$1.3 Billion Frozen in Sweeping California Hospice Fraud Crackdown

More than $1.3 billion in federal health care reimbursements have been halted, and 800 hospices have been suspended amid a sweeping crackdown on California hospice fraud.

These efforts have been led by Vice President JD Vance and Centers for Medicare & Medicaid Services Administrator, Dr. Mehmet Oz, who President Donald Trump selected to lead the Task Force to Eliminate Fraud.

Dr. Oz cited estimates suggesting roughly one-third of the nation’s hospice providers are based in Los Angeles—even though it only holds about 2.5% of the nation’s elderly population. 

“Ask yourself how that’s possible … it’s not.”

Oz further claimed “at least half” of the hospices in Los Angeles are frauds.

“We believe that at least half of the hospices in the entire area around Los Angeles are fraudulent. … Today we announce 800 of those hospices have been suspended. 800 hospices that last year charged the federal taxpayer $1.4 billion will no longer be paid.” 

The task force effort has not gone without criticism. In January 2026, California Gov. Gavin Newsom called Dr. Oz’s efforts “purely political” and stressed that his team has been dealing with the fraud “for years.”

“Hospice? We’ve been after that for years and years before Oz was even on the scene. This is purely political.”

In 2022, California imposed a moratorium on new hospice licenses after state auditors warned that a lack of oversight allowed questionable hospices into the market. 

According to a report published by Newsom in March 2026, the California Department of Public Health revoked 280 hospice licenses in the past two years. 

Despite Newsom’s efforts, Vance argues that previous enforcement efforts failed to stop billions in fraudulent billing. 

“The Task Force is preventing fraud before taxpayer money leaves the federal government. Agencies will now pay only when they are confident that a payment is legitimate and lawful.”

Vance shared the announcement in a post on X.

The administration says the payment-suspension model used in California could soon expand to other health care programs nationwide as the administration intensifies its anti-fraud efforts.