Healthcare Company Avoids Prosecution After Self-Reporting Under New DOJ Policy

On March 10, 2026, the U.S. Department of Justice (“DOJ”) released the first-ever Department-wide Corporate Enforcement and Voluntary Self-Disclosure Policy for criminal matters (the “CEP”)¹, establishing a uniform framework governing when and how DOJ will decline to prosecute companies that voluntarily disclose misconduct, cooperate with investigators, and remediate wrongdoing.² The key feature of the new CEP is that it establishes a clear commitment that DOJ will decline prosecution when CEP criteria are met, upgrading what was historically a discretionary “presumption” of declination that left companies with no assurance that a voluntary self-disclosure would guarantee a declination. 

On July 29, 2026, DOJ announced its first declination of charges against a healthcare company under the new policy, marking a significant milestone for healthcare companies evaluating voluntary self-disclosure. This alert summarizes the CEP’s key provisions and the recent declination and offers practical guidance for healthcare organizations.

The New Policy

The CEP applies to all corporate criminal cases department-wide, except antitrust matters under 15 U.S.C. §§ 1–38. It supersedes all prior component-specific corporate enforcement policies, including the Southern District of New York’s February 2026 Financial Crimes Program. As Deputy Attorney General Todd Blanche stated, the policy “draws on decades of experience across the Department and creates incentives for companies to come forward and do the right thing when misconduct occurs so that we may hold accountable the individual wrongdoers.”³

The main purpose of the revised CEP is to provide greater certainty for companies considering self-disclosure to incentivize companies to bring misconduct forward so the Department can pursue culpable individuals faster, compensate victims sooner, and deter fraud—without unduly burdening businesses that do the right thing. The proposition is straightforward: self-disclose, cooperate fully, remediate, and, absent aggravating circumstances, DOJ will decline to prosecute.

How the CEP Works

• Part I - Declination. DOJ will decline to prosecute companies that: (i) voluntarily self-disclose misconduct to an appropriate DOJ criminal component; (ii) fully cooperate with the investigation; (iii) timely and appropriately remediate; and (iv) have no aggravating circumstances. Companies must also pay all disgorgement, forfeiture, and restitution. All declinations will be made public.
  
  
• Part II - “Near Miss”. For companies that cooperated and remediated but either made a good-faith disclosure that did not technically qualify as voluntary self-disclosure, or had aggravating circumstances warranting a resolution, DOJ shall:
  • Provide a Non-Prosecution Agreement (absent particularly egregious circumstances);
  • Allow a term length of less than three years;
  • Not require an independent compliance monitor; and,
  • Provide a 50–75% fine reduction off the low end of the Sentencing Guidelines range.
    
    
• Part III - Discretion. Companies not otherwise qualifying under Parts I or II face prosecutorial discretion on the form of resolution, term, monitor, and monetary penalty, with fine reductions capped at 50%.

Key Definitions Under the CEP

• Voluntary Self-Disclosure requires: (1) good-faith disclosure to the appropriate DOJ component; (2) the misconduct was not previously known to DOJ; (3) no preexisting obligation to disclose; (4) disclosure prior to an imminent threat of disclosure or government investigation; and (5) reasonably prompt disclosure after becoming aware of the misconduct.
• 120-Day Whistleblower Clock. Companies must self-report within 120 days of receiving an internal whistleblower complaint to still qualify for voluntary self-disclosure credit, even if the whistleblower reported to DOJ first.
• Aggravating Circumstances are now more narrowly defined, focusing on the nature and seriousness of offense, egregiousness or pervasiveness of misconduct, severity of harm, or corporate recidivism (criminal resolution within five years or based on similar misconduct).
• Full Cooperation requires proactive disclosure of all relevant non-privileged facts, identification of individuals involved regardless of rank, and preservation and production of documents.

The Campus Eye Declination

On July 29, 2026, DOJ’s National Fraud Enforcement Division announced it declined to prosecute Campus Eye Management Holdings LLC and its subsidiary Campus Eye Management LLC under Part I of the CEP.⁴

Campus Eye is a management services organization that provided billing and other services to an optometry practice and ambulatory surgery center in New Jersey.

The company self-disclosed that its founder, E. Bruce DiDonato, allegedly orchestrated a healthcare fraud and kickback scheme from at least 2015 through March 2023. The scheme involved unnecessary diagnostic eye tests billed to Medicare and illegal kickbacks to referring surgeons. DiDonato allegedly caused approximately $3.4 million in fraudulent Medicare claims (approximately $1 million paid out) and marketed and sold the company to private equity investors based partly on the inflated Medicare reimbursements.

In granting the declination, DOJ considered: (1) Campus Eye’s timely voluntary self-disclosure; (2) full and proactive cooperation with the investigation; (3) the nature and seriousness of the offense; (4) timely remediation, including revision of billing, payment, and compensation policies and substantial compliance program improvements; (5) no factors warranting a disposition other than a Part I declination; and (6) the company’s agreement to disgorge the amount of ill-gotten gains and compensate victims.

Assistant Attorney General Colin M. McDonald stated: “The Department’s policies afford companies that take responsibility for their misconduct with a clear path to a declination. Businesses that ignore the law and profit from their executive’s lies and deceit will be held accountable.”⁵

Campus Eye is only the second company ever to secure a declination in a criminal healthcare fraud investigation. The first was HealthSun Health Plans Inc., a Florida-based Medicare plan company, which in 2023 avoided charges by self-reporting, cooperating in a yearslong investigation into alleged fraudulent Medicare billing, and paying $53 million in restitution.⁶

Key Takeaways for Healthcare Companies

• The CEP offers a concrete path. The Campus Eye declination demonstrates that DOJ will follow through on its commitment to decline prosecution of healthcare companies that self-report, cooperate, and remediate. Companies facing potential compliance issues now have a concrete example confirming the policy’s real-world application.
  
  
• Compliance programs should be reassessed. Healthcare companies should evaluate their compliance programs, internal reporting mechanisms, and investigation protocols in light of the CEP’s framework. Companies with robust compliance infrastructure are best positioned to identify, investigate, and disclose potential issues within the policy’s parameters.
  
  
• The 120-day clock demands urgency. The whistleblower provision creates a firm timeline for companies to escalate and assess internal complaints. Organizations should ensure they have systems in place to quickly receive, triage, and investigate whistleblower reports, and counsel prepared to advise on whether and how to self-disclose.
  
  
• Individual accountability remains paramount. DiDonato’s seven-count indictment (despite his company’s declination) underscores that corporate cooperation does not shield culpable executives. The CEP’s cooperation requirements include identifying all individuals involved regardless of rank/seniority and DOJ made clear that it will continue to hold individuals accountable.
  
  
• Be prepared to navigate complexities. Companies should carefully analyze the strategic benefits of voluntary self-disclosure and the inherent complexities of cooperation, particularly around individual accountability and privilege considerations. Early engagement of experienced counsel is critical to navigating these decisions.

For more information regarding the DOJ’s Corporate Enforcement Policy and navigating healthcare fraud inquiries, investigations, and enforcement, please contact your Quarles attorney or:

• Eric Pruitt: (312) 715-5170 / eric.pruitt@quarles.com
• Theresa DeAngelis: (202) 372-9522 / theresa.deangelis@quarles.com

END NOTES

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¹ Corporate Enforcement and Voluntary Self-Disclosure Policy, DOJ (March 10, 2026), found here.

² Department of Justice Releases First-Ever Corporate Enforcement Policy for All Criminal Cases, DOJ Press Release No. 26-230 (March 10, 2026), found here. (“DOJ Press Release”)

³ DOJ Press Release.

⁴ Fraud Division Resolves Fraud Investigation of Eye Care Group Under New Corporate Enforcement Policy; Health Care Executive Charged for Alleged Fraud and Kickbacks, DOJ Press Release No. 26-863 (July 29, 2026), found here. (“DOJ Press Release - Campus Eye”)

⁵ DOJ Press Release - Campus Eye.

⁶ HealthSun Health Plans, Inc., DOJ (Oct. 25, 2023), found here.