‘Ghosts’ clinics and daycares? California fraud fears explode

California’s safety net is under the microscope, and what’s turning up has watchdogs raising alarms.

Federal regulators say a wave of newly created hospice agencies in the state has triggered widespread concern, with many stripped of their ability to bill Medicare after suspicious activity surfaced. Others remain under review, forced to correct questionable practices or face removal.

Los Angeles, in particular, is emerging as a focal point.

Investigators have described dense clusters of hospice providers packed into tight areas, sometimes with multiple companies tied to a single address.

Site visits to some of those locations have reportedly revealed little more than empty offices, disconnected phones and unattended mail.

The concerns center on whether some operators are enrolling ineligible patients or billing for care that isn’t being delivered, turning a program intended for end-of-life support into a potential avenue for improper payments.

At the same time, scrutiny is spreading beyond hospice care.

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An investigation by Nick Shirley has drawn attention to California’s subsidized childcare system, raising questions about facilities that appear inactive or inconsistent with their reported enrollment.

Some locations tied to public funding showed limited on-site activity despite records indicating otherwise.

The issue has also been amplified by Mehmet Oz, who has pointed to unusually high concentrations of hospice providers in parts of Los Angeles and called for closer oversight.

Taken together, the findings have intensified concerns that complex reimbursement systems, moving large sums of public money, may be vulnerable to abuse if oversight fails to keep pace.

Officials say enforcement efforts are increasing, particularly in hospice care, where fraud risks have been under review for years.

State leaders, meanwhile, have cautioned against broad conclusions in the childcare cases, noting that not all irregularities indicate intentional wrongdoing.

Still, with significant taxpayer funding involved, pressure is mounting to ensure these programs are operating as intended, and reaching the people they’re meant to serve.