A single Los Angeles office building harbors 89 registered hospice companies with empty desks, dead phone lines, and piled-up mail—exposing how shell companies systematically defraud Medicare while regulators watch.
Quick Take
- CBS News investigators found 89 hospice agencies registered to one Van Nuys building with zero operational activity, revealing sophisticated Medicare fraud through ghost billing.
- California’s 2022 state audit warned of weak licensing controls; 742 of approximately 1,800 LA County hospices still operate despite state-defined fraud red flags.
- Emergency regulations mandated for January 1, 2026, remain delayed, leaving vulnerable terminal patients and taxpayers exposed to organized fraud networks.
- Assemblywoman Alexandra Macedo’s parallel investigation uncovered 197 hospices at another Van Nuys address, underscoring systemic regulatory failure across multiple sites.
- Attorney General Rob Bonta acknowledges enforcement arrives too late: “We need to react to red flags, not just count them.”
The Building That Tells Everything
CBS News journalists walked into a nondescript medical plaza in Van Nuys and discovered something that should alarm every American receiving or paying for healthcare. Eighty-nine hospice companies—companies legally registered to care for dying patients—operated from a single address. The offices were empty. Mail piled up unopened. Phone numbers connected to nothing. This wasn’t incompetence; it was infrastructure for theft on a massive scale.
How the Fraud Actually Works
Shell companies use stolen Medicare provider numbers to bill for services never rendered. Patients never see these agencies. Families never receive care. Yet Medicare and Medi-Cal payments flow out automatically. The Van Nuys building serves as a registration address—a postal box for organized crime targeting federal healthcare programs. Investigators traced dark web activity connected to these operations, revealing sophisticated criminal networks exploiting regulatory gaps that everyone knew existed.
California Knew This Was Coming
In 2022, California’s State Auditor issued a damning report: weak licensing controls created conditions for large-scale fraud. Between January 2015 and August 2021, the state received approximately 2,100 complaints, including 350 fraud allegations. Despite these warnings, regulators continued approving licenses. The administration revoked 280 licenses and made arrests, but only after damage was done. Attorney General Rob Bonta’s frustration is evident: reactive enforcement cannot protect patients already harmed or taxpayers already defrauded.
The Scale Demands Attention
Los Angeles County hosts approximately 1,800 hospice agencies. Of these, 742 display state-defined fraud indicators and remain operational. Assemblywoman Alexandra Macedo’s investigation discovered 197 hospices registered to another single Van Nuys address. These aren’t isolated incidents; they represent organized networks exploiting a regulatory system that moves too slowly. The density—500 hospices within three miles of certain addresses—defies coincidence or legitimate business clustering.
The Regulatory Failure Nobody Can Ignore
Emergency regulations were due January 1, 2026. They remain pending. This delay occurred despite bipartisan pressure, official audits, and public investigations. Governor Newsom’s administration touts revocations and partnerships with the Department of Justice, yet the core problem persists: licensing happens faster than fraud detection, and fraud detection happens faster than regulatory response. Terminal patients waiting for legitimate hospice care face delays. Families questioning whether their agency is real now have reason for suspicion. Trust erodes when systems fail the most vulnerable.
We visited an LA building with 89 registered hospices. Here's what we found. – CBS News https://t.co/kcg2q5BYnU
— Rich Newbold (@drnewbold) March 19, 2026
Why This Matters Beyond California
LA County has become ground zero for hospice fraud, but nothing prevents this model from replicating nationally. Federal authorities watch California’s response carefully. If the nation’s largest state cannot regulate a single industry despite warnings and evidence, what does that signal about healthcare oversight nationwide? Legitimate hospice operators suffer reputational damage. Rural agencies struggle to recruit staff when entire regions face fraud stigma. The fraud doesn’t just steal money; it corrodes confidence in end-of-life care when patients need it most.
Sources:
Valley assemblywoman finds 197 hospice agencies registered at one LA address
Hospice fraud report: Los Angeles CBS report on LA County empty offices and piled mail
CBS News: Hospice fraud investigation
