A sweeping federal takedown in Los Angeles has exposed what prosecutors say is a brazen, multimillion-dollar scheme that turned end-of-life care into a cash grab, allegedly using people who weren’t even dying to rip off taxpayers by more than $50 million. Eight defendants, including nurses, a chiropractor and a purported psychologist, were arrested in a crackdown targeting sham hospice operations and fraudulent medical billing schemes, according to the Justice Department. At the center of the case, hospice companies are accused of enrolling healthy patients, paying kickbacks and pocketing millions from Medicare for treatment that was never needed or never provided.
“We are enforcing a zero-tolerance policy for criminals who defraud American taxpayers,” First Assistant U.S. Attorney Bill Essayli said. “The defendants arrested this morning who are charged with stealing millions of dollars of health care benefits got caught and now face years in federal prison.”
Investigators say the pattern was repeated across multiple cases. Patients who weren’t dying were enrolled in hospice, marketers were paid illegal kickbacks and providers cashed in while delivering little or no legitimate care.
In Anaheim, Lolita Minerd, a nurse, allegedly ran a hospice business that recruited patients at a market, promising them free services and $300 a month in cash to enroll. Some of the couples who signed up were not terminally ill, a doctor confirmed, yet they were paid $600 a month in envelopes of cash while Medicare was billed for end-of-life care. Minerd’s company alone submitted more than $9.1 million in claims, collecting roughly $8.5 million from taxpayers, authorities said.
“More than $50 million in losses to taxpayers” across the scheme were noted by HHS Inspector General T. March Bell, who said anyone who weaponizes hospice care to bilk Medicare should expect to be held accountable.
In another case, a Covina couple, a nurse and a self-described psychologist, allegedly pulled in more than $4 million from Medicare and spent it on mortgages, international travel, restaurants and personal bills.
Federal prosecutors say one repeat offender went even further, allegedly running multiple fraudulent hospice companies while already facing charges in a separate case and being legally barred from operating such businesses.
Beyond hospice fraud, authorities say the takedown uncovered a $19 million scheme targeting a labor union’s health plan that the defendants allegedly billed for fake or unnecessary chiropractic and therapy services.
