A federal anti-fraud initiative spearheaded by Vice President JD Vance has resulted in the suspension of 70 hospice and home health providers in the Los Angeles region.
This decisive action, coordinated with the Centers for Medicare and Medicaid Services, came after the providers were flagged as high-risk for fraudulent practices. Within a week of their identification, federal funding for these providers was halted.
This move is part of the Task Force to Eliminate Fraud, launched through an executive order by President Donald Trump. Led by Vice President Vance, the task force focuses on identifying and addressing fraud within federally funded healthcare programs.
Utilizing advanced data analytics and artificial intelligence, the initiative aims to detect irregular claims more efficiently than previous manual processes. Official sources indicate that additional measures are expected nationwide, with California prioritized due to concerning patterns observed in hospice and home health services.
California’s hospice care, particularly in Southern California, has been under scrutiny for its billing practices. Audits at both federal and state levels have shown a sharp increase in hospice providers in Los Angeles County, with growth rates reportedly over 1,500 percent since 2010.
An investigative report from CBS News revealed that Medicare billing in the county was significantly higher, averaging around $29,000 per patient, compared to a national average of about $13,200, with some cases reaching up to $74,000.
Investigations have uncovered issues such as overbilling for services not rendered or lacking documentation of medical necessity, alongside the enrollment of patients without confirmed eligibility or consent. Such practices can result in inappropriate claims to Medicare.
State Agency Actions
A report from the California State Auditor in 2022 noted various red flags, including multiple providers sharing addresses and low patient volumes in relation to billed amounts.
In response to ongoing concerns, California state agencies have enacted their own measures. In 2021, Governor Gavin Newsom signed a moratorium on new hospice licenses, which has since been extended to 2027 to improve oversight.
Additionally, the state has set up a multi-agency Hospice Fraud Task Force, coordinated by the California Department of Public Health. This task force includes representatives from multiple agencies, including Health and Human Services and the Department of Justice.
Revocation and Investigations
Since the implementation of the moratorium, California has revoked over 280 hospice licenses and is reviewing about 300 more for possible revocation. The Department of Health Care Services has also strengthened verification protocols and begun suspending payments when credible fraud allegations arise.
Since 2021, the Department of Justice has investigated over 100 criminal enterprises linked to hospice activities, resulting in charges against 109 individuals and arresting 284 related offenders.
The recent federal suspensions align with these state efforts, utilizing national resources for broader impact. Furthermore, the House Committee on Oversight and Government Reform, led by Representative James Comer, has initiated an inquiry into the situation.
The committee has requested documents from California agencies pertaining to oversight of federally funded hospice programs, in light of previous audits focusing on preventing improper payments.
California officials have noted that its Medi-Cal program operates under different jurisdictional rules than Medicare, while cooperating with federal partners on intersecting issues.
The Department of Health Care Services employs fraud detection systems to uncover irregularities and works alongside federal entities when necessary.
