Los Angeles is at the center of a recent exposé uncovering rampant hospice fraud across the county. CBS News recently released a deep dive into the fraud, revealing that several companies are showing red flags that have largely been ignored.
There are about 1,800 licensed hospice providers in Los Angeles County, which is roughly six times the national average when adjusted for the size of its elderly population, according to CBS News. In 2022, California's state auditor sounded the alarm as LA County saw a 1,500% increase in hospice companies since 2010.
In a letter to Democratic California Gov. Gavin Newsom and state legislators dated March 29, 2022, the California state auditor flagged that there had been "a rapid increase in the number of hospice agencies with no clear correlation to increased need."
Other flags included "excessive geographic clustering of hospices," "long durations" of services for patients, "abnormally high rates" of living patients discharged from hospice and agencies "possibly using stolen identities of medical personnel."
"These indicators strongly suggest that a network or networks of individual perpetrators in Los Angeles County are engaging in a large and organized effort to defraud the Medicare and Medi-Cal hospice programs. Such fraud places at risk the extremely vulnerable population of hospice patients," the letter continued.
Out of the roughly 1,800 hospices in LA County, CBS News found 742 that were still operating despite triggering multiple red flags for fraud. One dense concentration of hospice companies shows nearly 500 operating within a 3-mile radius. CBS News found that, along Van Nuys Boulevard, there were 137 hospice sites, more than half of which showed indicators of fraud as defined by California.
In what could be the most egregious example, 89 companies were found to be registered to a single building on Van Nuys Boulevard, 72 of which reportedly showed multiple signs of fraud. CBS News noted that federal records indicate that regulators visited multiple suites in the building between 2021 and 2025. Additionally, the news outlet's analysis showed that almost 40 of the companies shared key personnel, something the state auditors consider to be a potential red flag for fraud.
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"While MAGA bloggers and idiots like Dr. Oz may have just discovered hospice fraud, California has been cracking down in this space for years. In 2021, Governor Gavin Newsom signed a law banning ALL new hospice licenses. That moratorium is still in place, blocking bad actors from entering the system while the state tightens oversight of existing providers," Newsom spokesperson Izzy Gardon said in a statement to Fox News Digital.
"Under the governor's leadership, the state launched a multi-agency Hospice Fraud Task Force bringing together CDPH, CalHHS, DHCS, DSS and the California Department of Justice to make arrests, share intelligence, investigate fraud and coordinate enforcement."
Gardon noted that more than 280 hospice licenses had been revoked in the last two years. Additionally, the Newsom spokesperson said 300 more providers were under investigation for potential revocation. Gardon also said that there was "coordinated action to suspend Medi-Cal payments, revoke licenses and pursue prosecutions."
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When CBS News attempted to reach 56 hospice offices whose state and federal data indicated that they showed five or more red flags for fraud, the reporters found that many phone numbers were disconnected or went straight to voicemail. In one case, callers were reportedly directed to text a number that turned out to be invalid.
"Hospice fraud costs taxpayers hundreds of millions of dollars every year, and California is ground zero," CBS News correspondent Adam Yamaguchi said in a video posted on the outlet's X page. Yamaguchi said when he and his team visited the supposed hospice sites, they found empty offices and piles of mail.
The report comes on the heels of the explosive revelations about fraud in Minnesota, particularly in the state's Somali community. In Minnesota, the Feeding our Future COVID-19 relief scam cost taxpayers hundreds of millions of dollars and triggered hearings on Capitol Hill.
Hospice fraud often involves stolen Medicare numbers being used to falsely enroll patients in hospice. In one case highlighted by CBS News, a 69-year-old woman was denied coverage for physical therapy because Medicare records showed that she was dying in hospice.
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