Every state with rampant social programs also has prevalent fraud. California has become an utter drain on the federal tax system. CMS Administrator Dr. Mehmet Oz revealed that California, Los Angeles County in particular, now accounts for 18% of all US Medicare home health and hospice billing to the tune of $3.5 billion annually. That equated to 2.5% of the population consuming 18% of healthcare funds.
There are over 2,000 hospice agencies in Los Angeles County—red flag. That means Los Angeles has more hospice agencies than 36 states COMBINED. Florida was once touted as “America’s waiting room” due to the aging population, but Los Angeles has 30X more hospice agencies than the entire state of Florida AND California.
LA County is the nationwide hotspot for Medicare fraud, but investigators have only scratched the surface. Over 100 hospices are registered under the same addresses. One doctor claimed to treat 1,900 patients in a single year, and received a $120 million check from the government. The Centers for Medicare and Medicaid Services (CMS) has had LA-based home health agencies (HHA) and hospice agencies on their radar for years. State auditors in California estimated that hospice agencies in Los Angeles County overbilled Medicare by $105 million in 2019. By 2022, 31% of all US hospice agencies were based in Los Angeles County, and yet, the county only hosted 1.49 million seniors. CMS noted an improper payment error rate of 7.7% ($1.2 billion) in 2023, with hospice fraud costing the American taxpayer $198.1 million in FY2023.
Investigators began to question the county’s method for authorizing home health and hospice agencies. Similar to the childcare fraud in Minnesota, people were permitted to create fraudulent practices with minimal vetting and bill the federal government for services not rendered.
The California State Auditor found that licensed hospice agencies in Los Angeles County increased from 109 in 2010 to 1,841 in 2021, a 1,589% increase. Over 1,732 additional licenses for home hospices were granted in an 11-year period between 2010 and 2021.
These agencies enroll as many beneficiaries as possible even if they fail to meet clinical criteria. Those beneficiaries are often billed on a daily per-diem basis for care they may or may not receive. Others have a physician order a 30-day “period of care” window that is then submitted as a Notice of Admission (NOA) to Medicare. The patients never leave the system and their billed care continually grows. “As a hospice owner, I could sign up everybody in this room for hospice,” California Attorney General Rob Bonta explained during a recent hearing. “It’s all just paperwork. I could fill [an application] out in Kazakhstan if I want, and get a hospice license.”
The average hospice stay is under 18 days, but in LA, patients are surviving for over 18 months. The Federal government has been shelling out an average of $260 per day for each senior receiving care. “A Medicare MIB number is more lucrative than a credit card,” says Sheila Clark, president of the California Hospice and Palliative Care Association, referring to the 11-character code each Medicare recipient has that allows federal reimbursement. “They’re human traffickers. They’re trafficking beneficiaries in and out of hospices, home health.”
Fraudsters have begun recruiting vulnerable seniors by offering to enroll them in a complimentary Medicare program that will provide them with minimal health care. The victim’s beneficiary Medicare number is then sold to these fraudulent agencies.
Social programs are a prime target for taxpayer fraud. Authorities knew that fraud was prevalent back in 2019 but looked the other way. The fraudsters likely donated to the right politicians and paid off the right people. The average American who works hard and pays into the system is always penalized by the same politicians who claim to represent the “average man.”
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