New interim head takes over Health & Hospital Corporation

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Paul Babcock

INDIANAPOLIS– Health & Hospital Corporation, the municipal corporation responsible for the health of Marion County, the medical treatment of thousands of patients annually at Eseknazi Hospital and the care of more than 6000 nursing home residents statewide, has a new interim President and Chief Executive Officer this week.

Paul Babcock, the Director of the Office of Public Health and Safety for Mayor Joe Hogsett, assumed the post Monday on a temporary basis for Matt Gutwein who recently informed the Board of Trustees of his sudden resignation after more than 18 years at the helm of HHC.

Babcock takes over after an analysis of HHC’s strategy to divert $1 billion in federal Medicaid reimbursement for nursing home care to its Eskenazi and Marion County public health care system and the performance of the corporation’s 78 long term care centers across the state during the coronavirus pandemic in which 427 residents lost their lives to COVID-19, a statistic double what should have been expected based on HHC’s nursing home population.

“The Board and I have had discussions about continuing the great work and mission of the Health and Hospital Corporation,” said Babcock. “We’re approaching flu season. COVID-19 is still here in our community and we’ve got to be prepared for a potential double whammy.”

Gutwein’s resignation becomes effective September 30th.

He announced his departure several months after the Board voted to bring in an outside auditor to review its Long Term Care division.

“The Board passed a resolution a couple months ago about doing a review of the nursing homes,” said Babcock. “The Board is looking at potential individuals to conduct it.

“Hopefully it continues to show that the work here done at the Corporation is helping the residents of Marion County.”

Gutwein won widespread praise for his strategy to build the $754 million Eskenazi Hospital without a general tax increase while rebuilding Marion County’s public health system.

An analysis by the Indianapolis Star determined that Gutwein utilized a legal stratagem which resulted in the purchase of dozens of nursing homes, then funneling federal Medicaid reimbursement for those nursing home patients back to HHC to support Eskenazi and the public health system.

During a recent special session of the City County Council’s Municipal Corporations Committee, councilors were told that of $1.6 billion in Medicaid reimbursement paid to HHC, approximately $600,000 actually was spent on nursing home care.

HHC’s nursing home operational partner, American Senior Communities, was the focus of a federal probe that determined several top ranking officials defrauded the company of financial losses that could have totaled $30 million.

While HHC was not complicit in the fraud, the Indy Star investigation revealed that Gutwein and HHC participated in a settlement with ASC and the convicted officials for reimbursement of about half of the estimated loss.

While nursing home care reimbursement funding was steered to other HHC properties and services, the Corporation’s long term care facilities ranked extremely low in resident care and were subject to dozens of lawsuits since 2012.

HHC officials promised councilors in late August that the Corporation would dedicate 60% of its Medicaid reimbursements next year to its nursing homes, an approximate 20% increase in the level of its past funding.

During the special hearing, City County Councilor Ali Brown was openly skeptical of the quality of care at HHC’s nursing homes.

“Did that go to help people who are in nursing homes or often visiting the hospital, is it working with seniors, is it making it more accessible, is it helping to pay for more ambulances so the runs are safe? I just need to know,” she asked. “Why is the turnover rate so high? I know the turnover rate is high in nursing home and long term care facilities all over the state. Is theirs higher for some reason? Is there an issue?

“Were these higher than the rest of the state’s average? Were these higher than comparable states? Was the money not properly spent? I just want answers.”

HHC’s 2021 budget comes before city county councilors in two weeks.

The Board has undertaken a nationwide search for Gutwein’s replacement.

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