Concerns about hospice fraud are rising in California, and Republican Congressional candidate Jenny Ray Le Roux is pointing fingers at state leaders. She claims they haven’t taken necessary action, allowing the issue to escalate due to lapses in oversight.
“All funds are channeled from California to the medical centers, and any mismanagement can lead to serious issues within the state. The federal government had to intervene, and it’s really up to Governor Gavin Newsom to tackle this — it’s a California problem,” Le Roux shared with FOX News Digital.
In response, Newsom’s office countered the allegations, stressing that enforcement is primarily a federal responsibility. They stated, “Fact: The state is not involved in the Medicare billing system. We support federal efforts to combat fraud, but it would be nice if the former president could stop giving pardons to fraudsters and actually hold them accountable!”
While states don’t directly process Medicare payments, they do control the licensing of hospice providers, essentially determining which organizations can participate in federal programs.
Recent claims of extensive hospice fraud in California have sparked federal actions. CBS News pointed out that of around 1,800 hospices in Los Angeles County, 742 remained active despite receiving numerous warnings. In fact, one area saw nearly 500 hospice companies operating within just three miles.
A warning from the California State Auditor in March 2022 highlighted the rapid growth of hospice agencies without a clear need, raising concerns about geographic clustering, extended patient stays, high discharge rates, and potential identity theft.
This month, the U.S. Attorney’s Office for the Central District of California arrested eight individuals in a healthcare fraud operation, allegedly scheming to defraud the health care system out of over $50 million. Some of their actions included running a bogus hospice care facility.
On April 9, Newsom and California Attorney General Rob Bonta announced significant initiatives aimed at dismantling a major identity theft and hospice fraud operation targeting the state’s Medi-Cal program.
According to the governor’s office, the scheme involved 14 fake hospice providers, leading to more than $267 million in fraudulent claims being processed in state and federal funds. Bonta reiterated that this isn’t just politics; it’s about safeguarding taxpayer dollars and ensuring vulnerable Californians are protected. “During the duration of this scam, millions were unjustly claimed in a blatant attempt to exploit Medi-Cal,” he emphasized.
Le Roux’s cousin, Democratic Virginia Governor Abigail Spanberger, is also campaigning in a Republican primary for a Congressional seat covering part of Orange County. Le Roux dismissed the state’s announcement about combating fraud, viewing it as a mere publicity stunt and criticizing Newsom for not proposing broader changes in hospice oversight.
“Newsom seems more focused on headlines than real solutions,” she said, suggesting that it is his responsibility to effectively tackle hospice fraud in California, regardless of federal funding.
Additionally, a report indicated that in Los Angeles, 447 hospices and 23 home health agencies were suspended due to fraudulent activities, with overall fraud estimates exceeding $600 million.
Le Roux believes that addressing fraud in California is a collective responsibility, emphasizing their agency’s commitment to investigating whistleblower tips statewide. “We’ve taken a new approach to tackle fraud,” she explained, stating that they’re moving beyond traditional means to conduct thorough investigations.
She argued that potential fraud in California is immense compared to case studies from states like Minnesota. While numbers remain unverified, findings suggest the existence of tens of billions in annual fraud and waste.
“California’s budget is enormous, ranking among the largest globally. With 2,000 tips currently under review, we aim to cover every sector,” she noted. “Minnesota’s issues are a fraction of what we see here.”
As she campaigns, Le Roux is eager to address these issues on a federal scale, advocating for enhanced transparency regarding taxpayer money. “If we’re spending taxpayer money in a place notorious for fraud, we need more federal oversight,” she asserted.
“That’s why I chose to run for Congress. Why should we have to make Freedom of Information Act requests for what should be public information?” she questioned, adding that besides defense spending, all public expenditures should be available for scrutiny.
FOX News Digital has reached out to Newsom’s office for additional comments.
