Risk & Compliance in California

California's Largest-Ever Medi-Cal Hospice Fraud Takedown — $267M State + $50M Federal Indictments Signal Enforcement Posture Shift

California DHCS and DOJ announced the largest-ever Medi-Cal hospice fraud takedown: 14 fraudulent hospice providers, $267M in improper claims, plus a parallel US Attorney (Central District) federal indictment of 8 defendants for $50M. No FQHCs named, but the signal matters: transnational criminal networks used stolen patient identities to enroll people in Medi-Cal — meaning FQHCs may see duplicate/fraudulent enrollees that trigger downstream eligibility disputes. DHCS is now investigating 300+ hospices. The House Oversight Committee has demanded documents from Gov. Newsom on hospice oversight. FQHCs should expect heightened DHCS audit activity and re-verify Medi-Cal eligibility at the point of service for 2026.

DOJ Federal Hospice Fraud Takedown: 8 Arrests, $50M Alleged Billing — Medi-Cal Enforcement Intensifies

U.S. Attorney's Office (Central District of California) announced an April 2 takedown — 8 defendants arrested for $50M in fraudulent hospice billing using stolen identities to enroll in Medi-Cal. Coordinated DHCS + DMFEA + federal action. State enhanced identity verification and multifactor authentication for Medi-Cal applicants in 2026. Over 300 hospices currently under DHCS investigation for license revocation. While hospice-specific, signals stepped-up Medi-Cal billing scrutiny across all enrolled providers — FQHCs should review identity verification, beneficiary attestation, and billing documentation.

DHCS Files Formal H.R. 1 Implementation Plan with California Senate — Authoritative Timeline for All Medi-Cal Changes

DHCS filed a formal implementation plan with the California Senate Budget and Fiscal Review Committee detailing how California will implement H.R. 1's Medicaid provisions. The document lays out the exact timeline: asset test reinstatement (Jan 2026), enrollment freeze (Jan 2026), dental benefit elimination for undocumented adults (July 2026), 6-month redetermination cycles (Dec 2026), work requirements (Jan 2027), and copayment implementation (Oct 2028). This is the authoritative state-level planning document FQHCs need for operational preparation.

California DHCS Launches FQHC Billing Compliance Review Initiative

The California Department of Health Care Services announced a targeted billing compliance review for 50 FQHCs in 2026, focusing on PPS encounter documentation, Medi-Cal managed care billing accuracy, and UIS patient service tracking ahead of the July 2026 PPS elimination for UIS patients. FQHCs must ensure documentation standards meet both HRSA and DHCS requirements. Reviews will examine 24 months of billing data with particular attention to ECM and Community Supports claims.