House Oversight Committee Chairman James Comer (R-Ky.) officially launched an investigation into "rampant taxpayer fraud" within California’s hospice programs on Tuesday, March 24, 2026.
Citing findings from independent journalist Nick Shirley, Comer suggested that the scale of corruption in the Golden State could be ten times worse than the recent scandals uncovered in Minnesota.
"You could multiply what we found in Minnesota probably by 10 in California,"_ Comer told Fox News, adding a direct warning to Governor Gavin Newsom: _"Lawyer up."
The federal investigation currently stands as a primary challenge to California’s fiscal oversight.
Its primary mandate involves investigating how 18% of the entire U.S. hospice budget was billed out of a single county, Los Angeles, despite it representing only a fraction of the national population.
Republicans on the committee allege that "shell" hospice companies have been billing Medicare and Medi-Cal for patients who aren't terminally ill or, in some cases, don't exist at all.
The probe will also absorb and expand upon the friction between the Governor’s office and independent investigators.
A critical component of the tension is the work of Nick Shirley, whose viral videos show "hospice offices" located in abandoned buildings and daycare centers.
While Newsom’s press office has attempted to discredit Shirley by posting altered photos of him, the journalist pushed back on social media, stating, "Start working for the people and not against them."_ _
One Oversight official cited the "brazen nature" of these fraudulent storefronts as the primary driver for the committee's subpoenas.
One of the most immediate challenges for the Newsom administration is defending its existing anti-fraud measures.
Observers cited the 2021 moratorium on new hospice licenses as the primary defense used by the Governor’s office.
“California took decisive action on hospice fraud years ago,” a spokesperson for Newsom stated, noting that over 280 licenses have been revoked in the last two years.
However, Comer argues these measures have been "woefully insufficient" given the billions still flowing to "bad actors."
The establishment of a "Hospice Fraud Task Force" by the state remains a point of contention, as federal lawmakers believe state agencies have been too slow to coordinate with the Department of Justice.
While the Labor Department has already deployed a "strike team" to California over separate $21 billion unemployment fraud concerns, the emphasis has now shifted to the medical sector.
Director-level investigators at the House Oversight Committee pledged to call whistleblowers to testify in the coming weeks.
As the political temperature rises between Washington and Sacramento, the question remains: “Will the federal probe uncover a systemic failure in California’s licensing department, or will Newsom's task force prove that the state was already cleaning house?” a question that will be central to the upcoming congressional hearings.