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Indiana Whistleblower Medicaid Suit and Private Equity Ties

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Category : research, healthcare
Published Date : 10/10/2024
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​When it comes to Private Equity (PE), I sometimes feel like the proverbial hammer where I see a private equity nail in every negative story about the healthcare system.

​This story is about a whistleblower suit that "claims that several insurance companies and hospital systems defrauded Indiana's Medicaid program by improperly billing them for patient care and walked away with more than $700 million."

​Being a PE hammer, I looked for a PE nail. PE wasn't mentioned in the story. I decided to look into Ascension Healthcare which was named in the suit. When I read the following, I thought I was wrong. No PE story here:

​"Ascension is a large private US healthcare system with 142,000 employees, 142 hospitals, and 40 senior living facilities operating in 19 states and is the largest [US] nonprofit and largest Catholic health system."

​A Catholic health system couldn't be further from the ethos of Private Equity right? No PE nail here. I was wrong.... Or was I?

I only needed to dig a little further to find my Private Equity nail:

​"[Ascension] also operates a conglomerate of for-profit firms, including subsidiaries involved in private equity, venture capital, insurance, medical software, and pharmacy delivery.
​Ascension has faced a number of investigations and controversies. A 2022 New York Times investigation found Ascension hospitals instigated a staffing crisis because of profiteering, leading nurses and doctors to file hundreds of complaints about possible preventable deaths." source: Wikipedia

​When Private Equity has penetrated a large, Catholic non-profit hospital network there is good reason to have grave concern for our healthcare system.
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Key takeaways:
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"According to the lawsuit, ...state Medicaid officials told him and his team to "significantly curtail its efforts" to use information from the contractor to "recoup improper Medicaid overpayments.""
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"The lawsuit accuses those Medicaid officials of "bowing to political pressure exerted by the health insurers' and the hospitals' lobby.""
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"All this comes about a year after the state announced a nearly $1 billion projected Medicaid budget shortfall."
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"The state blamed how families of medically complex children got reimbursed for care as part of the reason for that budget deficit."
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"We've been told it's on all of us to make sure we are playing by the rules when it comes to Medicaid and it's a little bit hard to swallow as a parent when it feels like allegedly families, we're being held to a different amount of accountability and responsibility then ... these large insurance companies and hospital systems are," said Jennifer Dewitt with Indiana Families United for Care."​

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