California Charges 21 in Alleged $267 Million Medi‑Cal Hospice Fraud Using Stolen Identities
California Attorney General Rob Bonta announced charges against 21 people and arrests of five in "Operation Skip Trace," accusing a ring of buying stolen identities of non‑California residents on the dark web, enrolling them in Medi‑Cal, acquiring 14 state‑licensed hospice companies and submitting roughly $267 million in claims for hospice care that was never provided at largely nonexistent facilities. Authorities released body‑cam footage of residential raids, said the suspects exploited licensing and oversight gaps (the state is investigating more than 300 hospices), and framed the crackdown amid a broader, partisan federal–state push against health‑care fraud.
📌 Key Facts
- California Attorney General Rob Bonta announced state charges against 21 people and the arrests of five in “Operation Skip Trace,” an alleged hospice‑fraud ring prosecutors say stole about $267 million from Medi‑Cal.
- According to state complaints, defendants purchased non‑California residents’ personal information on the dark web, enrolled those identities in Medi‑Cal, used straw owners to acquire 14 licensed hospice companies, and billed for hospice services that were not provided at non‑existent or paper‑only facilities.
- Officials say all hospice companies named in the complaints were properly state‑licensed and approved to bill Medi‑Cal, indicating the fraud exploited gaps in licensing and oversight rather than operating entirely outside the system.
- California’s Department of Health Care Services is investigating more than 300 hospices for possible license revocation; a CBS analysis found over 700 of roughly 1,800 hospices in Los Angeles County trigger multiple state‑defined fraud red flags.
- The enforcement action comes amid an intensified federal anti‑fraud push — including efforts led by Vice President JD Vance and operations like “Never Say Die” — and federal agencies have pursued related high‑billing hospice and Medicare cases.
- Related federal actions highlighted by reporting include CMS revoking Medicare billing privileges for Dr. Rajiv Bhuva after his name was tied to thousands of hospice claims (about $71.7 million in reimbursements) and prior convictions such as Domingo Barrientos’s 2024 conspiracy conviction after roughly $90.3 million in reimbursements.
- A separate federal prosecution named Paul Richard Randall, 66, pleaded guilty to one count of wire fraud for a Medi‑Cal billing scheme that totaled more than $269 million in claims (paid over $178 million); authorities say he laundered proceeds to pay kickbacks and he faces up to 30 years in prison with sentencing set for August.
- Law‑enforcement footage and reporting depict residential raids tied to the investigation and officials describe the alleged network as a paperwork operation with no legitimate patients; state leaders (Bonta and Gov. Newsom) have defended California’s anti‑fraud record, noting the state has filed 119 hospice‑related criminal cases and secured 51 convictions.
📊 Relevant Data
In 2023, White Medicare decedents represented 86% of hospice users, while Black, Hispanic, Asian, North American Native, and other groups comprised 14%, with utilization rates declining in 2022 by 9.4% among Hispanic Medicare decedents, 5.3% among Black decedents, 5% among North American Native populations, and 3.7% among Asian American populations.
The Problematic State of Health Equity in Hospice — Hospice News
Hospice fraud exacerbates racial and ethnic disparities in end-of-life care by fostering mistrust among underserved groups, with fraudulent operators targeting vulnerable populations including people of color through unscrupulous marketing strategies such as approaching seniors at community centers and offering financial incentives for enrollment without proper assessment.
The Problematic State of Health Equity in Hospice — Hospice News
As of January 2022, 94% of hospice agencies in California were for-profit, the highest percentage among all 50 states, contributing to fraud vulnerabilities through incentives for overbilling and enrollment of ineligible patients driven by profit motives.
California Hospice Licensure and Oversight — California State Auditor
📊 Analysis & Commentary (1)
"The piece criticizes California as a magnet for large‑scale hospice and health‑care fraud, argues federal CMS/DOJ crackdowns are justified, and calls for structural fixes—stronger audits, tighter rules and accountability—while warning against politicized or overbroad enforcement."
📰 Source Timeline (6)
Follow how coverage of this story developed over time
- Body‑camera footage shows California police raiding homes tied to the suspected hospice‑fraud network.
- Authorities have filed charges against 21 specific suspects connected to what they describe as a $267 million hospice‑fraud case with no legitimate patients.
- CBS identifies the case visually and narratively as involving residential raids, underscoring that the alleged hospice network was effectively a paperwork operation rather than a real care system.
- Confirms that 21 individuals have been charged and 5 arrested so far in connection with the hospice fraud scheme.
- Details that defendants allegedly purchased personal information for non‑California residents on the dark web, enrolled them in Medi‑Cal, then bought 14 hospice companies and billed for hospice services under those stolen identities.
- Includes fresh quotes from AG Rob Bonta and Gov. Gavin Newsom defending California’s anti‑fraud record and positioning the case amid criticism from the Trump administration.
- States that under Bonta the state has filed 119 hospice‑related criminal cases and secured 51 convictions.
- Reiterates that the Trump administration’s national anti‑fraud push, led by VP JD Vance under a March executive order, has focused on Democratic‑led states but also requested information from GOP‑run Florida.
- California Attorney General Rob Bonta announced state charges against 21 suspects and the arrests of five people in 'Operation Skip Trace,' an alleged hospice fraud ring that prosecutors say stole $267 million from Medi-Cal.
- According to the California DOJ, the scheme involved buying non-California residents’ identities off the dark web, enrolling them in Medi-Cal, having straw owners acquire 14 licensed hospice companies, and billing for hospice services that were never provided at non-existent facilities.
- California’s Department of Health Care Services says it is actively investigating more than 300 hospices for possible license revocation, and a CBS News analysis found that over 700 of roughly 1,800 hospices in Los Angeles County trigger multiple state-defined fraud red flags.
- Officials detailed that all the hospice companies named in the state complaints were properly state-licensed and approved to bill Medi-Cal, underscoring how fraudsters exploited gaps in licensing and oversight rather than operating entirely in the shadows.
- State officials explicitly framed the crackdown as part of a tense federal–state environment in which a Republican-led federal government is publicly targeting fraud in Democratic states, while Bonta emphasized that health-care fraud crosses partisan lines and occurs in 'all 50 states, red and blue.'
- CMS Administrator Dr. Mehmet Oz revoked California physician Dr. Rajiv Bhuva’s ability to bill Medicare in March 2026.
- Bhuva’s name was tied to 2,791 hospice claims in 2024 across 126 hospices (115 in Los Angeles County), generating $71.7 million in Medicare reimbursements.
- CBS/California audit benchmarks show an average California hospice doctor handles about 140 patients annually, highlighting how Bhuva’s volume far exceeded norms.
- California state auditors have warned that physicians or administrators working for more than three hospice providers at once is an indicator of potential fraud.
- Gov. Gavin Newsom’s office publicly framed the matter as a federal responsibility on Medicare billing while critics note the state’s role in licensing hospices that can enroll in Medicare.
- Another high‑billing California hospice doctor, Domingo Barrientos, received about $90.3 million in reimbursements and was convicted in 2024 of conspiracy to commit health‑care fraud.
- Reports that Paul Richard Randall, 66, of Orange, California, pleaded guilty to one count of wire fraud for a scheme that billed Medi‑Cal more than $269 million and was paid over $178 million.
- Details that the scheme exploited a temporary Medi‑Cal rule change eliminating pre-approval requirements for certain expensive drugs, allowing use of a controlled pharmacy to submit massive claims for non-contracted drugs that were not medically necessary, not provided, or both.
- Describes laundering of proceeds through a third party to pay kickbacks and conceal transactions; notes Randall faces a statutory maximum of 30 years in federal prison with sentencing scheduled for August.
- Includes a quote from First Assistant U.S. Attorney Bill Essayli saying the defendant used a public health program as his "personal piggy bank" and links the case to President Trump’s 'war on fraud.'
- Notes that federal officials tie this case to a pattern of California health-care fraud, alongside "Operation Never Say Die" and an uptick in hospice and provider suspensions under Vice President JD Vance’s anti-fraud task force.
- Captures social media reaction, with conservative politicians and commentators branding California the "Fraud Capital" and calling Gov. Gavin Newsom’s system an "empire of fraud."