Federal Anti-Fraud Task Force Revokes Dozens Of Hospice Care Licenses In California

A federal anti-fraud task force led by Vice President JD Vance has suspended 70 hospice and home health providers in the Los Angeles area.

The action, which was carried out in coordination with the Centers for Medicare and Medicaid Services, occurred in after the providers were flagged as high-risk for fraudulent activity. Federal funding for these entities was paused within one week of identification.

The suspensions form part of the Task Force to Eliminate Fraud, established by executive order under President Donald Trump. Vice President Vance chairs the task force, which aims to identify and address waste, fraud, and abuse in federally funded programs, including healthcare.

The initiative employs data analytics and artificial intelligence to detect irregular claims patterns more efficiently than prior manual review methods. Officials have stated that further actions are anticipated across the country, with California designated as a priority due to observed patterns in hospice and home health services.

Hospice care in California, especially in Southern California, has undergone review for several years regarding billing practices and enrollment procedures. Federal and state audits have recorded a substantial increase in the number of hospice providers in Los Angeles County, with some analyses indicating growth exceeding 1,500 percent since 2010.

An investigation from CBS News noted higher-than-average Medicare billing per patient in the county, reaching approximately $29,000 compared with a national average around $13,200, and in certain cases up to $74,000 per patient. The U.S. Department of Health and Human Services Office of Inspector General has estimated hospice-related improper payments or fraud in the Los Angeles area at $3.5 billion in one assessment, accounting for a significant portion of national hospice billing.

Issues identified in investigations include overbilling for services that may not have been furnished or lacked documented medical necessity, as well as enrollment of beneficiaries without verified consent or appropriate eligibility confirmation. These practices can lead to improper claims under Medicare, the federal program that covers end-of-life care for qualifying patients.

A 2022 California State Auditor report highlighted indicators such as multiple providers operating from shared addresses, low patient volumes relative to billed amounts, and instances where patients certified as terminally ill were later discharged alive.

In response, California state agencies have implemented their own measures. In 2021, Governor Gavin Newsom signed legislation establishing a moratorium on new hospice licenses, which has been extended through 2027 to curb expansion during oversight improvements.

The state maintains a multi-agency Hospice Fraud Task Force coordinated by the California Department of Public Health. This group includes representatives from the California Health and Human Services Agency, Department of Health Care Services, Department of Social Services, and the Department of Justice’s Division of Medi-Cal Fraud and Elder Abuse.

Since the moratorium began, the California Department of Public Health has revoked more than 280 hospice licenses and is assessing approximately 300 additional providers for potential revocation. The Department of Health Care Services has introduced enhanced claims verification, prior authorization requirements, and protocols for suspending payments upon credible allegations of fraud.

The Department of Justice has investigated 101 criminal enterprises associated with hospice activity since 2021, leading to charges against 109 individuals and arrests of 284 people linked to related offenses.

The federal task force’s recent suspensions in Los Angeles build upon these state-level activities while applying national resources and technology. Separately, the House Committee on Oversight and Government Reform, chaired by Representative James Comer, began an inquiry earlier this month.

The committee requested documents from California state agencies concerning oversight of federally funded hospice programs, referencing prior state audit findings on internal controls to prevent improper payments.

California officials have noted that the state’s Medi-Cal program, its Medicaid counterpart, operates under distinct jurisdiction from Medicare. State actions address state-funded claims while facilitating cooperation with federal partners on overlapping matters.

The Department of Health Care Services employs fraud detection systems to identify irregularities and collaborates with federal entities as needed.