US health official says California sees $3.5B in medical fraud, points to foreign criminals

By Asiye Latife Yilmaz

ISTANBUL (AA) - Dr. Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, said California has recorded $3.5 billion in medical fraud, attributing much of the increase to foreign influences, particularly Russian or Armenian individuals linked to the mafia or criminal gangs.

“L.A. County has become an epicenter for health care fraud in America,” Oz said on Tuesday on the US social media company X. “Criminals have corrupted the system so much that fraud is now almost expected.

He pointed out the rising number of care facilities in the city, suggesting that fraud may be driving this rapid growth.

Oz blamed foreign criminals, likely Russian or Armenian, for corrupting doctors and defrauding California’s medical system by enrolling ineligible patients in hospice care and billing for services not provided. Oz claims the scale of fraud in California far exceeds that in Minnesota.

Oz said he has instructed Governor Gavin Newsom to submit a comprehensive program integrity action plan within the next three weeks to address major fraud in California’s healthcare system.

He cited widespread California healthcare fraud with in-home services spending rising from $8 billion to $28 billion, home health costs surging by 21% in 2024 with Los Angeles overspending $1.4 billion, and hospice agencies in LA growing by 1,500% since 2010 with many reporting implausible survival rates.

“I'm hearing horror stories from seniors duped by these fraudsters because California is not stopping these criminals. Governor Newsom, the clock is ticking on the deadline for your comprehensive program integrity action plan. Start saving American lives instead of enabling criminals,” Oz added.

Newsom’s press office fired back at Oz in a post on X, saying: “Amazing to watch Dr. Oz cosplay as a fraud fighter for an effort the STATE launched years ago -- back when he was busy pitching “miracle” horse supplements to insomniacs on late-night TV.”

The statement added that Newsom has banned all new hospices beginning in 2022 and revoked more than 280 licenses.

Oz later responded by saying that Californians deserve more than “this defensive acknowledgment that you’ve known about the rampant fraud in your state for years but haven’t done much about it,” adding that he can help get California back on track.