California dismantles $267 million hospice fraud ring in 'Operation Skip Chase'; 21 charged

Bonta announces CA hospice fraud takedown

California Attorney General Rob Bonta, together with the California Department of Health Care Services (DHCS), today announced charges filed against 21 suspects and the dismantling of a major hospice fraud scheme that defrauded California of $267 million.

LOS ANGELES - California Attorney General Rob Bonta and the Department of Health Care Services (DHCS) have announced the takedown of a staggering $267 million healthcare fraud ring.

The operation, which involved 21 suspects and 14 fraudulent companies, targeted the state’s Medi-Cal system by billing for hospice services that were never rendered.

What we know:

The investigation, dubbed "Operation Skip Trace," culminated on Wednesday, April 8, with search and arrest warrants executed at 12 locations across Southern California, Bonta said during a press conference detailing the operation on Thursday. 

Investigators discovered that the suspects purchased personal identifying information of non-California residents on the dark web, then used "straw owners" to buy 14 hospice companies and bill the state for end-of-life care. 

PREVIOUS COVERAGE: 

• Operation Never Say Die: 8 arrested in $50M California hospice fraud takedown
• Inside the $60M takedown: 8 Southern California cases under Medicare fraud investigation
• DOJ targets California’s ‘kingdom of fraud’ in massive $60M hospice takedown

Law enforcement seized $757,000 in cash and two firearms during the raids. 

The 21 suspects now face charges including conspiracy to commit health care fraud, money laundering, and identity theft, with additional enhancements for aggravated white-collar crime.

What they're saying:

"Over the life of this fraud scheme, not a single legitimate hospice service was ever provided, yet millions were billed in a brazen, calculated scheme that exploited the Medi-Cal system," Bonta said.

"Our safeguards worked as designed: we identified irregularities early, stopped further improper payments, and suspended the fraudulent providers, DHCS Director Michelle Baass said.

RELATED COVERAGE: Feds cracking down on healthcare fraud

The DOJ’s "Operation Never Say Die" unsealed charges against 15 individuals in a $60 million Medicare hospice scheme.

"For years, California has led the charge to protect public programs from fraud and abuse," Newsom said Thursday. "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."

What you can do:

State officials are urging Californians to watch for red flags of hospice fraud, such as:

• Patients being signed up for hospice who are not terminally ill.
• Offers of gift cards, groceries, or cash in exchange for enrollment.
• Receiving Medi-Cal statements for services that were never provided.

To report fraud, visit oag.ca.gov/dmfea/reporting or call the toll-free complaint line at (800) 722-0432.