Full Breakdown
Federal Crackdown on Multimillion-Dollar Hospice Fraud Scheme
4/4/2026, 12:09:47 PM
Overview of the Scheme
A significant federal operation in Los Angeles has unveiled a large-scale fraud scheme involving hospice care, where healthy individuals were allegedly recruited to exploit Medicare, resulting in over $50 million in losses to taxpayers. Eight defendants, including nurses, a chiropractor, and a psychologist, were arrested as part of this crackdown on fraudulent hospice operations and medical billing schemes. The Justice Department emphasized a strict stance against such fraudulent activities, asserting that those involved will face severe legal consequences.
Key Allegations and Operations
At the center of the investigation is Lolita Minerd, an Anaheim nurse accused of running a hospice business that lured patients by offering free services and cash incentives. Reports indicate that Minerd's company enrolled individuals who were not terminally ill, paying them $600 monthly while billing Medicare for unnecessary end-of-life care. This operation alone submitted claims exceeding $9.1 million, with approximately $8.5 million collected from Medicare.
Investigators noted a pattern of similar fraudulent activities across multiple cases, where patients were enrolled in hospice care without legitimate medical need, and marketers received illegal kickbacks. The Department of Health and Human Services (HHS) Inspector General T. March Bell stated that the defendants turned hospice care into a profit-driven enterprise, significantly harming taxpayers.
Broader Implications of the Fraud
The investigation, dubbed Operation Never Say Die, revealed additional fraudulent schemes, including a $19 million operation targeting a labor union's health plan through unnecessary chiropractic and therapy services. Federal officials highlighted that Southern California has become a hotspot for hospice-related scams and healthcare fraud, contributing to the broader issue of healthcare fraud that costs the U.S. hundreds of billions annually. This fraud not only inflates healthcare costs but also undermines public trust in federal programs.
Official Statements & Responses
Federal officials have expressed a strong commitment to combating healthcare fraud. First Assistant U.S. Attorney Bill Essayli stated, "We are enforcing a zero-tolerance policy for criminals who defraud American taxpayers." Similarly, Department of Labor Inspector General Anthony D’Esposito remarked, "If you steal from workers or taxpayers, your time is up." The FBI's Akil Davis noted the high-risk environment for healthcare fraud in Southern California, emphasizing the need for continued vigilance.
Criticism & Opposition
While the crackdown has been widely supported, some critics argue that the systemic issues within the healthcare system contribute to such fraudulent activities. They suggest that inadequate oversight and regulatory gaps allow these schemes to flourish, calling for comprehensive reforms to prevent future occurrences.
Verbatim Quotes
- “The defendants charged today allegedly turned hospice care into a cash-producing operation, resulting in more than $50 million in losses to taxpayers,” — T. March Bell, HHS Inspector General
- “Today’s arrests are another decisive strike in our war on fraud,” — Anthony D’Esposito, Department of Labor Inspector General
- “Health care fraud undermines federal programs, threatens public trust and diverts resources away from legitimate patient care,” — Tyler Hatcher, IRS Criminal Investigation Special Agent in Charge
What's Next
The defendants face serious legal repercussions, with potential sentences of up to 10 years in federal prison for many charges. Authorities continue to investigate the extent of these fraudulent networks, aiming to dismantle operations that exploit vulnerable populations and taxpayer resources.
