(Luis Cornelio, Headline USA) California Gov. Gavin Newsom’s administration is suddenly touting a major hospice fraud “bust” in Los Angeles County after mounting warnings and accusations that officials allowed the scheme to spiral out of control.
The charges, announced Thursday by California Attorney General Rob Bonta and the Newsom-led Department of Health Care Services, target 21 individuals accused of orchestrating a scheme that cost taxpayers $267 million.
Bonta unveiled the charges as the Trump administration, federal prosecutors and congressional leaders intensify scrutiny of widespread hospice fraud in California, an issue critics say was enabled by the state’s lax oversight.
Reports suggest the fraud dates to at least 2021, when Newsom issued a moratorium blocking new hospice licenses from being issued.
Since then, Centers for Medicare & Medicaid Services Director Mehmet Oz has warned the total fraud could reach as high as $3.5 billion in taxpayer losses.
“If you thought the fraud was out of control in Minnesota, wait until you learn about what’s happening in California,” Oz said in a January video.
The scheme largely involved enrolling Medicare and Medicaid recipients into hospice care without their knowledge or using stolen information to bill the government for services never provided.
Even CBS News, an outlet hardly known for targeting Democrats, aired multiple reports flagging major red flags at hospice centers in Los Angeles County, describing the region as “ground zero” for the fraud.
The growing scandal has drawn the attention of the House Oversight Committee, which is now investigating whether “California officials failed to properly safeguard federal funds.”
Despite the scrutiny, Newsom and Bonta attempted to spin the charges as a success story.
“For years, California has led the charge to protect public programs from fraud and abuse,” Newsom said.
Meanwhile, Bonta stated, “This isn’t a political game for us. This is about protecting taxpayer dollars, protecting the programs that sick and vulnerable Californians rely on, and protecting our state.”
But U.S. Attorney Bill Essayli blasted the effort, arguing federal prosecutors are now being forced to clean up a mess of California’s own making.
“Having my office prosecute fraudsters to whom California blindly handed out millions does not count as ‘fighting fraud,’” Essayli wrote on X. “It’s the federal government cleaning up after you and the Governor’s incompetence. Maybe you should spend more time prosecuting your own fraudsters and filling up your prisons, and less time cooking up political lawsuits against the Trump Administration.”
I said “prevent.”
Having my office prosecute fraudsters to whom California blindly handed out millions does not count as “fighting fraud.”
It’s the federal government cleaning up after you and the Governor’s incompetence.
Maybe you should spend more time prosecuting your own… https://t.co/9GZIOpAuJa
— F.A. United States Attorney Bill Essayli (@USAttyEssayli) April 8, 2026
Bonta’s office did not respond to Headline USA’s request for comment before deadline. Essayli’s office pointed to his public remarks.
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