California Hospice Operator Reveals Uncomfortable Truth About Industry Fraud Claims

While federal investigators claim billions in Medicare fraud are hemorrhaging from California’s hospice industry, one Los Angeles operator is challenging the narrative—and his insider perspective exposes a crisis of government incompetence that dwarfs any private sector wrongdoing.

Kevin Tutunjian didn’t mince words when confronting the elephant in the room: Sacramento created this mess.

The founder of In the Arms of Grace Hospice and longtime board member of the California Hospice and Palliative Care Association laid the blame squarely where it belongs—at the feet of state bureaucrats who rubber-stamped thousands of hospice licenses, then turned around and accused the industry they enabled of systematic fraud.

“Why did we issue so many licenses and then turn around and say, look how many hospices there are—they’re all committing fraud,” Tutunjian demanded, exposing the circular logic that defines California’s regulatory dysfunction.

The numbers tell a damning story of government failure.

California has issued licenses to 2,836 hospice agencies. Over 1,800 operate in Los Angeles County alone. New York has 43. Florida has 44.

By 2019, Los Angeles County had six times the national average of hospice agencies relative to its elderly population. This isn’t organic market growth—this is regulatory negligence on an epic scale.

The Fraud Question Nobody Wants to Answer

Tutunjian acknowledged fraud exists. He’s not naive about bad actors exploiting the system.

But he directly challenged the billions-of-dollars narrative being peddled by federal investigators, questioning whether authorities have any real grasp of the problem they claim to be solving.

“Blatant fraud is someone who just bills Medicare without the individual knowing. That is one thing,” Tutunjian explained. “But there are organizations trying to do the right thing, but maybe they just are ill-equipped to deliver quality care for whatever reason.”

That distinction matters enormously—yet federal officials and their media cheerleaders deliberately conflate incompetence with criminality to inflate their numbers and justify expanded bureaucratic power.

Too Little, Too Late From Newsom

Governor Gavin Newsom finally signed legislation in 2022 imposing a moratorium on new hospice licenses.

Classic progressive governance: ignore a problem for years, let it metastasize, then impose blunt-force regulation after the damage is done.

Tutunjian, who operates a legitimate community-based hospice founded in 2011, said the timing reveals everything wrong with California’s approach. By the time Newsom acted, the state had already created the perception of an industry drowning in fraud.

“I think if you came here like five years ago, maybe that would have been appropriate. But I think now it might not be the same,” he said, specifically distinguishing hospice care from the home health sector where problems may be more severe.

The Real Solution: Empower Consumers, Not Bureaucrats

Rather than empowering yet another army of government investigators, Tutunjian proposed something radical by California standards: educating citizens to make informed choices.

Families should demand accreditation. They should ask about quality and compliance programs. They should inquire about volunteer programs, bereavement care, and specialty services.

“Do they have a volunteer program? Do they have a bereavement care program? All of this is essential in evaluating the quality of a program,” Tutunjian said. “It goes back to educating the public and the consumer on the right questions to ask.”

Imagine that—empowering Americans to evaluate service providers themselves rather than trusting the same government apparatus that created the licensing disaster in the first place.

Including Industry Voices in Reform

As Dr. Oz escalates his investigation into California’s health sector, Tutunjian issued a reasonable demand: include the people who actually operate in this industry when crafting solutions.

“Providers and stakeholders need to be at the table, we need to be a part of the conversation, and we need to be a part of the solution,” he insisted.

This shouldn’t be controversial. The people delivering end-of-life care day in and day out understand the operational realities better than Washington bureaucrats flying in to score political points.

The hospice fraud scandal is real, but it’s fundamentally a government-created crisis. State regulators flooded the market with licenses, federal oversight proved inadequate, and now legitimate operators like Tutunjian face suspicion because Sacramento couldn’t perform its most basic function.

Real reform requires acknowledging that uncomfortable truth—something California’s political class has shown zero interest in doing.