Last night, sweeping raids took place at ten locations suspected of facilitating hundreds of millions of dollars in hospice fraud. The scheme alone defrauded California’s Medi-Cal program—funded by state taxpayers—with an estimated $267 million stolen from the system.
According to the California Department of Justice and several state agencies, five individuals were arrested Wednesday as part of Operation Skip Trace. In total, the state has filed charges against 21 people linked to the quarter-of-a-billion-dollar operation.
State Attorney General Rob Bonta revealed that the defendants collected money without providing any legitimate hospice services. The probe began with a tip from the state Department of Health Care Services regarding alleged fraud at 14 companies. Investigators found suspects purchased personal identifying information for out-of-state individuals on the dark web and enrolled them in Covered California by posing as California residents.
Bonta explained that “straw owners” acquired hospice companies to bill Medi-Cal for services never provided to those stolen identities, using fake records, nonexistent offices, and fraudulent diagnoses to justify claims. Meanwhile, the so-called patients were healthy individuals living outside California who had no knowledge they were enrolled in hospice care.
During a press conference, Bonta stated: “This was a brazen, calculated criminal scheme that exploited the Medi-Cal system, stole from the State of California and Medicaid, and prevented services and care from going to sick individuals who actually need it.” He emphasized that the operation is being conducted entirely by state authorities, not federal agencies.
The California Attorney General’s office has filed charges against 21 suspects, with five taken into custody as of Wednesday. The remaining individuals received “notices to appear” in court and face arrest warrants if they do not show up.
