LOS ANGELES – California Attorney General Rob Bonta said Thursday that 21 suspects have been charged in what state officials describe as a hospice fraud operation that generated $267 million in improper claims paid with state and federal funds for services that were never provided.
According to the California Department of Justice, the case – dubbed “Operation Skip Trace” – centers on allegations that personal identifying information for non-California residents was purchased on the dark web and used to enroll those identities in Medi-Cal through Covered California. State officials said 14 hospice companies were then purchased by straw owners, and billers used those entities to submit hospice claims tied to the stolen identities.Bonta said “not a single legitimate hospice service was ever provided” over the life of the alleged scheme, even as millions were billed through Medi-Cal.Authorities searched 12 locations across Southern California, arrested five people, and seized more than $757,000 in cash along with two handguns, according to the California Department of Justice.”This wasn’t a mistake or a loophole; it was deliberate fraud,” Bonta said in a statement. “This kind of abuse undermines trust, drains critical resources, and threatens care for those who truly depend on it.”The 21 defendants were charged in three separate criminal complaints filed in Los Angeles County, according to the California Department of Justice. The charges include conspiracy to commit health care fraud, health care fraud, money laundering, and identity theft. Officials said the cases also include aggravated white collar crime and aggravated money laundering enhancements.The announcement came about a week after federal officials in Los Angeles announced a separate crackdown on $50 million in alleged Medicare fraud schemes tied to end-of-life services that investigators said were either not medically necessary or never provided.Gov. Gavin Newsom also weighed in Thursday.”We hold accountable to the fullest extent of the law anyone who tries to rip off taxpayers and take advantage of public programs, particularly those as sensitive as hospice care,” Newsom said…