Lawsuit against 70 Indiana hospitals includes fraud

NOW: Lawsuit against 70 Indiana hospitals includes fraud


SOUTH BEND, Ind. --  Two South Bend lawyers say that 70 Indiana hospitals reported false claims.

The hospitals allegedly cost the federal government and the state of Indiana more than $324 million dollars.

Although the original lawsuit was filed in September 2016, the documents were just unsealed. 

Michael Misch and Bradley Colborn claim 70 hospitals in Indiana received in an illegal manner!!

The two lawyers are apart of the Anderson, Agostino, and Keller firm, based in South Bend. 

The 44 page lawsuit details their investigations that began in 2013. 

They looked into four hospitals originally: Memorial Hospital in South Bend, St. Joseph Regional Medical Centers in both Mishawaka and Plymouth, and St. Vincent Hospital and Health Systems.

Misch and Colborn claim the four facilities violated guidelines for receiving a federal grant, that was aimed at getting hospitals to use new electronic health record systems.

In order to get the grant, each facility had to provide patients with their medical records, within three business days of a request, more than 50% of the time.

The lawyers claim, that didn't happen, when they made weekly requests themselves.

They compared their own data, with the hospital's data.  They add that the hospitals did not record all of the requests, in order to qualify for the grant.

The lawsuit states, "these hospitals have been paid $324, 386,169.32 in public funding from the citizens of the United States, in return for the promise that patients would be provided with fast, cheap, easy access to their electronic health records, and these hospitals have failed to keep that promise.

But that's not all.

The lawsuit also claims that the hospitals allowed a third-party business affiliate, based in Georgia, to overcharge patients for their records. 

It also says the business received kickbacks, in direct violation of the grant. 

Now, Misch and Colborn are taking action. 

They are asking for three times the damages amount, which is close to $1 billion. 

ABC57 News reached out to the 11 different hospitals, involved in the lawsuit, that are in our viewing area. 

Beacon Health System responded, and said "Memorial was made aware of these claims last year, and cooperated completely with all inquiries, after which the government declined to join the lawsuit. Quite simply, the claims are without merit.”

St. Joseph Health System, also provided a statement. They said, "Last week, we learned Saint Joseph Health System was named in a lawsuit filed against 62 Indiana hospitals. We strive to be a trusted community partner and are actively investigating the allegations."

Misch also responded to requests for a comment. 

He says, "In June of 2017, the Department of Health and Human Services Office of the Inspector General issued a report related to this grant program finding that hundreds of millions of dollars of funding for this program was issued to medical providers that did not qualify for the program."

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