Whistleblower: Indiana health system endangered babies for profit

Former hospital medical director alleges that poor pregnant women got subpar treatment because of a billing fraud scheme

INDIANAPOLIS – At 2 years old, Denise Koger can mutter sounds and gurgle noises, but she can't speak or stand on her own. The toddler – with a few dozen mini blond braids woven around her head – gets around in a wheelchair or stroller and receives food through a tube.

During birth, she ingested fecal matter and was deprived of oxygen, according to her mother, Nancy Koger. The 31-year-old blames her daughter’s disability on the hospital where she gave birth.

“They treated us like we were just secondhand people, like we didn’t matter; just throwaways," Koger said. "That if I died or she died, oh well, they still get paid. That’s how I felt."

Koger, who says she relied on her husband’s insurance and Medicaid to cover health costs during her pregnancy, received care at a clinic for low-income patients operated by HealthNet. Denise was born at Methodist Hospital, which is part of the Indiana University Health medical system, one of the largest health care systems in Indiana. 

Her case is now one of several named in a $100 million federal lawsuit (see below) filed against IU Health, HealthNet and the Medicaid health plan, MDwise. It alleges that the medical organizations put “poor, pregnant women and their newborn babies at risk with a fraud scheme designed to increase revenues.”

No doctors

Dr. Judy Robinson, the former medical director of maternity services at Methodist Hospital, filed the lawsuit, alleging that low-income women with high-risk pregnancies were cheated out of proper health care from a doctor as required by state regulations. 

The state’s Medicaid reimbursement rules state that, “nurse midwives may not provide services to members with medically high-risk pregnancies.” But Robinson’s lawsuit claims cheaper certified nurse midwives were providing care to high-risk pregnant women without adequate involvement from a doctor.

“I respect midwives tremendously,” Robinson told America Tonight. “But they don’t have the training for high risk, and you would see that in the charts. They’re not doing this purposely. They just don’t know how to manage these situations.”

The suit alleges that the health organizations would then file false claims with the government to be reimbursed for doctors’ services that the patients never received.

As a result of this alleged scheme, Robinson says 17 infants nearly missed a tragic outcome and at least three babies, including Denise, suffered permanent neurological damage.

"There's too many," she said. 

Denise Koger can't speak or stand on her own and receives food through a tube.
America Tonight

Robinson said a doctor should have been more involved in Nancy Koger’s care due to risk factors, including high blood pressure toward the end of her pregnancy. 

According to medical records obtained by America Tonight, Koger was admitted to the hospital when she was 41 weeks pregnant. But according to Robinson, a nurse discharged Koger after approximately 30 hours of trying to induce her labor, even though her baby’s heart monitoring strip showed abnormal vital signs. Robinson said that Koger should never have been sent home.

“I didn’t see any doctors,” said Koger, who said she was in extreme pain when she was sent home. “I couldn’t even make it to the restroom. I literally had to crawl on the wall to get to the bathroom, which was in the very next room.”

Three days later, she returned to the hospital for an emergency C-section. But she believes the damage to Denise had already been done.

"I only saw nurses," said Koger. "But I was trusting what they told me to do, because that's their job."

The whistleblower

Dr. Judy Robinson, the former medical director of maternity services at Methodist Hospital, filed the lawsuit.
America Tonight

In her dual roles at the hospital and as the director of women’s services for HealthNet, Robinson says she had a unique vantage point. She said other physicians approached her with similar concerns about patient care.

“[I learned of] people that should have certain monitoring during their pregnancies because of their risk factors – whether it’s high blood pressure, whether it’s diabetes – and that monitoring had not taken place," Robinson said. “There was little to no physician involvement in the obstetrical care of these high risk patients."

The doctor says she tried to appeal to her bosses numerous times and pushed for more physician involvement. But when she tried to do that, Robinson says she was first told to keep quiet and then fired in the summer of 2013.

“They knew it was wrong. They knew that they were preying upon a vulnerable population,” Robinson said. “They just felt that they could be sacrificed. Why? Is the almighty dollar that important to them?”

When asked why Robinson was fired, a spokesperson for IU Health told America Tonight: "Dr. Robinson and Indiana University Health had a contractual relationship that allowed either party to terminate the contract with notice. Indiana University Health exercised that provision.”

All three organizations at the center of lawsuit declined our requests for interviews, but IU Health and HealthNet, provided written statements. (See the full statesments below.) Both organizations vigorously denied the allegations and said they were fully complying with government requests for documents and medical records. Because of the ongoing litigation and patient privacy rights, they couldn't share specifics.

America Tonight tried to verify Robinson’s allegations by talking to numerous other doctors who worked in the system, but none were willing to speak on the record.

As a federal False Claims Act lawsuit, the government has the opportunity to take over the case. Both the federal and state governments are still investigating the allegations and told America Tonight that they have not yet decided if they will intervene.


Tana Tyler and her mother Ladonna Mills
Courtesy of Ladonna Mills

Tana Tyler also gave birth at Methodist Hospital, but she died during an emergency C-section last year. Details of her case are also included in Robinson's lawsuit.

Tyler had a high-risk pregnancy, and Robinson blames nurses for letting her eat dinner in the hospital and for failing to realize she could require emergency surgery.

"Prior history of stroke … a brainstem situation that had to be surgically repaired," said Robinson. "You don't feed pizza to them during their labor."

Fasting is standard practice before surgery, as any food and liquid in the stomach under anesthesia increases the risk of aspiration – when food or liquid is drawn into the lungs.

LaDonna Mills says her daughter had already been induced when they had pizza and nobody told them that was a bad idea.

According to Robinson, Tyler aspirated, causing complications that preceded her death.*

Mills is left raising her two grandchildren, Aaliyah and Chace, alone. She started a website to memorialize Tyler and to raise money to help with the kids. She believes Chace was deprived of oxygen during the birth that killed his mother.

"He's not meeting his milestones," she said. "Crawling, holding a bottle, standing on his own."

Asked what she would tell Chace about his mother when he's older, Mills teared up.

"I struggle with that every day," she said. "God has another plan. I don't know what it is yet, but it has to be amazing."

Robinson hopes these families get the relief she says they deserve. She wants her lawsuit to put an immediate end to the practices she believes have caused so much pain.

"This is not the Methodist Hospital that I grew up with that I knew," she said. "And so now, it's a very empty feeling. Very empty feeling."

* This sentence has been updated. A previous version stated that Robinson said Tyler could have aspirated.

IU Health's statement

We deny Judy Robinson’s claims and intend to vigorously defend ourselves against the allegations she has made.

IU Health cannot discuss matters in active litigation. We have an obligation to keep patient information and detail of team member employment confidential and will share specifics through structured and unbiased government proceedings rather than the media. We ask that you reserve judgement until all details of the case are reviewed and an outcome reached.

IU Health is working closely with the U.S. Attorney’s Office and has provided all documents, medical records and information requested so that they may review and compare our facts with the allegations made in the case document. We will continue to cooperate should there be additional requests. On February 27, 2015, the government notified the Court that "it is not intervening at this time."

As a trusted leader in caring for people and advancing health, IU Health is responsible for delivering the best care in the safest environment. We are confident in the abilities of our doctors, nurses and broader care team.

U.S. News & World Report has ranked IU Health as one of the best healthcare systems in the nation and in Indiana for 17 consecutive years. Last year IU Health provided safe, high-quality care to more than 1.4 million patients.

HealthNet's statement

“HealthNet has been offering comprehensive primary care and support services to uninsured and underinsured residents in the Indianapolis community for 47 years. Last year, HealthNet provided safe, high quality care to more than 59,200 patients, regardless of their ability to pay. Through our network of eight community-based health centers, five dental centers, an OB/GYN care center, a pediatric and adolescent care center, a maternal-fetal medicine center, nine school-based clinics, and many outreach and support services, HealthNet serves as a medical home for our patients – the majority of whom live at or below 200% of the Federal Poverty Level.

HealthNet is accredited by the Joint Commission, whose accreditation is recognized nationwide as a symbol of quality that reflects an organization’s commitment to achieving and maintaining high quality performance standards. HealthNet has been ranked among the top health centers in the nation for achieving the best overall clinical outcomes and focusing on quality in all aspects of clinical and business operations.

The health and safety of our patients is top priority and we take matters like this seriously. We deny allegations of wrongdoing, but given the litigation, we cannot discuss details. Furthermore, due to our patient’s privacy rights, we cannot comment on care provided to specific patients.

Since we learned of the suit, HealthNet has worked closely with the government to review each of the allegations made, providing documents, medical and billing records, and any other information requested. We intend to continue to cooperate should there be additional requests.

HealthNet provides high quality services to the medically underserved throughout Indianapolis, including maternity patients, providing much needed prenatal care and delivery services with licensed and skilled clinicians. We have the clinical expertise to care for them and it is our privilege. We follow the standards of care developed by the American College of Nurse Midwives and the American College of Obstetrics and Gynecology, and stand by our collaborative model of care whereby physicians and certified nurse-midwives work closely together to deliver the highest quality care.”

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