleblower Windfall? DOJ Announces Another Incentive Program for Reporting Fraud

In the latest from the U.S. Department of Justice (DOJ), the National Fraud Enforcement Division (NFED) announced on October 20, 2026, the creation of a Fraud Whistleblower Incentive Program (WHIP)[1] paying between $10,000 and $30,000 for information leading to criminal charges—to be handed out at the charging stage of a criminal case, as opposed to after the final resolution.

This program further incentivizes private whistleblowers to voluntarily disclose potential fraudulent activity. Health care companies, in particular, need to be aware of what this may mean for their businesses.

Payment May Come at Charging, Not at Conviction

Most federal whistleblower programs, such as the qui tam payments available under the False Claims Act (FCA), pay only after a case is fully resolved. NFED’s WHIP pays when charges are filed and unsealed, which means that an indictment, criminal information or complaint can trigger payment. This new framework gives whistleblowers much-needed certainty and speed, and will incentivize citizens who are aware of fraud to report it.  DOJ states:

These early-stage rewards aim to encourage prompt disclosure of information by giving whistleblowers more certainty about the amount and timing of a possible reward payment, while still leaving whistleblowers eligible for potentially larger rewards should their tips ultimately lead to large financial penalties or forfeiture.

Under WHIP, DOJ may, at its sole discretion, offer rewards for information relating to federal health care offenses and related crimes involving health care benefit programs or fraud againt patients or others in the health care industry, prioritizing submissions involving: 1) hospice, 2) home health care, 3) day care, and 4) special services fraud. DOJ defines “special services fraud” as schemes where those purporting to provide special needs services (such as autism care) defraud government-funded programs including Medicare and Medicaid. Specifically, the DOJ states that this “could involve, but is not limited to, falsely diagnosing patients with conditions such as autism, paying kickbacks to parents in exchange for enrolling children in special needs programs, or using the personal identifying information of individuals without their knowledge to obtain government benefits.”

For a potential whistleblower, the appeal is clear: a payment that could be paid in months, not years, for reporting on fraudulent activity that only has to be criminally charged but not proven. For a company, that timing shortens the window between an employee’s first concern, and the company’s ability to address that concern before government involvement.

WHIP will apply to government programs and benefits administered by the Department of Agriculture (e.g., Supplemental Nutrition Assistance Program (SNAP) benefits), the Department of Labor (e.g., unemployment fraud), the Department of Health and Human Services, the Department of Housing and Urban Development, the Department of Education, the Department of Veterans Affairs, the Department of War, and the Small Business Administration. WHIP, which will be subject to an initial three-year term, may also be expanded in the future to cover additional categories of fraud (see also the Frequently Asked Questions (FAQs)).

Who Qualifies and the Culpability Carve-Out

WHIP is designed to solve a gap in existing whistleblower programs, although whistleblowers remain eligible for other rewards programs including DOJ Criminal Division’s Corporate Whistleblower Awards Pilot Program, launched in 2024. Business entities, especially those operating in the health care space, should note that the following conditions will apply in order for whistleblowers to be eligible for WHIP:

• participation must be voluntary;
• truthful and complete original information must be provided in writing;
• information must pertain to defined subject matter areas;
• full cooperation is required;
• information must be provided by individuals who did not actively participate in the fraud (a minimal role may still qualify); and
• information must lead to criminal charges in the programmatic areas outlined.

Companies cannot be tipsters; only individuals qualify, and they may be represented by counsel. Other disqualifiers include being a DOJ or law enforcement official, being an elected or appointed foreign government official, or knowingly making false statements to, or obstructing, DOJ.

The most important nuance concerns culpability. Anyone who “meaningfully participated” in the scheme is ineligible. That includes directing, planning, initiating, or knowingly profiting from it. But WHIP carves out an exception: an individual may still qualify if DOJ determines that the individual’s role was “minimal,” meaning “plainly among the least culpable” of those involved (note that WHIP borrows the definition of “minimal participant” from section 3B1.2 cmt. n.4 of the U.S. Sentencing Guidelines). In that case, the individual’s role may reduce the amount of the award rather than barring it. DOJ will assess whether the whistleblower had a management and/or corporate executive role over the personnel or offices involved in the misconduct and may use that information to deny a reward. DOJ will consider whether the whistleblower

• was a senior executive or otherwise had decision-making authority related to the misconduct;
• contributed to failures of the compliance system to detect and prevent the misconduct at issue;
• created a corporate culture that deprioritized compliance programs and systems; or
• received information regarding red flags identifying potential misconduct but took no steps to address the issues.

The culpability exception is discretionary, and DOJ defines “profit” broadly. A kickback or a special bonus count, as well as a salary increase traceable to the scheme if the individual knowingly benefited.

WHIP’s Interaction with the False Claims Act

The FCA has long been the principal channel for whistleblowers in cases which allege fraud relating to payments from the government. Under a qui tam action, a relator files a sealed complaint, and the government decides whether to intervene. If the case succeeds, the relator typically receives 15 to 25 percent of the recovery when the government intervenes, and 25 to 30 percent when it does not. The process is typically slow, and sealed cases can remain pending for years.

While it appears that WHIP may retain some of the features of the FCA, such as the public disclosure bar and original source doctrine, WHIP seemingly competes with the FCA’s path. DOJ’s rules state that an award here does not preclude a later whistleblower payment under other programs. A tipster could therefore report through this program and later pursue a civil FCA action. Companies should assume that a single set of facts may generate both a criminal tip and a civil qui tam action, and coordinate their response accordingly.

Why Deputized Tipsters Matter

Beyond this program, the broader trend is worth noting. In our view, private individuals now have access to data analytics tools that were once available only to government investigators or large firms. Billing data, public Medicare datasets, licensing records, and open-source corporate filings can reveal anomalies such as unusual billing volume in hospice enrollment, concentrated referral patterns, or unexplained growth in day care enrollment. When that analysis is combined with a defined payment at charging, the result is a tipster who can do much of the government’s early detection work. Therefore, companies’ own internal compliance monitoring has never been more important.

Takeaways

As recently as October 15, DOJ and the Department of Health and Human Services Office of Inspector General (HHS-OIG) announced a new policy directing that companies seeking to voluntarily self-disclose potential criminal conduct relating to health care should now make self-disclosures to NFED. Such disclosures will automatically trigger both DOJ’s Corporate Enforcement and Voluntary Self-Disclosure Policy and HHS-OIG’s Health Care Fraud Self-Disclosure Protocol  (see related blog post here).

As the government ramps up its focus on fraud, particularly with respect to health care, it is increasingly incentivizing both companies that voluntarily cooperate and whistleblowers who come forward with respect to fraud. Whistleblowers are already a key part of civil False Claims Act (FCA) qui tam suits. In June, DOJ’s Civil Division accelerated review of FCA whistleblower complaints involving federally funded, state-administered benefits programs (see related blog post here.)

Companies concerned about their exposure, and operating in the health care space in particular should do the following:

• Strengthen Compliance and Internal Controls: Conduct thorough compliance audits across all operations; document and strengthen compliance programs; and create clear policies with respect to, for example, health care billing, FCA and Anti-Kickback Statute (AKS) compliance, and Food and Drug Administration compliance.
• Listen to Your Employees: When internal concerns and complaints surface, investigate any concerns with the appropriate level of scrutiny and diligence. Many whistleblowers report internally to their employers before going to the government. This gives companies a chance to remediate before an issue is handed over to the government to investigate.
• Consider Proactive Disclosure Mechanisms: DOJ has implemented policies to incentivize companies to voluntarily self-disclose misconduct. Establish robust internal reporting mechanisms and consider voluntary self-disclosure if misconduct is discovered.
• Scrutinize Duration and Scope of Conduct: Per DOJ’s Directive 26-12, “Corporate Enforcement in the Fight Against Fraud,” issued October 1, 2026, the government will place great weight on whether fraudulent conduct (i) lasted three years or more, (ii) affected multiple taxpayer-funded programs, (iii) spanned three federal districts, or (iv) resulted in more than $25 million in losses or harm to 25 or more victims (see related blog post here). Audit whether any practices fall into these categories.
• Know Your Data: The government is heavily relying on data analytics and artificial intelligence. Implementing those same technologies to audit records should be part of every company’s compliance program.
• Investigate Early and Under Privilege: When a concern surfaces, engage counsel to assess risk quickly, preserve relevant records, remediate as necessary, and decide on next steps to strategically address the issues.
• Prohibit and Monitor Retaliation: Train managers on risks and review any adverse action against an employee who raised a billing or compliance concern.

WHIP makes whistleblowing reporting faster and more financially attractive to the people closest to the conduct. For companies and individuals in health care and benefits programs, the practical response is to address exposure before the government hears about it from a whistleblower.

Epstein Becker Green Staff Attorney Ann W. Parks contributed to the preparation of this post.

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The Health Law Advisor blog is currently edited by Emily Chi Fogler.

ENDNOTES

[1] WHIP is used in DOJ’s Announcement/Press Release, but the new program is also referred to in DOJ materials as the NFED “Whistleblower Rewards Program,”  NFED “Criminal Tip Rewards Pilot Program,” (also in FAQs) and “Fraud Rewards Program.” The “Corporate Whistleblower Awards Pilot Program” is a separate program launched in 2024.