California Cracks Down on $267M Hospice Fraud Scheme

State DOJ investigation uncovers massive Medi-Cal billing fraud among 14 Southern California hospice companies.

Apr. 10, 2026 at 6:20pm

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An extreme close-up of a stack of medical documents and files, lit by a harsh, direct camera flash against a pitch-black background, conceptually illustrating the investigative details of a major health care fraud case.A harsh flash illuminates the paper trail of a massive California hospice fraud scheme, exposing the gritty details of a brazen Medicaid scam.Los Angeles Today

The California Department of Justice has arrested five people and charged 21 individuals in connection with a $267 million Medi-Cal fraud scheme involving 14 Southern California hospice companies. The state's Operation Skip Trace investigation found the companies were purchasing personal information of non-California residents on the dark web and enrolling the stolen identities in the state's Medicaid program, billing for hospice services that were never rendered.

Why it matters

Hospice care fraud has become a major focus of scrutiny by state and federal authorities, with California leading the charge to protect public programs from abuse. This case highlights the scale of fraud within the state's Medi-Cal system and the state's efforts to root out such schemes that directly impact vulnerable patients relying on these critical services.

The details

The fraud was initially suspected by the California Department of Health Care Services, which informed the state's DOJ. Investigators found that no hospice services had ever been rendered at any of the 14 sites involved. The suspects have been charged with conspiracy to commit health care fraud, health care fraud, money laundering, and identity theft.

  • The state's DOJ initiated the investigation, known as Operation Skip Trace, in 2023.
  • The arrests and charges were announced by Attorney General Rob Bonta on April 9, 2026.

The players

Rob Bonta

The Attorney General of California who announced the arrests and charges in this case.

Michelle Baass

The Director of the California Department of Health Care Services, which initially suspected the fraud and informed the DOJ.

Gavin Newsom

The Governor of California, who stated the state will hold accountable anyone who tries to defraud public programs like Medi-Cal.

Mehmet Oz

The administrator of the Centers for Medicare & Medicaid Services, who has taken a lead role in highlighting the extent of Medicaid fraud in California.

Bill Essayli

The first assistant U.S. attorney for the Central District of California, who announced a federal investigation into hospice fraud in the state alongside Dr. Oz.

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What they’re saying

“Fraud is a direct attack on Medi-Cal members who rely on us for care, and we will not stand for it. Our safeguards worked as designed: we identified irregularities early, stopped further improper payments, and suspended the fraudulent providers.”

— Michelle Baass, Director, California Department of Health Care Services

“For years, California has led the charge to protect public programs from fraud and abuse. We hold accountable to the fullest extent of the law anyone who tries to rip off taxpayers and take advantage of public programs, particularly those as sensitive as hospice care.”

— Gavin Newsom, Governor of California

“To all the fraudsters out there stealing from our seniors: run, don't walk. Because we're coming after you.”

— Mehmet Oz, Administrator, Centers for Medicare & Medicaid Services

What’s next

The state's Department of Justice says it will continue its crackdown on hospice fraud, with over 290 investigations conducted and more than 50 suspects arrested and convicted in the past three years.

The takeaway

This case highlights California's aggressive efforts to combat widespread Medi-Cal fraud, particularly in the sensitive area of hospice care, and the state's determination to protect vulnerable patients and taxpayer funds from abuse by unscrupulous providers.