President Trump has shifted his fraud cleanup blitz to California, pitting Vice President J.D. Vance, his new fraud czar, against Gov. Gavin Newsom.
Mr. Newsom, a Democrat positioned to run against Mr. Vance in the 2028 presidential race, lashed out at the vice president after the Justice Department announced that it had arrested a group of health care workers accused of bilking Medicare of $50 million in fake hospice care.
The sting operation was conducted in coordination with the new White House fraud task force, headed by Mr. Vance, who announced the raid on social media.
“Our task force isn’t wasting any time cracking down on fraud,” Mr. Vance said.
Mr. Newsom, who ranks near the top in 2028 Democratic presidential polls, posted a statement on social media belittling Mr. Vance’s announcement.
The Trump administration, the governor said, is “home to the biggest fraudsters on earth.” He said he is “glad to see the Feds finally taking seriously the fraud in the programs they themselves manage … only 15 months after Trump took office.”
Mr. Newsom has long claimed that Mr. Trump’s accusations of massive fraud in California are “baseless” and politically motivated.
The governor is gearing up to battle his likely 2028 presidential rival over the task force’s fraud sting in California.
Mr. Vance is leading by double digits in every poll of prospective Republican presidential candidates. Within two years, he could be battling Mr. Newsom for the White House and promoting his fraud cleanup in the Golden State.
Mr. Newsom is framing himself as a fraud warrior in the face of the Trump administration investigation. He has launched a state-run “Stop Fraud” website that serves as a portal for reporting fraud but mostly promotes Mr. Newsom’s actions that, according to the governor, have cut billions of dollars in fraudulent spending in the state, long before Mr. Vance stepped into his new role.
The website blamed the Trump administration for COVID-19-related unemployment fraud and highlighted ongoing fraud problems in Republican-led states, including Texas and Wyoming.
Instead of a photo of Mr. Newsom, the Stop Fraud website features a gloomy image of Mr. Trump. It labels the president “the king of fraud, pardoning criminals and promoting self-dealing corruption.”
Mr. Newsom faces what will likely be a protracted battle over fraud messaging with Mr. Vance and the Trump administration.
Mr. Trump celebrated the fraud-related arrests in Los Angeles and said Mr. Vance’s role as fraud czar “will be a major factor in how great the future of our country will be.”
Much of the fraud task force’s focus, Mr. Trump said, “will be in those blue states where CROOKED DEMOCRAT POLITICIANS, like those in California, Illinois, Minnesota (Somalia beware!), Maine, New York and many others have had a ‘free for all’ in the unprecedented theft of taxpayer money.”
Investigators said California fraud involving federally funded programs may be far more extensive than anywhere else in the United States.
Rep. James Comer, Kentucky Republican and chairman of the House Oversight and Government Reform Committee, recently launched an investigation into California’s fraud. He said the state’s problem may be 10 times worse than the $9 billion in federal fraud uncovered in Minnesota.
An investigation published last week by Christopher Rufo, a senior fellow at the Manhattan Institute, found that California’s fraud could amount to at least $180 billion.
“From unemployment insurance and Medicaid to failed homeless initiatives and welfare programs, seemingly every state program has been compromised by criminals,” Mr. Rufo said.
Mr. Newsom’s press team said the governor has taken steps to crack down on hospice fraud and to arrest criminals and hold them accountable.
A spokeswoman for the governor said there is no evidence of massive fraud in California.
“This is utter bulls—- from top to bottom. California will keep doing its part to go against fraud. We ask the federal government to work with us to do the same,” spokeswoman Diana Crofts-Pelayo said.
Justice Department officials in Los Angeles recently announced the arrests of eight people, including three nurses, a chiropractor and a psychologist, in an alleged scheme involving tens of millions of dollars in claims, mostly for hospice services for people who were not terminally ill.
One of the people charged is Lolita Beronilla Minerd, a 65-year-old licensed vocational nurse who operated a hospice care company that submitted more than $9 million in fraudulent hospice claims to Medicare.
Two others charged, 66-year-old psychologist Gladwin Gill and his wife, Amelou Gill, a 70-year-old registered nurse, are accused of paying illegal kickbacks for patient referrals for hospice services that were not medically necessary. The couple received more than $4 million for the fraudulent claims and spent the money on mortgage payments, car payments, international flights and restaurants, Justice Department officials said.
Hospices typically discharge fewer than 18% of patients, but Ms. Minerd’s company discharged about 85%.
Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, estimated that half of the approximately 1,800 hospices in the Los Angeles area were fraudulent.
Some of the hospices had survival rates of nearly 100%, Dr. Oz said.
“Certainly, if you have a survival rate of over 50% for a population that’s supposed to have passed in six months, you’ve got a problem,” he said.
Contact the author
Please read our comment policy before commenting.