California hospice fraud probe finds Van Nuys at center of vast Medicare billing scheme
Federal and state authorities uncovered widespread hospice fraud across California, finding billions siphoned from Medicare. Los Angeles County — especially Van Nuys — is the epicenter, with hundreds of suspicious operations billing for unnecessary services and committing identity theft.
Key takeaways
- Auditors estimated Los Angeles County hospices overbilled Medicare by $105 million in a single year.
- An analysis found more than 700 of roughly 1,800 hospices in LA County trigger multiple state red flags for fraud.
- Nearly 500 hospices operate within about three miles of Van Nuys Boulevard; 137 list Van Nuys Boulevard addresses.
- In 2025 CMS referred 343 cases tied to $3.4 billion in suspected fraudulent billing and revoked billing privileges for thousands of providers.
Scale of the problem
Investigations show the problem is large and growing. National watchdogs reported about $198.1 million in suspected Medicare hospice fraud in fiscal year 2023 — a figure documented by auditors and congressional inquiries that raised alarms about concentrated abuse in Southern California. See the congressional audit findings: Auditors’ report and analysis.
More recent enforcement activity shows even larger exposure: CMS and DOJ referrals in 2025 represent billions of dollars in suspected billing, reflecting expanded program-integrity reviews and criminal investigations.
California is a notable outlier. Reporting from state outlets documents a rapid multiplication of hospice providers in Los Angeles County over the last decade; experts estimate roughly 18% of national home health and hospice Medicare billing occurs in LA County, with a seven-fold rise in reported billing activity. For local context, see coverage from the Los Angeles Times.
Van Nuys: ground zero
Investigators and reporters identified a stretch of Van Nuys Boulevard as a focal point: nearly 500 hospices operate within about three miles of the corridor, and 137 hospices list Van Nuys Boulevard addresses. Auditors and journalists documented that more than half of those listings show state red flags.
Reporters found buildings with dozens of companies registered to the same address — one building listed 89 companies — and regulators who visited multiple suites between 2021 and 2025 noted deficiencies and empty offices. See the on-the-ground reporting and video documentation: field visits and red-flag evidence and the investigative project: CBS News hospice fraud project.
“Offices with no staff, piles of mail in the doorway, and addresses that appear to be empty storefronts or unrelated businesses.” — documented observations from reporters and auditors.
Common fraud tactics
- Billing for services never provided or medically unnecessary: documented in criminal cases and prosecutions — see the DOJ sentencing and case details: DOJ press release on sham hospices.
- Identity theft and straw owners: use of foreign nationals’ information and straw ownership schemes are central elements in several indictments and sentences; details are described by law enforcement in the DOJ release above.
- Enrolling beneficiaries without consent or without providing care: CMS and investigative reporting highlight sham enrollments and paperwork-driven billing: CMS/DOJ enforcement summary.
- “License flipping” and rapid sales: operators sell hospice licenses quickly to avoid scrutiny, a pattern noted in program-integrity reviews and reporting: Hospice News enforcement story.
- Fictitious or shared addresses; repeated key personnel: many agencies list the same addresses and personnel across dozens of companies — detailed in investigative reporting: CBS News investigation.
These tactics allow bad actors to collect Medicare dollars while avoiding the costs of delivering real care, draining funds and putting vulnerable patients at risk.
Federal and state response
Federal agencies have increased enforcement. In 2025 CMS revoked billing privileges for thousands of providers for “inappropriate behavior” and referred hundreds of cases to law enforcement. For an overview of the 2025 actions, see CMS and DOJ program integrity actions.
CMS announced program-integrity efforts, including a Fraud Tax Project in November 2025 aimed at curbing fraudulent billing and tax evasion. HHS and state authorities issued guidance and audits in late 2024 and 2025 to tighten screening of new hospice enrollments and detect enrollment trends. See congressional and agency materials: congressional request and audit summary.
Prosecutions and seizures
There have been successful criminal prosecutions demonstrating that law enforcement can win convictions. In November 2025, four California residents were sentenced for operating sham hospices that billed Medicare nearly $16 million between 2019 and 2023; the government seized bank accounts and ordered forfeiture of assets purchased with proceeds from the fraud. See the DOJ announcement: DOJ sentencing and forfeiture details.
Officials say, however, that the sheer scale of the schemes makes enforcement difficult and slow: tens of thousands of provider records, dense local networks of shell companies, and resource limits for investigators slow the pace of prosecutions.
Industry and expert concerns
Experts warn the growth in alleged fraud is outpacing regulators. Palliative-care leaders and investigators told reporters that the rapid expansion of suspect providers has overwhelmed state and federal capacity to respond. Reporting and expert interviews are compiled in investigative pieces such as the CBS project: CBS News hospice investigation.
Honest hospice providers say fraud diverts resources, harms reputation, and increases administrative burdens that strain small, legitimate operators.
Persistent gaps
Despite promises to crack down, auditors and reporters found hundreds of hospice programs still operating in Los Angeles County with multiple indicators of fraud years after initial warnings. Field visits and audits documented ongoing red flags: video and audit evidence and the broader investigation: CBS News reporting.
Regulators point to weak registration requirements and limited local oversight that made it easy for bad actors to create shell companies and exploit dense corridors such as Van Nuys Boulevard.
Implications for California
Economic impact
Medicare funds diverted by fraud reduce money available for honest providers and increase taxpayer costs. Auditors estimated at least $105 million in overbilling in a single year in Los Angeles County; federal referrals tied to billions in suspicious billing suggest much larger potential losses. See the congressional audit: audit findings.
Political consequences
The scale of the problem will draw sustained attention from lawmakers and regulators. State officials may face pressure to tighten licensing rules and speed enforcement; reporting suggests policymakers are already assessing reforms. See coverage on local political implications: Los Angeles Times analysis.
Social effects
Patients and families risk being enrolled without proper consent or receiving no care after billing occurs. That undermines trust in end-of-life care and can leave vulnerable people without services, as documented in investigative reporting: CBS News investigation.
Cultural relevance
California’s diverse population means hospice providers serve many languages and communities. Fraud that targets immigrant populations or uses foreign identities as straw owners can create particular harm in neighborhoods that already face barriers to care; see DOJ case examples and reporting: DOJ sentencing release and investigative coverage.
Practical applications for residents
Consumers should monitor mail and care notices, verify hospice consent forms with family members, and report suspicious contact to Medicare or state regulators. Lawmakers and regulators are urged to accelerate background checks on owners, enforce physical verification of addresses, and increase audits in high-density areas such as Van Nuys. See recommendations and reporting: CBS News recommendations.
Bottom line: Regulators have achieved notable enforcement wins, but the concentration of suspect providers in Los Angeles County — and the dense cluster along Van Nuys Boulevard — show structural vulnerabilities that require sustained, resourced action to protect Medicare funds and patient safety.
