Eight people have been arrested and 15 charged in connection with a scheme that allegedly bilked more than $50 million in health care funds by operating bogus health care facilities across Southern California, federal officials said Thursday.
The defendants billed Medicare for reimbursement payments for outpatient care for patients over several years, federal officials said, but many of those patients were not terminally ill. Government officials who filed the charges on Thursday described them as unconscionable attempts to commit fraud at multiple institutions across the state.
“This happens a lot, especially in Los Angeles County,” said First Assistant US Atty. Bill Essay. “We prioritize fraud.”
Government officials have arrested 8 people on various fraud charges in a campaign called Operation Never Say Die. Although the cases were not connected, officials say they used similar methods to defraud the medical system.
Some of the defendants are also health care providers, Essayli revealed, including three nurses, a chiropractor and a psychiatrist.
The defendants operated facilities in Covina, Anaheim, Glendale and Lakewood. Akil Davis, assistant director in charge of the FBI’s Los Angeles office, said Southern California is rife with hospice scams.
Instead of using the money to provide hospice care to terminally ill patients, Davis says, the suspects used it to travel internationally, pay off housing and car loans and send money overseas.
“Fraud historically doesn’t get the attention it deserves, so I’m glad to see the rest of the country on this rampant problem,” Davis said.
Amelou Gill and his wife, Gladwin, who works in St. Francis Palliative Care in Glendale, were arrested at their Covina home by an FBI SWAT team.
Although the facility was meant to care for the dying, the patient death rate was about 2.3% over the past five years, according to the Centers for Medicare and Medicaid Services, or CMS.
Dr. Mehmet Oz, director of CMS, told the Times earlier this year that such low death rates were one of the clearest signs of hospice not really supporting those at the end of their lives.
Oz and Essayli were present at Covina’s arrest.
In another case, Lolita Beronilla Minerd, 65, a licensed practical nurse from Anaheim, used Topanga Hospice Care Inc. in Artesia and allegedly submitted more than $9 million in fraudulent claims to Medicare, which paid more than $8.5 million of those claims, according to investigators.
A number of people were on the death benefit list because of claims that they had the same address.
Minerd is also accused of paying beneficiaries to be able to count them as patients, according to investigators.
One couple, who allegedly came to the supermarket, were told by Minerd that they could get $300 a month each and get nutrition, prescription vitamins and wheelchairs, Essayli said. He said they were not terminally ill.
The facility, Essayli said, has a no-kill discharge rate of about 85%, about five times the national average.
“If you go to the hospital, you will die there,” said Essayli. “You don’t have an 85% survival rate.
In another case, Nita Almuete Paddit Palma, 76, and her husband, Adolfo Catbagan, 68, are accused of operating fake hospices, including one that operated while Palma was out on bond in another fraud case.
“That’s how bad and daring some of these fraudsters are,” Essayli said.
The couple is accused of submitting at least $4.8 million in fraudulent claims between 2022 and 2024, even though they were barred from working at a hospice.
When announcing criminal activity and federal charges, Essayli and Oz also targeted political opponents, especially in California, Gov. Gavin Newsom and the administration of former President Biden.
“This is not just a fraud problem, this is a California problem and the federal government is the fund,” Essayli said during a news conference. “I call California a fraud state.”
Essayli accused the state of not vetting or vetting when granting hospice licenses.
“They don’t care because it’s not their money,” said Essayli.
However, the state accepted the announcement of a moratorium on issuing new hospice licenses, which comes after an investigation by the Los Angeles Times and a state study. It was recently extended until January 2027 after the state missed a deadline to enact new emergency rules for aged care facilities.
Oz, who came under fire earlier this year after posting a video accusing Armenian criminal groups of widespread fraud, continued Thursday to accuse officials in California and Los Angeles of not doing enough to fight fraud.
“Why would one-third of the nation’s terminally ill patients be in Los Angeles County?” said Oz. “You must be an unbeliever.
In 10 weeks, Oz said, federal officials have reduced intensive care units to 221 facilities.
In a series of posts on X, Newsom appeared to respond to these criticisms.
“The Trump Administration — home to the biggest fraudsters on Earth — is trying to blame California for problems with their federal system,” Newsom wrote in response to Vice President JD Vance’s comments about the state’s performance. “I’m glad to see the Fed is finally taking fraud seriously in the programs they manage themselves … 15 months after Trump took office.”
In another post, Newsom’s press office said the state has suspended more than 280 licenses in the past two years and is banning new licenses.
