DOJ targets California’s ‘kingdom of fraud’ in massive $60M hospice takedown

LOS ANGELES - Federal investigators and top Trump administration officials announced a massive crackdown on hospice fraud in Los Angeles Thursday, vowing to "stop the lies" and recover billions in stolen taxpayer funds.

What we know:

The investigation, dubbed "Operation Never Say Die," led to the arrest of doctors, nurses, and a psychologist who allegedly turned end-of-life care into a "cash-producing operation." 

Federal agents executed a series of coordinated arrests across the Southland on Thursday, including in Covina, Anaheim, and Glendale. The operation—led by Vice President JD Vance’s Anti-Fraud Task Force—targets "phantom" hospice facilities that billed Medicare for end-of-life care for patients who were not dying.

Among those charged are:

• Gladwin and Amelou Gill: A psychologist and nurse who allegedly used their daughter’s name to bypass their own criminal histories to open a hospice that billed $5.2 million.
• Lolita Minerd: Accused of running an Anaheim-based hospice with a "survival rate" of 85%, far exceeding the national average.
• Nita Palma: Allegedly operated three fraudulent hospices while incarcerated in federal prison and free on bond for previous fraud charges.

Prosecutors allege these schemes often targeted vulnerable people, offering them $300 monthly cash payments and free vitamins to sign up for hospice despite not being terminally ill.

What we don't know:

The administration is currently investigating whether state officials or insiders facilitated these schemes through "malpractice or malfeasance." 

While multiple suspects have been identified and many arrested, the full extent of the "transnational crime organizations" mentioned by Dr. Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services, remains under investigation.

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It is also unclear how many thousands of additional patients may have had their beneficiary numbers compromised in the "license flipping" schemes involving 42 different hospice licenses found within just four blocks in Van Nuys.

Dig deeper:

Fox News Digital is told a total of 221 providers in Los Angeles have been suspended so far due to suspected fraud, including a number of providers who were raided by federal authorities early Thursday morning.

The latest number of suspensions marks a more than 215% increase from the 70 providers initially suspended in Los Angeles last week as a result of the task force.

The backstory:

In a viral video released in late January, Dr. Oz toured the Van Nuys neighborhood of Los Angeles to highlight a cluster of suspicious hospice agencies. 

He claimed that 42 different hospice licenses are registered within just four blocks, often sharing the same multi-tenant office buildings to bypass federal oversight. 

According to Oz, these "shell companies" are used by transnational crime organizations to trick or pay roughly 100,000 patients for their beneficiary numbers, allowing the groups to bill Medicare for services that are never provided.

Oz pointed to specific intersections along Van Nuys and Victory Boulevards as proof of "license flipping." He noted that the concentration of these businesses in such a small area is statistically impossible given the actual death rate in the neighborhood, stating, "So, either there are a lot of people dying here, or you got a fraudulent activity that is so good everyone wants to get in on it.

The other side:

In early January, President Donald Trump posted that California "is more corrupt than Minnesota" when detailing his intentions to root out fraud.

Governor Gavin Newsom has consistently denied claims that fraud is not appropriately handled and addressed in his state. In March, a Newsom spokesperson told Fox News Digital that the governor had blocked $125 billion in fraud, and made a number of arrests. 

Timeline:

2018–2022: Initial fraudulent activity begins; search warrants are executed in 2022 but cases reportedly "languish."

January 1, 2026: Deadline for California to adopt emergency hospice regulations, which officials say the state missed.

Last Week: Vice President Vance leads the first meeting of the National Anti-Fraud Task Force.

Thursday, 5 a.m.: SWAT teams and federal agents initiate "Operation Never Say Die."

What they're saying:

"If you spent $1 million every single day, you would still be spending after 600 years to reach the $230 billion stolen from taxpayers annually," said Assistant Attorney General Colin McDonald. 

First Assistant U.S. Attorney Bill Essayli was more blunt regarding state oversight: "I call Gavin Newsom the ‘King of Fraud’ because he reigns over more fraud than we've seen in the history of the United States." 

Dr. Mehmet Oz added that if fraud were eliminated, the "life expectancy of the Medicare trust fund" would double.

What's next:

The suspects face statutory maximum sentences of 10 years for healthcare fraud and up to 20 years for wire fraud. 

Those currently in custody, including those in Idaho and Washington, will be extradited or summonsed to Los Angeles federal court for arraignment in the coming weeks.

Additionally, Dr. Oz announced a "nationwide moratorium" on certain equipment and a plan to review every single hospice in California by the end of the year.

Federal authorities expect "clusters" of similar takedowns every few months as the broader 2026 initiative will continue to audit high-billing hospice agencies nationwide to reclaim most taxpayer funds.