Hospice providers suspected of fraud lose $1.4B

EXCLUSIVE: Vice President JD Vance’s anti-fraud task force has withheld $1.4 billion in federal funding from home health and hospice providers nationwide, following a wave of suspensions enacted by an anti-fraud task force targeting operations in California, Minnesota and several other states.

Approximately 90% of the suspended providers have not reached out to the Centers for Medicare & Medicaid Services (CMS), the agency tasked with combating fraud, waste and abuse, since payments have been suspended.

Trump administration officials told Digital that they believe lack of communication between alleged fraudulent providers and CMS indicates that the providers were not legitimate enterprises.

The suspended group includes long-term providers who have been pocketing federal funds for years while failing to communicate with CMS, a senior Trump administration source told Digital.

“The Vice President’s task force continues to stop the flow of taxpayer funds before they fall into the hands of fraudsters and deliver savings to the American people,” a spokesperson for Vice President JD Vance told Digital. “This is great momentum in the fight for the President’s War on Fraud.”

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President Donald Trump has made the eradication of systemic fraud a cornerstone of his administration’s domestic policy. On Monday, CMS Administrator Dr. Mehmet Oz blasted California officials over the state’s hospice crisis, charging that the fraud is “stealing your lives” and pointing to a sophisticated web of international graft.

“We’ve got Russian government involvement, we believe, in Los Angeles. We’ve got the Chinese government involved in a big fraud ring in New York,” Oz told guest host Kayleigh McEnany on “Jesse Watters Primetime.” “And, of course, the Cuban connection… pointed out to me by former Miami Mayor Francis Suarez. We’ve got twice as many durable medical equipment suppliers—selling wheelchairs and canes—as there are McDonald’s in South Florida. The owners often flee back to Cuba with the money the moment we move in on them.”

Last month, Digital uncovered the suspension of 447 hospices and 23 home health agencies suspected of fraud in Los Angeles alone, with the total theft estimated at more than $600 million.

Days later, the U.S. Small Business Administration (SBA) referred 562,000 suspected fraudulent loans — totaling over $22.2 billion — to the U.S. Department of the Treasury for collection. These loans largely originated from the Paycheck Protection Program (PPP) and the COVID Economic Injury Disaster Loan (EIDL) program.

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The SBA noted these files were flagged for suspected fraud during the Biden administration but were never sent to the Treasury Department for recovery.

“The task force has made clear that the Biden Administration’s policy of giving direct cash payments to fraudsters is over,” a senior White House official told Digital.

In April, the head of a California hospice advocacy group warned congressional lawmakers that industry fraud is flourishing across the state. Sheila Clark, president and CEO of the California Hospice and Palliative Care Association (CHAPCA), questioned how these “ghost” providers managed to evade regulators for so long.

“You’d be amazed at how many hospices… you can walk up to the door in California and there is nobody there. You can see five months’ worth of mail stacked up,” Clark told the House Ways and Means Committee during an April 22 hearing. “And yet, they passed a survey. How did that happen?”

“How do you put a hospice in a burrito stand? How do you put a hospice in a retail store?” she quipped. “That all had to be vetted through licensure, certification and accreditation.”

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California Attorney General Rob Bonta recently announced the arrest of five individuals linked to an alleged multi-million-dollar hospice scheme that reportedly raked in $267 million through fraudulent billing to Medi-Cal, the state’s Medicaid program.

The Trump administration has intensified its focus on the abuse of taxpayer funds following last year’s arrests connected to the “Feeding Our Future” scheme in Minnesota—a massive “sham meal” operation that allegedly defrauded the government of hundreds of millions of dollars.