An unassuming office building on a side street in Los Angeles is being called a “ground zero” example of suspected, widespread hospice care fraud underway in California.
The Merabi Professional Medical Plaza, a 32,000-square-foot, stucco and glass building in the Van Nuys neighborhood of the LA’s San Fernando Valley is reportedly the home to 89 licensed hospice companies.
Sheila Clark, a patient advocate working to expose fraud in the hospice industry, called the building a “ground zero” example of the financial exploitation of taxpayer-funded programs like Medicare and Medicaid.
The building and the state records of the companies located there were highlighted Thursday in the latest installment of an ongoing investigation by CBS News into hospice fraud in Los Angeles.
“This particular building I noticed, I’m like, ‘Dang, how can there be that many licensed and certified hospices in this tiny little building?’” Clark told CBS.
The attractive building is not a slum property. It is well kept and also houses a law office, a modeling agency, and a real estate company.
However, CBS reporter Adam Yamaguchi cited the building as the most “extreme” example in Los Angeles County of what investigators call “clustering,” which is the grouping of large numbers of hospice offices. Auditors consider that a major red flag for potential fraud.
According to CBS:
The address for Merabi Plaza appears dozens of times in state records for licensed hospice companies. Inside the building’s entry hall, a directory lists numerous hospice agencies that line the long-tiled hallways, although the building’s owner claims many are no longer there.
Clark said it makes “no sense” to find so many licensed and certified hospice company offices operating inside a single building. Auditors said the clustering of so many firms raised concerns because it suggests that “the number of agencies in these areas likely exceeds the number of patients who need services.”
“Clustering” was cited in a 2022 California State Auditor’s report, which back then even found one building had 150 licensed hospice and home health agencies — “a number that exceeds the structure’s apparent physical capacity.”
That report also found that Los Angeles County had experienced a 1,500 percent increase in hospice companies countywide since 2010.
“That’s six times more hospice providers than the national average relative to the county’s elderly population,” CBS reported.
As for the Van Nuys building, federal records show regulators visited multiple suites in Merabi Plaza between 2021 and 2025 and found nearly 400 violations at 75 companies, according to the network’s report.
They included reports of no one visiting a single patient, phony drug prescriptions, and services for patients that were alive and not suffering life-threatening conditions. Hospice companies bill Medicare and state programs like Medi-Cal for their services — programs funded by U.S. taxpayers.
Kambiz Merabi, the building’s owner, told CBS that officials from Medicare came to his building two years ago to conduct inspections on hospice companies.
Merabi said in order to rent, his tenants have to present documents that show they are a business.
“I’m not a police or keeper of what they do, how they do business,” Merabi told the network.
However, Merabi said his records show only 12 hospice companies operating in his building, with many of them having moved, presenting the possibility others could be “ghost hospices” that bill the government for payments without providing any actual care.
California Attorney General Rob Bonta, whose office is responsible for investigating the industry, told CBS that state hospice fraud rates were “unacceptable” and he was “committed to tackling the issue.”
Centers for Medicare and Medicaid Services Administrator Mehmet Oz recently remarked about rampant hospice fraud emerging in Los Angeles.
“I want to make it clear, we’re not going to pay you money just because you sent me a piece of paper with a bill on it. We’re going to check to make sure that’s legitimate, and that document is evidence that you actually performed something that’s helpful to the American people,” Oz said. “Or you’re not getting money from us.”
The owner of the Van Nuys building said he supports rooting out fraud and would evict any business committing it. But he said authorities have never informed him of such cases in his building.
“I’m all for it because at the end of the day, you and I are paying for all those things that are not right,” Merabi said.
Contributor Lowell Cauffiel is the best-selling author of the Los Angeles crime novel Below the Line and nine other crime novels and nonfiction titles. See lowellcauffiel.com for more.
