California EXPOSED: Billions STOLEN From Dying Americans

Hospital patient holding visitors hand reassuringly.

Federal regulators have exposed California as the nation’s most brazen epicenter of hospice fraud, with criminals stealing billions in Medicare dollars by enrolling elderly Americans who aren’t even dying into fake end-of-life care programs.

Story Snapshot

CMS referred 343 fraud cases totaling $3.4 billion in fraudulent billing during 2025, with California identified as the worst offender
Los Angeles County experienced a seven-fold increase in suspicious hospice billing activity as fraudsters exploit vulnerable Medicare beneficiaries
Dr. Oz and the DOJ launched coordinated crackdowns after discovering criminals enrolled patients who weren’t terminally ill to bilk the system
California implemented emergency licensing restrictions, becoming the only state taking substantive action against the organized fraud crisis

Biden-Era Neglect Enabled Billion-Dollar Theft

CMS Administrator Dr. Mehmet Oz inherited a hospice system ravaged by systematic fraud that flourished under previous federal oversight failures. The Centers for Medicare and Medicaid Services referred 343 fraud cases representing $3.4 billion in fraudulent billing activity during 2025 alone. Nearly 4,780 healthcare providers had their Medicare billing privileges permanently revoked due to inappropriate behavior. Dr. Oz bluntly characterized the crisis: “Money is being sucked out of the system by these fraudsters. But these fraudsters are calling people who aren’t going to die.” This statement underscores how criminals systematically abused the hospice benefit designed for compassionate end-of-life care.

California’s Seven-Fold Fraud Explosion

Los Angeles County became ground zero for hospice fraud with a staggering seven-fold increase in billing activity, according to Dr. Oz’s press conference disclosures. California’s regulatory environment allowed fraudulent operators to proliferate through “license flipping” schemes where criminals sold hospice licenses before investigators could complete misconduct reviews. First Assistant U.S. Attorney Bill Essayli emphasized the accountability vacuum: “No one is making sure the money is actually being used where it’s intended to be used. Not only do the fraudsters benefit, but the real people who need the money are losing.” The state government finally implemented an emergency moratorium on new hospice licensing, becoming the only state to take substantive regulatory action.

Six-State Enforcement Initiative Targets Organized Networks

CMS expanded its Provisional Period of Enhanced Oversight program to six states—California, Arizona, Nevada, Texas, Georgia, and Ohio—after identifying coordinated fraudulent activity patterns. As of June 2025, approximately 668 hospices operated under enhanced medical review protocols, with 122 having their billing privileges permanently revoked. The geographic concentration suggests organized criminal networks rather than isolated incidents. Dr. Oz launched the Fraud Tax Project in November 2025, partnering with state tax authorities to identify operators committing simultaneous healthcare and tax fraud. This coordinated federal-state approach represents aggressive enforcement absent during previous administrations that allowed vulnerable elderly populations to become targets for deceptive marketing tactics.

Protecting Medicare Beneficiaries From Predatory Practices

Fraudulent hospice operators enrolled Medicare beneficiaries without their knowledge or consent, billing for services never provided to patients who weren’t terminally ill. These predatory practices exploited families during vulnerable moments while draining federal resources intended for legitimate end-of-life care. The enforcement crackdown protects both fiscal integrity and patient welfare by removing bad actors who threaten the Medicare system’s solvency. Legitimate hospice providers benefit from competitive advantages as fraudulent operators face criminal prosecution and permanent exclusion. The Trump administration’s decisive action demonstrates commitment to rooting out waste that previous federal leadership tolerated, ensuring taxpayer dollars reach Americans who genuinely need compassionate care rather than enriching criminal enterprises.

The aggressive federal-state coordination model may establish precedent for addressing fraud in other healthcare sectors where organized criminal activity concentrates geographically. While enhanced oversight increases compliance burdens for legitimate providers, removing fraudulent competitors ultimately strengthens industry integrity and restores public confidence in Medicare program administration under competent leadership focused on accountability rather than bureaucratic complacency.