More than 700 of the roughly 1,800 hospices operating in Los Angeles County are triggering multiple state-defined warning signs of fraud, according to a CBS News review.
The findings suggest patterns California auditors flagged years ago remain widespread despite a state crackdown and hundreds of revoked licenses.
The results point to a problem that regulators have been trying to contain since at least 2022, when the California state auditor said weak oversight had created opportunities for large-scale fraud and abuse in the hospice industry.
The audit found Los Angeles County's hospice count had surged from 109 agencies in 2010 to 1,841 in 2021 — a jump of nearly 1,600% — while the county averaged fewer than five patients per hospice on any given day.
Auditors highlighted several red flags, including multiple hospices in one building, geographic clustering, low patient counts, high live-discharge rates, excessive billing, and staff overlap.
CBS found those warning signs are still widespread across the county.
Its review identified hospices with unusually high Medicare billing, offices sharing addresses, and personnel tied to multiple companies.
In some cases, offices appeared vacant or phone numbers were disconnected.
One agency, VML, triggered all six state indicators in the review. Another nearby agency triggered five.
The report also found 75 people listed as working simultaneously at five or more hospice companies, including one medical director tied to 45 hospices.
Some hospice representatives denied wrongdoing and said they operate legitimate businesses that serve real patients.
One company representative told CBS the hospice had recently passed a federal review.
A building owner whose property housed multiple hospices said his leases require lawful business activity and said any fraud would lead to termination.
California responded to the problem by halting the issuance of new hospice licenses starting Jan. 1, 2022.
State law now extends that moratorium until Jan. 1, 2027, or one year after emergency regulations are adopted.
In December, the California Department of Public Health issued a notice of proposed emergency hospice rules, and Gov. Gavin Newsom's office said in January that California has revoked more than 280 hospice licenses since the ban took effect.
Still, the persistence of those indicators suggests the state's actions have not fully addressed the problem in the county.
The stakes extend beyond licensing and enforcement.
Hospice care is reimbursed through Medicare, meaning fraudulent enrollments and questionable billing can waste taxpayer dollars and disrupt care for patients whose records are used without their knowledge.
The problem also threatens confidence in a system designed for people nearing the end of life, where families and patients are often making urgent, high-stakes medical decisions.
Jim Thomas ✉
Jim Thomas is a writer based in Indiana. He holds a bachelor's degree in Political Science, a law degree from U.I.C. Law School, and has practiced law for more than 20 years.
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