Eight people were arrested and 15 were charged in an alleged scheme to bilk more than $50 million in healthcare funds by running sham hospice facilities across Southern California, federal officials announced Thursday.
The defendants billed Medicare for reimbursement payments for hospice care for patients over several years, federal officials said, but many of those patients were not terminally ill. Federal officials who unsealed the charges Thursday described them as brazen efforts to commit fraud at several facilities across the region.
“This happens entirely too much, particularly in Los Angeles County,” said First Assistant U.S. Atty. Bill Essayli. “We are making fraud a priority.”
Federal officials arrested eight people on various fraud charges in a crackdown dubbed “Operation Never Say Die.” Though the cases were not connected, officials said they adopted similar ways to defraud the medical system.
Some of the defendants were also medical care providers, Essayli pointed out, including three nurses, a chiropractor and a psychologist.
The defendants operated facilities in Covina, Anaheim, Glendale and Lakewood. Akil Davis, the assistant director in charge of the FBI’s Los Angeles office, said Southern California was rife with hospice fraud.
Instead of using the money to provide hospice care for legitimately dying patients, Davis alleged, the suspects used it for international travel, to pay mortgages and car loans and to send money overseas.
“Fraud historically does not get the attention it deserves, so I’m glad to see a national spotlight on this pervasive problem,” Davis said.
Amelou Gill and his wife, Gladwin, who operate St. Francis Palliative Care in Glendale, were arrested at their Covina home by an FBI SWAT team.
Although the facility was meant to care for the dying, its patient mortality rate was about 2.3% during the last five years, according to the Centers for Medicare and Medicaid Services, or CMS.
Dr. Mehmet Oz, the CMS administrator, told The Times earlier this year that such low mortality rates were one of the clearest signs of a hospice that isn’t truly providing for those at the end of their lives.
Oz and Essayli were present at the Covina arrests.
In another case, Lolita Beronilla Minerd, 65, a licensed vocational nurse from Anaheim, operated Topanga Hospice Care Inc. in Artesia and allegedly submitted more than $9 million in fraudulent claims to Medicare, which paid more than $8.5 million of those claims, according to investigators.
Several of the people who were listed as terminally ill beneficiaries for the claims allegedly had common addresses.
Minerd is also accused of paying kickbacks to beneficiaries in exchange for being able to list them as patients, according to investigators.
One couple, allegedly approached at a supermarket, was told by Minerd they could receive $300 a month each and receive nutritional shakes, nonprescription vitamins and wheelchairs, Essayli said. They were not terminally ill, he said.
The facility, Essayli said, had a non-death discharge rate of about 85%, nearly five times the national average.
“When you go to hospice you’re going there to die,” Essayli said. “You don’t have an 85% survival rate.”
In another case, Nita Almuete Paddit Palma, 76, and her husband, Adolfo Catbagan, 68, are accused of operating three fraudulent hospice care facilities, including one that was operating while Palma was free on bond in another hospice fraud case.
“That is how egregious and bold some of these fraudsters are,” Essayli said.
The couple are accused of submitting at least $4.8 million in fraudulent claims between 2022 and 2024, even though they were barred from operating a hospice.
In announcing the criminal operation and the federal charges, Essayli and Oz also took aim at political opponents, particularly California, Gov. Gavin Newsom and the administration of former President Biden.
“This is not just a fraud problem, this is a California problem and the federal government is the purse,” Essayli said during the news conference. “I call California the kingdom of fraud.”
Essayli accused the state of doing no vetting or checking when administering hospice licenses.
“They do not care because it’s not their money,” Essayli said.
However, the state did adopt a moratorium on issuing new hospice licenses, which came after a Los Angeles Times investigation and a state audit. It was recently extended until January 2027 after the state missed its deadline to enact new emergency regulations for hospices.
Oz, who earlier this year was criticized after posting a video accusing Armeniancrime groups of carrying out widespread fraud, continued Thursday to accuse California and Los Angeles officials of not doing enough to combat fraud.
“Why would one-third of hospices in the whole country be just in Los Angeles County?” Oz said. “You should be incredulous. We are.”
In 10 weeks, Oz said, federal officials had taken down 221 hospice facilities in the area.
In a series of posts on X, Newsom appeared to respond to the criticism.
“The Trump Administration — home to the biggest fraudsters on Earth — is trying to blame California for issues with THEIR federal program,” Newsom posted in response to a comment by Vice President JD Vance on the federal operation. “Glad to see the Feds finally taking seriously the fraud in the programs they themselves manage … only 15 months after Trump took office.”
In another post, Newsom’s press office said that the state had suspended more than 280 licenses in the last two years and is banning new licenses.
The post SoCal hospice owners bilked taxpayers for millions in false claims, federal officials say appeared first on Los Angeles Times.
