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California Attorney General Announces Arrests in Fraudulent Hospice Scheme

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California Attorney General Rob Bonta announced the arrest of 14 individuals, on Thursday, who were connected to a fraudulent hospice company scheme. The two hospice companies, New Hope Hospice, Inc. and Sterling Hospice Care, Inc. are based out of San Bernardino County and were “accused of stealing more than $4.2 million from the federal Medicare and state Medi-Cal programs.”

The companies and defendants allegedly enrolled patients into hospice care who did not have a full understanding of the program and were not terminally ill. Accordingly, from 2015 to 2021, the defendants billed both Medicare and Medi-Cal for millions of dollars over claims that they were “providing hospice care to patients who had less than six months to live when in fact these patients were not terminally ill.”

The defendants allegedly paid illegal kickbacks in an effort to recruit patients for hospice care, included patients who did not qualify for hospice because they were not terminally ill, took patient identity information and used it to put them in hospice without their knowledge, misrepresented to the patients what services they would be receiving, and switched the companies the patients were being billed by to avoid detection.

The California Attorney General notes that when a patient becomes enrolled in hospice care, they can no longer receive potential lifesaving services under the Medicare and Medi-Cal programs. Since the defendants enrolled patients who were not terminally ill into hospice care, they jeopardized the potential those patients had to receive lifesaving services under the Medicare and Medi-Cal programs, according to the announcement.

Attorney General Bonta commented on the arrests, saying that “patients should be able to trust that their hospice providers are acting in good faith” and that his office is “committed to protecting the well-being of Californians and prosecuting those who abuse the financial integrity of our healthcare system.”

The 14 defendants in custody are facing counts of conspiracy to commit insurance fraud, insurance fraud, grand theft, fraudulent insurance claims, identity theft, money laundering and tax evasion. Two individuals remain at large and have yet to be arrested. The case was investigated by the California Department of Justice’s Division of Medi-Cal Fraud and Elder Abuse.

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