Massive Crackdown: Feds Raid Over 100 Adult Daycare Centers in Sweeping Fraud Investigation

State and federal law enforcement agencies recently conducted a sweeping raid on more than 100 adult daycare providers across New York, a culmination of a monthslong investigation into alleged widespread Medicaid fraud. Governor Kathy Hochul announced the coordinated crackdown, which targeted facilities that offer daytime supervision, meals, social activities, and personal care services to seniors and adults with impaired cognitive function. New York currently operates over 400 such programs, serving 45,000 adults statewide at an annual cost exceeding $500 million.

While state officials did not provide a specific geographic breakdown, reports indicate that raids occurred in prominent New York City boroughs including Brooklyn, Queens, and Staten Island. These adult daycares are part of a federally authorized Medicaid service, overseen by the Centers for Medicare & Medicaid Services, and are available through the state’s Medicaid managed long-term care program. The extensive investigation involved more than a dozen federal, state, and local agencies, unfolding against a backdrop where the Trump administration had previously focused on healthcare providers suspected of fraud in mostly Democratic-leaning states.

Governor Hochul delivered the announcement during a separate news conference where she also revealed the arrests of 16 individuals suspected of involvement in auto insurance fraud. Her office highlighted the state Department of Health's long-standing efforts to improve oversight of these programs, including conducting numerous audits and investigations. Between 2021 and 2025, the state Office of the Medicaid Inspector General investigated 387 individuals connected to social adult daycare operations, forwarding approximately 100 cases to the state Attorney General's Office for potential prosecution, though the number of resulting convictions was not immediately disclosed.

Federal authorities have also pursued their own investigations into similar fraudulent activities. In one notable case, several individuals, including the owner of a center, were charged in a $68 million scheme to defraud Medicaid. This scheme involved paying kickbacks for services that were never actually provided at two Brooklyn adult daycares and a home healthcare company. Separately, federal prosecutors accused two Queens men of stealing more than $120 million from Medicare and Medicaid through a complex scheme involving a pharmacy and adult daycare centers.

In response to growing concerns over fraud and program integrity, the state Department of Health implemented a moratorium on new social adult daycare providers in July. Looking ahead, Governor Hochul announced that she is directing the Health Department to present options by the end of the year for implementing additional reforms, which could potentially include phasing out the adult daycare program entirely. Should the program be phased out, adults currently enrolled would be transitioned to other programs designed to support seniors. Governor Hochul affirmed that this joint effort between state and federal agencies to identify and confront fraudulent actors in New York builds upon years of dedicated efforts to enhance program oversight regulations.