Medicaid: A System Built for the Vulnerable, Hijacked by Fraud and Abuse

Let’s be clear from the very first line: I am not accusing anyone who sacrifices their own income to care for an ill child, parent, or relative of fraud. Many families legitimately rely on support from Medicaid when caregiving forces them to reduce or leave regular employment. Those people deserve help.

But alongside the legitimate cases, there is a massive amount of fraud and the system is being exploited on an enormous scale.

A newly released federal data trove shows how Medicaid’s “personal care” waivers have quietly turned into a loophole where people can get paid by the government simply for spending time with their own family members. In states like California, Medicaid reimburses “homemaking,” “chores,” and even “companionship & conversation,” performed by relatives. California spends billions of dollars on In Home Supportive Services each year and it is now the majority of medicaid spending. Unions like SEICU have negotiated higher pay rates for IHSS. I see them lobbying for more money at every single Santa Clara Co Board Of Sups meeting I have ever been to.

Because these services happen inside private homes, there is almost no oversight. No one can verify whether the visits occurred or what was done. Yet Ohio alone billed $1 billion for home‑care services in 2024.

As word spread that the government would pay people to hang out with their own families, parts of Columbus saw an explosion of home‑health companies, thousands of nearly identical LLCs, many with no staff present, all authorized to bill Medicaid. One office building housing 94 such companies billed taxpayers $66 million in just a few years.

Public records show many owners have histories of unpaid taxes, failed businesses, or criminal convictions. Some companies appear to launch with a full roster of clients on day one, despite no advertising or public presence. The model is simple: a relative becomes an “employee” of a home‑health company and bills Medicaid for caring for their own parent or sibling. The only witness is the family member benefiting from the arrangement.

Because the program has no spending cap and only requires a doctor’s signature, a single willing provider can generate unlimited taxpayer liability.

The result is a parallel economy built on Medicaid billing with little transparency, minimal oversight, and enormous potential for abuse. The data suggests billions of federal dollars are flowing not to vulnerable patients, but to people and companies who have figured out how to turn a safety‑net program into a cash machine. Let's clean up the fraud! Hard working tax payers deserve accountability for where our money is going.

When fraudsters exploit a program meant for the truly vulnerable, they don’t just steal money, they weaken the entire safety net for the people who genuinely depend on it.”