California AG charges 21 in $267M Medi-Cal hospice fraud

Earlier this month, the California Attorney General’s office filed charges against 21 people in a $267 million Medi-Cal fraud ring.

The lawsuit, called Operation Skip Trace, accuses the defendants of buying stolen personal information on the dark web, enrolling those identities in Medi-Cal through Covered California, and 14 hospice companies billing the state for end-of-life care that was not provided.

The patients were not dying. In many cases, they didn’t even live in California. They were names and Social Security numbers extracted from the data breach and turned into payment line items.

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DOCTOR DENIES KNOWING OF RAMPANT LA-AREA MEDICARE TRUST USING HIS PROVIDER NUMBER.

How hospice fraud scams work

Fraudsters pay people to put hospice care companies in their names, even though they don’t behave. This hides the real operators and gives the group a licensed business they can use to pass the bills. Behind the scenes, some buy stolen personal information on the web’s black markets. This includes names, dates of birth, Social Security numbers and addresses.

They then use that information to enroll people in Medi-Cal through Covered California and put them on the hospice list. Next, companies submit claims for visits, prescriptions and daily care tied to those names. They never provide any services. Because hospice care pays a low daily rate, the payment continues as long as you remain active.

Why Los Angeles is the epicenter of hospice fraud

Operation Skip Trace is the latest in a series of hospital fraud cases that federal and state officials have been tracking for years. The average Los Angeles County facility bills Medicare about $29,000 per patient, more than double the national average. Of the approximately 1,800 hospices operating in LA County, more than 700 raised multiple red flags for fraud, according to state auditors.

On March 23, 2026, the US House Committee on Oversight and Government Reform sent a letter to California Governor Gavin Newsom requesting documents regarding the state’s oversight of federally funded hospice programs. Committee members cited a “well-documented history of fraud,” including agencies enrolling beneficiaries without their knowledge and Medicare overbilling.

The Centers for Medicare & Medicaid Services estimates that Los Angeles County alone makes nearly $3.5 billion in hospice fraud. Newsom’s office said California has revoked more than 280 hospice licenses, temporarily suspended new providers and has hundreds of employees under investigation.

A GOOGLE SEARCH LEADS TO AN EXPENSIVE SCAM NETWORK

Many victims did not know their names were registered on Medi-Cal or tied to hospital claims. (Kury “CyberGuy” Knutsson)

What hospice fraud means to your identity and coverage

Most identity theft cases focus on credit cards, tax returns or new loans. That usually appears on your credit report. Hospice fraud works differently. Fraudsters can use your information within the Medicare or Medi-Cal billing system without triggering a credit alert or hard questions. That means it can go unnoticed.

Watch for warning signs such as Medicare Summary Notices listing services you never received, Medi-Cal enrollment letters in your name or explanation of benefits statements from providers you never visited.

If you apply for cover later, you may face rejection because records show you are already registered in another state. If your data has been exposed in a breach, it’s likely already circulating on the dark web.

How to spot hospice fraud and report identity theft

The Centers for Medicare & Medicaid Services recommends that you review the Medicare Summary Notice quarterly through MyMedicare.gov. If you’re enrolled in Medi-Cal, check your Covered California account for unexpected activity and report anything suspicious to the California Department of Health Care Services through its Stop Medi-Cal Fraud line.

Suspected Medicare fraud can be reported at 1-800-MEDICARE or directly to the HHS Office of Inspector General at oig.hhs.gov/fraud. Senior Medicare Patrol offers free assistance in reviewing statements and filing reports in all states. If you notice unfamiliar charges or registration activity, file a fraud alert with Equifax, Experian and TransUnion. Theft of medical information often overlaps with other types of fraud.

How identity theft monitoring helps catch hospice fraud

Hospice fraud schemes such as Operation Skip Trace often begin long before payment takes place. Exploited personal data is often traded on black web markets after a major data breach. Services like Aura monitor these marketplaces and data vendor listings for disclosed personal information, including social security numbers, driver’s licenses, and email addresses. They also track public record changes, such as address updates that may indicate fraudulent registration, and monitor credit files across Equifax, Experian, and TransUnion.

When suspicious activity is detected, users receive support from fraud resolution experts who help contact agencies, prepare documents, and dispute unauthorized accounts. Plans may also include identity theft insurance for reasonable recovery costs.

No service can prevent all misuse of stolen identities. But when fraud occurs within programs you don’t normally audit, such as Medicare or Medi-Cal, early warnings can make a significant difference.

This type of fraud often goes unnoticed because it doesn’t appear on your credit report or enforcement notices. (Annette Riedl/photo alliance)

How credit monitoring helps detect identity theft early

Credit monitoring services track activity at all major credit bureaus and notify you when anything changes. That gives you the opportunity to act quickly by closing your debt, disputing unfamiliar accounts or contacting the lender.

Many services monitor your credit across Equifax, Experian and TransUnion and send alerts immediately after activity is reported, so you’re not waiting for daily updates to spot a problem.

Some tools allow you to lock your credit file with one tap, which can help stop new applications before they are approved.

Beyond credit reports, some services monitor other personal data that may be disclosed in a breach or sold online. That can include email addresses, phone numbers, driver’s license information and even medical records, all of which can be used in identity theft programs.

While no service can prevent all types of fraud, having real-time alerts and comprehensive monitoring can help you catch suspicious activity early and limit damage.

See my tips and top picks for Best Identity Theft Protection at CyberGuy.com

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Kurt’s priority is taking

This case shows how identity theft occurs. It’s no longer just about opening bank accounts or opening credit cards. Scammers are now turning invisible patients into programs most of us never check. That change makes this fraud harder to detect and slower to stop. The best defense is to know where your information can come from and check systems you wouldn’t normally check.

If someone can use your identity for months without your knowledge, can you ever find it before the damage is done? Let us know by writing to us at CyberGuy.com

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