A federal investigation into California’s exploding hospice industry has revealed what officials are calling one of the largest health care fraud schemes in U.S. history, according to statements made Friday by Dr. Mehmet Oz and U.S. Attorney Bill Essayli.
Speaking at a press conference in Los Angeles, Dr. Oz — now serving as Administrator of the Centers for Medicare & Medicaid Services — said foreign nationals are running illegal hospice operations across California, with a particular concentration in Los Angeles County. Many of the operations are allegedly controlled by Russian and Armenian criminal syndicates working with a network of unscrupulous physicians.
“We have witnessed a sevenfold increase in hospice in LA County,” Oz said. “That doesn’t happen naturally. There is not seven times more death than there was five years ago. These are fraudsters.”
Dr. Oz claimed that about 100 doctors are suspected of being involved in the scam. The scheme reportedly involves doctors convincing otherwise healthy individuals they are dying in order to enroll them into hospice care and begin billing Medicare. Nearly 100,000 people have reportedly handed over their Medicare numbers in what’s being called a wide-ranging fraud network.
Essayli, the top federal prosecutor in the region, said the scale of the corruption dwarfs what was recently uncovered in Minnesota.
“Our belief is that the fraud in California will magnify whatever’s happening in Minnesota,” he said. “What’s happening in Minnesota pales in comparison.”
The Trump administration has ramped up oversight and enforcement. Dr. Oz also revealed that the federal government has already identified $1.3 billion in taxpayer dollars spent on elective procedures for illegal immigrants.
“That money is not supposed to be used that way,” he said. “The state is giving that money back.”
Officials estimate that $10 billion in California’s health care system is being funneled toward illegal immigrant care — a violation of federal law, according to Essayli. He said his office began its investigation earlier this year, initially focusing on homelessness-related corruption but quickly expanded it when the hospice scheme came into focus.
The Department of Health and Human Services recently froze $10 billion in child care and social service funding to California and other Democrat-led states — including New York, Minnesota, Illinois, and Colorado — citing concerns that the benefits were being siphoned off for ineligible recipients, including non-citizens.
California Gov. Gavin Newsom pushed back, boasting on X that the state has “blocked over $125 BILLION in fraud” and accused the Trump administration of politicizing enforcement.
But Dr. Oz made clear that the administration is serious about rooting out fraud — and cooperation is not optional.
“We will work with the state to develop a corrective action plan,” Oz said. “But if we don’t get that cooperation, there are steps we can take at the federal level. They are aggressive steps, but this kind of crisis requires aggressive treatment.”
Meanwhile, five Democrat attorneys general — led by California AG Rob Bonta — filed a lawsuit Thursday claiming the Trump administration’s freezing of federal funds is “unconstitutional and unlawful.”
Still, officials say the fraud discoveries are just beginning. The new Assistant Attorney General for Fraud, a position announced by Vice President JD Vance, is expected to play a central role in coordinating a national crackdown on welfare and health care fraud across multiple states.
The post Dr. Oz Uncovers Massive Health Care Fraud in California, Says Minnesota “Pales in Comparison” appeared first on Real News Now.
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