CA Hospice Fraud Question: ‘How Do You Put a Hospice in a Burrito Stand?’

The Centers for Medicare and Medicaid Services has halted payments to more than 400 hospices in Los Angeles and across California, with the estimated fraud being greater than $600 million, according to the anti-fraud task force led by Vice President JD Vance. 

Sheila Clark, CEO of the California Hospice and Palliative Care Association, is questioning how these alleged instances of fraud have slipped through the cracks.

“How do you put a hospice in a burrito stand in California? How do you put a hospice in a tire store? That all had to be vetted through licensure, certification, and accreditation,” Clark said during a House of Representatives hearing on April 21.

According to City Journal, a public policy magazine published by the Manhattan Institute, California has lost “at least $180 billion to fraud.”

While this amount of money is not attributed solely to hospice fraud, Californians such as Sheila Clark blame this level of alleged fraud on lack of oversight. 

“California is the clearest current case study of what happens when oversight weaknesses are exploited at scale,” Clark said.

In an interview with The Daily Signal, California Policy Center Vice President of Government Affairs Lance Christensen said City Journal’s reports of fraud are “probably underestimated.”

“It’s probably higher than that. But it’s hard to nail down because nobody goes through to actually validate most applications,” he said. 

Christensen continued, “When they do find fraud, they know that it’s going to cost more money to recuperate that money. Then you also have a lot of contractors who have learned how to game the system.”

He added that once individuals find easy targets for fraud, they take full advantage of the system.

“And right now, we’ve discovered that’s hospice fraud,” Christensen said. 

In an interview with Fox News, First Assistant U.S. Attorney for the Central District of California Bill Essayli called California “the kingdom of fraud.”

“Nobody is minding the shop. The money just goes out the door—no checking, no vetting. California has a responsibility to make sure the money is going to the intended recipients.”

On Tuesday, Health and Human Services Secretary Robert F. Kennedy Jr. reported that $6,000 was being paid out by the government for hospice patients that allegedly did not exist.

We have not gotten one call from a congressperson or a patient. Why? Because those hospices did not exist. They were signing up patients … and charging us $6,000 a month for that patient.”