California faces massive hospice fraud crisis

California is facing a significant crisis involving widespread hospice fraud, where scammers exploit weak government oversight to bill Medicare for services provided to patients who are not terminally ill. Fraudsters have been known to create fake hospice providers, trick individuals into enrollment, or use identity theft to submit fraudulent claims.

In Los Angeles County alone, federal officials estimate that fraudulent hospice claims have reached approximately $3.5 billion. The impact on victims is severe; once a person is enrolled in hospice care, Medicare typically ceases to pay for medical treatments outside of that specific palliative care framework. This can leave vulnerable seniors without access to essential medical appointments and life-saving treatments.

In response to the crackdown by the federal government, more than 1,000 California hospices have been removed from Medicare since early 2025. The state of California has also taken action by revoking nearly 500 licenses following a moratorium on new hospice licenses imposed in 2021. Additionally, new emergency regulations were adopted in June to implement stricter criteria for approving new licenses.