Every senior who loses access to care in rural America is paying the price for criminals exploiting Medicare in Los Angeles.
Los Angeles County now accounts for nearly ten percent of all Medicare home health spending, or about 1.5 billion dollars each year. Payments per patient there are almost five times higher than the national average. Those inflated figures distort how the Centers for Medicare and Medicaid Services (CMS) sets payment rates for the entire country.
Because CMS uses national data to determine reimbursement, inflated billing from one region drives down rates everywhere else. Law-abiding home health providers in places like upstate New York, where costs are honest and margins are tight, are being paid less than what care actually costs. The result is fewer agencies, fewer caregivers, and fewer seniors getting the skilled help they need at home.
Parts of Los Angeles County, once represented in Congress by President Biden’s Health and Human Services Secretary Xavier Becerra, have become a hub for Medicare fraud. The Department of Justice, HHS, and even ICE have documented organized schemes involving shell companies, ghost patients, and international money-laundering rings.
To confront this crisis, I recently sent a letter to CMS urging immediate action. We called on the agency to swiftly address the fraudulent billing and to correct the data before moving forward with their proposed payment changes. Our message was simple: step up enforcement where the fraud is happening so that the law-abiding providers serving seniors in good faith aren’t punished.
The data tells a disturbing story. One physician connected to hundreds of home health agencies billed nearly six hundred million dollars to Medicare between 2021 and 2024, including two hundred and ten million in 2024 alone. Ninety-five percent of those payments were concentrated in Los Angeles County. That doctor’s Medicare patient count tripled in just three years, yet the agencies tied to this network reported no Medicare Advantage revenue, suggesting active patient recruitment rather than legitimate post-hospital care.
Entire blocks in Los Angeles are now home to hundreds of “paper” agencies registered to the same addresses, some even using Gmail or Yahoo accounts in official filings. One address in Van Nuys hosts more than five hundred home health agencies and over two hundred hospices, many long flagged by law enforcement. These are obvious red flags that federal regulators should have caught. Instead, they were ignored by the Biden Administration while organized networks stole hundreds of millions of taxpayer dollars.
In 2026, CMS plans to reduce home health payments by another 6.4 percent, totaling more than one billion dollars, on top of nearly nine percent in cuts already implemented since 2023. These reductions would make it nearly impossible for small and rural agencies in upstate New York to keep their doors open.
The consequences are already visible. Since 2020, two million fewer Medicare beneficiaries are receiving home health services, and nearly one in four home health agencies across the country have closed. In my district, home health use has fallen by thirty-nine percent, and nearly twenty-six thousand seniors have been unable to access the care prescribed by their doctors. Nearly half of all patients referred to home health last year went without it. That means more hospital readmissions, more emergency room visits, and more preventable deaths. CMS’s own data show that patients who cannot access home health are thirty-six percent more likely to be readmitted, sixteen percent more likely to end up in the emergency room, and forty-three percent more likely to die.
Veterans and seniors in my district built this country and have spent their lives paying into Medicare for the promise of access to trustworthy care. Every fraudulent claim paid is money stolen from them and from future generations who will depend on Medicare’s promise.
CMS has the authority to act now. The agency can freeze payments to suspect providers, revalidate every home health and hospice agency operating in Los Angeles County, and temporarily halt new enrollments in California until the problem is addressed. These targeted steps can be taken today to protect taxpayer dollars and restore confidence in the system.
The Medicare home health benefit is one of the most compassionate and cost-effective parts of our health system. It allows older Americans to recover safely at home and saves taxpayers nearly a billion dollars a year by reducing hospital readmissions and nursing home placements. Every dollar taken by fraudsters or withheld from legitimate providers forces seniors into higher-cost, less personal care settings.
The solution is straightforward: confront the fraud, correct the data, and protect seniors’ access to care. CMS must fix the underlying data informing payment decisions that could negatively impact seniors’ access to care. Medicare’s future, and the dignity of millions of Americans who rely on it, depend on it.
By: Rep. Claudia Tenney, R-N.Y.
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