TL/DR –
Federal officials have arrested eight people and charged 15 in connection to a fraudulent scheme where over $50 million in healthcare funds were bilked through fake hospice facilities in Southern California. The defendants presented non-terminally ill patients as terminally ill to bill Medicare for reimbursement payments over multiple years. Some of the funds were allegedly used for international travel, paying mortgages and car loans, and sending money overseas, instead of providing hospice care to genuinely terminally ill patients.
Federal Officials Uncover Massive Healthcare Fraud in Southern California
Eight people have been detained, with 15 facing charges in an alleged scam to swindle over $50 million in healthcare funds via fake hospice facilities throughout Southern California, as revealed by federal officials. The accused allegedly defrauded Medicare by charging for hospice care for patients who were not terminally ill.
Crackdown on Healthcare Fraud
The government authorities arrested eight individuals on fraud charges in an operation dubbed “Operation Never Say Die”. Despite the cases being unrelated, the accused reportedly used similar methods to defraud the healthcare system. Among the arrested were medical care providers, including three nurses, a chiropractor, and a psychologist.
The perpetrators operated facilities in Covina, Anaheim, Glendale, and Lakewood. Akil Davis, the assistant director in charge of the FBI’s Los Angeles office, claimed that Southern California is rife with hospice fraud. Instead of using the funds to provide hospice care for legitimately dying patients, the accused used the money for international travel, to pay mortgages and car loans and to send money overseas.
Specific Cases of Fraud
Business operators Amelou Gill and his wife, Gladwin, were detained at their Covina residence. Their facility, St. Francis Palliative Care in Glendale, had an abnormally low patient mortality rate of 2.3% over the last five years, a strong indication of fraud, according to the Centers for Medicare and Medicaid Services (CMS).
Another instance involved Lolita Beronilla Minerd, a licensed vocational nurse who allegedly submitted over $9 million in fraudulent claims to Medicare through her facility, Topanga Hospice Care Inc. The facility had a non-death discharge rate of around 85%, nearly five times the national average.
Nita Almuete Paddit Palma and her husband, Adolfo Catbagan, are accused of operating three fraudulent hospice care facilities. Despite being barred from operating a hospice, the couple allegedly filed at least $4.8 million in fraudulent claims between 2022 and 2024.
The Role of State Officials
Federal officials took the opportunity to slam California, Gov. Gavin Newsom, and the previous Biden administration for their handling of the issue. The state, however, has imposed a moratorium on issuing new hospice licenses, which was recently extended until January 2027.
Dr. Mehmet Oz, the CMS administrator, has been vocal in his criticism of California and Los Angeles officials for insufficient efforts to combat fraud. “Why would one-third of hospices in the whole country be just in Los Angeles County?” Oz questioned. In the last 10 weeks, federal officials have shut down 221 hospice facilities in the region.
Gov. Newsom responded to the criticism, stating that the federal government is to blame for the issues in their program. His press office asserted that the state had suspended over 280 licenses in the last two years and is currently banning new licenses.
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