California officials dismantle $267M hospice fraud network, 21 suspects charged

Story by Iman Palm 

California officials, including Gov. Gavin Newsom and Attorney General Rob Bonta, announced charges against 21 suspects and the dismantling of a large‑scale hospice fraud scheme that allegedly stole $267 million from the state’s Medi‑Cal program.

The investigation, known as Operation Skip Trace, resulted in the arrest of five people after searches of 10 locations in Southern California. In addition, two handguns and over $757,000 in cash were seized. 

DOJ filed three criminal complaints charging 21 defendants with conspiracy to commit health care fraud, health care fraud, money laundering, and identity theft. Prosecutors also added aggravated white‑collar crime and aggravated money‑laundering enhancements.

“This isn’t a political game for us. This is about protecting taxpayer dollars, protecting the programs that sick and vulnerable Californians rely on, and protecting our state,” Bonta said in a statement. “Over the life of this fraud scheme, not a single legitimate hospice service was ever provided, yet millions were billed in a brazen, calculated scheme that exploited the Medi-Cal system. This wasn’t a mistake or a loophole; it was deliberate fraud.”

The California Department of Justice launched the investigation after receiving a credible fraud allegation from the Department of Health Care Services.

According to investigators, the suspects purchased personal information for non‑California residents on the dark web and used those stolen identities to enroll individuals in Medi‑Cal through Covered California.

Authorities say 14 hospice companies were then purchased using straw owners, and billers submitted claims for hospice services that were never provided. The fraudulent billing totaled approximately $267 million.

During Bonta’s tenure, the DOJ conducted 294 hospice‑related investigations, filed 119 criminal cases, and secured 51 convictions tied to hospice fraud.

State officials urged families to watch for warning signs.

• The patient isn’t receiving regular visits from nurses, aides or caregivers.
• Medication, equipment or other promised services are missing.
• Scheduled visits are frequently missed or occur at unusual or inconsistent times.
• The hospice team rarely checks in or is difficult to reach.
• The patient does not appear to have a life‑limiting illness.
• The patient can still perform most daily activities without major changes.
• There is no clear diagnosis explaining why hospice was recommended.
• The patient or family never received a clear explanation that hospice is end‑of‑life care.
• Hospice services began without a referral or explanation from the patient’s regular doctor.
• Someone offered gift cards, groceries or cash in exchange for signing up.
• The offer came from someone unfamiliar or seemed “too good to be true.”
• The patient has remained in hospice longer than six months with no updates or discussion.
• There is no clear care plan or communication about next steps.
• Staff appear rushed, unprofessional or poorly trained.
• Bills or Medi‑Cal statements do not match the care being provided.
• The patient or family feels pressured to stay enrolled.

How to protect yourself from hospice fraud

• Know the purpose: Hospice is intended for patients with terminal illnesses nearing end of life.
• Consult your doctor: Always speak with the patient’s regular physician before agreeing to hospice care.
• Watch for red flags: Be cautious of services offered without a referral or providers offering incentives.
• Ask questions: Legitimate hospice agencies will clearly explain services, billing and care plans.
• Verify providers: Use licensed, accredited hospice agencies and review their credentials.
• Understand your benefits: Know what Medi‑Cal or insurance covers to help spot false charges.
• Keep records: Document all care and compare it with insurance statements.
• Report concerns: If something feels wrong, report it immediately.

How to report suspected hospice fraud

• Online: https://oag.ca.gov/dmfea/reporting
• Phone: DOJ Division of Medi‑Cal Fraud & Elder Abuse Complaint Line, (800) 722‑0432
• Mail: California Department of Justice Division of Medi‑Cal Fraud & Elder Abuse P.O. Box 944255 Sacramento, CA 94244‑2550 

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California officials dismantle $267M hospice fraud network, 21 suspects charged

Seven Arrested for Hospice Fraud in Monterey County

Posted on February 6, 2026

“The California DOJ Division of Medi-Cal Fraud and Elder Abuse works, in part, to protect tax payer funds as they pertain to programs such as Medi-Cal.  Protecting these programs from fraud means funds will be available for those who need it.”

CSLEA President Alan Barcelona

MONTEREY COUNTY — On February 5, 2025, California Attorney General Bonta announced the arrests of, and filing of multiple felony charges against, seven individuals for hospice fraud in Monterey County. Among the individuals arrested is the owner of Compassionate Touch Hospice and Spiritual Touch Hospice, two co-owners of Fountain Hospice, three doctors, and one nurse. The arrest and charges are the result of investigations by the California Department of Justice (DOJ) and the U.S. Department of Health Service Office of the Inspector General.
 
“Abusing systems meant to support Californians, and putting profits before people and their families won’t be tolerated,” said Bonta.
 
California DOJ received a referral from the California Board of Registered Nursing after fraudulent activity was discovered and associated with Spiritual Touch Hospice and Compassionate Touch Hospice. The California DOJ Division of Medi-Cal Fraud and Elder Abuse’s (DMFEA) multi-year investigation revealed a sophisticated conspiracy to defraud Medi-Cal and Medicare and allegedly involved the owners, doctors and nurses of Spiritual Touch Hospice, Compassionate Touch Hospice, and Fountain Hospice. The defendants owned, operated, or worked for the three hospice companies simultaneously.  It is alleged they recruited, enrolled, and certified patients for hospice services who did not suffer from a terminal diagnosis. Some of these patients did not know hospice was intended for patients who were terminally ill, or that they were even enrolled in hospice. To avoid suspicion, the defendants allegedly transferred several patients between the three companies after six months and continued fraudulently billing for hospice services.
 
The total loss to Medi-Cal and Medicare is $3,211,419.79. On January 30, 2026, DMFEA filed felony charges in Monterey County Superior Court against:

• Nimfa Molina (Head Nurse),
• Luis Artavia (Medical Director),
•  Mark Samonte (Medical Director),
• Shomir Banerjee (Medical Director),
• Danny Lodevico (Owner),
• Flor Mora (Owner), and
• Christine Nugiud-Yem (Owner)

 alleging violations of false or fraudulent claims, conspiracy to commit a crime, with an aggravated white-collar enhancement.
 
The DMFEA is a California Department of Justice unit whose mission is to protect citizens and the state’s medical program from those who defraud taxpayers and divert state health care resources. The investigation would not have been possible without the collaboration of government agencies and those who reported the incidences of Medi-Cal fraud.

It is important to note that a criminal indictment contains charges that are only allegations against a person. Every defendant is presumed innocent until proven guilty.

A copy of the complaint can be found here.  

Full Article & Source:
Seven Arrested for Hospice Fraud in Monterey County