CMS Chief Mehmet Oz Vows Hospice Crackdown After CBS Flags Widespread Fraud in Los Angeles County
CMS Administrator Mehmet Oz vowed a crackdown on hospice fraud — saying he will decertify providers found to be defrauding Medicare and even aiming to take “half the hospices in California” off the program — after a CBS analysis found more than 700 of roughly 1,800 Los Angeles County hospices trigger state-defined fraud red flags and CMS issued a checklist to trigger targeted on-site inspections. The move follows congressional reporting and data showing large, concentrated billing — including nearly $600 million billed from 2021–2024 by home‑health agencies tied to one provider number (about $210 million in 2024, with 95% in L.A. County), an HHS OIG estimate of $198.1 million in suspected hospice fraud nationwide, and documented patient-level harms, while California officials say they have revoked about 280 hospice licenses and created a multi‑agency task force.
📌 Key Facts
- Data tied to an 87‑year‑old Dr. Gilbert Faustina’s 10‑digit Medicare provider number show home‑health agencies billed nearly $600 million to Medicare from 2021–2024, including roughly $210 million in 2024 (a 124% increase from 2021); about 95% of those payments were concentrated in Los Angeles County and beneficiaries linked to those agencies rose from 9,693 in 2021 to 29,527.
- Multiple agencies using Faustina’s provider number reportedly operate out of a single Los Angeles‑area address that alone has billed more than $40 million.
- Rep. Claudia Tenney sent a November letter to CMS Administrator Mehmet Oz requesting an investigation into home‑health and hospice agencies linked to Faustina’s Medicare provider number.
- Home‑care expert Dr. Ira Byock describes an apparent scheme in which multiple hospice and home‑health entities share one address, keep very small patient loads per license, and use multiple licenses to ‘shuffle’ patients to stay below Medicare audit thresholds.
- CBS’s analysis found more than 700 of roughly 1,800 hospices in Los Angeles County trigger multiple state‑defined red flags for fraud; the HHS Office of Inspector General’s 2023 report estimated $198.1 million in suspected hospice fraud nationwide.
- CMS Administrator Mehmet Oz vowed a crackdown—questioning how 18% of U.S. home‑health billing can come from Los Angeles County, pledging to decertify providers found to be defrauding Medicare (saying he would take “half the hospices in California” off the program), and directing a new checklist of common hospice‑fraud tactics to trigger targeted on‑site inspections.
- California officials say the state has already revoked about 280 hospice licenses and formed a multi‑agency Hospice Fraud Task Force, disputing suggestions that the state is not acting in good faith.
- Reporters documented concrete patient‑level harm, including a beneficiary whose Medicare number was stolen and used to fraudulently enroll her in hospice care she did not need.
📊 Relevant Data
Healthcare fraud accounts for 3%-10% of annual U.S. healthcare expenditures, with estimated losses of $135 billion to $450 billion in 2022, disproportionately affecting racial minorities such as African Americans and Hispanics who are more likely to incur debt or forgo necessary medical care due to fraudulent practices.
Impact of healthcare fraud on racial disparities in health outcomes in the United States — Global Scientific and Academic Research Journal of Multidisciplinary Studies
In a 2023 hospice fraud case in Los Angeles, two men of Armenian descent, Julian Akhsharumov and Edvard Sarkisyan, were sentenced for their roles in a scheme that defrauded Medicare of over $9 million through false claims for hospice services.
Two Men Sentenced for Role in $9M Hospice Fraud Scheme — U.S. Department of Justice
The Armenian population in Los Angeles County is approximately 188,511, representing about 1.91% of the county's total population, providing context for overrepresentation in certain healthcare programs and fraud allegations.
Armenian Population in Los Angeles County, CA by City — Neilsberg Research
📰 Source Timeline (3)
Follow how coverage of this story developed over time
- CMS Administrator Mehmet Oz publicly pledges to lead an effort to decertify any hospice providers found to be defrauding Medicare, specifically saying his plan is to take "half the hospices in California" deemed illegitimate off the program.
- CBS’s data analysis finds that more than 700 of roughly 1,800 hospices in Los Angeles County trigger multiple state‑defined red flags for fraud.
- HHS Office of Inspector General’s 2023 report is cited estimating $198.1 million in suspected hospice fraud nationwide.
- California officials respond that the state has already revoked around 280 hospice licenses and created a multi‑agency Hospice Fraud Task Force, disputing Oz’s suggestion that California is not engaging in good faith.
- CMS has created a checklist of common hospice‑fraud tactics that will now be used to trigger targeted on‑site inspections.
- The piece highlights concrete patient‑level harm, including a beneficiary whose Medicare number was stolen and used to fraudulently enroll her in hospice care she did not need.
- Rep. Claudia Tenney sent a November letter to CMS Administrator Mehmet Oz specifically asking for an investigation into home-health and hospice agencies linked to 87‑year‑old Dr. Gilbert Faustina’s 10‑digit Medicare provider number.
- Between 2021 and 2024, home-health agencies associated with Faustina’s number billed nearly $600 million to Medicare, including roughly $210 million in 2024 alone—a 124% increase from 2021—with 95% of those payments concentrated in Los Angeles County.
- Beneficiaries tied to those agencies rose from 9,693 in 2021 to 29,527, while multiple agencies sharing Faustina’s number reportedly operate out of a single Los Angeles–area address that alone has billed more than $40 million.
- CMS Administrator Mehmet Oz is quoted questioning how 18% of all U.S. home-health billing can come from Los Angeles County, underscoring federal concern about geographic concentration and systemic fraud.
- Home‑care expert Dr. Ira Byock describes a deliberate strategy in which multiple hospice and home-health entities share a single address, maintain very small patient loads per license, and use multiple licenses to ‘shuffle’ patients and stay under Medicare audit thresholds.