#297 Nick Shirley - Inside California’s $222 Billion Medi-Cal Crisis
Independent journalist Nick Shirley discusses his investigations into California's Medi-Cal fraud, which has ballooned from $108 billion in 2022 to a proposed $222 billion budget in 2026 despite minimal population growth. He exposes hospice fraud run by Armenian and Russian mafias in LA County, California voter registration vulnerabilities, the homeless industrial complex, and shares his meeting with Elon Musk after his Minnesota fraud exposé went viral.
Summary
Nick Shirley, a 23-year-old independent journalist, returns to discuss his ongoing fraud investigations, this time focused on California after his earlier work exposing billions in Minnesota daycare and food program fraud. He explains that after Minnesota, he faced serious death threats from Somali groups and pivoted briefly to California election fraud before diving into hospice fraud.
On Medi-Cal fraud, Shirley reveals that California's Medicaid program (called Medi-Cal) had $108 billion allocated in 2022 for 39.9 million enrollees, but the proposed 2026 budget has ballooned to $222 billion for 40 million enrollees — more than double the spending for virtually the same population. He argues this massive increase, combined with California's shift from a $100 billion surplus before 2020 to a $20-40 billion deficit, points directly to systemic fraud.
The hospice fraud scheme works by stealing Medicare beneficiary numbers from elderly patients and secretly enrolling them in hospice programs without their knowledge. Since hospice is end-of-life comfort care rather than curative care, enrolled patients can be denied surgeries and other medical procedures, potentially causing deaths. Shirley found that one-third of all hospices in America are located in LA County, with buildings in areas like Van Nuys housing up to 89 separate hospice businesses — many with empty offices, a single desk, and luxury cars in the parking lot belonging to fraudsters. Armenian and Russian organized crime groups are heavily involved, and Shirley reveals that the Russian mafia made a threatening phone call to his mother warning him to stop investigating.
On voter fraud, Shirley demonstrates that California requires no voter ID — voters only need to state their name and sign a ballot. He highlights voter rolls containing people listed as 126 years old, registrations tied to UPS boxes, and a Republican woman who successfully registered her dog to vote, with the dog's vote counting in one election before the owner turned herself in. He also discusses Minnesota's vouching system, which theoretically allows one person to vote on behalf of others.
Shirley also investigates California's homeless industrial complex, arguing that NGOs receiving government funding are financially incentivized to perpetuate homelessness rather than solve it. Some NGOs have accumulated half a billion dollars in assets by purchasing hotels and apartment complexes, often billing the government $1,800/month for apartments where tenants pay only $30. He contrasts this with his personal action of paying out-of-pocket to house a homeless mother and child he found on Skid Row, who were subsequently placed in permanent housing within three days — something well-funded NGOs had failed to do.
Shirley also discusses his viral Minnesota video, which accumulated 4 billion views across all platforms and was reportedly the most viral video ever on X. He describes meeting Elon Musk at X headquarters, where they discussed government incompetence in fighting fraud, suppression of free speech, and the potential consequences of increasing government oppression. Within the same 72-hour period, Shirley also met with Vice President JD Vance, who credited Shirley as a major reason for the creation of a new inter-agency fraud task force. Vance is leading this effort to get Treasury, HHS, and other departments to share information and coordinate on fraud cases, which previously operated in silos.
Key Insights
- Shirley claims California's Medi-Cal budget more than doubled from $108 billion in 2022 to a proposed $222 billion in 2026, despite enrollment growing only marginally from 39.9 million to 40 million people — a population increase that does not justify the spending surge.
- Shirley argues that one-third of all hospices in the United States are located in LA County, and that one in every $10 for home healthcare nationally flows to LA County, suggesting extreme geographic concentration of fraud.
- Shirley found buildings in Van Nuys, California housing up to 89 separate hospice businesses under one roof, with empty or near-empty offices and luxury vehicles like Maybachs and G-wagons in the parking lots belonging to the operators.
- Shirley explains the hospice fraud mechanism: fraudsters steal Medicare beneficiary numbers, secretly enroll victims in hospice without their knowledge, and then bill Medi-Cal for services never rendered — while victims may be denied surgeries or emergency care because they appear to be in end-of-life care.
- Shirley reveals that the Russian mafia called his mother to warn him to stop investigating their hospice fraud operations, a threat he describes as more sophisticated and dangerous than the public threats he faced from Somali groups in Minnesota.
- Shirley argues that California's voter registration system, which requires no ID and only a signature for verification, allowed a Republican woman to register her dog under its own name, and the dog's vote counted in one election before the owner self-reported.
- Shirley claims that in Minnesota, voters can legally vouch on behalf of other individuals at polling places with no ID requirement, creating a system he argues is easily exploited for fraudulent voting.
- Shirley contends that California NGOs focused on homelessness are financially incentivized to perpetuate the problem — some have accumulated up to half a billion dollars in assets by purchasing hotels and apartment complexes while billing the government far above market rates, with $24 billion reportedly going unaccounted for in California in recent years.
- Shirley states that New York City spends $81,000 per homeless person annually — exceeding the median household income in the city — yet homelessness has not meaningfully declined, which he uses to argue the money is not reaching its intended purpose.
- Shirley claims his Minnesota fraud exposé became the most viral video in X's history, accumulating 4 billion views across all platforms within seven days, and that JD Vance personally told him he was 'one of the main reasons' a new inter-agency fraud task force was created.
- Shirley argues that the new federal fraud task force is significant because previously agencies like Treasury and HHS did not share information with each other, allowing fraudsters to exploit the gaps between siloed government departments.
- Shirley contends that Gavin Newsom's claimed crackdown on hospice fraud — signing a moratorium and publicizing enforcement actions — failed to 'stop the bleeding,' as evidenced by a 1,000% increase in hospice facilities in LA County and the continued operation of fraudulent facilities he personally visited.
Topics
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