Virtual And Digital Health Digest - December 2025

• Published date: 07 January 2026
• Law Firm: Arnold & Porter
• Author: Arnold & Porter Kaye Scholer LLP

This digest covers key virtual and digital health regulatory and public policy developments during November and early December 2025 from the United States, United Kingdom, and European Union.

In this issue, you will find the following:

U.S. News

• Health Care Fraud and Abuse Updates
• Corporate Transactions Updates
• Provider Reimbursement Updates
• Privacy and AI Updates
• Policy Updates
• FTC Updates

U.S. Featured Content

This month's issue covers major developments in health care fraud enforcement, corporate investment trends, and policy updates shaping the future of digital health and artificial intelligence (AI). We highlight two significant telehealth fraud cases, including the conviction of executives behind a $100 million Adderall distribution scheme and an indictment tied to a $2.7 million telehealth billing fraud. On the innovation front, startups Function Health and Angle Health raised funds to scale AI-powered platforms for preventive care and benefits management.

We also dive into the Centers for Medicare & Medicaid Services' (CMS) new ACCESS pilot, which will test an outcome-aligned payment (OAP) approach for technology-enabled chronic care, and review the calendar year (CY) 2026 Medicare Hospital Outpatient Prospective Payment System (OPPS) final rule, including CMS' interest in creating a payment framework for software as a service (SaaS). Additional updates include the White House's Request for Information (RFI) on enhanced research under the Genesis Mission, U.S. Health and Human Services' (HHS) AI strategy rollout, U.S. Food and Drug Administration's (FDA) TEMPO digital health pilot, and Federal Trade Commission's (FTC) $27.6 million consumer refund announcement.

EU and UK News

• Regulatory Updates
• Privacy Updates
• IP Updates

EU/UK Featured Content

This month saw tighter governance of AI and digital technologies in the UK and EU life sciences and MedTech sectors, underscoring that innovation must advance alongside strengthened accountability.

In the UK, new funding for Medicines and Healthcare products Regulatory Agency (MHRA) and National Institute for Health and Care Excellence (NICE) signals growing recognition of the need for stronger oversight around digital mental health tools, while Proprietary Association of Great Britain's (PAGB) report of AI in consumer health care advertising highlights the increasing scrutiny on how AI is used in public-facing health communications.

Across the EU, the introduction of an AI Act whistleblower tool reflects efforts to create a more transparent and risk-aware regulatory environment, and the European Commission's Digital Omnibus proposals further demonstrate the EU's intent to harmonize expectations across AI, data protection, and cybersecurity.

Together, these developments indicate that, while opportunities for AI in health continue to grow, regulators are continuing to take measures to ensure safety, trust, and consistency across the sector.

For life sciences and MedTech companies, this points to a regulatory landscape where expectations around transparency regarding ongoing oversight for AI systems and AI-enabled communications are becoming increasingly defined.

U.S. News

Health Care Fraud and Abuse Updates

Telehealth Executives Convicted for Adderall Distribution and Health Care Fraud Scheme. On November 18, 2025, a federal jury in San Francisco convicted two executives of a digital health company for their roles in a years-long scheme to illegally distribute Adderall online. The jury found that Ruthia He, the founder and CEO of Done, and David Brody, the clinical president of Done, used deceptive advertising to prescribe over $100 million worth of Adderall and other stimulants.

According to the court documents, the defendants allegedly spent $40 million on social media advertising and paid for keyword search advertisements to attract drug seekers. The defendants also allegedly kept initial clinical appointments to half the usual length to maximize profits and paid nurse practitioners high salaries to refill prescriptions without clinical interactions. Additionally, patients were allowed to auto-refill their prescriptions without any clinical oversight. Further, as part of the scheme, the defendants allegedly defrauded insurers by submitting false and fraudulent prior authorization requests, resulting in Medicare, Medicaid, and the commercial insurers paying over $14 million.

Telemedicine Company Owner Indicted for $2.7 Million Telehealth Scheme. On November 21, 2025, a federal grand jury in the Middle District of Florida indicted Marek Rex Vernon Harrison, the owner and manager of CTD Network LLC (CTD), a telemedicine company, for allegedly submitting fraudulent claims for telehealth services. The indictment alleges that CTD employed medical providers to authorize prescriptions for genetic tests for Medicare beneficiaries referred by marketing companies or laboratories. These providers signed orders for tests that were medically unnecessary for beneficiaries, and they did not use the test results for treatment. CTD then allegedly billed Medicare for these telehealth services, submitting over $2.7 million in false and fraudulent claims, of which Medicare paid...