House Republicans are going after rampant hospice fraud in the Medicare program in California. The only problem is that they are targeting a deep blue state rather than fraud in all 50 states. Hospice fraud and abuse is widespread in the Medicare program. The following is from CBS News:
The Republican-led House Oversight Committee, which has the authority to investigate, has sent a letter to California’s Democratic governor, Gavin Newsom, asking for documents related to the state’s “oversight and internal controls to detect and prevent fraud for its federally funded hospice programs.”
“Recent reporting has revealed alarming evidence of fraudulent activity in California’s hospice programs, including agencies overbilling Medicare and fraudulently enrolling beneficiaries without their knowledge,” committee members wrote, citing a recent CBS News investigation.
Nearly half of hospices in Los Angeles Country (700 of 1,800 firms) had some red flags that reveal potentially evidence of fraudulent activity.
The U.S. Department of Health and Human Services’ Office of the Inspector General reported in 2023 that suspected hospice fraud totaled an estimated $198.1 million. It has been an acute issue in Southern California.
According to House Oversight Committee, the average hospice cost per Medicare beneficiary is about $13,000. Hospices in LA County billed an average of about $29,000 while one hospice bill was $74,000 per patient. One doctor’s Medicare provider number was used to bill Medicare for 76,000 claims over a three-year period totaling nearly $600 million. If you do the math, that works out to evaluate a Medicare patient and order hospice care once every hour of the workday, five days a week, 50 weeks a year for more than three years. Eighteen separate hospice firms were using this same doctor’s Medicare provider number. A random doctor the patient has never met should not be ordering hospice care. It should be the senior’s personal physician or a specialist deeply involved in their ongoing care. After all, they are (in theory) asserting their patient has less than six months to live.
Five years ago, California created a moratorium on new hospice licenses. While preventing new bad actors from entering the field, it did nothing to reduce those already in existence. CBS News reports that one 3-story, 32,000 square foot medical office plaza is home to 89 licensed hospice companies, at least according to state records. More from CBS News:
Auditors said other warning signs for potential fraud included multiple hospices in one building, geographic clustering, low patient counts, high rates of terminally ill patients later discharged alive, excessive billing and staff shared across multiple companies.
CBS News found that 72 of the 89 registered hospices in Merabi Plaza have at least three of those six potential warning signs.
The building owner claims that he only has about 12 actual hospice tenants in his building, saying some had moved out. It appears some of the 89 are ghost hospices that continue to bill the government but provide no actual hospice care.
According to a whistleblower, some hospices recruited seniors (sick or not) to be enrolled in hospice care by offering them kickbacks. The hospice program is intended for terminally ill patients judged to be in the last six months of life. Only patients who have agreed to forgo further medical care are eligible. People unknowingly enrolled in hospice are generally denied further therapeutic care if they seek it. Some seniors were enrolled in hospice without their knowledge. Many received no home visits or palliative care once enrolled.
About half of people who die while enrolled in Medicare use the hospice care benefit. While seniors in hospice are supposed to die within six months, many outlive their hospice care by months or even years. The percentage of Medicare hospice patients who outlive their six-month limit has been increasing steadily in the past few years. A family member of my wife was enrolled shortly after entering a nursing home, simply because she was old. Her condition was stable and mortality tables suggested she could live another two years, which she did. The Medicare hospice benefit started out as a promising idea for those at the end of their lives. In return for foregoing additional, futile care, they would be provided with palliative care to make their final weeks comfortable. Instead, hospice care has turned into a gravy train for firms abusing the program, often providing recipients nothing in return.
Read more at CBS News: Congress launches investigation into California hospice fraud, citing millions in taxpayer losses
State records show 89 hospice companies at one Los Angeles office plaza. We went to look for ourselves.
Also see Centers for Medicare and Medicaid Services Hospice Monitoring Report (April 2025)