The Department of Justice (DOJ) announced on Oct. 22 that it charged 15 people with healthcare fraud in California over a combined $2 billion in alleged fraudulent claims submitted to government and private healthcare programs.
The allegations include unnecessary medical procedures, illicit kickbacks, and hospice fraud, authorities said.
“California has a fraud problem,” Bill Essayli, First Assistant U.S. Attorney for the Central District of California, said. “I dubbed California the kingdom of fraud. Whether it’s hospice fraud or health care fraud or election fraud, California does fraud best. … California does nothing—nothing—to prevent fraudsters from getting money.”
California Gov. Gavin Newsom’s office responded to the announcement with a post on X.
“All but one of the cases announced today were regarding a FEDERAL program or PRIVATE insurance,” Newsom’s press office stated on Oct. 22 in a response to a post by FBI Director Kash Patel. “USDOJ acknowledged that state officials assisted in the one that was state related. Despite what you and your colleagues have claimed previously, California is holding fraudsters accountable (would have you suggest to the President not pardoning them—he has a habit of that).”
One major charge highlighted on Oct. 22 involved more than $1.6 billion billed in an alleged scheme to lure vulnerable individuals to California for sham substance abuse treatments that were never given to the patients. The DOJ said it was the largest case of its type that the department ever prosecuted.
Prosecutors allege that David Young, 71, and his son Nathan Young, 39, controlled dozens of treatment companies and used recruiters to lure vulnerable people with offers of free travel, housing, money, and drugs.
The operation allegedly favored patients with lucrative insurance policies, while others lived in crowded, unsanitary housing. Prosecutors say the Youngs recruited patients with free flights, money, apartments, hotel stays, cars, gift cards, marijuana, cigarettes, and illegal drugs.
Prosecutors allege the Youngs cycled patients through facilities regardless of medical need and encouraged some to use drugs to qualify for detox.
Purported therapy sometimes consisted of Zoom sessions with more than 100 attendees who were not required to participate beyond turning on their cameras, prosecutors allege.
The Youngs offered drugs to their patients, stopped them from communicating with family members, drugged patients who tried to leave, and physically blocked others from leaving, the DOJ said in a statement.
Attorneys for the Youngs did not respond to an email by The Epoch Times seeking comment.
California Attorney General Rob Bonta said in an X post on Oct. 22 that the state has filed felony charges against 103 in-home supportive services providers for allegedly defrauding the Medi-Cal program of $4.5 million.
“While the alleged fraud represents a small fraction of California’s $30 billion IHSS budget, any abuse of Medi-Cal jeopardizes funding for our most vulnerable residents,” Bonta said. “This statewide enforcement effort ensures the integrity of the IHSS program so that every individual who genuinely needs care receives it.”
In March, Newsom responded to claims of healthcare fraud in a post on X.
“This notion that [President Donald] Trump of all people is an anti-fraud crusader is complete BS — he was personally found legally liable for fraud!” Newsom said in the post. “California has been eliminating fraud for YEARS. In fact, the Feds consistently showcase the integrity of our Medicaid program to help other states!”
The Justice Department established the National Fraud Enforcement Division on April 7 to investigate and prosecute the theft or fraudulent misuse of taxpayer money. Its work supports Trump’s Task Force to Eliminate Fraud, chaired by Vice President JD Vance, which targets fraud, waste, and abuse in federal benefit programs.
Since 2007, the department’s Health Care Fraud Strike Force Program has charged more than 6,200 defendants who collectively billed federal healthcare programs and private insurers more than $45 billion. The program comprises nine strike forces operating in federal districts nationwide.
Correction: A previous version of this article misspelled California Gov. Gavin Newsom’s name in one instance. The Epoch Times regrets the error.
