Explosive Growth Fuels Fraud Concerns (Image Credits: Upload.wikimedia.org)
California – Dr. Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services, spotlighted the state’s escalating hospice fraud challenges during a CBS News interview.[1][2]
Explosive Growth Fuels Fraud Concerns
Hospice providers in Los Angeles County expanded seven-fold over the past five years, reaching 1,923 agencies – more than in 36 other states combined.[3] This surge stood out sharply against national trends, with LA County accounting for 18 percent of the country’s home health care billing despite a relatively smaller elderly population compared to states like Florida or New York.[3]
State auditors identified hotspots, such as Van Nuys in the San Fernando Valley, where 210 hospice agencies clustered within a single square mile.[3] One unmarked commercial building held licenses for 112 hospices, and another hosted 89, according to investigations.[4] California Attorney General Rob Bonta described the situation last year as an epidemic centered in greater Los Angeles.[3]
Oz Levels Direct Criticism at Newsom
Dr. Oz visited Los Angeles and released a video from Van Nuys, estimating $3.5 billion in hospice and home care fraud within LA County alone.[3][5] He declared, “Hospice is crazy here,” and pointed to a four-block area with 42 hospices, including one tied to a prior $16 million scheme.[3][6]
In his CBS News remarks, Oz stated, “If we could fix California it would help the rest of the country,” signaling ongoing discussions with Governor Gavin Newsom: “We are talking.”[1] Oz demanded a comprehensive program integrity action plan from Newsom within three weeks to tackle fraud in Medicare and Medi-Cal programs, including the In-Home Supportive Services, where spending ballooned from $8 billion to $28 billion over a decade.[7] He accused certain networks of corrupting doctors to certify healthy patients.[3]
State Responses and Accusations Fly
Governor Newsom countered by filing a civil rights complaint against Oz with the U.S. Department of Health and Human Services, alleging discriminatory remarks in the video that targeted the Armenian community.[5][6] Oz had referenced “Russian Armenian mafia” involvement while standing near an Armenian bakery, prompting claims of harm to local businesses.[5]
California officials noted prior efforts, including a 2021 law banning new hospice licenses and revocation of over 280 licenses, with 300 more under review.[4][6] The state pursued 101 criminal enterprises, charging 109 individuals with related offenses.[4] Federal prosecutors also charged dozens in schemes like a $100 million Medicare theft by an international ring.[3]
Mechanics of the Medicare Scams
Fraudsters recruited at senior centers, offering cash, walkers, or drinks for Medicare numbers, then sold them to providers for $1,000 to $3,000 per patient.[3] Healthy individuals ended up listed as terminal, shuffled between agencies to prolong billing through upcoding and unbundling.[3]
- No ownership limits on hospices, allowing foreign applicants.
- Patients unaware until seeking care elsewhere.
- One Medicare ID proved more valuable than a credit card.
- Clusters in strip malls, auto shops, and bakeries.
- Nationwide improper payments hit $198 million in 2023 audits.
Key Takeaways
- LA County hosts disproportionate hospice numbers, fueling billions in suspected fraud.
- Federal-state tensions escalate over enforcement and blame.
- Actions like license bans show progress, but issues persist.
Resolving California’s hospice woes demands coordinated federal and state measures to protect vulnerable seniors and taxpayer dollars. What steps should leaders prioritize next? Share your thoughts in the comments.
