Under Democratic Governor Gavin Newsom’s ‘leadership,’ California’s hospice industry has skyrocketed, particularly in Los Angeles County, where numerous facilities have raised alarms for potential fraud as they bill Medicare.
As investigators delved into licensing records and Medicare billing data, a concerning trend became evident among the hospice providers in the region. Auditors and regulators reviewing these filings began to identify recurring warning signs that suggested broader issues within the industry:
“More than 700 of the roughly 1,800 hospice agencies in Los Angeles County had two or more indicators commonly associated with fraud… raising concerns about whether some providers are exploiting the system.”
California’s auditors have been warning about the rapid expansion of the hospice industry for years. Licensing approvals have surged, but oversight has not kept pace, leading to hundreds of new hospice companies entering the market while regulators struggle to monitor those already in operation.
The sheer scale of the industry raises concerns. Los Angeles County now has nearly two thousand hospice providers serving a single region, a situation that attracted closer scrutiny as investigators began analyzing the billing data within the system:
“Auditors found that Los Angeles hospice providers overbilled Medicare by about $105 million between 2017 and 2019.”
The investigation into the money trail led officials to a fundamental question: With nearly two thousand hospice providers suddenly in Los Angeles County, where were all of these providers actually operating?
As regulators began examining licensing records, the industry’s rapid growth appeared less like a healthcare boom and more like a troubling trend. Many of the same addresses and administrators kept resurfacing. In some instances, the same physicians were associated with multiple hospice companies. What was supposed to be a diverse network of independent providers increasingly resembled clusters of companies stacked on top of one another in the same filings.
One address in particular came up so often that it led investigators to take a closer look:
“State records list 89 hospice agencies registered at the same address in Van Nuys. The building owner told investigators that only about 12 companies actually operate from the location.”
State licensing records reveal that hospice companies linked to a single address were granted approval to operate and bill Medicare through California’s regulatory system. Investigators have coined the term “ghost hospices” for operations that seem legitimate on paper but fail under scrutiny. These entities appear in licensing databases and Medicare billing records as functioning medical providers; however, when regulators try to locate them, they often find that the operations behind the paperwork are either shell companies or completely nonexistent.
As auditors continued to investigate this issue, they noticed the same names repeatedly emerging across various companies. Administrators responsible for running hospice agencies appeared in multiple filings, and doctors listed as medical directors were found across overlapping networks of providers scattered throughout Los Angeles County.
Moreover, investigators discovered a statistic that highlighted the severity of the situation.
“In the most extreme case, a single medical director has been listed as working simultaneously at 45 different hospices. The state audit said the medical director’s responsibilities are so great, it would be difficult to hold that position at so many companies.
The report also questioned whether one person could serve multiple hospices as administrator, finding each position requires 20-40 hours per week, making it virtually impossible to run more than two or three agencies at once.”
Under Newsom’s administration, California has seen a rapid expansion of the hospice industry, with nearly 2,000 providers currently operating in Los Angeles County alone. Many of these providers have raised fraud warning flags by sharing addresses, administrators, and medical directors among overlapping networks of companies. Meanwhile, billions of Medicare dollars have continued to flow through the system as regulators struggle to keep up with the industry’s growth.
A case highlighted by CBS involves Lynn Ianni, a 69-year-old resident of Los Angeles. She discovered a problem when she attempted to schedule physical therapy and found that Medicare refused to cover the treatment. The explanation she received was puzzling: according to Medicare’s records, she was enrolled in hospice care.
However, Ianni had never signed up for hospice services. She was not terminally ill and had not requested any such care. Somewhere in the system, her Medicare number had been used to enroll her in a program intended for patients nearing the end of life.
Now, the real question is: What will the California governor who wants to be president do about it?
