Every elderly person who loses access to care in rural America is paying the price for the criminals who exploited Medicare in Los Angeles.
Los Angeles County currently accounts for nearly 10% of all Medicare home health spending, or about $1.5 billion each year. Payments per patient are nearly five times the national average. These inflated numbers distort the way the Centers for Medicare and Medicaid Services (CMS) sets national payment rates.
CMS uses national data to determine reimbursement, so higher charges from one region drive down rates in other regions. In places like upstate New York, where costs are honest and profit margins are tight, compliant home health care providers are paid less than the actual cost of care. As a result, there are fewer agencies and caregivers, and fewer seniors have access to 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 centers of Medicare fraud. The Department of Justice, HHS, and even ICE have documented systematic schemes involving shell companies, ghost patients, and international money laundering organizations.
To combat this crisis, I recently sent a letter to CMS asking them to take immediate action. We called on authorities to quickly address fraudulent claims and correct data before proceeding with the proposed payment changes. Our message was simple. The idea is to crack down on places where fraudulent activity is occurring, so that law-abiding providers who provide services to seniors in good faith are not punished.
The data tells an alarming story. One doctor associated with hundreds of home health agencies billed Medicare nearly $600 million from 2021 to 2024, including $200 million in 2024 alone. 95% of these payments were concentrated in Los Angeles County. The physician's Medicare patient volume has tripled in just three years, but the network's connected institutions report no Medicare Advantage revenue. This suggests active patient recruitment rather than legitimate post-discharge care.
Across the Los Angeles metropolitan area, there are currently hundreds of “paper” agencies registered to the same address, some using Gmail or Yahoo accounts on their official applications. One address in Van Nuys is home to more than 500 home health agencies and more than 200 hospices, many of which have long been flagged by law enforcement. These are clear red flags that federal regulators should have noticed. Instead, the Biden administration ignored them and an organized network stole hundreds of millions of taxpayer dollars.
In 2026, CMS plans to reduce home health care costs by an additional 6.4%, on top of the nearly 9% reduction already in place since 2023, totaling more than $1 billion in home health care cost savings. These cuts will make it nearly impossible for small local agencies in upstate New York to keep their doors open.
The impact is already visible. Since 2020, 2 million fewer Medicare beneficiaries receive home health services, and nearly a quarter of home health agencies in the United States have closed. In my district, home health care utilization has decreased by 39 percent, leaving approximately 26,000 seniors without access to doctor-prescribed care. Almost half of patients referred for home care last year were unable to receive home care. This means more hospital readmissions, more emergency department visits, and more preventable deaths. CMS' own data shows that patients without access to home health care are 36 percent more likely to be readmitted to the hospital, 16 percent more likely to end up in the emergency room, and 43 percent more likely to die.
Veterans and seniors in my district built this country and have spent their lives relying on Medicare to ensure access to reliable health care. Every fraudulent claim paid is money stolen from them and future generations who depend on Medicare's promises.
CMS has the authority to act immediately. The agency could freeze payments to questionable providers, recertify all home health and hospice agencies operating in Los Angeles County, and temporarily suspend new registrations in California until the issue is resolved. You can take these targeted steps today to protect taxpayers' money and restore confidence in the system.
Medicare home health benefits are one of the most compassionate and cost-effective parts of our health care system. This will allow older Americans to recover safely at home, reducing hospital readmissions and nursing home admissions and saving taxpayers nearly $1 billion annually. For every dollar taken by scammers or withheld from legitimate providers, seniors are forced into more expensive and less personal care settings.
The solution is simple. It's about fighting fraud, fixing data, and protecting access to care for seniors. CMS must correct the underlying data that informs payment decisions that may adversely impact access to care for older adults. The future of Medicare and the dignity of the millions of Americans who depend on it depend on it.
Posted by: Rep. Claudia Tenney, RN.Y.
