We visited “ground zero” for hospice fraud: Los Angeles, California

We visited “ground zero” for hospice fraud: Los Angeles, California


A CBS News analysis of records for every hospice operating in Los Angeles County finds indications of fraud are growing.


At age 69, Lynn Ianni is a pickleball whiz, zipping from dinks to drives energetically. When she suffered an injury on the court two years ago, she sought physical therapy, and was surprised to learn her Medicare insurance wouldn’t cover it.

She was, according to Medicare records, dying and in hospice.

Lynn Ianni stands on the opposite side of a pickleball net from CBS News correspondent Adam Yamaguchi.
Lynn Ianni plays pickleball with CBS News correspondent Adam Yamaguchi and tells him about her experience being a victim of hospice fraud in Los Angeles County. Louie Mejia / CBS News
“They said, ‘you're in hospice.’ And I said, ‘what? What are you talking about?” Ianni said. “‘Are you kidding me? Do I look like I’m in hospice?’”

Ianni’s Medicare number had been stolen, and used by a company to fraudulently enroll her in hospice – specialized, compassionate care for terminal patients nearing the end of their lives. It was another example of fraud in the hospice industry, long a nationwide problem. But her case arose well after officials had promised to stamp it out in California, where the problem has been especially acute.

A tearsheet showing Bagnall’s approved and denied claims.
Ianni was initially approved for physical therapy treatments through Medicare. But later, her coverage was denied because she was listed as receiving hospice care, and the services were deemed not covered — even though she was not, and has never been, in hospice. CBS News
Medicare is federally administered, and hospices must be certified for reimbursements. But the state issues the licenses for hospices to operate.

Three years ago, California’s state auditor sounded the alarm that Los Angeles County had seen a 1,500% increase in hospice companies since 2010 – more than six times the national average relative to its elderly population.

Auditors estimated LA County hospices overbilled Medicare by $105 million in a single year. The report called out notable red flags – key warning signs of fraud:

Multiple hospices in one building

Geographic clustering

Low patient counts

High rates of terminally ill patients later discharged alive

Excessive billing

Staff shared across multiple companies

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