Hospice Clustering Sparks Medicare Fraud Scrutiny

A three‑story office plaza in Los Angeles is home to 89 licensed hospice agencies, a number that raises eyebrows among regulators. The building, known as Merabi Professional Medical Plaza, hosts a mix of businesses—from a salon to a realty firm—yet the bulk of its tenants are hospice providers. State auditors flag this concentration as a red flag, noting that the number of agencies likely far outnumbers patients in need. In 2022, Los Angeles County saw a 1, 500% jump in hospice companies since 2010, making it six times denser than the national average for its elderly population. Investigations reveal that many of these agencies exhibit warning signs: low patient counts, high discharge rates for terminal patients, shared staff across firms, and excessive billing. CBS News found that 72 of the 89 agencies at Merabi Plaza show at least three such red flags. Federal regulators have visited the plaza multiple times between 2021 and 2025, uncovering nearly 400 violations across 75 companies. Reports include cases where patients received no care yet were billed, or medication records that did not match patient statements.The owner, Kambiz Merabi, acknowledges discrepancies between public records and his tenant list—claiming only 12 hospices currently occupy the building, while many have recently moved out. He argues that agencies are required to notify authorities of relocations, suggesting the gap may be administrative rather than fraudulent. Critics argue that these “ghost hospices”—paper companies that bill Medicare without providing services—threaten public funds. California’s Attorney General, Rob Bonta, has pledged to eliminate such fraud, while federal officials emphasize stricter payment checks. Despite the owner’s support for stronger oversight, questions linger about how many agencies are truly operational and whether Medicare reimbursements are being misused. The situation underscores the need for vigilant monitoring of clustered hospice providers to protect vulnerable patients and taxpayers alike.