Indiana taxpayers ripped off in horrifying scheme that targeted poor pregnant women

A federal whistleblower lawsuit accuses Indiana's largest health provider of ripping off taxpayers while shuttling poor pregnant women to substandard care, IndyStar reports.

The lawsuit claims that IU Health and HealthNet, a IU Health affiliate that serves poor patients through eight inner-city clinics, shunted high-risk pregnant women to nurse midwives, while billing them as though doctors had treated them. Also named in the lawsuit is MDwise, a local care insurer that processed many of the claims by HealthNet's patients.

Dr. Judith Robinson, a former employee of HealthNet who filed the lawsuit, claims she raised questions about patient safety at HealthNet in 2013 and was subsequently fired.

In an email Robinson sent to her employers in spring 2013, cited in the lawsuit, Robinson raised concerns about a "broken system" and identified 14 cases where the lives of the mother and/or baby were endangered, and two with "terrible outcomes" within a six to eight-month period.

In response, HealthNet Chief Medical Officer Donald Trainor said her request to fix the problem was "premature," according to the lawsuit.

Shortly after that, Robinson was fired.

"Why is it that it seems to be OK to have this population of indigent patients … get less care? It is just not right," Robinson said in an interview. State policy does not allow nurse midwives to provide services to medically high-risk pregnant patients on Medicaid.

"I went to everybody and anybody I could because I was concerned about these patients," said Robinson.

The three organizations have all benefited financially while putting the lives of high-risk, low-income pregnant women and their babies in danger, according to the lawsuit.

Trainor explained in an email in 2011 included in the suit that the reasoning  behind employing more nurse midwives than obstetrician-gynecologists was "largely financial." He continued to say in the email that while midwives are paid one-third to one-half as much as doctors, HealthNet is "paid the same amount by Medicaid (our primary payor) regardless who provides the care."

In 2010, according to the lawsuit, midwives' average salary was $108,632, while that of a doctor was $349,976.

This is not the first case of hospital bilking Medicaid. In similar cases, Columbia University paid a $5.1 million fine in 2002 and New York University Downtown Hospital paid $2.1 million two years later.

The three organizations face up to $100 million in penalties and fines should they lose in court.