Hospice Fraud Leaves California Seniors Stranded as State and Federal Officials Clash

For Linda Henry, a 71-year-old retiree in Southern California, a routine checkup in 2024 turned into a nightmare. A Medicare worker informed her that she was enrolled in hospice care, a service meant for those with six months or less to live, and that her records listed her as having heart failure. Henry, who was in good health, had become a victim of a sprawling fraud scheme targeting the hospice industry.

The problem has been particularly acute in California, where weak oversight allowed scammers to create fake hospices, trick people into enrolling, or steal identities to bill Medicare for services never rendered. The scale of the issue is staggering, with federal officials estimating that Los Angeles County alone accounts for roughly $3.5 billion in fraudulent claims. Since early 2025, more than 1,000 California hospices have been removed from Medicare as part of a federal crackdown.

The consequences for victims are severe. Once enrolled in hospice, Medicare stops paying for other medical treatments, leaving seniors without access to crucial appointments and procedures. Henry delayed physicals and a colonoscopy for months while fighting the erroneous enrollment. It took eight months for Medicare to acknowledge she was a fraud victim, and a full year before she could resume normal medical care.

California has taken steps to address the crisis, including a moratorium on new hospices since 2021 and the revocation of nearly 500 licenses. In June, the state adopted emergency regulations with stricter criteria for new licenses. State Attorney General Rob Bonta has filed over 100 hospice-related criminal cases and secured more than 50 convictions since 2021. In April, federal prosecutors made arrests in five LA-area cases, and Bonta announced 21 arrests in a separate multimillion-dollar identity theft scheme.

The federal response has drawn criticism. First Assistant U.S. Attorney Bill Essayli called California "the kingdom of fraud," a remark that fueled accusations that the Trump administration is targeting Democratic states for political reasons. The administration has also faced scrutiny for errors in its data and for focusing on providers with immigrant backgrounds. In January, CMS administrator Dr. Mehmet Oz made controversial remarks about the "Russian Armenian mafia" during a press event, prompting a civil-rights complaint from Governor Gavin Newsom.

Advocates say the human toll is devastating. Sheila Clark, CEO of the California Hospice and Palliative Care Association, testified about a woman who couldn't get cataract surgery approved because she was falsely enrolled in hospice. The woman fell in the dark, broke her hip, and died two months later. "That did not need to happen," Clark said, urging state and federal cooperation to "clean house."