Dr. Mehmet Oz pledged this week to lead an effort that would decertify any hospice providers that are found to be defrauding taxpayers by stealing the identities of people not in hospice or by overbilling for those who are dying.
“If they steal the money, they’ll steal your health, they’ll steal your life, and we’re seeing that over and over again, which is why we have to send a very loud message to fraudsters that we’re not open for business for you,” said Oz, who is the Trump administration’s administrator for the Centers for Medicare and Medicaid Services.
“Run away, defraud somebody else, go into some other illegitimate business, but do not steal from the American people,” he said in an exclusive interview with CBS News.
Hospice care offers patients who are terminally ill the ability to treat pain and die with dignity. But the industry has in recent years suffered at the hands of bad actors who have billed the federal government for services they never provided, or for people who are not even sick.
Oz’s comments came in response to a CBS News examination of state and federal data that raised concerns about potentially fraudulent charges, notably in California, where an outsized number of companies offer hospice services.
The investigation found that over 700 of the roughly 1,800 hospices in LA County trigger multiple red flags for fraud as defined by the state.
Nationwide, the U.S. Department of Health and Human Services Office of the Inspector General reported in 2023 that suspected hospice fraud amounts totaled an estimated $198.1 million.
The agency headed by Oz plays a crucial role in overseeing hospice care. Medicare is federally administered, and hospices must be certified for reimbursements made with taxpayer dollars.
“My plan is to do just that, to take half the hospices in California, the ones that are illegitimate based on the criteria we’ve been discussing today, and take away their ability to bill us,” Oz said
“Forty-nine states do not have the kinds of problems that Los Angeles County has,” Oz continued.
“All of us together are going to have to make some tough decisions — Democrats and Republicans, red and blue, doesn’t matter.”
California is confronting this problem as Gov. Gavin Newsom, a Democrat eyes a potential presidential run. Fraud in public services has become a thorny political issue. Republicans and an army of social media influencers have seized on the issue as politically potent, accusing Democratic state leaders of failing to prevent costly schemes.
Oz said he isn’t sure if there is a greater willingness from California to share information and fix the problem together.
CBS News reached out to Newsom’s office for a response to Dr. Oz’s allegations.
A spokesperson for Newsom told CBS News, “California has always been ready and willing to engage constructively with the federal government over anti-fraud efforts. The state cracked down on hospice fraud years ago.” The statement notes the state launched a multi-agency Hospice Fraud Task Force, which makes arrests, shares intelligence, investigates fraud and coordinates enforcement.”
State officials told CBS News it is far from true that California is not engaging in good faith with the federal government and they stand ready to partner together.
The state has revoked around 280 hospice licenses.
For its part, Oz said CMS made a checklist of tactics used in fraud schemes; those red flags will trigger on-site visits by the agency to figure out what is illegitimate.
Behind the hundreds of millions of dollars fraudulently charged to the federal government around the country are real victims whose identities are stolen and might have trouble getting care they desperately need.
“I didn’t feel protected. I didn’t feel safe,” Lynn Ianni, whose Medicare number was stolen and used to fraudulently enroll her in hospice care she didn’t need, told CBS News. “I felt, like, abused by a system that didn’t work that was truly broken, and without a remedy from that same system. It was really frustrating.”