ProPublica

by Jeremy Kohler and Alex Mierjeski

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Former U.S. Rep. Billy Long of Missouri, whom President-elect Donald Trump has named his nominee to head the IRS, touts his expertise in tax matters.

He advertises his credential as a certified tax and business advisor, and he adds CTBA to his name on his X profile. That profile encourages people to message him to “save 40% on your taxes.”

Long identifies himself as a certified tax and business advisor, a designation created by a small firm that only requires attendance at a three-day seminar. (X)

But tax experts told ProPublica that they have never heard of CTBA as a credential in the tax profession. The designation is offered by a small Florida firm, Excel Empire, which was established just two years ago and only requires attendance at a three-day seminar. That is in stark contrast to the 150 credit hours and the rigorous exams required to become a certified public accountant, a standard certification for tax accountants.

In most tax cases, only lawyers, CPAs and enrolled agents — federally authorized tax practitioners — can represent taxpayers at the IRS.

“The cost of relying on tax advice from somebody that is solely focused on minimizing the tax liabilities that you have — as opposed to somebody that’s focused on both minimizing the tax liabilities and complying with the tax law — can be extraordinarily high if you are found to be in violation of the standards,” said Nathan Goldman, an associate professor of accounting at North Carolina State University.

Excel Empire’s three-day certification course has been advertised for as much as $30,000; its upcoming session is advertised at $4,997. Matthew Pearson, one of its founders, said this summer in a podcast that about 135 people have earned the CTBA designation, which the firm designed to help people without tax backgrounds to become advisors.

Nina Olson, a prominent taxpayer advocate, said that the modern tax industry has seen “a proliferation of different groups and entities that are providing tax advice” and that consumers have no way of knowing who is competent.

“It could just be that you’ve taken a very short course, and paid a large fee for that course, and that gives you the ability to put some initials after your name,” said Olson, who served as the IRS’ national taxpayer advocate from 2001 to 2019. She is now executive director of the Center for Taxpayer Rights, a Washington-based nonprofit that promotes fairness and access to justice in tax systems.

Tax experts said that Long’s years of experience as a real estate agent and as an auctioneer — before spending a dozen years in Congress — pales next to the deep experience in tax policy or management of the people who have held the job. For instance, the current IRS commissioner, Danny Werfel, previously served as acting IRS commissioner and held leadership roles at the Office of Management and Budget. He also worked in the private sector as a managing director at Boston Consulting Group.

Long’s experience in the tax world has been more narrowly focused. In the two years since he left Congress, he worked to bring in customers for at least two firms that marketed the employee retention credit — a pandemic-era benefit designed to support businesses that kept workers despite revenue losses or disruptions caused by COVID-19.

The credit also attracted fraud, eventually landing on the IRS’ “worst of the worst” list for tax scams. Two Democrats on the Senate Finance Committee on Wednesday announced an investigation into the firms, noting Long had neither a “background in tax preparation nor any credential as a licensed accountant, attorney or enrolled agent.”

Worth up to $28,000 per employee, the credit was available for the 2020 and 2021 tax years and has been widely used by both for-profit companies and nonprofit organizations across the country. However, the IRS raised significant concerns about aggressive promoters pushing ineligible businesses to file questionable claims. Red flags included inflated payroll numbers, claims for all quarters without proper eligibility or citing minor government orders that did not directly impact business operations.

The IRS says it has recovered over $1 billion from businesses that voluntarily reported improper claims. And it has launched hundreds of criminal investigations to try to recoup what it says could be billions of dollars more.

In a prepared statement in November, Werfel said businesses should review their claims and see if they were misled by firms marketing the tax credit.

“They should listen to trusted tax professionals, not promoters,” he said.

In a 2023 podcast discussing his work for the two firms, Long joked that he had a hat bearing the name of the credit glued to his head. He said his work marketing the tax credit had caused some clients to question their CPAs’ advice.

“Hey, this auctioneer, real estate broker, former congressman told me I’m going to get $1.2 million back,” he said. “Uh, you’re my CPA. Why didn’t you tell me that?” And he said the response of CPAs would be: “That’s a joke. That’s a fake deal. That’s not true. You’re going to have to pay all that money back. You’ll get audited.”

But he said the firms he worked for had never seen the IRS turn down one of their claims.

There is no evidence that either Excel Empire, Long or the firms that he worked for — Lifetime Advisors of Hudson, Wisconsin, and Commerce Terrace Consulting of Springfield, Missouri — engaged in wrongdoing. In the same 2023 podcast, Long emphasized he and his colleagues had helped only taxpayers who were entitled to the benefit.

Neither Long, Lifetime Advisors nor Commerce Terrace Consulting responded to requests for comment.

If Long is confirmed and succeeds Werfel, he’ll have the power to influence how Americans pay their taxes and how the federal government collects revenue. Trump has promised to end IRS “overstepping,” while Republicans have said that they would slash billions of dollars in funding passed under the Biden administration to modernize the IRS and enhance tax enforcement.

The IRS and the Trump transition team did not respond to requests for comment.

During his time representing Southwest Missouri in Congress, Long pursued legislation to abolish the IRS and establish a national sales tax. Billionaire Elon Musk, a Trump advisor, recently asked on X if the agency’s budget should be “deleted.”

Like Long, members of Excel Empire suggest that accountants don’t feel it is their role to save their clients money because they prioritize compliance over planning and are too busy during tax season to discuss strategies. The company’s website claims the firm has saved taxpayers hundreds of millions of dollars.

Edward Lyon, who is listed on Excel Empire’s website as chief tax planner and tax attorney, writes on his personal website that the seven most expensive words in the English language are “My CPA takes care of my taxes.”

Lyon elaborated on a podcast last year, noting that accountants “generally are rule followers,” but when it comes to lawyers, “we are trained to understand the rules but we’re trained to stretch the rules and bend the rules and poke at the rules and do an end run around the rules. It's a much more proactive focus.” Still, he has consistently emphasized that his company acts “legally, ethically and morally.”

On its website, Excel Empire claims that certified public accountants are not focused on saving their clients money and says their advisers are better equipped to identify tax breaks. (Excel Empire)

The company’s co-founder, Pearson, once described Lyon on a podcast as the “preeminent proactive tax attorney in the country.” Lyon and Pearson declined to comment.

The Ohio Supreme Court suspended Lyon’s law license in 2005 for failing to meet registration and fee requirements on time, and he hasn’t regained it. He also does not appear to be registered with the Securities and Exchange Commission as an investment advisor.

Despite this, Lyon says he has trained tens of thousands of tax and finance professionals. As the author of several books and a column, he claims to be one of the country’s most widely read tax strategists and commands speaking fees of $15,000 and first-class travel arrangements.

Lyon has also developed several tax certification programs. On the Excel Empire website, some officers, including Pearson, use a title created by Lyon: tax master.

Appearing on another podcast, Lyon discussed how small businesses can be used as tax shelters. As an example, he asked the host, Heather Wagenhals — who also carries the CTBA title — if she had a swimming pool at her home, where she records her show.

“I do,” Wagenhals said. “That’s why I picked this one.”

Lyon responded: “All right, so I’m gonna rock your world in five words, ready? On-premises employee athletic facility.”

“Oh my God!” Wagenhals said.

Lyon added: “It’s really there in the tax code, and nobody’s told you that.”

In another podcast, Pearson brags about firing an accountant who balked at his request for advice about how to use a new Corvette “to keep from paying taxes.”

Olson said that attitude was disturbing and that simplistic answers can create problems for taxpayers in IRS audits and in the courts. “A swimming pool in someone’s home, even if employees are working in the home and using it, still would require the court to look at the percentage of employee use versus personal use — and they would look really closely at that,” she said.

by J. David McSwane

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up to receive our biggest stories as soon as they’re published.

Anthony Olson wanted a career, children, a partner with whom he could hike Montana’s trails. Despite the diabetes diagnosis at age 4, the anemia, the kidney transplant that failed at age 29, the dialysis, he clung to those dreams. He attended community college and later moved from his parents’ house in Helena to study accounting at Montana Tech in Butte. He thought he might live a nearly normal life.

All of that was taken away in early 2011 when an oncologist at St. Peter’s, Helena’s only hospital, diagnosed him with myelodysplastic syndrome, a blood disorder that’s often described as pre-leukemia. The life expectancy of MDS patients is short. “He told me that without treatment, I’d be dead before the end of the year,” Olson said. He was 33.

“That diagnosis changed the direction of my life,” Olson, now 47, told me.

Olson couldn’t have known that he was one of many patients who, according to court records, may have received inappropriate, harmful or unnecessary treatments from Dr. Thomas C. Weiner. As I reported earlier this month, administrators at St. Peter’s suspected Weiner, who directed the hospital’s cancer center, was hurting patients for years. Yet hospital administrators allowed him to keep treating people until late 2020, when they suspended and then fired him. Weiner has denied all the allegations.

“I trusted that he was doing what was best for me,” Olson said of Weiner. “I never really questioned that until someone else told me that there was reason to.”

I discovered Olson’s story in a cache of records related to an ongoing legal dispute between Weiner and St. Peter’s. I was struck by how similar his case was to that of another Weiner patient, Scot Warwick. Weiner had diagnosed Warwick with Stage 4 lung cancer and treated him with chemo and other therapies for 11 years, court records show; after Warwick died in 2020, his family learned, from both a biopsy and an autopsy, that he never had cancer. Weiner insisted that Warwick had cancer all those years and that other doctors “missed” the disease.

Olson’s diagnosis was similarly flimsy, and he had been treated over nearly the same period of time. But there was a key difference between the two men: Olson lived to tell his story.

After he was diagnosed, Olson dropped out of college, moved back in with his parents and began Weiner’s prescribed regimen: four straight days on chemo, four weeks off. Repeat until he died. Olson endured this for nine years.

“I stopped moving towards a career and a future and was trying to figure out, ‘What can I do now? What’s most important to me?’” Olson said. “I spent a lot of time thinking about that, but I didn’t really have the money, especially with the cost of treatments, to do anything. I was kind of just stuck.”

In our conversations, Olson downplayed what happened to him next. As chemo goes, he said he had it easier than most. He kept most of his hair, for example. But exhaustion from the chemo anchored him to his parents’ basement. He sank into himself, tinkering with computers and dabbling in photography, “reaching for anything that I could do in my relatively short amount of time.” He told loved ones he’d soon be gone. He asked his parents to take his car. His father refused.

Early in his treatment, tests showed the chemo had worsened Olson’s anemia. Weiner placed him on weekly iron-rich blood transfusions. Over months and then years of chemotherapy and other treatments, Olson bonded with Weiner and St. Peter’s staff. He thought of them as friends. As the iron levels in his blood continued to rise, the cancer center nurses began calling him “The Iron Man.”

“I thought he was helping me,” Olson said of Weiner. “I actually felt pretty fortunate that we had such a gifted doctor in such a small community.”

His parents, too, believed they’d found “a miracle” in Weiner. Olson appreciated that Weiner had taken over as his primary care physician. Like dozens of Weiner’s patients, Olson told me he thought he had found a sort of concierge alternative to the broken maze that is the American health care system. Weiner often fast-tracked patients for hospital stays, which made him popular with patients. It also increased his patient load — as many as 70 patient contacts a day, records show. The more treatments and visits Weiner billed, the more money he made.

“He always made the process fairly easy,” Anthony’s mother, Patti Olson, said of Weiner. “So, if we needed medications or anything like that, he would bridge that gap for us. That went a long way in helping us through a lot of pretty difficult situations.”

Dr. Thomas C. Weiner (Louise Johns, special to ProPublica)

In 2016, Dr. Robert LaClair, the kidney specialist who was managing Olson’s dialysis, became concerned. After hundreds of blood transfusions, Olson’s body was suffering from “iron overload” (a ferritin level of over 10,000), which can destroy internal organs. It could have killed him.

LaClair tweaked Olson’s treatments, which improved his anemia and iron overload. He told him that he could now be a candidate for a new kidney, which would supplant the need for dialysis and maybe allow him to regain his life. The only problem? His chemo treatment disqualified him from the transplant waitlist.

Olson told me there were moments of real anger at his situation, “but most of the time, I think I was pretty level, and just did it because it had to be done, and this was the treatment. For a lot of it, I was amazed that I was still around and that it was working as well as it was.”

By 2019, LaClair suspected that Weiner may have misdiagnosed Olson and urged his patient to get a second opinion. But LaClair kept quiet about his misgivings for years, according to records and interviews. Weiner was a powerful figure within St. Peter’s and in Helena. He was earning $2 million a year and had threatened to sue the hospital several times, court records show. While his nurses adored him, others inside St. Peter’s feared him. Many on staff credited him with forcing out two hospital CEOs who had challenged his pay, court records show.

“If any one of us came up against him, we would have been crushed,” LaClair told me. “He had too much power and too much money.”

LaClair finally took his concerns to the hospital’s peer review committee, an internal group of doctors charged with examining questions about patient care. In early 2020, he became the committee chair and would lead the effort to remove Weiner. He acknowledged that he and the hospital waited too long to act.

In December 2020, St. Peter’s fired Weiner, accusing him of “harm that was caused to patients by receiving treatments, including chemotherapy, that were not clinically indicated or necessary,” among other allegations.

Weiner responded by suing the hospital for wrongful termination and defamation. Former patients created a Facebook group called “We stand with Dr. Tom Weiner” and held the first of hundreds of small protests outside the hospital. A Montana judge dismissed Weiner’s suit. He filed an appeal, which is pending with the state Supreme Court.

When Olson learned that Weiner had been removed, he was outraged, convinced that he’d lost a brilliant medical mind, who had been kind and given him years he otherwise would never have seen. He and his parents cheered on the protestors. “I would have been probably one of those people, on his side, up until all this blew up and we found out what was really going on,” he told me.

Olson didn’t know that his case was among dozens that St. Peter’s sent to outside medical reviewers at the University of Utah and The Greeley Company, a health care consultancy. The reviewers discovered that Weiner had ordered two bone marrow biopsies in 2011. The first showed signs of MDS, which researchers in recent years have found is commonly misdiagnosed. However, the second, taken 10 months later, indicated no disease.

Weiner shared the negative biopsy result with Olson but told him to ignore it; all it proved was that the regimen was working. Weiner continued Olson’s chemotherapy.

That second biopsy, at the very least, should have prompted more testing to confirm or eliminate MDS, the reviewers wrote. It was unclear “why this second bone marrow biopsy result was ignored, and why another bone marrow biopsy was not done,” the report said. “The patient may have been exposed to the toxicities of these treatments unnecessarily.”

When I questioned Weiner about Olson’s case, he dismissed the reviewers’ conclusion that he should have stopped chemotherapy when the follow-up biopsy was negative. “That doesn’t say you didn’t have the disease,” he said. “It just means that the treatment worked, and it knocked it away. It doesn’t mean you didn’t have it at the beginning.”

I pressed Weiner. If the chemo had “knocked it away,” wouldn’t that call for adjusting the treatment? He said he continued chemo for another nine years on the advice of experts at the Mayo Clinic. Olson scoured his medical file and found no evidence to support this claim.

After Weiner was gone, Olson received another biopsy, which came back negative. St. Peter’s also retested the sample from the first biopsy. It, too, showed that he never had MDS. Despite the overwhelming evidence that Weiner had misdiagnosed and improperly treated Olson, LaClair felt he couldn’t just say, “Dr. Weiner did this to you.” Records show many Weiner patients bristled when told to get a second opinion or became hostile at the suggestion that Weiner had mistreated them.

“The worst part of the harm is that they believed in him,” LaClair told me. “The harm that he’s done to these people — they’re broken both physically and mentally because of what he did.”

For years, LaClair could not comprehend why so many in Helena continue to support Weiner, but in watching the change in one of his favorite patients, he came to understand something: Olson didn’t just feel betrayed; he was heartbroken. “You want to hear something that really makes you sick?” LaClair asked. “He said to me, ‘I just wanted him to say he’s sorry.’”

After receiving chemo through his 30s and into his 40s, Olson’s cancer treatments were stopped in early 2021.

In a court filing that year, the hospital alleged that Weiner “misdiagnosed and/or failed to properly diagnose numerous other patients whose subsequent chemotherapy treatments may not have been warranted … .” St. Peter’s, however, did not provide a full accounting. The hospital reported that it had suspended Weiner to the state medical board, which declined to comment. But it’s unclear whether St. Peter’s relayed Olson’s case or any of the other misdiagnoses to the board. Hospital administrators declined to comment on the case, even though Olson signed a medical privacy waiver granting them permission to talk to me. A spokesperson said in a statement that “St. Peter’s is focused on moving forward, and we remain fully committed to providing the great care and experience our community deserves.”

When I presented Weiner with examples of alleged patient harm, he denied that he mistreated anyone and remained unapologetic. He does acknowledge, however, that Olson suffered for no reason.

“I felt that he had MDS,” Weiner said. “I was continuing this medicine to suppress it and control it for as long as possible, because he had no other option. Obviously, if I knew that he never had MDS, I wouldn’t have done it, but I was under the belief from the reports and everything that he should continue it. Now, again, hindsight says that he got it needlessly, and that part of it, I’m sorry about. I am.”

For Olson, the acknowledgement that he didn’t have cancer is 13 years too late. In 2022, he sued St. Peter’s for malpractice. The hospital settled and paid an undisclosed amount. Because Weiner was an employee of St. Peter’s, he was not held liable.

No longer overloaded with iron or receiving chemo, Olson became eligible for a donor kidney. In the summer of 2023, he got one. He continues to struggle with an array of health issues, but he knows there’s a chance he can live into old age.

Olson tries not to think about what happened to him. It takes him to a dark place. He still wants to see the best in people, even Weiner. But he sometimes can’t help but wonder what motivated his former oncologist. “Did he just do this for money?” he asked. “Was he betting on me to die and just thought he could make more money?”

by Kavitha Surana, Robin Fields and Ziva Branstetter

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After the Supreme Court overturned the constitutional right to abortion in 2022, President Joe Biden issued an executive order tasking the federal government with assessing the “devastating implications for women’s health“ of new state abortion bans.

Experts were warning that these bans would interfere with critical medical care and lead to preventable deaths. And the states that passed the laws had little incentive to track their consequences.

Biden directed the secretary of Health and Human Services to make sure federal agencies were “​​accurately measuring the effect of access to reproductive healthcare on maternal health outcomes.” He called on the National Institutes of Health and the Centers for Disease Control and Prevention to drive targeted research and data-collection efforts.

But the Biden administration has missed a critical opportunity to illuminate how abortion bans are interfering with maternal health care, leading to deaths and irreversible injuries: The CDC has not pushed state committees that review maternal deaths to examine the role these new laws have played.

The CDC leads the nation’s work to track and reduce maternal mortality, spending nearly $90 million over the last five years to fund state panels made up of health experts who analyze fatalities to spot trends and recommend reforms. While it cannot require states to collect or report certain data, the CDC gives committees detailed guidance for assessing whether deaths were preventable and which factors contributed to them.

Following this guidance, committees consider factors including obesity, mental health issues, substance use, homicide and suicide. In 2020, the CDC added a checkbox to its model case review form for committees to indicate whether discrimination played a role.

Yet the agency has issued no guidance to address the recent rollback of reproductive rights or to direct committees to consider how abortion bans factor into deaths. Some state officials point to this silence as a reason their committees haven’t made any changes to their process. “The committee must follow national guidelines in maternal mortality review committee death investigations,” said a spokesperson for Oklahoma’s health department, which oversees the committee in the state.

Researchers say that this can obscure the impact of abortion bans.

“It’s pushing it under the rug in a way — like we don’t want to count it, we don’t want to know what’s happening,” said Maeve Wallace, an epidemiologist at the University of Arizona who has published studies on the intersection of intimate partner violence and maternal deaths, including one that found a rise in maternal homicides in places with increased abortion restrictions.

When asked about this, the CDC said the information submitted by states is sufficient to understand any effects from abortion bans.

“Maternal mortality review committees already comprehensively review all deaths that occur during pregnancy and through the year after the end of pregnancy, including abortion-related deaths,” said David Goodman, lead health scientist with the CDC’s Maternal Mortality Prevention Team. “The current process includes documenting and understanding contributing factors.”

But experts said that the CDC’s current guidance gives committees no standard way to consider the role abortion bans played in maternal deaths, which makes it harder to study deaths related to the restrictions and create an evidence base to inform recommendations.

Georgia’s maternal mortality review committee blamed the state’s abortion ban as a factor in one of the deaths examined by ProPublica, that of Candi Miller. The 41-year-old mother of three ordered abortion medication online and suffered complications, but did not visit a doctor “due to the current legislation,” her family told the coroner, who documented the statement. Committee members told ProPublica that the explicit mention in the records indicated the law created a barrier to care.

Candi Miller and her family (Courtesy of Turiya Tomlin-Randall)

The case of Amber Thurman wasn’t as clear-cut; she had taken abortion medication at home and she sought care in a Georgia hospital for complications similar to Miller’s. Records showed doctors discussed, but did not provide, a dilation and curettage procedure to clear her uterus of infected tissue as she suffered for 20 hours with sepsis. Any impact the law may have had on the doctors’ decisionmaking was not noted in records the committee reviewed.

The committee concluded that one of the factors in her preventable death was the delay in care. And while members were able to check a “discrimination” box for Thurman’s case, they did not have any method to flag that she experienced a delay in receiving a procedure that is commonly used in both abortions and miscarriages and that had recently been criminalized.

If such a category were created by the CDC, it would allow researchers to see if there have been increased delays in care after abortion was banned, maternal health researchers said.

Experts told ProPublica this categorization would likely have covered the three other deaths ProPublica reported on, of Texas women who had not considered ending their pregnancies but who needed the same kind of procedure to manage their miscarriages. In those cases and that of Thurman, doctors diverged from the standard of care in ways that raise serious questions about how criminal abortion bans are affecting care for pregnancy loss, ProPublica’s reporting found.

“CDC public data shows an alarming increase in maternal mortality in states that ban abortion,” said Nancy L. Cohen, president of Gender Equity Policy Institute, a nonpartisan research organization. “Our analysis of the evidence and other factors strongly indicates that the bans are driving this increase, but there is no way currently to determine from publicly available data if abortion restrictions contributed to a particular death.”

The CDC “has the power to correct this,” she said, by asking states to collect information about whether abortion restrictions contributed to a death.

Amber Thurman with her son (Via Facebook)

Inas Mahdi, a maternal health researcher who previously worked at the CDC for 15 years, said officials at her former agency know the power that investigating the impacts of policy can have. “The CDC is well aware that without data, there’s no action,” she said. But she added that officials likely experienced “trepidation” over wading into a “polarizing” topic without more direct support from the administration.

In Republican-led states, there’s little appetite to study the harmful effects of laws that their leaders avidly support, and any backlash could hamper efforts to improve maternal health that are seen as bipartisan, she said.

Her fellow CDC alum, Dr. Zsakeba Henderson, agrees. “If CDC were to request that of maternal mortality review committees, I know there would be pushback at the state level,” said Henderson, who previously worked in the agency’s reproductive health division supporting state-based perinatal quality collaboratives. The maternal mortality program is voluntary, and states could simply opt out. In the past year, for example, Texas decided to forgo federal funding and not share maternal death data with the CDC. Officials at the CDC declined to comment on the reason for the change. A spokesperson for the Texas Department of State Health Services said the Legislature directed the agency to do this.

A spokesperson for the Biden administration responded to ProPublica’s questions about whether his order had been fulfilled with a list of efforts to gather and make available data on contraception access and maternal health care outcomes. They said the administration had also “amplified” data from other sources on the impact of abortion bans in a memo.

When asked why the CDC has not created a checkbox to track deaths related to abortion access, a spokesperson for HHS, the CDC’s parent agency, said that the CDC “receives feedback from states on data fields.” The spokesperson noted that the discrimination checkbox was “added based on state requests” after a work group went through a multiyear process.

The spokesperson also said the lack of a checkbox does not mean HHS failed to meet the goals of Biden’s order. The spokesperson forwarded a 73-page update on the maternal mortality crisis that had been sent to Congress this past July. The report is packed with information on progress combating major maternal health risks: task forces to support mental health, initiatives to respond to the opioid crisis, research on intimate partner violence.

It doesn’t include a single reference to abortion access.

Ushma Upadhyay, a public health scientist at the University of California, San Francisco, said collecting data is crucial for understanding how the new abortion bans are impacting maternal health. Her research through WeCount, a project from the Society of Family Planning, has helped establish that the number of abortions has increased nationally since Roe v. Wade was overturned.

Though she has participated in roundtables with HHS officials about how it could better support reproductive health research related to abortion access, she never saw the agency take action based on these talks, she said. (When asked about what these conversations had led to, the agency shared a readout on an expert roundtable about contraception and said its work on studying how abortion restrictions impact maternal health care is ongoing.)

Upadhyay said sending a congressional update on maternal mortality with no mention of abortion access as evidence of fulfilling the order “kind of says it all.” When it comes to measuring the impact of abortion restrictions, “HHS is not doing much.”

The federal government’s largest contribution to this effort comes in the form of millions of dollars of NIH funding to research projects by academics looking into the impact of abortion restrictions, Upadhyay said. But more than two years after the Dobbs v. Jackson Women’s Health Organization decision allowed abortion bans to go into effect, none of those studies have been published and it’s unclear whether the incoming administration will continue funding them.

Researchers who track reproductive health lament the failure to think creatively and act urgently to monitor the fallout of abortion bans while the department had a chance.

“The Biden administration’s lost opportunity is that it viewed Dobbs as a political moment to gain advances for the Democratic Party,” said Tracy Weitz, the director of the Center on Health, Risk, and Society at American University. “It did not take this seriously as a public health crisis.”

The window is closing as President-elect Donald Trump prepares to take office. There is little chance a Republican administration will try to collect data that helps shed light on the impact of abortion bans, which were uniformly passed by Republican-majority state houses.

Last week, Trump named Ed Martin, a prominent anti-abortion activist, to be the chief of staff for his Office of Management and Budget, which oversees how the federal budget is administered. Martin has opposed abortion exceptions, supported a national ban and discussed the idea that women and doctors should be prosecuted for abortions.

If Project 2025 is any guide to how the Trump administration will approach abortion, the CDC may soon start a very different project: launching a mandatory, nationwide surveillance program aimed at portraying abortion care as dangerous.

The conservative blueprint for reshaping the federal government recommends that the agency require all states to report detailed data on abortions, miscarriages and stillbirths or risk losing federal funding.

It states that the CDC “should ensure that it is not promoting abortion as health care.” Instead, “It should fund studies into the risks and complications of abortion.”

Mariam Elba contributed research.

by Kavitha Surana

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up to receive our biggest stories as soon as they’re published.

As doctors navigate risks of criminal prosecution in states with abortion bans, hospital leaders and lawyers have left them to fend for themselves with minimal guidance and, at times, have remained “conspicuously and deliberately silent,” according to a 29-page report released Thursday by Senate Finance Committee Chair Ron Wyden. The poor direction is leading to delays in emergency care for patients facing pregnancy complications, the report concluded.

The Oregon Democrat launched a probe in September in response to ProPublica’s reporting on preventable maternal deaths in states with abortion bans. Wyden requested documentation from eight hospitals to see whether they were complying with a federal law that requires them to stabilize or transfer emergency patients; his committee has authority over the regulatory agency that enforces the law. The report also draws on roundtable discussions with doctors from states with abortion restrictions.

The resulting committee staff report provides a new layer of insight into the chaotic and dysfunctional hospital landscape in states with abortion bans, as well as a fresh opportunity for hospitals to consider reforms and provide proactive and transparent guidance to patients and doctors.

Physicians, whose accounts were anonymized, described hospital lawyers who “refused to meet” with them for months, were "pretty much impossible" to reach during "life or death" scenarios and offered little help beyond “regurgitating” the law, according to the report. Doctors described how other doctors gave out wrong and potentially harmful information, saying that patients could not legally choose their own course of treatment and that doctors could not legally treat ectopic pregnancies, potentially fatal complications in which an embryo develops outside the uterine cavity.

“Doctors are playing lawyer, and lawyers are playing doctor,” Wyden said in an interview. As a result, “women are getting hurt, they’re suffering, they can die, and we want to deliver this wake-up call so that they’re better protected and they understand what their rights are.”

The Biden administration has told hospital officials that they have a responsibility under the federal Emergency Medical Treatment and Labor Act, known as EMTALA, to stabilize any patients who show up to their emergency rooms, even if that means doing so with an abortion procedure that conflicts with state abortion law. If they can’t, according to the administration’s guidance, they must transfer the patient to a hospital that can. Some states have fought this. In Texas, a court ruled that the administration’s guidance can’t supersede the state abortion ban and the Supreme Court turned down an appeal.

Information on how to handle the legal conflicts between the bans and federal law is usually not written down at hospitals and, in some cases, is only provided on a “need-to-know” basis, the investigation found. Nurses not included on the same emails as doctors did not trust that they could treat patients, according to an Idaho physician, who added that doctors are left on their own to “figure out the second or third best option.” An emergency medicine doctor who once worked in Texas said they’d encountered OB-GYNs who were too afraid to help deliver care. Another said that colleagues “just want to get these patients out of the hospital” because they worried about the professional and personal risks of treating them.

The report described each of the five preventable deaths ProPublica reported as examples of the fatal consequences of abortion bans. It also added to the mounting accounts of patients in crisis being denied care. Physicians shared examples such as:

• A patient in Idaho whose placenta had “sheared off” the side of the uterus, leading to a massive hemorrhage; the bleeding patient was sent home from the emergency room four or five times. Only at the moment they were “going to bleed out” did the hospital believe they were legally allowed to stabilize the patient, the doctor said.
• Another Idaho patient who was 19 weeks pregnant and cramping and spotting but was sent home at the direction of maternal-fetal medicine specialists until she could “be brought into an emergency situation.”
• A patient whose water broke at 21 weeks and whose fetus wasn’t viable. Doctors refused to remove the fetus until the heartbeat stopped, first sending her home and then, upon her return, requiring her to wait over six hours before they agreed to induce labor. ProPublica wrote about a similar case in Texas in which a woman died of a fatal infection after being made to wait for 40 hours for the fetal heartbeat to stop.

Wyden was able to obtain documentation and answers from hospitals that are rarely provided to the public. In December, ProPublica requested miscarriage treatment protocols from the 50 hospitals in Texas that account for roughly half of the births in the state, according to state hospital discharge data. Almost all declined to provide them. Researchers who attempted a similar survey in Oklahoma last year were met with comparable resistance after they tried to get hospitals to share their policies for treating pregnancy complications under the state’s ban, according to a study by Physicians for Human Rights.

The senator requested documentation from eight hospitals across the country that had been the subject of reports of delayed or denied emergency care for pregnancy complications. He asked for their “policies, processes and procedures related to state abortion laws and emergency reproductive health care.” All eight responded, sharing hundreds of pages of documentation and answers, which the committee published along with the report. The documents provide a rare, detailed view into the operations of private medical systems that may give doctors and ethics committees at hospitals new insight into what others are doing to respond to the laws.

The response revealed that many of the hospitals were relying on guidance created before the existence of abortion bans, the report said. In most cases, physicians were given basic EMTALA guidance that didn’t discuss how to handle new abortion restrictions and were told to contact legal or ethics counsel for questions. Only a few hospitals had created proactive guidance to help their providers navigate the new landscape, and only two of those explicitly discussed conflicts that exist between abortion bans and EMTALA and how to handle them. It was not always clear if these directives were created before media reports of denied care.

Freeman Health System in Missouri was found by federal investigators to have violated EMTALA after doctors told a patient whose water broke nearly 18 weeks into her pregnancy that they could not induce labor because of the state’s new abortion law. It submitted robust protocols to the committee that include a flowchart of its intake for pregnant patients and informed consent paperwork advising patients of high-risk pregnancy complications that constitute an “emergency medical condition” under EMTALA. The Missouri hospital system was the only one out of the eight that said it offered full civil and criminal defense of any providers sued under state abortion laws, according to the report.

Also surveyed was the Georgia hospital system that treated Amber Thurman, a 28-year-old single mother who faced a deadly infection from a rare complication after taking abortion medication. Doctors at Piedmont Henry Hospital discussed, but did not provide, a procedure to clear her uterus in time, according to a report by the state maternal mortality review committee, which concluded that her death was preventable.

Piedmont told Wyden it had assembled a task force after the state’s abortion ban went into effect. The hospital said it gave providers educational material on conflicts the abortion ban could create, including a “decision tree,” a statement from the American College of Obstetricians and Gynecologists on navigating exceptions to abortion bans and guidance for complying with the law’s documentation requirements. (ProPublica reported in September that the task force provided education in the months after Thurman’s death.)

Piedmont, Freeman and five of the other hospitals mentioned in the report did not respond to requests for comment. Dr. R. Cliff Moore, the chief medical officer and maternal-fetal medicine physician for Woman’s Hospital in Louisiana, said that when an early pregnancy-loss diagnosis is unclear, physicians “wait for additional information as long as the patient is stable.”

“The policies, evaluation, treatment and care for early pregnancy loss at Woman’s Hospital have not changed,” he said.

To safeguard emergency reproductive care, the report called for abortion access to be reestablished across America and for the federal government to enforce EMTALA “to the fullest extent of the law.”

But with Republicans in control of all branches of government next session, Wyden recognizes this is an unlikely scenario.

“It is all the more important that hospitals and provider groups step up and do all that they can to make sure patients get the health care they need,” he said. “That means making it crystal clear that patients have a federal legal right to emergency care, no matter where they live, and shouldn’t have to be on the brink of death to get it.”

The report issued four recommendations:

• It called on hospitals and hospital associations to work together to provide training, guidance and resources to doctors to ensure they provide emergency pregnancy care in abortion ban states.
• It said professional medical organizations “should issue guidance and publish standards that clearly define appropriate clinical care in obstetric emergencies.”
• It encouraged hospitals to support the full spectrum of doctors, from OB-GYNs to family medicine physicians, in becoming certified to prescribe mifepristone, part of the two-pill abortion medication regimen.
• It said doctors should counsel patients about their rights under EMTALA and how to report violations.

Mariam Elba, Cassandra Jaramillo, Lizzie Presser and Ziva Branstetter contributed reporting.

by Jennifer Berry Hawes, data analysis by Nat Lash, with additional reporting by Mollie Simon

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The scoreboard glowed with the promise of another Friday night football game in Liberty, Mississippi, a small town near the Louisiana border. The Trojans, in black and gold, sprinted onto the field to hollers from friends and families who filled barely half the bleachers.

The fans were almost all Black, as is the student body at the county’s lone public high school. Scanning the field and the stands would give you little indication that more than half the county’s residents are white.

In some swaths of the South, a big event like high school football unites people. But not in Amite County.

Just beyond the Trojans’ scoreboard, past a stand of trees, another scoreboard lit up. At Amite School Center, a small Christian private school, cars and pickup trucks crammed every inch of space on the front lawn and in its parking lots. A charter bus for the visiting team, another private school, rumbled near the entrance to the field.

A good 500 people, nearly all of them white, filled the bleachers and flowed across the hill overlooking the field. They cheered from lawn chairs and waggled cowbells as cheerleaders in red-and-white uniforms performed a daring pyramid routine.

A child waved a handmade white poster that read, “Go Rebels.”

Amite School Center, like many private schools across the Deep South, opened during desegregation to serve families fleeing the arrival of Black children at the once all-white public schools. ProPublica has been examining how these schools, called “segregation academies,” often continue to act as divisive forces in their communities even now, five decades later.

In Amite County, about 900 children attend the local public schools — which, as of 2021, were 16% white. More than 600 children attend two private schools — which were 96% white. Other, mostly white students go to a larger segregation academy in a neighboring county.

“It’s staggering,” said Warren Eyster, principal of Amite County High until this school year. “It does create a divide.”

The difference between those figures, 80 percentage points, is one way to understand the segregating effect of private schools — it shows how much more racially isolated students are when they attend these schools.

Considerable research has examined public school segregation. Academics have found that everything from school attendance zones to the presence of charter schools can worsen segregation in local public schools.

But the ways in which private schools exacerbate segregation are tough to measure. Unlike their public brethren, they don’t have to release much information about themselves. That means few people on the outside know many details about these schools, including the racial makeup of their student bodies — at a time when legislatures across the South are rapidly expanding voucher-style programs that will send private schools hundreds of millions more taxpayer dollars.

Very White Private Schools in Majority-Black Districts

ProPublica looked at majority-Black public school districts where private schools also operated. A wide swath of districts across the South exhibited the same pattern: Student populations in private schools are far whiter than in the surrounding public schools.

Includes only districts that had within their boundaries at least one private school that reported to the National Center for Education Statistics’ Private School Universe Survey at least once since 2015. Source: Private School Universe Survey. (Nat Lash, ProPublica)

But a new ProPublica analysis shows the extent to which private schools segregate students. We dug into decades of private and public school data kept by the U.S. Department of Education, including a survey of the nation’s private schools conducted every other year by its National Center for Education Statistics. Outside of academia, few people know about this data.

The surveys are imperfect measures. Schools self-report their information, and about 1 in 4 didn’t respond to the most recent round in 2021. But the surveys are the only national measure of this kind. ProPublica used them to determine how often students attended schools with peers of the same race in tens of thousands of private schools nationwide and compared that to public schools.

A stark pattern emerged across states in the Deep South — Louisiana, Mississippi, Alabama, Georgia, South Carolina and North Carolina — where about 200 majority-Black school districts educate 1.3 million students. Alongside those districts, a separate web of schools operates: private academies filled almost entirely with white students. Across the majority-Black districts in those states, private schools are 72% white and public schools are 19% white.

Many of those districts are home to segregation academies, which siphon off large numbers of white students. In many areas, particularly rural ones, these academies are the reason that public school districts scarcely resemble their communities — and the reason that public schools are more Black than the population of children in the surrounding county.

Which county has the largest chasm? Amite.

Amite School Center’s football team, the Rebels, and fans during a home game in September 2024. (Edmund D. Fountain, special to ProPublica)

Along the two-lane country roads through Amite County, fear still mingles with the red clay. Civil rights violence scarred the place just a few generations ago. At least 14 lynchings and other terrifying acts of racist violence took place here, including one of the nation’s most infamous unsolved civil rights murders. In neighboring Pike County, the town of McComb became known as the “bombing capital of the world” for its violent resistance to civil rights.

“You can’t forget things like that,” said Jackie Robinson, chair of the Amite County Democratic Committee. A Black woman, she remembers going to the neighborhood store with her grandmother and being called a racial slur. Her mother told stories of crosses burning.

Robinson said she encounters Black residents who won’t put campaign signs for Black candidates in their yards. They fear that white residents, who own most of the local businesses, might shut them out if they do.

Liberty, Mississippi, is the county seat of Amite County, which has a long history of racial segregation and civil rights violence. (Edmund D. Fountain, special to ProPublica)

White adults outnumber Black ones, and white elected officials control the school district that educates mostly Black children.

Only one school trustee is Black. She sent her children to the local public schools, but few, if any, of the white trustees did. One longtime white board member, whose children attended Amite School Center, has as his Facebook profile picture a photo of the private school’s football team. ProPublica reached out to all of the school board members multiple times, but none responded.

That school board hired a superintendent who is white. It selected high school and middle school principals who are white. And all of the people collecting $7 cash from each spectator at the football game appeared to be white.

Janice Jackson-Lyons, a Black woman, ran for a school board seat in 2020 against the white incumbent with the private school Facebook photo. She described her campaign message as: “I’m reaching for all children. I’d love to see all the kids go to school together because all the kids in Amite County are going to compete for jobs with people from all over the world.” She lost by 60 votes.

Woran Griffin lost a race for an Amite County School Board seat in November. (Edmund D. Fountain, special to ProPublica)

Woran Griffin, who volunteers with Amite County High School’s football team, ran for a board seat in November. He and another Black resident, an educator in a neighboring school district, both lost to white candidates. “There are too many whites running kids they don’t know nothing about,” he said.

They are among the Black residents who wonder: Why do white people who never sent their kids to the public schools keep challenging Black candidates who have? Many Black residents figure it comes down to control — over property tax rates, district spending contracts and hiring.

“I call that a plantation-style school,” said local resident Bettie Patterson, a Black woman who served on the school board years ago.

Amite County has one of the lowest property tax rates for funding schools in Mississippi. And when the board consolidated schools in 2010, it shuttered the elementary school in Gloster, a mostly Black town in the county, and moved all students to Liberty, a mostly white one. The only school left in Gloster is a Head Start for preschoolers.

The grounds of the abandoned Gloster Community Center, which also served as an elementary school. The school closed_ _in 2010, after budget reductions and decreases in state funding. (Edmund D. Fountain, special to ProPublica)

Superintendent Don Cuevas wouldn’t comment on the racial dynamic of the board. “We have a good school system,” he said. “We have a safe school system. Everybody’s treated equal.”

Several Amite public school teachers and parents described watching the PTA, the booster club and a parent liaison position disappear. They said they don’t feel their input is welcome. But Cuevas said the district wants to be selective about when it asks for money from its families, many of whom have very low incomes, when the district doesn’t need it.

“Financially, we’re set,” Cuevas said. “We handle money very well.” He pointed to renovations at the elementary school, including improvements to the parking lot and plumbing, a new iron fence around the entire property and a guard shack. The superintendent said it was to ensure safety and order, but Griffin said the fence felt “like a prison wall.”

Multiple Black educators told ProPublica that the district had passed over qualified Black teachers with local roots for jobs and promotions.

Jeffery Gibson, who grew up in Gloster, was a PE teacher and Amite County High School’s head football and a track coach last year when, he said, he applied for two open administrative positions. Given he had coached multiple state championship teams, received his administrator license and worked as a lead teacher, he figured he’d be a strong candidate.

“I know the kids,” Gibson said. “I can motivate them. I can get them to do what I ask. I can get them to reach their full potential. I’m from there.” But he said the district didn’t respond to his applications, so he took a job as the athletic director of a larger district.

Former Amite County High School head football coach Jeffery Gibson greets players at halftime in September 2024. (Edmund D. Fountain, special to ProPublica)

ProPublica identified 155 counties across the Deep South with private schools that likely opened as segregation academies. Roughly three dozen of those schools are in Mississippi. One in Amite County has never — over nearly 30 years of responding to a federal survey — reported enrolling more than one Black student at a time.

The other, Amite School Center, began reporting enrollment of Black students in the past decade, but not enough to come close to reflecting the population of children in Amite County, where almost half of school-age kids are Black. In the 2021 federal survey, Amite School Center reported student enrollment was 3.5% Black. It employs no Black teachers.

When asked if his school still creates divisions in the community, ASC’s Head of School Jay Watts said no: “I haven’t seen it here.” The school has a policy that says it doesn’t discriminate based on race.

The nonprofit Christian academy, home of the Rebels, opened hastily in 1970 “in the wake of court ordered all-out racial desegregation of the Amite County Schools,” a local Enterprise-Journal story said a few months beforehand.

Back then, A.R. Lee Jr., a doctor and congressional candidate from Liberty, was president of the nonprofit Amite School Corp. As violence erupted in other Southern towns, Lee told a Mississippi newspaper reporter, “The fact that we have a private school here is the reason everything is calm. If we didn’t have it, it wouldn’t be calm in Amite County.”

In the front office of the modest one-story school, which educates just over 300 students across all grade levels, a Confederate flag with “ASC” emblazoned in the center is tacked to a cabinet. Down a hallway, Watts sat at a desk beneath an impressive deer mount, a wooden paddle perched against the office’s doorframe. He welcomed questions from a reporter who showed up without an appointment.

Watts seemed eager to share what his school offers: a Christian-based education that eschews government interference.

“We are charged with educating academically, physically, spiritually, emotionally,” Watts said. “I’m not sure that that’s the mission of the public schools. They’re there to educate academically. I think our mission is broader.”

Because ASC is private, it can operate without the government dictating whether teachers can lead prayer, what tests they administer — and whether or not that paddle gets used. Watts said many of its families think the broader culture is changing in ways they don’t agree with.

“We don’t have to let a girl go to the boys’ bathroom or a boy go to the girls’ bathroom,” he said.

Josh Bass, the school’s athletic director and basketball coach, worked at public schools earlier in his career, then came to ASC from a larger academy in neighboring Pike County. He said he and his wife enrolled their three children at ASC primarily due to their Christian faith: “If it’s not biblical leadership, then I don’t want it for my child.”

He insisted that racial segregation isn’t the school’s goal today. “That might have been at one time, 100 years ago, and some people hang on to that,” Bass said. “We want all to have an opportunity to go to these schools and be a part of what we’re trying to lead them to be.”

Amite School Center’s athletic director Josh Bass watches the football team. Bass said he enrolled his children in the private school because of its focus on Christian education. (Edmund D. Fountain, special to ProPublica)

The men also recognized that even though ASC’s tuition is relatively low compared to many other private schools — under $6,000 a year per child — disparities in resources still create barriers. The median white household income in Amite County is $54,688, compared to $21,680 for a Black household, the U.S. Census Bureau estimates.

ASC has received $459,000 in donations over the past three years through a state tax credit program for certain educational charities, including private schools. But Watts said the school still lacks the money to offer financial aid.

Across the tree line at the public school’s district office, Cuevas said in terse tones that he had no comment about anything related to the private schools or the parents who choose them. He knew nothing about what ASC offers and therefore could not — and would not — compare the public schools to it.

“I don’t even know those answers,” Cuevas said. “I don’t know anything about the private schools. I don’t ask.”

He said he didn’t go out into the community to promote the schools he leads. Instead, he opened the schools’ doors and tried to educate whoever walked in. He’s unclear why so many white students don’t come.

“We don’t know why. We offer a good education,” Cuevas said.

Gibson, the public school’s former football coach, turned his pickup truck onto ASC’s jam-packed campus and found a slip of empty grass on the front lawn where he could park amid the football crowd. He had never set foot on this property even though he had worked and attended the nearby public schools.

Halftime approached as he headed toward the football field. A peal of parents’ yells — “Way to go!” and “Keep pushing!” — burst from the entrance. Once inside, Gibson scanned a sea of white people who filled the bleachers and packed together in lawn chairs, most of them strangers to him except for a few who worked at the public school district. The public schools pay more and offer better benefits.

Gibson had come to see one of his favorite players, a gifted senior who was on his team last year — and who was now the only Black player he saw on ASC’s team. It wasn’t hard to find the teen’s father. Nobody said anything unfriendly to him, but Gibson felt hundreds of eyes watching as he strolled over to the man, who stood front and center against the fence.

The player he came to see had transferred to ASC after Gibson left the public high school. Gibson had barely said hello to the teen’s father before the player scored a touchdown. Cheers cascaded from the crowd, and Gibson joined them.

But it felt strange standing there with so many white people at the “white school.” Back when he was growing up, he couldn’t have imagined such a thing. In college and after, while coaching in Oklahoma, Gibson made good friends who are white. As he cheered with the crowd at ASC, he wondered how many white friends he might have made here in Amite had the local kids all gone to school together.

He found an empty seat in the front row of the metal bleachers and took in the manicured field before him. It was so close to the one where he’d been a student and coach. Yet it felt like stepping into another world.

by Kavitha Surana and Lizzie Presser

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We heard the same story again and again this year:

The women were having miscarriages. They were bleeding and in pain.

They needed a medical procedure to clear their uterus, but their doctors delayed it or didn’t even counsel them about it. Our yearlong investigation found that abortion laws are affecting how physicians treat pregnancy loss and other complications because the procedures used in these cases are also used for abortions.

We spoke to women who survived terrifying experiences, and we interviewed family members of those who died without care. They all felt unprepared as they entered emergency rooms, unaware of how abortion laws were reaching into pregnancy care.

They wished they had known what to expect and how to advocate for themselves and their loved ones.

We created this guide for them and anyone who finds themselves in the same position.

We wrote it in consultation with dozens of doctors, including those who hold positions at leading medical organizations and those who regularly treat patients who are miscarrying.

This guide does not provide medical or legal advice. We encourage you to seek out other reliable resources and consult with experts you trust.

What Is a Miscarriage?

When a pregnancy has stopped developing before 20 weeks, that is considered a miscarriage.

This is common — it happens in up to 1 out of every 4 known pregnancies. The medical term for miscarriage is “spontaneous abortion.”

During a pregnancy loss, someone might experience symptoms like bleeding and cramping and pass pregnancy tissue. Or an ultrasound might show that there’s no fetal cardiac activity even if the patient had no miscarriage symptoms.

While most miscarriages resolve on their own, some lead to dangerous complications, including hemorrhage and infection.

Eight in 10 miscarriages occur in the first trimester. A pregnancy that ends after 20 weeks is considered a stillbirth, but sometimes it is still referred to as a miscarriage.

Other rare complications, like premature rupture of membranes (when the water breaks too early) or preeclampsia (life-threatening high blood pressure), can develop in the second trimester of pregnancy and endanger both the pregnant patient and the fetus. Choosing not to intervene may mean there is some chance the fetus could survive, but it also may put the patient at risk of developing life-threatening complications.

Each situation is unique. In these circumstances, doctors should talk to patients about the risks and benefits of continuing the pregnancy and the option of ending it to protect their health, experts said. Sometimes these cases are referred to as a miscarriage.

What Are the Treatment Options?

When a patient is having a miscarriage or is at high risk for one, they should be offered three choices, according to major medical organizations like the American College of Obstetricians and Gynecologists:

1. Expectant management: Waiting to see if the body will pass the pregnancy on its own.
2. Medication: Taking medicine to help the body clear the tissue. This can include misoprostol or mifepristone with misoprostol, which causes the uterus to contract and can speed up the process
3. Procedure: Getting a dilation and curettage (D&C) in the first trimester or a dilation and evacuation (D&E) in the second trimester to empty the uterus.

All of these can be safe choices for an uncomplicated miscarriage, and a first trimester-miscarriage is rarely an emergency. The standard of care is for doctors to explain all options along with their risks and benefits, and then let their patients choose what they prefer. All major medical societies say that patients should be given that choice.

If a patient is bleeding heavily or showing signs of infection, doctors should recommend a procedure (D&C or D&E) to protect their health, medical experts say.

What Is a D&C?

A D&C is a procedure to empty the uterus and is one of several safe ways to navigate pregnancy loss.

The term D&C stands for dilation and curettage and the procedure is often called “surgical” — but that’s a bit of a misnomer. It is more accurately called “uterine aspiration.” Doctors don’t need to make incisions or use sharp tools. They insert a straw-like tube into the uterus and use suction to gently draw out pregnancy tissue. The patient can be awake, sedated or asleep. It only takes a few minutes and typically ends the bleeding quickly.

When this suction procedure was popularized in the 1970s, after abortion became legal nationwide, “it was a real awakening” in maternal health care, said Dr. Philip Darney, a reproductive health care expert at the University of California, San Francisco. It made emptying the uterus faster, safer and more accessible, he said, saving countless lives.

Today, the simple procedure is usually used for pregnancies up to 12 weeks. Some prefer it as a quick and thorough way to complete a miscarriage and minimize ongoing pain and bleeding, as well as infection risks. For patients with heavy bleeding or infections in the first trimester, a D&C could be lifesaving, doctors told us.

What Is a D&E?

A D&E, or dilation and evacuation, is a procedure used in the second trimester to empty the uterus. The doctor uses suction and tools like forceps. The patient is sedated or asleep in an operating room. It takes less time than an induction, allows the patient to avoid a labor experience and generally is associated with less blood loss and infection risk than other options. For patients with heavy bleeding or infections in the second trimester, a D&E could be lifesaving, doctors told us.

How Have D&Cs and D&Es Been Affected by Abortion Bans?

The same procedures are used for both abortions and miscarriages; whether they’re used to remove pregnancy tissue because of a complication or because the patient has decided to end the pregnancy for another reason, there’s no difference in how the procedures are carried out, and most state abortion bans aren’t clear about when physicians are legally allowed to perform them. The American College of Obstetricians and Gynecologists, the leading organization representing OB-GYNs, calls the language these laws use to describe exceptions “unclear” and “inherently vague.”

This can create confusion and fear around the procedures. For example, a patient can be in the process of miscarrying, but there might still be fetal cardiac activity. Some doctors consider intervening to be a risk because managing the miscarriage in that situation could be defined as an abortion.

The laws attach criminal penalties to a violation — in Texas, for example, doctors can face up to 99 years in prison for performing an abortion. State laws usually include exceptions for “medical emergencies.” (Patients can check their state law and discuss it with their doctors.)

Many physicians have told us, however, that the exceptions do not account for how quickly emergencies can develop or how medical decisions are made. While many miscarriages resolve on their own, infections and other complications like heavy bleeding can rapidly become life-threatening, leaving doctors little time to intervene.

While some OB-GYNs who work in abortion-ban states interpret these laws as allowing them to offer all options for a miscarriage, sticking to longstanding medical best practices, our reporting has found that confusion around the grey areas in the laws and the need for extra documentation have caused some doctors to change their approach to counseling and treating miscarriages, even in cases where there is no fetal cardiac activity.

We have found that sometimes doctors didn’t talk about any procedures or medication management options with patients and only told them about the “watch and wait” approach. We’ve heard from doctors who say that it can be difficult to get these procedures approved by their hospitals and that sometimes other medical staff such as OB-GYNs, anesthesiologists or nurses don’t feel comfortable participating. In still other cases, we have reported on doctors delaying care while they take extra steps to document that there is no fetal heartbeat.

At least five women — Amber Thurman, Candi Miller, Josseli Barnica, Nevaeh Crain and Porsha Ngumezi — died after they didn’t receive these procedures in time, we found.

How to Find Doctors Who Will Offer All Options

Talk to people and organizations you trust for recommendations. This can include local doulas, midwives, nurses who work on labor and delivery wards, and reproductive health organizations.

Medical experts suggested asking physicians direct questions like: I’ve seen stories about patients who were unable to get care for miscarriage or pregnancy complications because of state abortion laws. Can you explain to me how the law in our state could affect my care?

They suggested following up with questions like:

• Considering the law in our state, are there options you would not be able to offer?
• If I were having a miscarriage, would you do a D&C if I wanted one? Would you do a D&C if I needed one for medical safety?
• If I were having a miscarriage in the second trimester, would you perform a D&E?
• Are you allowed to tell me my options or give me information in the event of a miscarriage?
• If you can’t provide these services, where should I go?

How to Prepare for Emergencies

Experts told us patients can talk to their doctors early about what to do if something goes wrong.

Here are some questions they recommend asking:

• If I think I’m miscarrying, can I receive care at your office, or do I need to go to the ER?
• Do you do D&Cs and D&Es? How often and where?
• If my water breaks in the second trimester, do you offer the option of abortion care or do you wait until there are signs of infection?
• Which hospital do you recommend if I need emergency care?

How to Choose a Hospital

Here are some things doctors and patients told us you can do:

• Ask to see the hospital’s miscarriage management guidelines.
• Ask whether doctors are expected to counsel patients on all three treatment options and provide whichever the patient chooses.
• Ask if the hospital has any physicians who have expertise in D&Es. One sign that a doctor may be well-qualified to perform this procedure is if they have done a Complex Family Planning fellowship.
• Check what organizations a hospital is affiliated with. Hospitals with religious affiliations sometimes don’t perform procedures to empty the uterus. Hospitals affiliated with universities tend to provide more comprehensive care and are more likely to have doctors with extra training in D&Es.
• Don’t delay seeking emergency care, even if it’s difficult to find an ideal hospital.

What to Do if You’re Experiencing Signs of a Miscarriage

Cramping and bleeding can be signs of miscarriage, but not always. Call your doctor or midwife to discuss symptoms first.

• You may be advised to wait and monitor your symptoms. Most miscarriages resolve without intervention within two weeks.
• If a doctor says to go to a hospital or a clinic, experts suggest asking for:
  • An ultrasound to guide your care
  • An OB-GYN to be involved in your care
  • Information about all three treatment options
  • The treatment option you prefer to get
• Be on the lookout for symptoms like high pulse and feeling faint, which could mean you have a serious complication. Bleeding heavily, such as soaking a pad in 30 minutes or less, is a reason to ask doctors if it’s necessary to empty the uterus, experts told us.

What to Do if You Aren’t Getting Care You Need

Medical experts recommend the following:

• Documenting the care.
• Asking directly for the desired treatment.
• Asking why care is being denied.
• Asking to see another doctor if the one assigned to the case is not providing the desired care.
• Requesting a transfer to another hospital if the one you’re at will not provide the care. Patients can cite EMTALA, the Emergency Medical Treatment and Labor Act, and remind physicians that federal law requires hospitals to stabilize anyone experiencing an emergency. If they can’t, they must transfer the patient to another hospital that will.
• Showing doctors evidence-based standards of care from professional medical organizations to explain that you should be offered these options. Here are guidelines from the American College of Obstetricians and Gynecologists.
• Asking to speak with patient advocates, who work at hospitals to help patients understand their rights and answer questions about their care. Or asking to speak to the hospital’s legal team. Hospitals have processes for escalating concerns.
• Asking for an ethics consult if you still aren’t getting straight answers or are being denied a procedure. Another option is an interdisciplinary meeting with your doctors and nurses, nursing leaders and hospital administrators.
• Reminding doctors that you are being denied the standard of care, which could mean the providers are committing malpractice.
• Filing complaints with the state survey agency, if you think EMTALA was violated, and with the state medical board.
• Calling your state representatives or contacting legal advocacy groups that can advocate for patients’ rights, including the Repro Legal Helpline at If/When/How (844-868-2812), the Center for Reproductive Rights (917-637-3600), the American Civil Liberties Union or the National Women’s Law Center.
• You can also reach out to journalists at ProPublica at reproductivehealth@propublica.org. We are continuing to investigate cases of denied care.

by Sharon Lerner

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Citing a recent ProPublica investigation, Sen. Richard Blumenthal, D-Conn., urged the Environmental Protection Agency in a letter this week to issue a final report on the health risks of formaldehyde that is “science-based” and “as strong as possible,” adding that “the agency has an obligation to protect the public from the chemical.”

Formaldehyde, used for everything from preserving dead bodies to binding wood products and producing plastic, is extremely widespread and causes far more cancer than any toxic air pollutant. ProPublica’s analysis of EPA air pollution data showed that, in every census block in the U.S., the risk of getting cancer from a lifetime of exposure to formaldehyde in outdoor air is higher than the goal the agency has set for public exposure to air pollutants.

The EPA issued a draft of the formaldehyde risk evaluation in March and, after receiving feedback from the public and a committee of experts, is expected to release the final version by the end of the year. The forthcoming evaluation will be used to inform future restrictions the agency puts on the chemical. But the ProPublica investigation found that the draft version of the report used unusual techniques to underestimate the risk posed by formaldehyde.

In one case, the agency determined whether concentrations of formaldehyde in outdoor air posed an “unreasonable risk” — a level that requires the agency to address it — not by measuring them against a health-based standard, but rather by comparing them to the highest level of the chemical measured outdoors in a five-year period. The measurement the agency chose as a reference point was a fluke, ProPublica found, and had not met the quality control standards of the local air monitoring body.

The EPA did not immediately respond to questions from ProPublica about Sen. Blumenthal’s letter and when the agency plans to release its final report.

The EPA is evaluating the health risks of formaldehyde under the Toxic Substances Control Act, the main federal law that governs chemicals. That process typically relies on toxicity estimates calculated by a separate division of the agency. In the case of formaldehyde, the EPA released the final toxicity values in August of this year, decades after it began the process of calculating them. Throughout that time, companies that make and use the chemical — and could lose money if it is restricted — criticised the agency’s numbers and worked to delay their release.

Some industry-affiliated members of the expert committee that reviewed the draft evaluation of formaldehyde this year have continued to find fault with the EPA’s toxicity estimates and have suggested that the agency weaken them in its final report.

In his letter, Blumenthal advised EPA Administrator Michael Regan against taking this route. “Throughout your tenure, EPA has been steadfast in upholding its vital mission of protecting human health and the environment,” he wrote. “I urge you to continue this commitment and issue a final risk evaluation for formaldehyde that is rooted in the best available science.”

by Charles Ornstein

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In my early years living in New Jersey, I keenly remember The Star-Ledger in Newark reporting on how hundreds of police officers and firefighters got anabolic steroids, human growth hormone and other forms of testosterone at taxpayer expense for medically unnecessary reasons. It was a tour de force of local journalism; something that deepened my understanding of the state where I lived.

Sadly, this kind of journalism has been harder to find as the papers that cover Jersey have struggled financially. Because the state is sandwiched between two big TV media markets — New York City and Philly — the issues facing our towns and cities get far less attention.

Indeed, in February, The Star Ledger is ceasing its print publication entirely and moving to an online-only format. Over the years leading up to this decision, the paper imposed multiple rounds of job cuts and its offerings thinned, even as the staffers who remained continued to produce vital journalism. The company’s leaders say they will reinvest funds from ending the print publication into the core newsroom.

I hope so. Because with each passing year, the reminders of the local news industry’s decline become more pronounced. Layoffs. Newspapers closing. Fewer investigative stories.

That’s why I’m so proud to share how ProPublica is stepping in to help fill this void through a number of new initiatives that we’ve launched and will continue to roll out in the new year.

In early 2024, we announced our 50 State Initiative, through which we pledged to tell accountability stories with partners in all 50 states over the next five years. We’re currently working with our first 10 local newsrooms, including a project in North Dakota (the first time we’re collaborating with an outlet in the state), and we will be selecting another 10 in 2025.

As part of this effort, we pay for a reporter’s salary and benefits for one year so they can dive deep into a project that matters for their communities or regions. We also pair those reporters with editors here and members of ProPublica’s data, research, crowdsourcing and news applications teams so they apply new and innovative techniques to their reporting. One of the consequences of newsroom layoffs has been drastic reductions or the elimination of research and data teams. Giving partners access to those resources greatly expands a story’s possibilities.

The 50 State Initiative is an outgrowth of our Local Reporting Network, which began in 2018 and has generated about 100 projects to date. Those stories have changed laws and changed lives. They’ve led to a national emergency being declared in Alaska, debt being forgiven in Memphis, Tennessee, and vast sums of money being allocated to fix long-standing problems in Idaho and Hawaii. Almost weekly, we see the impact of journalism from reporters in the network. We have seen changes in both blue and red states; so many issues transcend partisanship. People want to fix problems where they live when they become aware of them.

Reporter Jennifer Smith Richards looks through archived newspapers at the Mount Vernon Public Library in Ohio. (Sarahbeth Maney/ProPublica)

This success is possible because we work with a huge range of publications: legacy newspapers, radio and TV stations, and a new cadre of nonprofit newsrooms that have sprung up seeking to increase the sources of news to local residents. We’ve learned over and over again that people in different communities get their news in different ways, but the appetite for fact-based reporting transcends location.

Next year, we will build on this track record of success. In January, we will launch what we are calling our Sustainability Desk, which will work with previous partners to produce stories even after a reporter’s one-year fellowship has ended. We are hiring an editor and several other members of our staff to keep these relationships going and to identify opportunities to match the local knowledge of our partners with ProPublica’s investigative expertise. Be on the lookout for stories from these partnerships early in the year.

We are also launching a new initiative with our partners at The Texas Tribune. In addition to continuing the work of our shared investigative unit, we will be identifying major issues facing the state and collaborating with five local newsrooms each year to cover one of those issues from different perspectives.

Texas is helping to set the national dialogue on issues from education to health care to immigration. Gov. Greg Abbott focused the national spotlight on the border by busing more than 100,000 newly arriving immigrants to New York, Chicago and other big cities. The state is poised to adopt private school vouchers in its upcoming legislative session. And it also has the highest share of residents without health insurance in the nation. We will provide financial, editorial and audience support to five newsrooms around the state, and we are hoping that our investment in journalism meets the moment. As Texas lawmakers consolidate power in Austin — and newsrooms pare back their presence in the capital — this new approach will help to ensure newsrooms from El Paso to Tyler, Lubbock to Laredo, can learn about how people in various parts of the state are dealing with similar issues.

Reporter Mark Olalde uses a hand-held gas monitor to test for explosive methane and toxic hydrogen sulfide as part of his writing on oil well cleanup in New Mexico. (Nick Bowlin/Capital & Main)

Lastly, we will be hiring a reporter based in Florida. This will be our first dedicated reporting effort in the state, although we have done memorable work there, including Local Reporting Network partnerships with The Palm Beach Post on the harm caused by sugar cane burning and with the Miami Herald about a Florida program that was doing a poor job taking care of children born with brain damage.

The changes promised by Donald Trump as he prepares for his second administration are sure to create effects that will be felt locally. We are prepared to document the consequences for communities in an unprecedented way. When Trump took the oath of office for the first time, we had no regional offices and we hadn’t yet started our Local Reporting Network.

Now we have ProPublica journalists on the ground in 17 states: Alabama, Arizona, Colorado, Georgia, Idaho, Illinois, Michigan, Minnesota, Missouri, Nevada, New Mexico, North Carolina, Oregon, South Carolina, Texas, Washington and Wisconsin. Florida will make 18.

And we have 21 active Local Reporting Network partnerships across the country. All told, ProPublica has nearly 50 reporters in different communities covering local news through an investigative lens.

We may never fully replace the hyperlocal coverage of high school sports, the police blotter and the town council. But we do believe that every American should have the benefits of accountability journalism, regardless of where they live.

by Paul Kiel

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Fourteen years ago, Congress set out to remedy a basic unfairness in the tax code. The tax that funds Medicare, because it’s aimed mainly at wages, hits even the poorest American workers. But the wealthy could easily avoid paying their share. So lawmakers created a new type of Medicare tax to capture the kinds of income the rich often enjoy: interest, dividends and capital gains from investments.

A host of billionaires — sports team owners, oil barons, Wall Street traders and others — have managed to avoid paying it, ProPublica found.

To study who was actually paying the new tax, ProPublica analyzed its trove of IRS data containing information on thousands of the wealthiest Americans. We identified 17 people who, in the first six years of the law, 2013 through 2018, each shielded at least $1 billion in capital gains from the tax. Together, this small group, by collectively exempting more than $35 billion, saved about $1.3 billion in taxes.

Most members of the group were able to sidestep the tax because of a huge gap written into the law, which allows owners to exempt gains from the sale of their businesses. They include Donald Sterling, the disgraced former NBA team owner who avoided the tax when he sold the Los Angeles Clippers to Steve Ballmer for $2 billion in 2014.

But others eluded the tax in ways that raise questions about how the law is being enforced.

One clear target of the new tax was investment professionals who rack up capital gains. Yet ProPublica found examples in the IRS data of financiers who claimed outsize profits but did not pay the tax. Tax experts contacted by ProPublica said they couldn’t think of a legitimate reason why those individuals were exempt.

Lynn Tilton, a hard-charging private equity manager, who has been dubbed the “diva” of distressed asset investing, is one example. The biggest avoider of the new tax in the data was Jeff Yass, the Republican megadonor who sits atop one of the most profitable trading firms in the world.

Both Medicare tax and its twin, the Net Investment Income Tax, as the new levy was called, are easily avoided by business owners. Last week, ProPublica revealed how some of Wall Street’s most powerful people use a loophole to avoid paying Medicare tax on their share of their firms’ profits. Eliminating these ways around the taxes, as House Democrats proposed to do in a 2021 bill, would raise an estimated $250 billion over 10 years. Medicare, the federal program that provides health care for some 68 million seniors, is projected to run short of money in 2036.

“It becomes a pretty glaring problem when you have ultra-rich individuals layering loopholes on top of loopholes to dodge both the NIIT and Medicare taxes,” said Sen. Ron Wyden, chair of the Senate Finance Committee, in a statement. “To the nurse or the janitor whose taxes come straight out of their paychecks, it’s ridiculous to see these examples of fabulously wealthy individuals enjoying huge windfalls and continuing to avoid paying a fair share.”

The NIIT, together with its holes, entered the tax code as part of the Obama administration’s push to pass the Affordable Care Act. In need of ways to help pay for a major expansion of government health care subsidies, Democratic lawmakers embraced the idea of this new tax on investments.

The aim was to level the playing field. All workers pay at least 2.9% in Medicare taxes on their wages, an amount usually deducted automatically from their paychecks. The NIIT, for high-income taxpayers (defined as $250,000 and up for a married couple), subjected investment income to a 3.8% rate. That mirrored the Medicare tax rate that workers earning over the same threshold paid under the new law.

But while the tax was a bold step, the ACA’s lead negotiators had navigated various interest groups to piece the bill together and were afraid of whom their new tax might provoke. Behind closed doors, Democratic leaders hashed out a compromise that carved active business owners out of the tax.

The small-business owner is a hallowed figure on Capitol Hill, and an army of lobbyists and trade groups stand ready to mobilize against any bill that arguably disadvantages small businesses. The Democrats crafting the NIIT were wary of such a campaign.

Democrats wanted to avoid “a swing state Dem being attacked for punishing an entrepreneurial hard-working person” with the tax, said Robert Andrews, a former Democratic U.S. representative from New Jersey who was among the negotiators.

The phrase “small business” conjures images of Main Street grocers, plumbers or garage-based startups, but the types of business that benefit from the carve-out range from small to enormous. There are millions of passthrough businesses, so called because the income earned and taxes owed pass through to the owner. Only a small number of such businesses are worth $100 million or more, yet the owners of the largest businesses are likely the prime beneficiaries of the exemption.

Owners of passthrough businesses with significant revenue already enjoy plenty of tax perks, as ProPublica showed in previous stories. The NIIT carve-out added to that list. The carve-out meant that when they sold their businesses, or portions of them, they’d be spared any extra charge beyond income tax on their capital gains. They’d pay a lower tax rate on those gains than on virtually any other form of investment.

“What we’re left with in terms of these gaps are nonsensical results,” said Steve Rosenthal of the left-leaning Tax Policy Center.

When Sterling sold the LA Clippers, virtually the entire $2 billion sale price was taxable capital gain, because he’d bought the team for $12.5 million in 1981. Sterling, who made his money in LA real estate, did not give the impression of someone who enjoyed owning an NBA franchise. He was notorious for deriding his own players and underinvesting in the team. But it was only a scandal, a leaked private recording in 2014 of him urging his girlfriend not to be seen “associating with Black people,” that forced him to sell after the NBA banned him.

It was the biggest payday of Sterling’s life by far. He paid substantial income tax on the capital gain from the sale, but the exemption from the NIIT saved him around $70 million. Neither Sterling, who is 90, nor his tax preparer responded to requests for comment.

In ProPublica’s database, most of the biggest winners from the NIIT carve-out were owners, like Sterling, selling their privately held businesses. Among those exempting gains of $1 billion or more were four moguls from the fossil fuel industry spared the extra tax when they sold off portions of their oil, natural gas or coal empires. The carve-out saved each of the four between $45 million and $87 million in taxes.

The NIIT carve-out was huge and costly, but it didn’t apply to all business owners. Owners who are merely passive investors in a business, for instance, must pay the NIIT on that income. And Congress singled out securities traders as clearly subject to the tax.

The NIIT was targeted at “high-income people who lived off investments,” remembered Andrews. It was designed to hit “someone who is day-trading, someone who is arbitraging the market,” he said, referring to the practice of exploiting mismatched prices of securities, like stocks or bonds.

That could serve as a loose description of what Yass’ firm, Susquehanna International Group, is renowned for. Yass, a former professional poker player who thrives on taking well-calculated risks, amassed an army of traders at Susquehanna to outwit the market. They are hired to execute computer-driven strategies that seize on advantages at the microsecond level and search for situations that, through a cleverly executed arbitrage, they can exploit. The firm deals extensively in options as well as other securities. Susquehanna has been immensely profitable; Forbes estimates Yass’ fortune at $50 billion.

From 2013 through 2018, Yass reported a total of $9 billion in capital gains on his taxes, according to ProPublica’s IRS trove, but excluded $8.5 billion of those gains from the NIIT. That saved him more than $300 million in taxes during those years. Two of Yass’ Susquehanna partners, Arthur Dantchik and Joel Greenberg, also excluded billions in gains from the NIIT during that time: $2.1 billion and $1.2 billion, respectively. Together, they saved about $120 million.

In 2013 and 2014, Yass managed to wipe out not only his gains for the purpose of the NIIT but also hundreds of millions in interest and dividend income. In each of those years, his tab for a tax crafted to target traders like him amounted to $0.

Tax experts contacted by ProPublica struggled to explain how Yass and his Susquehanna partners could justify excluding their firm’s gains from the NIIT.

“Although the principal here is active in the business, the business is trading in financial instruments,” said Andrew Needham, a former attorney with Cravath, Swaine & Moore who has written extensively on how tax laws apply to hedge funds and other financial firms and now teaches at New York University School of Law. That means Yass’ gains should be subject to the NIIT, he said. “I don’t know what his theory is.”

A Susquehanna spokesperson, speaking on behalf of Yass and his partners, declined to respond to a list of questions.

Yass, a longtime libertarian, gave $95 million last election cycle to conservative groups, especially the antitax Club for Growth, putting him among the largest political donors in the country.

Yass has a history of taking bold positions on his tax returns. The IRS recovered more than $75 million from Yass after one protracted audit fight that spilled into court, and Susquehanna is currently in court fighting another audit. In an earlier story, ProPublica detailed how Yass and Susquehanna engineered the firm’s investments to transform income normally taxed at the high, ordinary rate into income taxed at the 20% long-term capital gains rate. Those maneuvers saved Yass over $1 billion in taxes.

ProPublica analyzed the tax data of hundreds of the wealthiest hedge fund and private equity managers to understand how they were complying with the NIIT. Huge, blanket exemptions among finance moguls like Yass were rare, we found, but when they did occur, the cost to the Treasury was considerable.

Tilton won fame on Wall Street as the brash, stiletto-wearing head of her own investment firm. She specialized in distressed investing: Her funds purchased both the debt and equity of over 40 struggling companies, then blended those investments together and sold them to investors. Tilton sought out publicity — with mixed success. The Sundance Channel developed a reality show starring Tilton titled “Diva of Distressed,” but it never made it past the pilot. In 2011, she tried to convince Forbes that she was a billionaire, but the magazine disagreed, estimating her wealth at around $830 million.

Tilton has left a trail of unhappy investors. She’s been sued for fraud and racketeering, for misleading investors and pillaging the portfolio companies for her own profit. Tilton, for her part, maintained that she’d fully briefed investors and denied taking any improper compensation. She successfully fought off three major lawsuits, including one from the Securities and Exchange Commission.

Tilton’s investment funds were passthrough businesses set up so that she, not her investors, would bear the tax burden. In most years, there wasn’t much of a burden to bear. But in 2016, the funds posted a $1.4 billion capital gain. While a huge gain sounds like a good thing, for Tilton it meant a big tax bill.

The income tax hit was significant for her, about $162 million after deductions. She complained about having to pay the bill in one of the lawsuits against her firm, calling it a tax on “phantom income.” As she put it later at the trial, “But let’s be clear, I was paying taxes for money received by the noteholders.”

While Tilton did pay income tax on that big gain, she claimed that the entirety of the $1.4 billion was exempt from the NIIT. That saved her about $50 million in tax.

An attorney for Tilton declined to comment for the record but said that Tilton had correctly exempted her gains because she had actively managed the funds’ investments in the portfolio companies.

Tax experts contacted by ProPublica disagreed. Brian Galle, a professor at Georgetown Law and former federal prosecutor of tax crimes, said Tilton appeared to have invented a category of financier who is not subject to the tax. The tax clearly applies to passive investors and traders, he said. Tilton appeared to be claiming to be somewhere in between, an “active” investor but not a trader. While there is some ambiguity in the regulations surrounding the law, he said, it was a “ridiculous argument.”

Tilton, like Yass, has had her battles with the IRS. From 1996 through 2013, all but two of her tax returns drew audits, the largest change leading to $1.5 million in additional tax on one year’s return. But ProPublica’s IRS data shows no active audits of Tilton’s later returns as of mid-2020.

One reason might be the devastating budget cuts to the IRS that started in 2011 and reduced enforcement staff by a third. The agency did glance at Tilton’s 2016 return, according to the data, but concluded that, although the return had “audit potential,” no agents were available to examine the return.

Similarly, there’s no indication the agency has scrutinized Yass’ NIIT obligations. As of mid-2020, the agency did not have an open audit of his tax returns for 2013 through 2017. An audit of his 2018 return was in the early stages. The IRS declined to comment.

In just the last year, the IRS began to regain some of its lost enforcement muscle, hiring thousands of new revenue agents with funds from the 2022 Inflation Reduction Act. However, it’s unclear how long that resurgence will last. Congressional Republicans have continually vowed to clawback the extra enforcement money. The incoming Trump administration has supported that goal while touting a new round of tax cuts, in particular for business owners.

by Kavitha Surana, Mariam Elba, Cassandra Jaramillo, Robin Fields and Ziva Branstetter

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In states with abortion bans, ProPublica has found, pregnant women have bled to death, succumbed to fatal infections and wound up in morgues with what medical examiners recorded were “products of conception” still in their bodies.

These are the very kinds of cases state maternal mortality review committees are supposed to delve into, determining why they happened and how to stop them from happening again.

But panels in states that have recently imposed strict bans on abortion have done little to uncover whether the laws are contributing to maternal deaths, including tracking delays in care for pregnancy complications and making these problems known, a ProPublica investigation shows.

In fact, we found that in a few states, political leaders who backed the bans have stood in the way of measuring their consequences.

They have dismissed committees, slowing down their work. They have weeded out members openly critical of abortion bans and supportive of transparency.

Texas has gone as far as to legally prohibit its committee from reviewing deaths that are considered abortion-related. This could include some miscarriage care, health officials told ProPublica.

In two deaths of Texas women that ProPublica investigated, Porsha Ngumezi and Josseli Barnica had already miscarried when they were given misoprostol to help complete the process. The committee does not review cases that involve that drug because it’s also used for abortions, said committee chair Dr. Carla Ortique: “If they received medication, if they received any procedure, we will not get those records.” Chris Van Deusen, the spokesperson at the Texas Department of State Health Services, would not say whether Ngumezi’s and Barnica’s deaths would be reviewed.

First image: Porsha Ngumezi with her husband, Hope. Second image: Josseli Barnica with her infant daughter. (First image: Danielle Villasana for ProPublica. Second image: Courtesy of the Barnica family.)

Other state committees have not made changes to systematically examine the role abortion bans are playing in maternal deaths, officials acknowledged, though some said they might note it as a contributing factor if it appears in the records. “If the committee discovers a trend that raises a particular concern, it could decide to include that information in its reports,” South Carolina officials said.

Some noted that they follow guidelines from the Centers for Disease Control and Prevention, and that those recommendations don’t direct committees to consider abortion access or delays in abortion care. Indiana’s law directs committee members to determine whether the person who died had an abortion and whether that contributed to their death; it does not focus on delays in access to abortion care.

States can direct their committees to look at any important health issue; Texas’ panel added new questions to its process to help capture the role of the coronavirus pandemic in deaths, for example.

ProPublica asked governors in 15 states with strict abortion bans whether committees should examine the impact of the laws on maternal deaths; most did not respond. None directly answered the question or advocated for specific changes. (Read their responses here.)

“We’re not acting like we want to know the answer to this question. And that concerns me,” said Caitlin Myers, an economics researcher at Middlebury College who is studying the impact of abortion access on maternal health. “However you feel about the ethics of abortion, we should want to understand how these policies are affecting women’s health.”

Experts interviewed by ProPublica say state maternal mortality review committees are uniquely well-positioned to examine the impacts of abortion bans on maternal health. The panels are often made up of practicing OB-GYNs, cardiologists and nurses, and they can also include doulas, medical examiners and experts in mental health, substance abuse and domestic violence. They review summaries of medical records to determine whether deaths were preventable and to identify contributing factors. This allows researchers and government officials to see patterns and come up with ways to improve the country’s poor maternal health outcomes.

Committees are not systematically tracking an issue that came up throughout ProPublica’s reporting on deaths in states with abortion bans: delays and denials of procedures, like dilation and curettage, which are used to empty the uterus during miscarriages to avoid hemorrhage and infection. The procedures are also used for abortions, and doctors face prison time for violating restrictions. Women have died after they could not access these procedures, ProPublica found.

Nevaeh Crain, a teenager whose organs were failing, was made to wait 90 minutes for a second ultrasound to confirm fetal demise. Amber Thurman suffered for 20 hours while sepsis spread. And Barnica was subjected to serious infection risks for 40 hours while doctors monitored the fetal heartbeat until it stopped.

First image: Nevaeh Crain. Second image: Amber Thurman with her son. (First image: Danielle Villasana for ProPublica. Second image: Via Facebook.)

Studying such delays “needs to be a part of these kinds of reviews,” said Dr. Daniel Grossman, a leading reproductive health care researcher and professor of obstetrics and gynecology at the University of California San Francisco.

Grossman has collected dozens of accounts from health care providers detailing substandard treatment and poor outcomes in states that banned abortion. But he and others recognize who is ultimately in charge of state maternal mortality review committees.

“I can’t imagine the states that passed restrictions saying, ‘Now we want to know if that caused any deaths,’” said Eugene Declercq, a professor at Boston University’s School of Public Health who serves on Massachusetts’ maternal mortality review committee. “The clinicians and the public health people might want to know, but the political leaders would be aghast.”

Even if they start to pursue such answers, states are years behind in reviewing deaths, ProPublica found in a survey of 18 states with the most restrictive abortion laws. Most have not finished reviewing deaths from 2022, the year most bans became effective after the Supreme Court overturned the constitutional right to abortion. Two states are still reviewing 2021 deaths. Three states — Florida, North Dakota and South Dakota — did not respond.

Most States With Abortion Bans Are Years Behind in Reviewing Maternal Deaths Criminal abortion bans went into effect after the Supreme Court overturned Roe vs. Wade in June 2022. Texas enacted a civil law banning abortion at six weeks in 2021. This data was gathered by contacting each state agency that oversees the maternal mortality review committees in the states we surveyed. It is current as of November 2024. Some states did not submit a response to our outreach last month, so we are including their most recent response. Idaho is reviewing 2023 cases before it reviews 2022 cases. Texas began reviewing 2024 cases in December, skipping 2022 and 2023.

Reviews typically lag years behind deaths because of the time it takes state health department employees to learn of cases, track down records and wrestle them free from hospitals and doctors before they summarize and redact them for review. “We have one person in the entire state that has to collect all that data. Literally one,” said Dr. Stacie Geller, a founding member of Illinois’ committee. “I live in fear of her retiring.”

The CDC, which has pumped tens of millions of dollars into helping states establish these committees and standardizing their work, has tried to reduce the backlog by setting a goal for committees that receive funding to review cases within two years. However, there’s no way to compel states to do so, and not all have caught up.

Such lags matter more in places where there has been a seismic shift in abortion access, experts told ProPublica, because there isn’t a full understanding yet of the laws’ effect on maternal health care.

Marian Knight leads the United Kingdom’s maternal mortality review program, widely seen as the world’s best. She said if there were a major legal shift like this in her country, she and her colleagues would adapt to track the impact in close to real time. “I would be monitoring that in the same way as I did during COVID, where we were analyzing data weekly and feeding it in,” Knight said.

As of last month, only five states — Iowa, West Virginia, Indiana, Georgia and Tennessee — had finished reviewing cases from 2022, ProPublica found. None had yet published a report on its findings for that year.

Seven other states were still examining 2022 cases: Alabama, Oklahoma, South Carolina, Mississippi, Missouri, Arkansas and Louisiana.

Idaho, Texas and Kentucky had not yet started looking at cases from that year.

Even though North Dakota did not respond to ProPublica’s survey, reporters found that its committee, formed by state legislation in 2021, has never met to review cases, according to two members.

In some instances, state officials are responsible for delays.

Idaho disbanded its committee in summer 2023 after a conservative group argued it was unnecessary and attacked members for recommending that the state expand Medicaid for postpartum patients. The move froze the group’s work until last month, when a reconstituted, smaller committee met for the first time. Two members who had spoken out against the ban’s impacts on maternal health, and are suing the state over it, were not brought back onto the committee. The state is defending its anti-abortion laws; the Idaho Attorney General has said he “will not stop protecting life in Idaho.”

It is unclear how long Georgia’s reviews will be stalled after state officials dismissed its committee last month, citing a violation of confidentiality rules after ProPublica reported on internal documents in stories about two preventable deaths examined by the group. The Georgia Department of Public Health said in a letter about the dismissal that this would not result in any delays to the committee’s responsibilities.

In a move that confused maternal research experts, Texas’ committee said it would not review data from 2022 and 2023 and begin with reports from 2024 to get a more “contemporary” view of deaths. The committee has skipped years in the past to address gaps, and at its recent meeting, Ortique, the chair, said that the decision had “absolutely no nefarious intent.” The period it plans to skip includes two of the preventable deaths ProPublica reported.

Dr. Romy Ghosh, an OB-GYN in Austin, Texas, pleaded with the maternal mortality review committee at a public meeting this month to reconsider its decision to skip those years.

“There’s been a lot of fear in my patients. They wonder, can I save their life if something goes wrong?” she said. “I think that this information will tell us there’s either nothing to worry about or it will be damning.”

Dr. Romy Ghosh addresses Texas’ maternal mortality review committee at a public meeting in Austin this month. (Ilana Panich-Linsman, special to ProPublica)

Between the decision to skip years and the legal prohibition against examining cases involving abortion-related care, it appears Texas will not review any of the three preventable deaths ProPublica identified.

There is a limit to how much committee members can push back against state leaders.

When Texas delayed publishing its maternal mortality report in 2022, an election year, then-committee member Nakeenya Wilson, a community advocate, spoke out, saying “withholding data that does not make us look good is dishonorably burying those women.”

The next session, Texas lawmakers passed a bill changing the requirements for the position that Wilson held, effectively removing her from the committee. State officials appointed Dr. Ingrid Skop, a Texas OB-GYN who is the vice president of a prominent anti-abortion organization.

Wilson said maternal mortality review committees must be free to speak candidly about patterns they see in maternal deaths and to release information in a timely fashion.

“If it’s not the committee, then who is it?” she said. “There has to be increased accountability.”

First image: Crain’s mother, Candace Fails, cries at her daughter’s grave. Second image: Ngumezi’s husband, Hope, touches his wife’s grave in Pearland, Texas. (Danielle Villasana for ProPublica) Thurman’s grave in McDonough, Georgia, on the day after what would have been her 31st birthday. (Nydia Blas for ProPublica)

Audrey Dutton, Anna Maria Barry-Jester, Lizzie Presser and Amy Yurkanin contributed reporting.

by Bob Fernandez and Craig R. McCoy for The Philadelphia Inquirer

This article was produced in partnership with The Philadelphia Inquirer, which was a member of ProPublica’s Local Reporting Network in 2020-21. Sign up for Dispatches to get stories like this one as soon as they are published.

This spring, the Justice Department announced a major victory against a drug firm that manufactured billions of opioid painkillers. Endo Health Solutions, the agency said, would face $1.5 billion in fines and forfeitures and plead guilty to a corporate criminal charge.

Prosecutors said the massive fine would hold accountable a suburban Philadelphia company that profited by “misrepresenting the safety of their opioid products and using reckless marketing tactics to increase sales.”

But in the end, federal prosecutors offered far friendlier terms than those trumpeted by the agency.

Endo would not have to pay the $1.5 billion in criminal penalties, which was already a deep discount from the billions federal officials said Endo owed for dodging taxes and driving up Medicare costs.

In what amounted to a liability fire sale by the Justice Department, the company’s woes with the federal government would all be resolved by a $200 million payment.

In sentencing Endo in federal court in May, Judge Linda Parker wondered how the amount paid to the U.S. could be so low.

“I don’t understand. I really don’t understand,” Parker said. “I just don’t understand how it went from $1 billion to $200 million.”

Federal prosecutor Benjamin Cornfeld explained: Endo was broke. 

“The reality is that there are limited funds available because the debtors were in bankruptcy,” Cornfeld said.  

But a fuller explanation, drawn from corporate filings, interviews, and criminal court and bankruptcy records, shows how the DOJ, after years of aggressively prosecuting opioid companies, delayed for a decade a winning criminal case against Endo. In the intervening years, Endo vastly expanded its narcotic-pill empire before executing a corporate escape plan.

Codenamed Project Zed, the plan allowed Endo to restructure its debt to retain control of the company and hand out $95 million in executive bonuses before seeking protection in bankruptcy. The result for U.S. taxpayers: Endo paid a tiny fraction — three pennies on the dollar — of the $7 billion that officials said it owed the U.S. government, including $4 billion in taxes.

Endo is not a household name. But by 2018, a year when 15,000 Americans overdosed and died on prescription painkillers, Endo and the firms it purchased had sold 33 billion opioid pills over two decades, almost three times the number sold by Purdue Pharma, the Sackler family’s OxyContin powerhouse.

Though federal prosecutors first learned about Endo’s criminal behavior in a 2013 whistleblower suit, they dropped their investigation, even as they doggedly pursued Purdue. By the time DOJ prosecutors revived the allegations against Endo early this year, the company was bankrupt.

Hundreds of lawyers, paralegals and financial advisers litigated Endo’s bankruptcy, billing more than $350 million. Some lawyers charged more than $2,000 an hour. Paul Leake, Endo’s lead attorney, said in a court filing that the bankruptcy plan “extinguished” Endo’s liabilities for “a fraction of the debtors’ total criminal and civil exposure.”

Individual opioid victims didn’t fare as well. They got just $40 million from Endo — a sum that works out to about $1,000 per victim. In comparison, people hurt by bankrupt Purdue, the poster firm for the U.S. painkiller trauma, were to share up to $750 million. Purdue victims are to receive sums ranging from $3,500 to $48,000.

Margo Siminovitch, an attorney representing opioid victims, was the fiercest critic of the plan. At the bankruptcy’s last major hearing, she told the judge that lawyers in the case earned hourly rates that “exceed what an opioid victim who’s had their life devastated is going to get.”

Endo “came with a strategy purposely intended to reduce payments to opioid victims,” Siminovitch said in an interview. “All of the [Endo] opioid victims were burned by this process, in that they were going to get virtually nothing.”

The Federal Government Sought $7 Billion. It Got a $200 Million Payment.

When Endo filed for bankruptcy, federal agencies brought claims against the drug firm seeking $7 billion in back taxes, Medicare overpayments, and criminal and civil penalties. But the Justice Department’s slow-moving prosecution and Endo’s financial maneuvers left little cash in the coffers. In the end, Endo paid the U.S. government just $200 million.

(Sources: Court and bankruptcy records; corporate filings (John Duchneskie/Philadelphia Inquirer, adapted by ProPublica)) Profiting From Pain Management

Spun out of DuPont Merck in 1997, Endo — the name is Greek for “inside” — set out to make money “in the changing landscape of pain management,” and for 20 years it did just that.

The company started with Percocet: It upped the per-pill opioid dosage and whipped up sales through promotions and a contest among salespeople where BMW corporate cars were the prize. Revenue soared.

Endo’s next big bet was Opana ER, an extended-release painkiller that won the Food and Drug Administration’s approval in 2006. Opana ER became its flagship opioid, Endo’s answer to Purdue’s OxyContin. Endo launched the brand with a $48 million marketing campaign and began, in a phrase Endo used internally, “hyper-targeting” heavy opioid prescribers.

To ease deep-seated concerns over opioid addiction, Endo also linked up with other pharma companies to try to reshape the public image of prescription narcotics. The firm poured millions into advocacy front groups, notably the American Pain Foundation, which contended doctors feared opioids “because they mistakenly think their patients will become addicted.” The foundation shut down the day a Senate committee announced it was probing the industry groups.

Larry Romaine, Endo’s senior vice president for sales, told subordinates in a 2012 voicemail that salespeople had to be “laser focused” on selling Opana ER. “If we have reps out there, I don’t care who they are, that can’t sell Opana ER clinically, they can’t be with Endo. OK?” he said.

His voicemail and other material from inside Endo, including emails, became public court records in lawsuits filed against the company.

Endo declined to comment for this story and would not respond to detailed questions sent to the firm. Former Endo employees, including those whose communications were entered into court records and are cited in this story, did not return emails and phone calls seeking comment.

In an email sent in 2009, Endo sales manager Bret Anderson wrote to his team, referencing requirements to identify and cut off doctors who prescribed suspiciously high volumes of opioid drugs, with a warning that if too many doctors were flagged it could hurt business. “I also consider the rule: ‘if you are not aware of any major issues, it is probably not a problem.’”

In a 2009 email, Endo manager Bret Anderson told staffers that reporting too many doctors who were prescribing suspiciously high volumes of opioids could harm business, saying, “it may risk that territory being a viable territory.” (Documents obtained by ProPublica and The Philadelphia Inquirer. Highlighting added by The Philadelphia Inquirer.)

At Endo’s headquarters, Linda Kitlinski oversaw Endo’s education programs for doctors for 16 years. In 2009 she sent an email to her husband documenting her concerns that “Endo’s senior leadership” was pressuring her to improperly use her program as a sales tool. Soon after she raised these issues internally, her boss called her into his office and warned her that she had nearly been fired because she was “an impediment to the business.” She needed to stop “playing policeman.”

When Endo salespeople alerted bosses to dangerous doctors, lawsuit testimony revealed that the company, unlike other manufacturers, never reported those suspicions to the Drug Enforcement Administration. Those reports were required by law.

In Alabama, Endo sales reps made 1,200 visits to a Mobile clinic where two doctors wrote “thousands of Opana ER prescriptions after Endo knew the clinic to be engaged in abuse,” the government said this year in its criminal case against Endo. Prosecutors said the clinic had a crowded waiting room with intoxicated customers, armed guards and medical staff “abusing controlled substances on-site.”

In Knoxville, Tennessee, where Endo sold more Opana ER pills than in New York City, Los Angeles and Chicago combined, a sales rep reported to supervisors that one doctor had “patients waiting in the parking lot in lounge chairs,” and “it is just a matter of time before the DEA closes him down.”

In Pittsburgh, more than 100 pharmacies refused to fill prescriptions for a reckless doctor, yet Endo continued to supply him. He was the nation’s largest Opana ER prescriber, according to an Endo email.

Doctors in those clinics were eventually sentenced to prison.

Separately, records show that of Endo’s 20 biggest Opana ER prescribers in the Medicare program in 2016, four clinic operators would later be convicted of running multimillion-dollar pill mills. A fifth would lose her medical license for dangerous prescribing.

Linda Kitlinski, who oversaw Endo’s education program for doctors, sent an email to her husband in 2009 contending that senior management was pressuring her to use her program as a sales tool. The email was made public as evidence in New York state’s lawsuit against Endo. The drug company settled the suit in 2021 for $50 million. (Documents obtained by ProPublica and The Philadelphia Inquirer. Highlighting and redactions added by The Philadelphia Inquirer.)

As it became clear that opioids were causing a health crisis, Endo came up with a response. It engineered a new, purportedly safer pill with a hard outer shell to make it more difficult to extract the active opioid, branding it as Opana ER “with Intac Technology.”

But there was a big problem: The FDA found the retooled drug to be no safer than the old version. For three years, the agency warned Endo that the pill could be “readily prepared for injection” — an even riskier high than snorting because of the danger of sharing needles.

I just don’t understand how it went from $1 billion to $200 million.

—Federal Judge Linda Parker, on reviewing the final deal with Endo

Within Endo, Bob Barto, the vice president for regulatory affairs, warned in a 2010 email against using the Intac slogan “because we don’t have any data to demonstrate that the technology conveys any benefit to the patient.”

Endo leaders didn’t drop the marketing approach. In the new drug’s slogan, the company said the pills were “designed to be crush resistant,” stopping short of saying they actually were crush resistant.

In early 2012, William Best, an Endo executive who dealt with regulators, emailed internally to say he was comfortable with promoting Opana as designed to be safe. While acknowledging that the language might provoke FDA disapproval, Best wrote, “it is likely to be a warning letter.”

As the company began selling its new formulation, the firm declared in marketing material: “At Endo, we are doing our part to limit abuse.”

Warning Signs for Endo

In 2013, a whistleblower emerged from the Endo salesforce. Her name was Loretta Reed.

A veteran in the pharma industry, Reed had worked for Endo for seven years when she filed a lawsuit in Philadelphia federal court alleging that top executives were intent on selling the updated version of Opana ER as safer, despite the FDA’s rejection of that claim. The 50-year-old’s job was to market Endo’s pain drugs to doctors in the Atlantic City, New Jersey, area.

Endo leaders distributed marketing gimmicks, notably kits with samples of Opana ER’s new hard covering, Reed disclosed. Salespeople deployed the kits, she said in the suit, to demonstrate the toughness of the pills, pounding samples with hammers and microwaving them — the kinds of misleading tactics cited later as part of Endo’s guilty plea.

But while hammering and microwaving demonstrated the new pill’s exterior strength, it left doctors uninformed about the other ways the narcotic active ingredient, oxymorphone, could be extracted by abusers, including by cutting, chewing, grinding and heating the pills for injection.

Endo’s marketing was “purposely designed to fraudulently manipulate prescribing physicians,” Reed’s suit charged. She said the company’s management misled the sales force about the FDA’s concerns.

Indeed, Endo’s own research, provided to the FDA in 2016, showed that many users switched to shooting up when abusing the product.

You had to cook them. … It pretty much forced me to have to inject really.

—A drug user on the hard cover added to Opana ER pills

In 2017, a senior medical adviser with the Centers for Disease Control and Prevention investigated the role Opana ER had played in an HIV outbreak in Indiana after doctors diagnosed 135 people with the disease, all of them tightly concentrated in a rural county. Narcotics users had extracted the oxymorphone from Opana ER and shot it up, with many sharing needles.

In his report, the CDC investigator quoted a drug user as saying that once Opana ER added its hard cover, “You had to cook them. … It pretty much forced me to have to inject really.”

Said another: “I couldn’t find any [original] Opanas or other pain medicine to snort. It became almost non-existent. So I was turned on to shooting up. So that’s pretty much how that went down.”

Reed’s allegations of mislabeling were strikingly similar to those made by an Endo salesperson eight years earlier. In a 2005 federal lawsuit, sales rep Peggy Ryan had reported that top executives had relentlessly pushed the sales force to sell the nonopioid shingles drug Lidoderm off-label for everything from sore backs to carpal tunnel. Ryan declined to comment for this story.

Federal prosecutors had embraced Ryan’s suit, using her to gather evidence. Ryan wore a wire for the FBI for two years. The criminal investigation advanced slowly, but in early 2014, Endo admitted it had illegally misbranded Lidoderm. It paid a $192 million fine and signed a “corporate integrity agreement” promising to improve its ethics. The deal permitted it to keep doing business with Medicare, despite a law mandating that criminal pharma firms be cut off.

As for new whistleblower Reed’s allegations involving Endo’s leading narcotic painkiller — a far more dangerous drug than Lidoderm — the Justice Department took them seriously at first. Federal officials put together a task force of prosecutors and FDA investigators.

By the fall of 2014, eight months after charging Endo over Lidoderm, prosecutors had decided to end their probe regarding Opana ER, Philadelphia court documents show. That led Reed to withdraw the case in 2015. Prosecutors would not discuss their reasons for dropping the Opana ER investigation.

The Justice Department did not answer questions in detail for this article, but in a statement it praised the deal it finally reached with Endo this year that “secured a victory for American taxpayers and other stakeholders.”

Reed’s lawsuit aside, Endo still saw promise in opioids. New chief executive Rajiv De Silva, who took charge in 2013, executed an ambitious acquisition strategy, taking on debt to buy Par Pharmaceuticals, a maker of generic opioids that was churning out billions of pills a year, for $8 billion.

The timing was terrible. After Endo’s expensive wager on Par, the national conversation over opioids darkened. Tens of thousands had overdosed and social costs exploded. Cities and counties across the nation, linking up with aggressive personal-injury law firms, sued opioid players at every rung of the business, from pillmakers to distributors to pharmacies to doctors. More than 40 state attorneys general joined together to demand compensation from opioid firms.

In 2017, the FDA held two days of emotional public hearings on Opana ER that laid bare its dangers.

Not long after, the agency asked Endo to take Opana ER with Intac Technology off the market, a first in modern times for an approved opioid. If Endo didn’t remove the drug, the FDA said it would. Endo complied. By then, Endo had made $543 million in profits over six years selling the painkiller.

In 2018, federal prosecutors subpoenaed opioid-related records from Endo. After the FBI contacted Reed, now living in Florida, about the allegations made in her withdrawn Philadelphia case, her lawyer, Eric Young, refiled the whistleblower suit in Florida. But it would be another five years before federal prosecutors would bring criminal charges against Endo.

Launching Project Zed

As the feds delayed, Endo acted.

Facing a growing wave of lawsuits, Endo spent heavily on legal fees — ultimately paying $345 million. Its fierce legal strategy generated its own controversy as Endo’s leading defense firm, Arnold & Porter, faced repeated allegations that it wasn’t fighting fair.

One New York state prosecutor in a civil trial accused the law firm of “concealing vast troves of smoking-gun evidence proving Endo’s grave misconduct.”

In California, a judge barred testimony from former Endo senior director Kitlinski after Arnold & Porter and other defense law firms did not turn over her 2009 memo.

In Tennessee, the legal hardball became a debacle for both Endo and Arnold & Porter. A judge there held them in contempt and found that they had engaged in “a coordinated strategy” to deprive opponents of information. The judge demanded that Arnold & Porter apologize to the court and that its attorneys take an ethics refresher class.

Arnold & Porter declined to comment, but referred reporters to previous statements. The firm said at the time it had acted in good faith and regretted that any document had been produced late. It said its lawyers had worked hard to locate and turn over all relevant documents and had even offered to pay for additional depositions to go over issues raised in any belatedly revealed material.

In 2020, a Tennessee judge held Endo’s lead defense firm, Arnold & Porter, in contempt for failing to disclose potentially damaging information. The firm’s chair apologized to the court, and more than 100 Arnold & Porter attorneys involved in Endo cases nationwide took an ethics class to satisfy the judge’s order. (Documents obtained by ProPublica and The Philadelphia Inquirer.)

Endo turned to another big law firm, Skadden Arps in New York, to deal with a declining business and potential bankruptcy. From Endo’s perspective, the lawyering here proved more successful. Skadden Arps helped develop a plan that Endo confidentially codenamed Project Zed.

When companies declare bankruptcy, all the businesses and people who are owed money file proofs of claims to be paid. These creditors are divided into groups, and those with the strongest legal claims are placed in higher tiers for payment — and thus are more likely to recover funds.

Distressed companies have gotten aggressive with rearranging debt so that some creditors may leapfrog others through a process called “uptiering.”

Endo completed sweeping uptiering transactions in 2019 and 2020, putting liens on assets and replacing unsecured debt with secured debt. Endo said its uptiering under Project Zed gave the firm time to seek settlements for opioid lawsuits by extending debt deadlines.

But the uptiering also shrank the funds available to deal with Endo’s opioid liability. State attorneys general initially sought $3.3 billion from Endo for its role in the epidemic, according to bankruptcy court records. They lost bargaining power, though, as the business declined and Endo uptiered debt. Before Endo filed for bankruptcy, the state prosecutors settled for $274 million.

In total — including pre-bankruptcy lawsuit settlements with a few individual states and payments to private organizations and victims — Endo paid about $635 million for the ravages of the opioid crisis.

In their deal, the Sacklers and Purdue agreed to pay $6 billion in compensation, with most of the money going to state and local governments. Teva and Allergan, pharmaceutical companies that merged their generic opioid businesses, are to pay $6.5 billion.

Mallinckrodt, the nation’s biggest opioid pill maker, agreed to pay $1.7 billion in opioids damages in 2022 in its first bankruptcy. It filed a second bankruptcy last year and cut its payment to $700 million.

In the Endo bankruptcy, lawyers for opioid victims and other unsecured creditors labeled Project Zed a scheme to wall off assets, alleging it amounted to fraud. Endo denied the fraud allegations.

“It’s all the more unfortunate,” attorneys for opioid victims and unsecured creditors said in court filings, “that the victims of Endo’s conduct in this should also be the victims of the opioid crisis from which Endo profited handsomely.”

In interviews, legal experts called uptiering a dangerous trend. Opioid victims are “kind of like sitting ducks,” Berkeley Law professor Kenneth Ayotte said. Opioid victims, he said, “don’t have contracts to protect themselves against these transactions.”

As it failed to pull out of a financial tailspin, Endo accelerated bonuses to about two dozen executives. Records show a total of $95 million was paid in less than a year.

Four days after the last bonus round of $22 million was paid to chief executive Blaise Coleman and his three top lieutenants, Endo filed its bankruptcy petition in federal court in New York. The total Endo paid its top bosses dwarfed the controversial $7 million in pre-bankruptcy bonuses granted to a handful of Purdue executives.

The bonuses immediately came under fire from a federal bankruptcy watchdog, opioid victims and many creditors. The critics told U.S. Bankruptcy Court Judge James Garrity Jr. that the payouts violated a law, championed by then-Sen. Ted Kennedy, D.-Mass., nearly 20 years ago after scandals involving windfalls paid to executives of bankrupt firms, most notably Enron.

In interviews, professors who specialize in bankruptcy said that the bonuses appeared to be an end run around Kennedy’s reforms. “It looks like pre-petition theft,” said Gregory Germain, a widely published bankruptcy expert at the University of Syracuse.

They marketed these drugs inappropriately and wrongly and flooded the streets. They did nothing about it because money was number one.

—Emily Walden, whose son died from an overdose

Skadden lawyer Lisa Laukitis defended the bonuses in a bankruptcy hearing. “These are not windfall payments that were made to line the pockets of executives on the eve of the filing,” she said.

The bankruptcy went on for months. Hedge funds and other investors — led by GoldenTree Asset Management, a New York firm that specializes in buying distressed debt — agreed to use their secured debt to buy Endo out of bankruptcy. In negotiations to take ownership, the group sweetened the deal by increasing the payments going to individual opioid victims and other unsecured creditors. As part of the deal, the critics dropped their complaints about Project Zed and the bonuses.

Garrity, the judge in New York, confirmed Endo’s bankruptcy plan in March. Federal prosecutors, engaged in a parallel criminal investigation of Endo, had reached their own deal. All that remained was for Parker, the judge in the criminal court in Michigan, to approve the intertwined deals.

Winners and Losers

On the afternoon of May 2 in Detroit, federal prosecutors and Endo’s defense lawyer explained to Parker how the financial penalty facing Endo had dwindled to $200 million.

Along with the criminal fine, a final “global resolution” signed by U.S. officials and Endo wiped out virtually all of the potential $4 billion IRS bill. The agreement also mostly erased claims of another $1.5 billion for false health care billing and Medicare costs generated by the opioid crisis.

Endo’s attorney, Carole Rendon, a former U.S. attorney from Cleveland, blamed the misconduct at the firm on a “very small number” of rogue salespeople.

She told the judge the company had cleaned up its act, including firing its 375-member opioid sales staff back in 2016. The firm at one point had called them “pain solution brand ambassadors.”

A near-defunct Endo subsidiary pleaded guilty to a misdemeanor, allowing the parent company to again sidestep a law barring convicted firms from doing business with federal health care programs. No Endo executives or employees were criminally charged in the case. Endo is still selling Percocet and other opioids that bring in 7% of its revenue.

With the bankruptcy case closed, law firms and financial advisers won big. Skadden Arps billed for the labor of nearly 350 lawyers and paralegals. Its total fees: $114 million.

Two law firms, Akin Gump and Cooley LLP, represented painkiller victims. In total, the lawyers and other advisers for victims are set to receive $48 million — more than the $40 million Endo’s individual opioid victims are to share in a court-approved trust.

Reed, the Endo opioids whistleblower, received a reward of about $1.9 million.

Stockholders got wiped out. More than 3,000 victims’ lawsuits were ended.

And Endo continues to reward its veteran and new top executives, setting aside more than $80 million in a stock pool for them, board members and other “key employees.” It gave former CEO Coleman a $6.1 million parachute when he resigned in August.

Individual victims still need to be compensated. If the number of individual victims holds steady, arithmetic shows they might each receive about $1,000 after administrative costs from the court-approved trust. Under the $750 million Purdue plan, the largest checks, for $48,000, were to go to family members who lost someone to a fatal overdose.

The Rappold family has filed for compensation. They lost Nicholas Rappold, 21, a kosher deli waiter and community college student. He was found slumped in his car in 2010, dead from an overdose. Rappold received various prescriptions, including for Percocet, from Dr. Stan Li in the weeks leading up to his death, according to court records from Li’s criminal trial. Li banked thousands in cash from selling painkillers at his New York City clinic to customers who lined up around the block.

Nicholas’ mother, Margaret, faulted the way Endo and other firms marketed to Li. The doctor died in prison while serving a 10-year sentence for manslaughter in the fatal overdoses of her son and a 37-year-old former stockbroker.

“Just to get sales, they don’t care what they sell,” said Margaret Rappold, 75, who works at a school cafeteria. “Whether it’s good for you or not good for you.”

While she says money would never make up for the loss of her boy, it could defray her expenses, including her son’s $14,000 funeral.

So far, the Rappolds and other families have found collecting difficult. They have had to deal with paperwork filled with legalese and footnotes, a short deadline for seeking money, an application website that didn’t work — and, most significantly, rules that barred thousands of victims from getting help.

First image: Emily Walden. Second image: T.J. Walden. (Bryan Woolston for The Philadelphia Inquirer)

Emily Walden, a Kentucky woman whose son, T.J. Walden, died at age 21 on a camping trip after taking Opana given him by a friend, followed the Endo saga closely until she realized that the trust will only help if victims had a doctor’s prescription for an Endo narcotic.

“These prescriptions were not falling off trucks,” Walden said. “They marketed these drugs inappropriately and wrongly and flooded the streets. They did nothing about it because money was number one.”

Some 90,000 individual victims initially filed opioid claims against Endo. Already, two-thirds of them have dropped out.

You can reach reporter Bob Fernandez at bobyardleyfernandez@gmail.com. You can reach reporter Craig R. McCoy at craigmccoy7@comcast.net.

by Peter Elkind

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up to receive our biggest stories as soon as they’re published.

For years, the home-oxygen industry has failed in myriad ways the million-plus Americans who struggle to breathe. Lincare, the country’s largest distributor of breathing equipment, has a decadeslong history of bilking Medicare and the elderly, as ProPublica has revealed. Philips Respironics hid serious problems with its sleep apnea machines, with devastating consequences, including reported deaths. Other large respiratory companies have paid multimillion-dollar fraud settlements.

But as the current session of Congress hurtles to a close, advocates for oxygen patients — in a seemingly improbable alliance with the companies that have victimized them — are making a final push for legislation that, among other things, would pay the scandal-scarred industry hundreds of millions of dollars more than it currently receives. The patients, many aged and infirm, have been besieging lawmakers with meetings, calls and emails, pressing them to pass the Supplemental Oxygen Access Reform, or SOAR, Act by the end of the year. The corporate and patient advocates vow that if the legislation fails in the current term, as seems possible, they will push to reintroduce it next year.

The SOAR Act would achieve two long-sought goals for the industry, which receives much of its revenues from Medicare. The bill would protect companies from additional reductions in their billings by removing oxygen from Medicare’s competitive bidding program, which has saved taxpayers hundreds of millions of dollars. And it would make it far more difficult for the government to challenge those billings.

The patient groups, in turn, have their own goals: improving the industry’s notoriously poor service and assuring access to costly liquid oxygen for a relatively small group of the sickest patients. That form of oxygen is coveted by patients with advanced lung disease because it provides the high flows they need in easy-to-carry cylinders that last for hours. Emotional accounts of stricken patients, unable to obtain the equipment they need, have been prominent in the lobbying campaign to pass the measure.

“The current situation is pretty horrific,” said Susan Jacobs, pulmonary research nurse manager at Stanford University Medical Center, who has spent more than a decade studying access to oxygen therapy and supports the legislation. “Patients aren’t getting the oxygen devices they need or being educated or trained on use of that device. The SOAR Act addresses multiple issues.”

Jacobs and other advocates acknowledge the history of bad behavior by oxygen companies. “I used to feel like they are the enemy,” Jacobs said. Added Erika Sward, assistant vice president of national advocacy for the American Lung Association, another supporter of the SOAR Act: “Some of the companies were very much acting in bad faith when it came to taxpayer dollars.”

But the patient advocates are now backing the industry’s long-standing complaints that Medicare’s payment cuts have gone too far. “I have become convinced of this over the past five years or so,” Sward said. “They’re not being paid enough under competitive bidding. … I fully believe the suppliers are negotiating from a very good-faith perspective for patients.” She added: “Unless everyone is willing to compromise, nothing is going to change. Obviously they have a financial interest.” (Sward said the American Lung Association receives no funding from oxygen companies or trade groups.)

The SOAR Act, which now has a half dozen sponsors in the Senate and 31 in the House, was first introduced in late February by Louisiana Republican Sen. Bill Cassidy, a physician, and Democratic senators Mark Warner of Virginia and Amy Klobuchar of Minnesota. “Respiratory care is lifesaving for so many patients, but too often access to this care is cost-prohibitive or simply not accessible,” said Warner, in a joint press release issued at the time. Cassidy, Warner and Klobuchar did not respond to requests for comment.

Beyond protecting against further Medicare rate cuts for items such as an oxygen concentrator (the bill would essentially freeze them at current levels), the SOAR Act would create a standardized medical form for authorizing suppliers’ claims; pay companies like Lincare to provide respiratory therapist services; and more than double what the companies are paid for liquid oxygen systems.

The bill is projected to cost taxpayers about $654 million over 10 years, according to a private study partly funded by industry (which the SOAR Act’s supporters have declined to share). The nonpartisan Congressional Budget Office has not yet prepared an estimate. Beneficiaries would also have to pay the companies more as part of their 20% Medicare copay.

Liquid oxygen has long been virtually unavailable even to Medicare beneficiaries who need it most. In 2004, before cuts in the government’s historically lavish payments for oxygen began kicking in, suppliers provided portable liquid oxygen equipment to more than 80,000 Americans.

Fewer than 4,000 Medicare patients received liquid oxygen in 2021, according to Medicare data. That’s a tiny portion of the 1.5 million Americans who now receive some form of supplemental oxygen. The bill’s advocates say there are thousands of Medicare beneficiaries who desperately need liquid oxygen to live more normal lives. “We’re ordering liquid,” Jacobs said. “Our [suppliers] are saying, ‘We don’t have it, and we can’t provide it.’ That’s not acceptable. Patients should be able to have enough oxygen to get out of their house. They’re unable to go to religious services, unable to see family, can’t go to a child’s graduation. These are heart-wrenching stories.”

Under the competitive bidding program that was launched in 2011, oxygen companies were legally required to provide liquid systems to any patient whose doctor prescribed them. But the companies insisted it was too expensive to do it at the rates the companies had agreed to in the bidding process. Providing liquid oxygen, which is stored at freezing temperatures under high pressure in special equipment, requires special trucks, frequent deliveries and hazmat-certified drivers.

Medicare enforcers never cracked down on the companies. Then, in 2019, the federal government “paused” the oxygen bidding program and many of its reimbursement rules — five years later, it can’t say when it may replace or reactivate them — freeing companies from any obligation to provide liquid oxygen.

In a statement, a Medicare spokesperson repeated the program’s long-standing contention, disputed by industry and patient groups alike, that access to liquid oxygen has not been a significant problem: “Although there were some complaints about contract suppliers refusing to furnish liquid oxygen, the suppliers came into compliance and agreed to furnish the liquid oxygen, so no [supplier] contracts were terminated as a result.”

The SOAR Act also includes what advocates call a “patient bill of rights” — and which they view as a major concession by the oxygen companies. Aimed at addressing the dismal service that has predominated, it and other parts of the bill would require suppliers to provide equipment setup assistance and monitoring, patient education and 24/7 coverage for emergencies as a condition for Medicare payment. (Left unresolved is how the federal government, whose enforcement record has historically been less than stellar, would police such rules.)

Lincare has long blamed problems on Medicare’s cuts and what it characterizes as the “flawed” competitive bidding program. The company told the agency in a 2017 letter that low reimbursements and “burdensome documentation requirements” had made it “next to impossible to continue providing quality services to beneficiaries.” Yet Lincare appears to collect substantial profits. It generated about $300 million in profit in 2023, on revenues of $2.4 billion, according to a former company executive. (Lincare declined to comment.) Rotech, another large company in the home respiratory business, was purchased this year for $1.36 billion, after recording $200 million in earnings for fiscal 2023.

Such profits make it possible for the industry to spend lavishly on Capitol Hill. Its lead trade group is the Council for Quality Respiratory Care, made up of six big manufacturers or distributors of oxygen equipment, including Lincare and Philips, and chaired by Lincare’s CEO. Since 2018, each of the six CQRC companies has reached at least one multimillion-dollar settlement with the government alleging it cheated Medicare. The corporations have typically denied wrongdoing.

Lobbying payments by the trade group and its member companies on reimbursement issues have totaled more than $1.4 million since the start of 2023. CQRC’s outside PR firm won an industry “advocacy” award for its 2016 campaign in support of legislation slowing oxygen reimbursement cuts, where it boasted of generating 29,000 emails to members of Congress. Through such efforts, the award commendation read, “an engaged community of concerned citizens was created to help support CQRC’s efforts.”

In a statement responding to ProPublica’s questions, CQRC praised the SOAR Act for providing “long-overdue Medicare reforms” and correcting service woes that patients and their advocates have often blamed on the industry. The trade group blamed “current law” and “chronic underfunding” for leaving patients “often unable to access the medically necessary home respiratory treatments their doctors prescribe,” but it said the bill would establish “clear patient protections and supplier responsibilities” while protecting Medicare beneficiaries from “potential fraud and abuse.”

Meanwhile, a new government-funded academic study is challenging the industry’s claims about the purported harms of competitive bidding for oxygen services. Published in late October in JAMA Internal Medicine, the investigation examined Medicare data to weigh the bidding program’s impact on patients with chronic obstructive pulmonary disease, by far the largest group of Medicare oxygen patients.

Its conclusion: Competitive bidding saved taxpayers and patients hundreds of millions of dollars, without curbing their access to oxygen or hurting their health. Dr. Kevin Duan, an assistant professor of respiratory medicine at the University of British Columbia and the article’s lead author, told ProPublica his team’s review found no evidence of harm: “No drop in claims, no change in clinical outcomes.” Duan said the study has sparked a backlash from the measure’s advocates. “I knew this was directly questioning a part of the SOAR Act,” he told ProPublica. “I feel like I walked into a firestorm.”

“We don’t have a horse in this race,” Duan said. “There’s a lot of blaming the competitive bidding program without much data. Rarely do we have high-quality evidence that can directly inform a piece of legislation. It shouldn’t be ignored.”

Doris Burke contributed research.

by Robin Urevich, Capital & Main

This article was produced in partnership with Capital & Main, which was a member of ProPublica’s Local Reporting Network in 2022-23. Sign up for Dispatches to get stories like this one as soon as they are published.

As Los Angeles prepares to host tens of thousands of visitors for the 2028 Summer Olympics, city officials are moving to stop property owners from illegally listing their homes as vacation rentals and devouring the city’s already strained housing supply.

The City Council’s housing and homelessness committee is considering adding inspectors, imposing stiffer penalties and requiring websites like Airbnb and Booking.com to use an electronic system already in place in New York City that would automatically reject bookings at properties that aren’t approved for short-term rental.

A July investigation by Capital & Main and ProPublica found more than 60 rent-controlled buildings with units advertised on booking sites despite LA’s Home Sharing Ordinance, which prohibits such stays in rent-controlled apartments. In some cases, entire apartment buildings were listed as boutique hotels on reservation sites.

Rent-controlled units make up nearly 75% of the city’s rental market; the designation caps annual rent increases at about 4% and is intended to preserve affordable housing for city residents.

The number of buildings with illegal listings is likely far higher than the news organizations found because most booking platforms mask the addresses of the properties. The LA Housing Department now estimates that 7,500, or about 60% of the city’s short-term rentals in multiunit buildings, are illegal, according to a memo sent by the agency’s interim general manager, Tricia Keane, to the City Council.

“I think having the capacity to do stronger enforcement is the big missing piece,” said Councilmember Nithya Raman, who chairs the housing and homelessness committee. She said very few violators were receiving citations and fines “because of how broken the process is.”

At a committee hearing in early December, the proposals faced opposition from several property owners, who urged the committee not to impose stricter rules. “I have become absolutely reliant on Airbnb to make ends meet,” said Joni Day, a freelance TV producer.

Airbnb and Booking.com representatives didn’t answer emails requesting comment on the city’s enforcement proposals. Airbnb previously told the news organizations that it works closely with city staff “to address Hosts who try to evade the rules.”

For more than a year, the housing and homelessness committee has been looking into the growth of home-sharing in LA. It has convened representatives of key city departments and the city attorney’s office to learn about enforcement of the 2019 home-sharing law against unapproved listings and what can be done to improve it.

Raman said the dysfunction in the city’s home-sharing enforcement system is a matter of “priorities and staffing.” Additionally, she said, “There are real breakdowns of communication between departments.”

In addition to spotlighting the misuse of rent-controlled apartments, Capital & Main and ProPublica documented how those breakdowns hobbled enforcement as cases were passed between the planning department, whose computer system flags potential home-sharing violations, and the Housing Department, which is tasked with actually citing violators.

Raman has asked city officials to draft plans to establish a single home-sharing task force to streamline the process.

However it’s organized, Housing Department Director of Code Enforcement Robert Galardi said he simply needs “boots on the ground” to investigate what he argues is an “underground” of illegal vacation rentals, which are often disguised as legal monthly rentals by some hosts to evade enforcement.

Capital & Main and ProPublica’s investigation found that relatively few property owners have been cited under the ordinance and that some of those who had been cited continued to offer short-term rentals after paying minimal fines or while their cases awaited appeal hearings.

In one case, residents and neighbors of 1940 Carmen Ave., a 21-unit apartment building in Hollywood, had repeatedly complained to the city about illegal vacation rentals. But the owner had never been fined for home-sharing. However, after the investigation, the owner was fined, and the building appears to no longer accept reservations on booking sites.

Building owner Alexander Stein didn’t return calls seeking comment.

Currently, the city imposes a $587 fine on first-time violators, but the department is proposing higher penalties that would escalate from $1,000 for first violations on the smallest properties to $64,000 for a third violation on the largest.

Another proposal from City Councilmember Bob Blumenfield would give any LA resident the right to sue property owners who offer illegal short-term rentals and to reap some of the damages if they win.

Activists who monitor home-sharing applauded the city’s efforts to strengthen the Home Sharing Ordinance. “Now, the problem is the city still has to develop the will to actually enforce this law,” said Noah Suarez-Sikes, an organizer for Better Neighbors LA.

As the housing and homelessness committee pieces together its proposals, a process that will likely continue well into 2025, it has asked city departments to report back on how the city could put them into effect.

The committee has also ordered the Housing Department to provide annual reports on its enforcement of another law aimed at preserving some of the city’s lowest-cost housing — in LA’s residential hotels, which typically provide single-room dwellings with shared bathrooms.

The Housing Department was granted five new positions this year to enforce the Residential Hotel Ordinance, which prohibits the conversion of residential hotels to tourist accommodations.

The budget allocation came in response to a 2023 investigation by Capital & Main and ProPublica, which found that lax enforcement of the law had allowed the loss of nearly 800 housing units to tourist rooms.

by Annie Waldman

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up to receive our biggest stories as soon as they’re published.

There was a time when Sharelle Menard thought her son would never be able to speak. She couldn’t soothe Benji when he cried, couldn’t read him books he could follow, couldn’t take him out in public. “The screaming, and screaming, and screaming,” she said. “He would get so frustrated because he couldn’t communicate.”

Benji was nearly 3 when he was diagnosed with severe autism and soon after started a specialized therapy to help him develop basic skills. After two years in treatment, his murmuring gave way to small words, with “bubbles” among the first. To celebrate, Menard powered up a bubble machine she found at the dollar store, and for hours, they watched the iridescent orbs drift over their porch.

Menard, who is raising Benji alone in south-central Louisiana, began to picture a future for her son that diverged from the stories she’d heard about some kids with similar diagnoses, who grew up still unable to manage their frustrations and had to live in nursing homes or institutions.

But now, she’s worried again.

The insurer that has been paying for her son’s therapy, UnitedHealthcare, has begun — to the befuddlement of his clinical team — denying him the hours they say he requires to maintain his progress. Inside the insurance conglomerate, the nation’s largest and most profitable, the slashing of care to children like Benji does have a reason, though it has little to do with their needs. It is part of a secret internal cost-cutting campaign that targets a growing financial burden for the company: the treatment of thousands of children with autism across the country.

Sharelle Menard cares for Benji at their home in Louisiana. Benji, who is severely affected by autism, requires a specialized therapy. (Annie Flanagan, special to ProPublica)

ProPublica has obtained what is effectively the company’s strategic playbook, developed by Optum, the division that manages mental health benefits for United. In internal reports, the company acknowledges that the therapy, called applied behavior analysis, is the “evidence-based gold standard treatment for those with medically necessary needs.” But the company’s costs have climbed as the number of children diagnosed with autism has ballooned; experts say greater awareness and improved screening have contributed to a fourfold increase in the past two decades — from 1 in 150 to 1 in 36.

So Optum is “pursuing market-specific action plans” to limit children’s access to the treatment, the reports said.

“Key opportunities” are outlined in bullets in the documents. While acknowledging some areas have “very long waitlists” for the therapy, the company said it aims to “prevent new providers from joining the network” and “terminate” existing ones, including “cost outliers.” If an insurer drops a provider from its network, patients may have to find a new clinician that accepts their insurance or pay up to tens of thousands of dollars a year out of pocket for the therapy. The company has calculated that, in some states, this reduction could impact more than two-fifths of its ABA therapy provider groups in network and up to 19% of its patients in therapy.

Internal company documents reveal the strategy by Optum, a UnitedHealth Group subsidiary, to prevent ABA providers from participating in its network. (Obtained by ProPublica)

The strategy targets kids covered through the company’s state-contracted Medicaid plans, funded by the government for the nation’s poorest and most vulnerable patients. To manage Medicaid benefits, states often pay private insurers a fixed amount of funds per patient, regardless of the frequency or intensity of services used. When companies spend less than the allotted payment, they are typically allowed to keep some or all of what remains, which federal investigators and experts acknowledge may be incentivizing insurers to limit care.

United administers Medicaid plans or benefits in about two dozen states and for more than 6 million people, including nearly 10,000 children with autism spectrum disorder. Optum expects to spend about $290 million for ABA therapy within its Medicaid plans this year, and it anticipates the need increasing, documents show. The number of its Medicaid patients accessing the specialized therapy has increased by about 20% over the past year, with expenses rising about $75 million year-on-year.

So Optum — whose parent company, UnitedHealth Group, earned $22 billion in net profits last year — is “heavily investing” in its plan to save millions by limiting access to such care.

In addition to culling providers from its network, the company is scrutinizing the medical necessity of the therapy for individual patients with “rigorous” clinical reviews, which can lead to denials of covered treatment. Optum has developed an “approach to authorizing less units than requested,” the records state.

Internal company documents reveal Optum is deploying “rigorous utilization management” in response to an increased need for ABA therapy. (Obtained by ProPublica)

Mental health and autism experts and advocates reviewed ProPublica’s findings and expressed outrage over the company’s strategy. Karen Fessel, whose Mental Health and Autism Insurance Project helps families access care, called the tactics “unconscionable and immoral.”

“They’re denying access to treatment and shrinking a network at a time when they clearly know that there is an urgent need,” she said.

United and Optum declined a request ProPublica made more than a month ago for an on-the-record interview about their coverage of behavioral health care. They have not answered questions emailed 11 days ago, citing the Dec. 4 killing of UnitedHealthcare’s CEO as the reason. In an email, a spokesperson said “we are in mourning” and could not engage with a “non-urgent story during this incredibly difficult moment in time.” Offered an additional day or two, the company would not agree to a deadline for comment.

Benji, who is now 10, requires 33 hours of weekly therapy to be able to progress, his therapists have concluded. They have documented the consequences of having even a few hours less: toppled furniture, scratched-up classroom aides, a kid in unremitting tears, unable to learn. But in a letter to Menard, Optum said it was refusing to pay for the full hours, stating that her son had been in therapy for too long and was not showing enough progress to ultimately graduate from it.

“Your child still has a lot of difficulty with all autism-related needs,” Optum wrote. “Your child still needs help, but it does not appear that your child will improve enough to end ABA.”

The response confounded experts who spoke with ProPublica, who said such an approach misunderstands the long-term nature of his condition. “Challenges that often come with autism shouldn’t be looked at like an injury that you’re going to get better from quickly and then the treatment can stop,” said Christa Stevens, who directs state government affairs for the advocacy group Autism Speaks. “Treatment may still be medically necessary even if it’s for skill maintenance or the prevention of regression.”

The company’s denial also appears to contrast with recent professional guidelines for the therapy — which are cited as a reference in Optum’s own clinical criteria — that state “there is no specific limit on the duration of a course of treatment.”

The appropriate duration of treatment, according to those standards and experts interviewed by ProPublica, should be based on the patients’ needs, as evaluated by the clinicians working directly with the patients.

“This is a very blunt instrument to chase after excessive costs,” said Tim Clement, the vice president of federal government affairs at the nonprofit group Mental Health America.

Several advocates told ProPublica the company’s strategy is legally questionable.

The federal mental health parity law requires insurers to provide the same access to mental health and physical care. As ProPublica recently reported, United has gotten in trouble in the past for targeting therapy coverage in a way that violates the law; while denying the allegations, it agreed to a multimillion-dollar settlement. It continues to use arbitrary and one-size-fits-all thresholds to scrutinize its therapy claims, ProPublica previously found.

It would raise legal questions if the company restricted ABA more stringently than comparable physical care, the advocates said.

“Medicaid managed care organizations are subject to the parity act,” said Deborah Steinberg, a senior health policy attorney with the nonprofit advocacy group Legal Action Center. The company may be violating Medicaid regulations, she said, which require managed care organizations to maintain networks sufficient to provide covered services to all enrollees.

Last year, the federal government formally affirmed that ABA therapy is a protected benefit, and it recently investigated health plans for entirely excluding its coverage; legislators have passed laws in every state requiring insurance companies to pay for it.

“Yes, this therapy can be expensive,” said Dan Unumb, an attorney and president of the Autism Legal Resource Center. “But solving the problem by denying kids access to medically necessary care is a terrible solution.”

“What Happens if We Withdraw the Care?” Benji dances with his behavior analyst, Whitney Newton, at Aspire Behavioral Health Center in Lafayette. (Annie Flanagan, special to ProPublica)

Benji was making progress about three years ago.

For more than 33 hours a week in the specialized therapy, his clinicians broke down the learning process into basic steps, using repetition and positive reinforcement to affirm behaviors. The state’s Medicaid contractor, UnitedHealthcare, covered the bill.

Researchers have found that about a quarter of kids diagnosed with autism are severely affected; these children are often minimally or non-speaking or require extensive assistance for basic daily needs. “Things a lot of people take for granted,” said Menard. While experts continue to debate which therapies are most effective and appropriate for these kids, ABA is one of the most widely recommended.

By 7, Benji had accumulated a few dozen words, and his aggressive, prolonged tantrums had grown less frequent, allowing his mother to take him grocery shopping and to mass on Sundays. It was time for him to go to school, she thought.

Menard enrolled him in their public school district, St. Martin Parish. He attended Breaux Bridge Primary twice a week in a special education classroom and continued therapy the other days. Menard urged the district to allow a therapeutic technician to shadow him in school, but it refused. (The district declined to respond to ProPublica’s questions, citing privacy restrictions.)

With the diminished hours of treatment, Benji grew increasingly disruptive. “It was a disaster,” said Menard. He snapped a swing in gym class and struggled to sit still during lessons. When teachers tried to give him instructions, he hit them. His speech plateaued and eventually regressed.

Menard, who cleans pools for a living, grew to fear the moment her phone rang. School employees, unable to soothe Benji’s tantrums, frequently called her to take him home. One morning last spring, they told her Benji had lashed out when an aide tried to persuade him to work, aggressively poking their hand with a pencil. He hadn’t broken the skin, but after a dozen incidents, the situation was becoming unsalvageable. The district made her sign a behavioral contract, his second in two years: If Benji didn’t behave, he could be suspended or expelled.

Menard felt she had no choice but to withdraw Benji. She enrolled him full time in a home-study program run by his therapy group, Aspire Behavioral Health Center in Lafayette, which costs about $10,000 a year in tuition, a substantial portion of her paycheck. That was in addition to the therapy cost, which his insurance still covered.

Benji’s clinicians determined he needed direct support for most of the day and told Optum they wanted him to scale up his therapy from 24 hours a week to 33. They expected the insurer would approve the request; after all, it was less than what was previously covered and only nine hours more than it was currently paying for.

But Optum denied the increase in a letter to Menard this past May. “Your child has been in ABA for six years,” the insurer wrote. “After six years, more progress would be expected.”

The response disturbed Whitney Newton, Benji’s behavior analyst and a clinical director at Aspire; it didn’t seem rooted in the established medical standards for the treatment. She’d seen firsthand how critical the therapy had been to his growth. “We know what he needs. It’s in our scope of practice and it’s our right as the provider to determine that,” she said. “They’re cutting and denying an unethical amount.”

Newton has worked with Benji since he was 3. (Annie Flanagan, special to ProPublica)

The center’s founder, psychologist Joslyn McCoy, has grown accustomed to battling insurers. Her practice serves about 160 patients between the ages of 2 and 19 across five centers, and many have Medicaid coverage. In 2022, Louisiana expanded its Medicaid parameters, allowing parents with higher incomes to access coverage for children with complex medical needs.

“What I’m seeing is that children now have this ticket to access this care, but then once they go to try to access it, it’s being denied,” she said.

Nearly two years ago, Optum selected her center for a payment integrity audit, demanding to inspect its clinical and billing records. After her team turned over thousands of pages of documentation, Optum conducted a separate in-person quality review.

Internal company records show Optum is targeting ABA providers for scrutiny based on how much they invoice and how many services they provide. Groups like McCoy’s can be flagged for patterns that providers told ProPublica are typical in the delivery of ABA therapy: billing on weekends or holidays, serving multiple family members in one practice, having long clinician or patient days, providing an “above average delivery” of services, or abruptly increasing or decreasing the number of patients or claims.

Internal company documents reveal Optum’s strategy for identifying ABA providers for scrutiny based on “outlier patterns.” (Obtained by ProPublica)

McCoy said that a company executive who visited her office for the quality review told her that she approved of the center’s work and thought Aspire should expand across the state.

But Optum has continued to challenge her patients’ individual therapy claims.

When her team received the denial for Benji’s care, McCoy set out to gather hard evidence to demonstrate the necessity of his treatment. “It’s what we call a reversal to baseline, where we will withdraw the treatment for a short period of time,” McCoy said. “The reason is to demonstrate what happens because we’re curious, too: What happens if we withdraw the care?”

Joslyn McCoy, founder and director of Aspire Behavioral Health Center (Annie Flanagan, special to ProPublica)

Much of the therapy is driven by positive reinforcement; for example, if Benji pays attention and engages in his academic exercises, he can take a break to play on his iPad. But the reward is contingent on him not hitting anyone for at least 10 minutes at a time. During the experiment, the clinicians took away the possibility of his reward, and without an incentive, they had limited leverage to manage his behavior.

At first, Benji lightly hit the staff, they said, as though testing the limits. But when there was no response to his behavior, it began to escalate. He tossed chairs and flipped tables. He pushed Newton into a bookshelf, which collapsed to the ground. He hit walls and windows, eventually turning his fists on his aide. They stopped the experiment early, both for his safety and theirs.

Once they resumed the interventions, Benji was able to calm down.

Newton drafted a report, including line charts that quantified his behavior with and without the interventions and photographs of her team’s injuries. She faxed it to Optum, asking the company to reconsider the denial.

The insurer did not change its decision.

“The Need Is Not Going Away” Benji works with registered behavioral technician Hortencia Cervantez during ABA treatment. (Annie Flanagan, special to ProPublica)

Last month, inside a cubicle decorated with posters of Minions and Mario Brothers, a behavior technician placed a laminated card with an image of a sneaker in front of Benji.

“What is this?” she asked him.

Benji paused, rubbing the edge of his baseball cap and pursing his lips. “Sh,” he said, stuck on the consonant.

“Shoes, that’s right,” the technician responded. She pulled out another card, showing a slice topped with white frosting. “Is this cake?”

“No,” Benji said.

“Is this cake?” she repeated, before adding, “yes.”

“Yes,” echoed Benji, but her correction appeared to frustrate him. He hit the technician on the leg, softly but with determination.

“We’ll let it go,” she warned with a sugared voice, “but hands to self, OK?”

After 10 minutes, a timer beeped. It was time for Benji’s reward, getting to hear a reggaeton hit by Daddy Yankee. “It’s a big reinforcer here,” Newton said.

Even though Optum denied the additional hours of treatment, Benji has continued to receive them. “We’re giving the hours even if they were not approved,” McCoy said. “We don’t think it would be safe for him to do what the insurance is saying.”

Next month, a state administrative law judge will hear an appeal for the additional hours. If the request is approved, Benji’s clinicians will be paid for the six months of services that they’ve provided without reimbursement.

Even if that happens, their battle with the insurer will go back to square one. Each insurance authorization typically lasts for only six months, and soon after the hearing date, the clinicians will have to request coverage for his treatment again.

They will be doing so at a time when internal records show Optum has deployed more than 90 “care advocates” to question clinicians about the medical necessity of their patients’ ABA treatment, using “quality initiatives to decrease overutilization and cost.”

Optum is focusing on states whose Medicaid plans yield the highest costs for ABA therapy, including Arizona, Nebraska, Tennessee, Virginia, New Jersey, Indiana and Louisiana, where Menard and her son live. ProPublica reached out to the state Medicaid programs with questions about their oversight of United’s practices. Arizona’s Medicaid agency told ProPublica that all managed care organizations, including United, are required to provide timely services within their networks, and that the agency has been closely monitoring ABA networks. (Read its full response.) No other state Medicaid agencies responded to ProPublica’s questions.

Internal company documents reveal Optum’s strategy for managing its ABA coverage. (Obtained by ProPublica)

Autism experts said such a strategy may not only be harmful to children, it could also ultimately be more expensive for states, as children age and require more intensive services, like residential or nursing care.

“If these kids get the intervention they need as children, then there will be tremendous cost savings over the course of their lives,” said Lorri Unumb, an attorney and CEO of the Council of Autism Service Providers.

Menard worries about what will happen to her son’s hard-fought gains if he can’t get the level of therapy he needs. And even if the additional nine hours are approved, she fears that with the next authorization, they could face a more drastic denial that could be challenging to overturn.

“This motivation and momentum — when you lose that,” she said, “it’s so hard to get it back.” She doesn’t believe that Benji needs to be fixed or cured or changed from who he is. She just hopes the therapy helps him to be better able to advocate for himself and, ultimately, be safe. “There’s nothing else that I’ve known to work,” she said.

McCoy resents being put in the position of scaling back care that her patient needs because an insurer is refusing to pay. “It puts us in a tough place, because we don’t want to discontinue therapy of our client who’s not ready,” she said.

When such denials become common, it disincentivizes clinicians from working with insurance companies, she said, and can ultimately drive clinics into the ground. “The patients can’t afford it,” she said, “so eventually the private provider goes out of business.”

But even if children like Benji get pushed out of treatment, there is no shortage of children seeking care. McCoy’s center currently has a waitlist of about 260 children.

That list may likely expand. Internal documents show Optum is aiming to exclude from its network about 40% of Louisiana groups that offer ABA therapy. About 1 in 5 children whose treatment is covered by the company's Medicaid plan in the state could lose access to care.

“If the insurance company wants to deny all of our clients, we’re going to replace them,” she said. “The need is not going away.”

We’re Investigating Mental Health Care Access. Share Your Insights.

by Erin Edwards for ProPublica and Robin Fields

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up to receive our biggest stories as soon as they’re published.

The night the EMTs carried Elizabeth Nakagawa from her home, bleeding and in pain, the tarp they’d wrapped her in reminded her of a body bag.

Nakagawa, 39, is a Coast Guard commander: stoic, methodical, an engineer by trade. But as they maneuvered her past her young daughters’ bedroom, down the narrow steps and into the ambulance, she felt a stab of fear. She might never see her girls again.

Then came a blast of anger. She’d been treated for a miscarriage before. She knew her life never should have been in danger.

Earlier that day, April 3, 2023, Nakagawa had been scheduled to have a surgical procedure called a D&C, or dilation and curettage, to remove fetal tissue after losing a very wanted pregnancy. But that morning, she was told the surgery had been canceled because Tricare, the military’s health insurance plan, refused to pay for it.

While her doctor appealed, Nakagawa waited. Then the cramps and bleeding began.

In recent months, ProPublica and other media outlets have told the stories of women who died or nearly died when state abortion restrictions imposed after the Supreme Court’s 2022 Dobbs decision impeded them from getting critical care.

But long before Roe v. Wade was overturned, military service members and their families have faced strict limits on abortion services, which are commonly used to resolve miscarriages.

Under a decades-old federal law, the military is prohibited from paying for abortions except in cases of rape, incest or to save the life of the mother. This applies even to service members based in states where abortion is legal; Nakagawa lives in Sonoma County, California.

There’s also no exception for catastrophic or fatal fetal anomalies. In such cases, service members either have to pay out of pocket for abortions or carry to term fetuses that won’t survive outside the womb.

Tricare does allow abortions in cases like Nakagawa’s, in which the fetus has no heartbeat. But even then, some doctors who treat military service members say that Tricare requires more documentation and takes longer to approve these procedures than other insurers, putting women at risk.

“There definitely have been cases where our Tricare patients have required emergency services, emergency D&C procedures, blood transfusions, things that have been critical to lifesaving care because their procedure had yet to occur,” said Dr. Lauren Robertson, an OB-GYN who has served military members and their spouses in San Diego for more than a decade.

Erin Edwards is a Navy veteran and reporter who has been covering reproductive health care access for military members. She’s spoken with military and civilian doctors, researchers and patients across the country about the challenges service members have long faced in obtaining reproductive health care.

Robin Fields is a longtime ProPublica reporter who has written about maternal deaths and near-deaths, as well as about the reliability of data gathered on maternal mortality.

If you want to get in touch and learn more about how we work, email Edwards at erin@moseyroad.com or Fields at robin.fields@propublica.org. We take your privacy very seriously.

“It just feels very unnecessary.”

Since the Dobbs decision, abortion care for service members seems to be coming under heightened scrutiny, said retired Rear Adm. Dana Thomas, who was until recently the Coast Guard’s chief medical officer and advocated for Nakagawa.

“Trust me, post Roe v. Wade, I’m sure people felt there was much more of a spotlight,” Thomas said. “I think they were more guarded after June of ’22.”

After being rushed to the emergency room, Nakagawa hemorrhaged for four more hours before doctors performed the surgery Tricare had refused to authorize. Later, Tricare and Defense Department officials would all agree that Nakagawa should have been treated as her doctor recommended, and she said they told her they’d taken steps to prevent future mistakes.

But her experience, which doctors say nearly cost Nakagawa her life, laid bare the challenges service members have long faced in obtaining reproductive health care. And it raises questions about whether the Supreme Court’s ruling has created a chilling effect that has further complicated access to these procedures.

Officials at the Defense Health Agency, which runs the military health system, including Tricare, did not respond to specific questions from ProPublica, but they provided a statement saying its policies haven’t budged.

“There have not been any changes to Tricare coverage or documentation requirements for medically necessary care of D&Cs following the Supreme Court’s Dobbs decision,” the statement said. “Medically necessary care was, and continues to be, covered.”

The agency declined to answer questions about Nakagawa, saying that “as a matter of practice” it doesn’t discuss individual beneficiaries’ care. (ProPublica is involved in an unrelated public records lawsuit with the DHA.)

As a senior officer, Nakagawa felt duty-bound to press for answers about what happened to her.

“The abortion policy, in theory, is supposed to protect life, and in my case it did the opposite,” Nakagawa said. “It almost led to my children not having a mother.”

After the Supreme Court upended Roe, the Biden administration took steps to reassure service members that their access to reproductive health care would remain unaffected by a wave of state abortion bans.

An October 2022 memo from Defense Secretary Lloyd Austin pledged to facilitate leave for service members seeking abortions that were not covered by Tricare, and to pay for travel if care wasn’t available nearby. It also emphasized that these procedures would be “consistent with applicable federal law.”

The statute barring the Defense Department from paying for most abortions goes back to 1985 and mirrors language in what’s called the Hyde Amendment. Named for its author, Henry Hyde, a Republican representative from Illinois, Congress has attached the amendment to spending bills since the late 1970s to prohibit the use of federal funds on abortion.

With Congress in control of military spending, abortion care is highly politicized, said Kyleanne Hunter, a Marine Corps combat veteran and senior political scientist at RAND Corp. “There’s been a lot of backlash and a lot of scrutiny and a lot of congressional disapproval as to how the DOD has engaged with abortion care, D&C care and the like.”

About 9.5 million people, including active-duty service members and their families as well as military retirees and their dependents, rely on Tricare for health services. Women make up a growing portion of the active-duty force, more than 17%. They also leave the military at higher rates. Research by RAND and others suggests the military’s reproductive health policies may make it harder to recruit and retain them.

Dr. Toni Marengo, a former Navy OB-GYN, said she left the service in part because she felt unable to provide patients with appropriate care. Many of them only discovered how sharply Tricare’s policies curtailed access to procedures like D&Cs when they needed them.

“It was like living in a pre-Roe world,” said Marengo, now chief medical officer at Planned Parenthood of the Pacific Southwest.

The effects have been felt for decades. In 1994, Maureen Griffin and her then-husband, a captain in the Air National Guard, ended her pregnancy after learning their baby had anencephaly, a fatal birth defect. They found out the military considered her induced labor an abortion when she got a phone call from a bill collector for the hospital seeking thousands of dollars in reimbursement for the procedure.

“I said: ‘We have full coverage. My husband’s in the military.’ And they said, ‘They don’t pay for abortions,’” Griffin recalled. “We were completely blindsided. I mean, no one called it an abortion. It was a horrible tragedy.”

Griffin, then known as Maureen Britell, was so outraged that she sued the Defense Department, winning a judgment in federal district court in 2002. Two years later, an appeals court reversed the decision, upholding the Defense Department’s refusal to cover abortions in such circumstances.

Twenty-five years after Griffin’s pregnancy, Samantha Babcock spent the equivalent of seven paychecks to fly home from her husband’s Air Force base in Okinawa, Japan, for an abortion Tricare wouldn’t cover.

She was five months pregnant when doctors told her that her fetus had multiple abnormalities and wasn’t viable.

The grief was crushing. Then she found out that, by law, the military couldn’t perform or pay for a surgery called a D&E, or dilation and evacuation, which her military doctors agreed was the safest option. She and her family paid $14,000 — most of it for plane tickets — with help from a GoFundMe so that she could go home to Portland, Oregon, to get the procedure.

She still can’t believe such a step was necessary.

“I assumed Tricare had my best interest at heart,” she said. “If the condition was fatal, why wouldn’t they help me?”

Babcock said her specialist told her that the military would pay to transfer her temporarily to Hawaii for more testing. They also offered to move her family to a location where they would have access to specialty care for the baby in the unlikely chance she survived outside of the womb.

For Babcock, that was untenable. “I did not want to keep growing a baby that wouldn’t live,” she said.

In August 2022, Thomas, the Coast Guard’s chief medical officer, was galvanized into action when a service member sought help to end her pregnancy after receiving a diagnosis similar to Babcock’s.

Doctors had recommended that, like Babcock, she have a D&E. Because the fetus still had a heartbeat, Tricare would not approve the procedure.

Thomas called Tricare daily trying to find a solution, then elevated the case to leaders at the DHA, which sets policy for the health plan. “We have to do something,” she told them.

Dana Thomas, a retired rear admiral and chief medical officer at the Coast Guard (Caroline Gutman, special to ProPublica)

Tricare stuck to its denial even after the service member’s doctor appended a note explain­ing that continuing the pregnancy would endanger the patient’s life.

That was the first case Thomas had taken on after Dobbs.

The second was Nakagawa’s.

Nakagawa and her husband, Matt, met a couple years after earning engineering degrees from the Coast Guard Academy in the mid-2000s. Their path to a family was long and bittersweet. In 2015, they suffered a miscarriage. A year later, their first daughter was born. Then came a second miscarriage, followed by the birth of a healthy girl.

For the next three years, they tried for another child. Then Nakagawa got pregnant in 2021, only to learn at 10 weeks there was no fetal heartbeat. She waited, hoping to miscarry naturally, then tried abortion pills.

When a follow-up exam showed she hadn’t passed all the fetal tissue, her OB-GYN scheduled a D&C. The procedure was approved by Tricare, and she had the surgery soon afterward.

By early 2023, Nakagawa had risen to become chief of engineering at the Coast Guard’s training center in Petaluma, California, and her husband had left the service and was supporting her as a stay-at-home dad. They were thrilled to learn she was pregnant, only to have their joy turn to devastation when two ultrasounds showed that once again, her fetus had no heartbeat.

This time, since abortion pills hadn’t worked in 2021, Nakagawa and her OB-GYN agreed the best course would be to schedule a D&C as soon as possible. Her doctor’s office scheduled the procedure for Monday, April 3, and requested approval in advance, or prior authorization, from Tricare.

Then, five hours before the procedure was scheduled to begin, the office told Nakagawa the surgery was canceled — Tricare had refused to cover it.

In its denial letter, Health Net Federal Services, the contractor that administered claims for Tricare’s western region, said the services requested were “not a covered benefit.”

The insurer’s letter also said it had requested additional information from Nakagawa’s doctor, but that the information had not been sent. (Health Net declined to answer questions from ProPublica about Nakagawa even though she waived her right to privacy.)

Her doctor maintains that wasn’t the case. She declined to be identified, citing concerns about safety.

“Tricare has always been difficult to work with for coverage of women’s health care — they require records more than other insurances — this often creates a delay in care,” the doctor said via text.

The office staff appealed the denial, telling Nakagawa they’d provided documentation of the ultrasounds showing no fetal heartbeat. The staff also told her a Tricare medical director wasn’t available to review it that day and that it might take an additional three to five days to get a response.

Nakagawa called Tricare for answers herself, only to be told her options were to wait or pay out of pocket — not only for the surgery but for any follow-up care, including mental health counseling.

“It was surreal. I was angry and shaking,” Nakagawa said. She couldn’t understand why Tricare had approved her D&C in 2021 under similar circumstances, then denied the same care two years later.

Overwhelmed by emotion, she climbed into bed and cried herself to sleep.

At about 5 p.m., her doctor provided a prescription for abortion pills as a backup plan. But before Nakagawa could pick it up, she started to miscarry.

The first signs were mild cramping and spotting. Soon after, the fetus passed. Nakagawa yelled for her husband and sobbed. They consoled themselves with the thought that they’d made it through the hardest part.

“At least this is over,” Nakagawa recalled saying. “At least God’s giving us a break for once.”

Then the hemorrhaging started — fist-sized clots of blood that soaked through sanitary pads in minutes. Nakagawa lay in the fetal position on towels, in so much pain she couldn’t sit up.

Around 9 p.m., her husband called the doctor, who recommended they go to the emergency room.

At the hospital, she was given fluids, a clotting drug and a transfusion, but her bleeding continued.

After four hours, doctors decided her condition was critical and they needed to intervene. They performed a D&C to remove the remaining tissue.

Nakagawa’s recovery took more than a week. Lying on her couch, unable to walk, she was determined to ensure other service women would get the care she was denied. Taking a risk, she banged out a long email to Thomas, who had a reputation for being approachable.

“I feel compelled to report a traumatic experience I went through that will undoubtedly impact more women in the CG and DOD if the TRICARE policy is not changed,” the email began. “The summary is that I nearly lost my life last week due largely to a TRICARE policy regarding miscarriages and abortions.”

Thomas connected Nakagawa to the Defense Health Agency’s chief medical officer, Dr. Paul Cordts, who called her personally a month after her emergency surgery.

Nakagawa said that Cordts seemed apologetic and even angry on her behalf. “This shouldn’t have happened to you,” she recalled him saying, adding that he’d get to the bottom of what went wrong. (Cordts didn’t respond to emails from ProPublica.)

Two days later, a new record appeared in Nakagawa’s Tricare file: a letter approving the scheduled D&C she’d never received and no longer needed. “Please contact the provider to schedule your appointment(s),” it said.

Cordts also arranged for Col. John Verghese, Tricare’s chief of clinical oversight and integration, to look into her case. Nakagawa said she had two calls with Verghese, who looped in a senior official at Health Net, the Tricare contractor that had dealt with the request to cover her D&C.

In one, she said, Verghese acknowledged Tricare had become more conservative in reviewing requests for D&Cs, requiring more documentation to justify approving these procedures. (Verghese, who has retired, declined to answer questions from ProPublica about the case.)

He admitted that until her case, Tricare hadn’t understood that delaying or denying care could put women at risk, she said. This infuriated Nakagawa.

“I just said, ‘Well, maybe you didn’t realize there would be physical negative consequences, but you had to know there would be mental and emotional consequences to making women carry around their [dead] fetuses’” after a miscarriage.

Verghese quickly apologized, she said.

On the final call, Nakagawa said that Verghese and the Health Net official told her that from now on, they would no longer require doctors to submit proof of no fetal heart tones to get approvals for D&Cs and would speed up reviews of appeals.

In its statement to ProPublica, the DHA maintained that Tricare’s coverage and documentation requirements for D&Cs have not changed.

Nakagawa is one of few women in senior leadership within Coast Guard civil engineering. She remains committed to serving in the military. But she worries about the impact the Defense Department’s reproductive health policies could have on service members and their spouses and daughters. Junior members especially might be less able to advocate for themselves, she said.

“At the very least, this policy will likely encourage women, like myself, to work for a company that has insurance that will cover these procedures,” she said, “At the worst, it will lead to service members or their dependents losing their lives.”

Mariam Elba contributed research.

by Mica Rosenberg

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up to receive our biggest stories as soon as they’re published.

In handwritten cursive, a Russian immigrant named Marina wrote out the story of the day U.S. Customs and Border Protection agents took away her 1-year-old baby while she was being held in a detention facility in southern California. “I cried and begged, kneeling, not to do this, that this was a mistake, not justice and not right,” she wrote. “She was so little that no one knew anything about her. I was very afraid for her and still am!”

This didn’t happen during the Trump administration, which separated more than 4,000 migrant children from their families under its controversial “zero tolerance” policy. Marina was separated from her baby in April of this year. The 40-year-old former restaurant manager came to the U.S.-Mexico border with her husband, mother-in-law and child to seek asylum. More than eight months later, she and her mother-in-law remain in federal immigration custody in Louisiana. Her husband is detained at a different Louisiana immigration facility. And Aleksandra is over a thousand miles away, being cared for by strangers in foster care in California.

Aleksandra is one of around 300 children the Biden administration has separated from their parents or legal guardians this year, according to two government sources who asked not to be identified because they hadn’t been authorized to speak about the separations. Most of the cases involved families crossing the southwestern border, the sources said. These numbers haven’t previously been reported.

Similarly, 298 children were separated from their parents in 2023, according to a government report to Congress published on Tuesday, even as overall migrant crossings have declined. According to the report, the average amount of time children separated between April 2018 and October 2024 have spent in federal custody before being released to a sponsor is 75 days.

The Department of Homeland Security, Customs and Border Protection, and Immigration and Customs Enforcement did not respond to multiple requests for comment on the numbers or on Marina’s case.

Those officials who did speak about the separations did so on the condition they not be identified. They said the current separations are not similar — in either character or scale — to what was happening during the Trump administration. Its zero tolerance policy directed authorities to detain and criminally prosecute all immigrants caught illegally crossing the border and to separate them from their children if they were travelling together. Biden administration officials say they have only separated families for reasons according to longstanding immigration practices, including when they have concerns about the parents or the safety of the children. Some of those concerns are related to suspicions about abuse, criminal histories or threats to national security.

The administration reports the numbers of separations to Congress and to lawyers at the American Civil Liberties Union who have been charged with providing oversight. However, those reports give few details about the reasons for the separations, especially in cases where parents have been flagged for national security reasons. Around 80 of the children separated between December 2023 and November 2024 were in that category, one of the government sources said, and some 50 of those were Russian, like Aleksandra. The second source said at least 10 of the Russian children who were separated this year are still in government custody.

In cases involving national security, the government can withhold its rationale even from the families themselves, making it hard for them and their lawyers to contest the separations or mount a defense. And some advocates have been reluctant to talk publicly about the current separations, much less call out President Joe Biden’s administration, as they press for the government to resolve their clients’ cases and fear the incoming Trump administration could apply the same standards more broadly to separate more families in the future.

Family separations at the border did not begin with the zero tolerance policy and didn’t end when it was lifted, said Talia Inlender, deputy director of the Center for Immigration Law and Policy at the University of California, Los Angeles School of Law, which wrote a report on family separations going back to the Obama years and before. She said that while Trump’s policy was unprecedented because of how expansive it was, the scant information that the government provides about separations at the border has been common practice across administrations.

“I think the lack of transparency creates a lack of accountability,” she said, “and that is by design.”

“Where there is room left for agency discretion,” Inlender said, “that’s really where we need to make sure that there are eyes on what is happening, so that these exceptions, or these grey areas, don’t become the rule.”

During telephone interviews with Marina and her husband, conducted through a translator, the couple said they hoped by breaking the silence on their case, they might get answers about why they were separated from their daughter and get her back. They asked to be identified only by their first names because of their pending deportation cases.

Marina said that she and her husband Maksim, who worked as a supplies manager at a construction company, had met at a restaurant where Marina worked in Moscow. They married in 2021 and tried for years to have a child before Alexsandra was born.

Maksim said he started going to antigovernment protests in support of opposition leader Alexei Navalny and later against Russia’s invasion of Ukraine. According to an affidavit Marina gave as part of her asylum case, she said Maksim had been detained, questioned and on one occasion beaten up by police after protests. ProPublica could not independently corroborate the accounts of his political activity. They both said Marina wasn’t involved in the protests and had asked him to stop attending them. Eventually the family decided to leave the country, fearing government reprisals.

After researching the best routes into the U.S. online, they said they bought tickets to Dubai, Mexico City and Tijuana, which sits on the border with California. Once in Tijuana, Marina said they waited for six months for an appointment after using a U.S. government app known as CBP One to apply for permission to approach the border and ask for asylum. They were finally granted a slot and allowed to cross in mid-April.

But instead of being released to pursue their asylum claim, Marina said she and Aleksandra were held in a cold cell at a Border Patrol detention facility. She said she was given only formula and vegetable purees for Aleksandra. She smashed up bread from her own sandwiches to give her daughter extra food. At the time Aleksandra was learning to walk and was always moving around; she had just started to talk.

Then, after several days, Marina said she and her baby were surrounded by border officials who told her the adults would be detained and Aleksandra would be taken away. She said one of the agents handed her a note that read: “CBP has made this decision for the following reason: You are being taken into custody for presenting a public safety or national security risk.”

Recalling the desperation she felt upon seeing the note, Marina wrote: “Why would that be? I didn’t even have an interview!!!”

She said she became catatonic after a Border Patrol agent took her daughter by the hand and led her away.

“I thought I died at that moment.”

Excerpts from a handwritten account by Marina, a Russian immigrant, about her separation from her 1-year-old at the U.S. border. She wrote and translated it in detention and shared it with ProPublica.

Her experience might sound familiar to anyone who followed the news about the thousands of separations carried out by the Trump administration. Its zero tolerance policy first began as a pilot program in 2017, but the administration denied its existence until spring 2018. Even then, authorities refused to make public the details of how the policy was being implemented, including where the children were being held, how many of them were in custody, or even how the separations were conducted.

In June of 2018, ProPublica obtained audio that had been recorded in a Border Patrol facility of wailing children who had been separated from their parents. Among them was a 6-year-old girl, pleading to make a phone call to her aunt. That audio triggered a bipartisan outcry that led the administration to announce the end of the policy 48 hours later. And a federal lawsuit brought by the ACLU forced the administration to reunify the children in its custody with their families.

That reunification effort continued even after Trump left office. Biden, who called zero tolerance a “a moral and national shame,” formed a task force to finish the reunifications shortly after taking office. It found that some parents had been deported without their children and remained separated years later. Biden promised going forward that his administration would not separate children from their parents “except in the most extreme circumstances where a separation is clearly necessary for the safety and well-being of the child or is required by law.”

Biden’s Justice Department negotiated a settlement with the ACLU allowing it to disperse assistance to the families that had been harmed by zero tolerance. Under the terms of the deal, signed last December, future family separations were only allowed in “limited” circumstances, including when parents are deemed a threat to the child, have an outstanding arrest warrant or need to be hospitalized.

The settlement also said separations were allowed when government officials found parents or legal guardians could pose “a public safety or national security risk to the United States,” including people suspected of terrorism or espionage. But in those cases the agreement says that the government is not required to provide documentation of the reason for its decision if it would mean disclosing sensitive information.

Such cases could include instances when migrants’ names come up on an international watch list, said a third government official, who, like the others, spoke on the condition of anonymity. In June of this year, the U.S. Treasury Department sanctioned two Uzbeks and one Russian national for alleged links to an ISIS-linked human smuggling network that the State Department said facilitated travelers coming to the United States.

“If they are looking into cases more deeply and then people are let go after they found out the information they had was not correct,” the official said, “it’s still pretty difficult to say we shouldn’t go ahead and make those checks if we need to pay extra security attention in these cases.” Sometimes, the official said, authorities are able to quickly resolve any security concerns and reunite the families.

Advocates do not disagree that sometimes separations are warranted, said Lee Gelernt, an ACLU attorney and the lead lawyer in the family separation lawsuit. And they said they understand the sensitivity of sharing information that could put the country at risk.

However, when asked whether the Russian cases highlight the potential pitfalls of the agreement the ACLU made with the administration, Gelernt said that the government “cannot create a loophole and place everything in the black box of national security.”

He added that if the exceptions become “an excuse to circumvent the bar on separations, we will return to court.”

With Biden leaving office soon, it’s the incoming Trump administration that most worries the advocates. Trump made stopping border crossings and mass deportations a centerpiece of his campaign and says they are part of his Day 1 plans for when he takes office, but when asked several times in an interview over the weekend if he would revive the zero tolerance policy, he said: “We’ll send the whole family, very humanely, back to the country where they came. That way the family’s not separated.”

Inlender wasn’t convinced that Trump wouldn’t ramp up family separations. “With any loopholes that exist in policies, any loopholes that exist in the settlement agreements, I think there is always a danger when you have an incoming administration that has already both shown itself willing, and in some cases able, to inflict cruelty to separate families, that they will use any tools at their disposal,” Inlender said.

The children who were separated from their parents for national security reasons in the past year came from a range of countries, including Romania, Turkey, Ukraine, Lebanon, Iran, Kyrgyzstan, Armenia, Colombia and Venezuela, the two government sources said. The majority, however, came from Russia. In fact, only one Russian child separated from their parents this year was listed as being separated for a reason other than national security, they said.

None of the officials interviewed could say whether Russian families had been flagged for special scrutiny. The 50 Russian children separated last year represent a very small share of the overall Russian border crossings. According to CBP data for the 2024 fiscal year, which began last October and ended in September, 7,137 Russian families crossed the southwestern border, almost all of them through legal ports of entry like Marina’s family.

The secrecy surrounding Marina’s case has meant the government has not told her or her lawyer any more specific reason for her detention and prolonged separation from Aleksandra. Marina’s New York-based attorney, Elena Denevich, said in an email that while she has filed a series of parole requests for Marina since May, “the requests were denied based on unspecified ‘national security concerns.’” Denevich said DHS “has provided no evidence or explanation to substantiate this allegation.”

The Office of Refugee Resettlement, which is part of the Department of Health and Human Services and oversees migrant children, said it could not comment on individual cases and referred questions about enforcement to DHS. ORR, which earlier this month had only published data on family separations through January 2024 on its website, updated its site with nine new reports from February through October this week.

In addition to interviews, Marina shared her four-page handwritten account of the separation after translating it herself into English using a tablet provided to her in detention. ProPublica reviewed court documents and spoke to Maksim’s stepfather, who crossed the border months earlier but was released to pursue an asylum claim.

Marina’s family has joined a class-action lawsuit brought by more than 150 detained Russian-speaking asylum seekers against the government claiming they are systematically being denied parole by ICE because of their nationalities. Maksim’s stepfather says he has been working nonstop as a long-haul truck driver to pay for legal fees as he fights for the release of his family. ICE said it could not comment on pending litigation.

After their separation, Marina, stuck in detention, said she had to wait three months before she was finally allowed to speak with her daughter on the phone in July. Beginning in August, they were allowed weekly video calls. Because the family Aleksandra is staying with doesn’t speak Russian, Marina has asked them to put on Russian YouTube videos from time to time so her daughter can listen to people speaking her native language. She says Aleksandra looks healthy and like she is being well taken care of, surrounded by toys and wearing new clothes. She is grateful for the foster family, who points to the screen and says “mama” when they talk to remind her who her mother is, but she breaks down crying when talking about how the separation has affected her.

“I’m just trying to take care of myself because my little daughter needs a healthy mom. But because she is so little, I feel really bad. I am starting to fall apart, both mentally and physically,” Marina said from detention. She said she is having trouble sleeping and experiencing a series of worsening health problems.

Not knowing the reason behind their family’s separation is agonizing.

“I don’t have the slightest clue why they did this to us.”

Andrey Babitskiy contributed reporting.

by Patricia Callahan, Debbie Cenziper and Megan Rose

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up for Dispatches, a newsletter that spotlights wrongdoing around the country, to receive our stories in your inbox every week.

The drug potassium chloride has been on the market for decades, widely prescribed to help the nerves and muscles — including the heart — function properly in patients with low potassium. Too much of it, however, can kill you.

At high doses, it is so effective at stopping the heart that some states have used injections of it for executions.

So the danger was obvious in May, when Indian drugmaker Glenmark Pharmaceuticals recalled nearly 47 million capsules for a dire flaw: The extended-release medication wasn’t dissolving properly, a defect that could lead to a perilous spike in potassium. The U.S. Food and Drug Administration deemed it the most serious kind of recall, a defective drug that had the potential to kill people.

At the time of the recall, the FDA, which is charged with protecting Americans from unsafe drugs, was already on notice about troubles at Glenmark.

The Mumbai-based company had four recalls in the previous eight months and would have two more in following months, all for the same dangerous tendency for pills to dissolve improperly. All the faulty medications were made at the same Glenmark factory in central India, government records show.

Yet the FDA hasn’t stopped Glenmark from shipping pills from the factory to American patients. Nor did it send investigators to the Indian facility to figure out what had gone wrong. Its last inspection of the plant was more than four years ago, before the COVID-19 pandemic.

“They should have been camping out there,” said Patrick Stone, a former FDA inspector who now advises pharmaceutical companies.

Glenmark’s String of Recalls

In less than 12 months, Glenmark Pharmaceuticals had seven recalls for drugs that didn’t dissolve correctly. All were made at the same factory in central India, records show.

Oct. 20, 2023: Recall of deferasirox tablets for oral suspension, which treat iron overload from blood transfusions

Oct. 23, 2023: Recall of ranolazine extended-release tablets, which treat chest pain

March 26, 2024: Recall of diltiazem hydrochloride extended-release capsules, which treat high blood pressure

April 17, 2024: Another recall of diltiazem hydrochloride extended-release capsules

May 29, 2024: Recall of potassium chloride extended-release capsules, which treat low potassium. This recall was expanded on June 24, 2024, and announced by the FDA the next day.

June 28, 2024: Recall of pravastatin sodium tablets, which treat high cholesterol

July 31, 2024: Recall of indomethacin extended-release capsules, which treat rheumatoid arthritis

Since the May recall, Glenmark told regulators it has received reports of three deaths, three hospitalizations and four other serious problems in patients who took the recalled potassium chloride capsules, FDA records show. It’s unclear if the drug was the cause.

A federal lawsuit alleges that the pills were responsible for the death of Mary Louise Cormier, a 91-year-old woman in Maine. A letter informing her of the recall arrived three weeks after she died.

The FDA’s anemic response underscores longstanding weaknesses in the way the agency oversees the safety of generic medications manufactured in foreign factories. The agency failed to act on clear patterns of trouble, was slow to warn the public about the potentially deadly pills and never mentioned that millions of them had been sold to consumers.

From the day of the first recall in October 2023 through the next 12 months, the FDA oversaw 22 recalls for drugs that didn’t dissolve correctly and could cause harm, agency data shows. That single Glenmark factory was responsible for more than 30%, a ProPublica analysis found.

“The FDA is always late to respond,” Stone said. “This should have been dealt with immediately.”

The FDA has long said it polices foreign plants by prioritizing inspections based on risk. For routine inspections, the agency uses a computer model that weighs prior recalls, the date and results of the most recent inspection, and other factors. FDA employees decide when to send investigators for more urgent visits based on signs that something is amiss. But the agency would not explain why Glenmark’s string of recalls didn’t meet that threshold.

What’s more, federal regulators were aware of significant deficiencies at three of Glenmark’s four other factories that have made drugs for the U.S. market, FDA records show. The breakdowns were so grave at one plant that the FDA barred drugs made there from entering the country.

The FDA’s failings date back decades. In her book “Bottle of Lies,” journalist Katherine Eban exposed the agency’s struggles to identify and combat corruption in the global pharmaceutical industry amid a huge demand for cheap generic drugs in the U.S. The book detailed how a whistleblower in 2005 started feeding the FDA insider details about unsafe medications at a different Indian drugmaker, but it took federal officials almost nine years to wrap up a criminal case.

The majority of the factories making drugs for U.S. patients are in other countries, many of which churn out the generics that make up more than 90% of prescriptions filled here. Yet the investigative arm of Congress has repeatedly found that the FDA has too few inspectors to adequately oversee these plants.

The consequences of lax oversight were unmistakable when the U.S. Centers for Disease Control and Prevention reported in 2023 that four people died and others had to have their eyeballs removed after they used contaminated eyedrops made by a different Indian company. The FDA had never inspected that factory before people got sick.

Fed up with what they called “institutional weaknesses and dysfunction” in the oversight of foreign drugmakers, the House Committee on Energy and Commerce in June demanded that the head of the FDA turn over documents about inspections in India and China.

A spokesperson for the FDA declined to answer questions about the Glenmark recalls or inspection history, saying the agency could not publicly discuss potential or ongoing compliance matters. “When there are quality issues identified that could result in harm, patients should rest assured that the FDA does everything within our authority to work with firms to ensure a recall is conducted most effectively,” FDA spokesperson Amanda Hils wrote in an email. A recent reorganization, she added, “will ultimately help the agency be more efficient and cohesive in our inspection and investigation efforts.”

Officials with Glenmark also declined to answer detailed questions. In a court document, the company denied being responsible for the death of Cormier, the woman in Maine.

“Due to the ongoing litigation, we are unable to provide further information at this time but Glenmark is fully committed to maintaining the highest standards of quality and regulatory compliance in all our operations,” a Glenmark spokesperson wrote in an email. “We continue to work closely with the FDA to ensure compliance with manufacturing operations and quality systems.”

Overseas compliance with U.S. manufacturing standards is crucial in a drug market where foreign factories like the ones operated by Glenmark make a wide range of injections and pills that treat some of the most vulnerable patients in the U.S., including those with cancer, heart disease, epilepsy and kidney ailments. What happens in a factory a half a world away can have deadly consequences.

Glenmark’s major troubles with the FDA began in 2019 at a factory far from the one that made the potassium chloride.

That spring, FDA investigators went to the company’s Himachal Pradesh plant in northern India and reviewed more than 100 complaints about products made there: A steroid cream was gritty, a medication was watery, and tubes of medicines were cracked and punctured.

The inspectors found so many problems at the facility that the agency sent Glenmark what’s known as a warning letter, a disciplinary tool the FDA uses to lay out significant violations of federal requirements and demand changes. Too often, Glenmark didn’t identify the root causes of problems and failed to come up with plans to prevent the same defects in the future, the director of the FDA’s Office of Manufacturing Quality wrote to Glenmark’s chairman.

“Your quality system for investigations is inadequate and does not ensure consistent production of safe and effective products,” the FDA official wrote.

This became a recurrent theme for Glenmark in subsequent years as FDA investigators dinged one plant after another for failing to follow manufacturing processes that prevent defective drugs from winding up in American medicine cabinets.

FDA records show the problems stretched from India to the U.S., where Glenmark has a factory outside of Charlotte, North Carolina. In August 2021, Glenmark recalled every product it made at that plant. The recall notices said they failed to meet manufacturing standards.

In the spring of 2022, FDA investigators spent more than a month in that factory, documenting 17 violations that resulted in a warning letter for that plant as well.

The problems snowballed in the fall of 2022. The FDA sent Glenmark’s chairman yet another warning letter, this time about its factory in Goa, India, which the agency said failed to thoroughly investigate discrepancies among batches of drugs and lacked the procedures necessary to ensure that its products had the strength, quality and purity that Glenmark claimed. And FDA officials were so concerned after a subsequent inspection of Glenmark’s Himachal Pradesh factory that they placed it on the agency’s dreaded import alert list, which allowed federal regulators to prevent drugs made there from entering the U.S.

At that point, three of the five Glenmark factories that had made drugs for American consumers were in trouble with the FDA.

Get in Touch

Do you work at the FDA? Do you have information about generic drugs that we should know? We’re particularly interested in decisions made by the Center for Drug Evaluation and Research about drug shortages, foreign or U.S. manufacturing, and regulatory actions, such as warning letters and import alerts. What aren’t officials telling Americans about their drug supply? Email Megan Rose at megan@propublica.org or Debbie Cenziper at debbie.cenziper@propublica.org. If you prefer to reach out confidentially on Signal, Megan can be contacted at 202-805-4865, Debbie can be contacted at 301-222-3133, or get in touch with both reporters at 202-886-9594.

But one plant has escaped scrutiny in the last few years: the Glenmark facility that made the recalled potassium chloride.

The factory, in Madhya Pradesh, India, previously had a mixed record with the FDA. The agency had sent inspectors every year between 2015 and 2020, finding problems in half the visits.

In 2018, the FDA asked Glenmark to voluntarily make improvements after inspectors found evidence that drafts of internal investigations were shredded in the quality department, among other deficiencies.

Subsequent inspections in September 2019 and February 2020, though, went well.

Then the COVID-19 pandemic hit, and the FDA put all but the most urgent inspections on hold. An Associated Press analysis this September found that about 2,000 pharmaceutical plants had not been inspected by the FDA in five years.

The FDA doesn’t have enough experienced investigators to figure out what’s wrong at factories where there are signs of trouble, said Peter Baker, a former FDA inspector who consults on pharmaceutical quality.

“It’s really difficult to be proactive when you don’t have people,” Baker said.

People familiar with FDA enforcement say inspectors are often frustrated because they have little say on which facilities they inspect. That decision is made by another arm of the agency that doesn’t have the same sort of on-the-ground view of what’s going on in factories.

Those who have the most to lose — the patients who could be endangered by defective pills — rarely, if ever, learn about the conditions inside the manufacturing plants. The FDA doesn’t make it easy for people to know where a drug is made, let alone whether it was by a factory with a concerning safety record.

To determine that the recalled Glenmark drugs were all made at the Madhya Pradesh factory, ProPublica matched drug-labeling records from the U.S. National Library of Medicine with details in two FDA databases. Because the FDA doesn’t routinely post its inspection reports online, ProPublica obtained these and other records from Redica Systems, a data analytics company that receives this information from the FDA through public-records requests.

The first in the string of recalls from the plant came in October 2023 for a drug that treats iron overload from blood transfusions. Days later, the company announced a second recall, this time for a medication for chest pain. Then came two more for capsules that treat high blood pressure. The potassium chloride recall was Glenmark’s fifth. Two more came after that, for a cholesterol-lowering drug and a rheumatoid arthritis medicine.

The only one mentioned on the FDA’s recalls website was the potassium chloride. In that case, the agency followed its practice of posting a press release from the drug company rather than writing its own alert for the public.

“Public notification is generally issued when a product poses a serious health hazard or has been widely distributed,” the FDA spokesperson wrote in an email.

Records show the agency determined that potential harm from taking the other pills Glenmark recalled was likely to be temporary or reversible. But it never told the public what that harm might be.

Mary Louise Cormier never knew her potassium chloride pills had been recalled.

On June 27, the 91-year-old was taken to the emergency room from her nursing home in Brunswick, Maine. She was lethargic and could give only soft, monosyllabic answers to questions, according to the lawsuit filed by one of her daughters.

A blood test showed that her potassium level was alarmingly high — so high that an emergency room doctor had the lab run the test a second time to make sure the result wasn’t a mistake, according to the lawsuit. A level above 6 millimoles per liter is considered a medical emergency. The tests showed Cormier’s level was 6.9, the lawsuit says.

Cormier — who had raised five children, cared for babies in the foster care system and once ran a day care out of her home — suffered cardiac arrest and died, the suit says.

The lawsuit, filed in federal court in Newark, New Jersey, accuses Glenmark of a “systematic disregard for drug safety” and alleges the company sold pills “more suitable for an execution” than for the vulnerable patients they were supposed to help. Cormier’s pharmacy confirmed that her pills came from recalled batches, the lawsuit says. The suit is seeking class-action status.

In a court filing, Glenmark denied the allegations. The company’s attorneys listed dozens of defenses, including that the injuries claimed were the result of preexisting or unrelated medical conditions and that the product contained an adequate warning. There can be other reasons for a spike in potassium, and ProPublica was unable to independently verify key details in the suit. Cormier’s daughter referred a reporter to her attorney, Aaron Block, who declined to release Cormier’s medical records, citing the early stage of the litigation.

It’s not clear when Cormier’s pharmacy first learned the pills could be dangerous, but news of recalls can often take time to reach pharmacists — and longer to get to patients. The suit says Cormier’s pharmacy dispensed the pills on June 25. That was the day the FDA posted the recall on its website and three days before Cormier died. Medicines in the U.S. often pass through distributors. The manufacturer is responsible for notifying its distributors, who then have to notify their customers and so on down the supply chain.

News of the recall didn’t reach Cormier’s family until three weeks after her death. As her family was preparing for her memorial, a letter arrived. Cormier’s health insurance company was writing with “important drug recall information” about her potassium chloride: “Our records show that you may have recently filled a prescription for this product.” The letter made it clear that the pills may cause high potassium levels, potentially leading to cardiac arrest and death.

Glenmark knew there was a problem with its potassium chloride at least a month before Cormier died.

On May 29, a Glenmark executive wrote a letter to distributors saying a batch of potassium chloride had failed to dissolve correctly in a test, so the company was issuing a recall. The executive told the distributors that the recall was “being made with the knowledge of the Food and Drug Administration” and used red capital letters to mark the notice “URGENT.” The letter was sent via FedEx overnight. But the company and the FDA didn’t tell the public at the time.

In late June, Glenmark recalled dozens more batches, including the pills that the lawsuit says Cormier took.

On June 25, about four weeks after the Glenmark executive had written to distributors, the FDA finally alerted the public.

Glenmark and the FDA declined to say why the initial recall in May didn’t include all of the faulty pills or why they didn’t tell the public sooner. Speaking generally, Hils, the FDA spokesperson, said that the agency does not have the authority to mandate recalls of most drugs, with a limited exception for controlled substances. The agency’s role, she said, is “to oversee a company’s recall strategy, assess the adequacy of the company’s action, and classify the recall.”

Since then, Glenmark has told the FDA about reports it received of the deaths, hospitalizations and other serious health problems in patients who took the recalled potassium chloride. Companies are required to file reports to the FDA’s Adverse Event Reporting System so the agency can monitor the safety of drugs. The FDA’s online database includes only bare-bones details, so ProPublica was unable to independently verify what happened in each case. While the FDA would not comment on these complaints, the agency generally warns, “For any given report, there is no certainty that a suspected drug caused the reaction.”

A majority of the reports said the patients suffered from abnormal heart rhythms, while the second-most-common complaint was of muscle problems. Glenmark’s public alert said that the recalled pills could cause irregular heartbeats and severe muscle weakness.

Glenmark’s top executives have told financial analysts on earnings calls that the company has invested in improvements to its factories.

The company’s troubles with U.S. regulators are so well known to investors that its compliance officer notified the National Stock Exchange of India in September that FDA inspectors had found no problems at one of its other factories in India. As the news spread, Glenmark’s stock jumped 9%.

by Sawyer Loftus, Bangor Daily News

This article was produced for ProPublica’s Local Reporting Network in partnership with the Bangor Daily News. Sign up for Dispatches to get stories like this one as soon as they are published.

Public housing helped bring an end to Linda Gallagher-Garcia’s three years of intermittent homelessness in her hometown of Presque Isle, Maine, in 2020. With $200 in secondhand furniture, she made the apartment feel like home for her and her dog, Tex.

But when she fell behind on her rent and was evicted two years later, the fact that she was in public housing made her future more dire: Maine public housing authorities’ rules bar evicted tenants from returning to government-subsidized units and from receiving other benefits that could help them relocate.

Gallagher-Garcia had moved back to her hometown in northern Maine in 2017 after her husband died. She was working as a home health aide and struggled to earn enough to afford a place to live; then, when she got COVID-19 and had to take time off from her job, she fell behind on her rent. The Presque Isle Housing Authority evicted her in 2022. “I was sick,” she said. “It didn’t matter to them.” Citing confidentiality rules, the housing authority said it could not comment on her case.

Last spring, Maine lawmakers had a chance to help public housing tenants at risk of losing their homes when they created a fund to prevent evictions. But instead of doing what nearby Massachusetts and Connecticut did, and making public housing tenants eligible for the program, Maine did the opposite and specifically excluded them. That left public housing residents — who are more likely than others to become homeless after eviction — ineligible for the aid.

Those who crafted the law said they didn’t realize people in public housing might need such help. Gallagher-Garcia’s story shows why they do.

She owed just $955 in back rent and utilities when she got her eviction notice — an amount the new eviction prevention program could have covered if it had been in place and if she had been living in a privately owned apartment. Instead, at age 59, Gallagher-Garcia checked into the local emergency shelter where she stayed for two years. In total, state and federal dollars paid about $55,000 for her to stay there.

Gallagher-Garcia outside her old apartment at the Presque Isle Housing Authority’s elderly and disabled section. She lived there for two years before being evicted in 2022. (Linda Coan O’Kresik/Bangor Daily News)

Maine’s pilot eviction prevention program, called the Stable Home Fund, opened to applications in October. It provides eligible households with up to $800 a month for up to one year, with additional funds available to cover back rent.

The creators of the Stable Home Fund thought that public housing tenants already had enough aid. Public housing, which is funded with federal dollars, is supposed to be affordable for low-income families, the elderly and people with disabilities, with rent typically capped at 30% of household income. Public housing tenants, however, can still struggle to afford rent and be evicted just like tenants in private apartments.

In fact, in 2023, Maine’s public housing authorities filed a disproportionately high share of eviction cases, according to an analysis of court data obtained by the Bangor Daily News and ProPublica. The eviction filing rate for public housing authorities was more than twice as high as the rate for all rental housing: 10 eviction filings per 100 units for public housing compared with four filings per 100 units for all rental housing.

The cause of most public housing eviction filings in Maine was nonpayment of rent, based on a separate review of court data collected by Pine Tree Legal Assistance, Maine’s largest legal aid group.

Because of public housing rules forbidding tenants from returning after an eviction, and because public housing tenants are generally poorer than other renters, both publicly and privately owned properties become out of reach. (By contrast, people who have been evicted from privately owned housing are still eligible to live in public housing.)

As a result, the consequence of being evicted from public housing “is almost certainly homelessness and extreme housing instability for already vulnerable families,” said Marie Claire Tran-Leung, director of the National Housing Law Project’s evictions initiative.

That homelessness comes with a financial cost to state and local governments. A 2009 Maine study found that governments spent about one-and-a-half times more in services for a homeless person in the six months before they were placed in subsidized housing and given supportive services than in the six months after.

Aroostook County in Maine. Three-quarters of the state’s 2023 low-income eviction cases were in its rural 2nd Congressional District, which includes Presque Isle. (Linda Coan O’Kresik/Bangor Daily News) Public Housing Gets Excluded

Little is known about evictions in Maine, in part because the state’s paper-based court system makes it hard to obtain data. In 2023, Pine Tree Legal, a nonprofit that provides civil legal services to people with low incomes, spent a year traveling around the state to review eviction filings to understand why landlords try to remove tenants, how often renters don’t show up in court and how frequently they have representation. The Bangor Daily News and ProPublica analyzed the data, which covered about 40% of cases filed between 2019 and 2022. The newsrooms also obtained further data from the state court system on every eviction case filed by a public housing authority from January 2019 through August 2024.

Taken together, the data provides a window into a little-noticed aspect of Maine’s housing crisis. Since 2019, public housing authorities, which had a combined total of 3,299 units last year, went to court to evict low-income tenants about 1,300 times.

In 2023, their cases made up 5% of all eviction filings, despite the authorities having just 2% of the state’s rental units. Of the public housing cases, three-quarters were in the rural 2nd Congressional District, which covers most of the state outside the populous southern coastal region and includes Gallagher-Garcia’s hometown of Presque Isle.

The Presque Isle Housing Authority, where she lived, is in the geographically largest county east of the Mississippi River and has a population of just 67,000 residents. The housing authority filed nearly one eviction suit for every five of its public housing units in 2023, the highest rate of any housing authority in Maine, the Bangor Daily News and ProPublica found. The vast majority of cases in Presque Isle were for nonpayment of rent.

The housing authority said that a small minority of its cases resulted in actual eviction orders. (The state of Maine, however, does not track the number of people who leave after being threatened with eviction but before their cases are completed.)

The housing authority’s executive director, Jennifer Sweetser, explained that evictions are necessary because the agency’s budget relies on consistent rental payments. She also said that the housing authority doesn’t grant individual exceptions to eviction, which could be unfair or discriminatory. Instead, she said, the eviction process gives tenants a “neutral” way to resolve issues.

Farther south in the 2nd Congressional District, the Bangor housing authority filed more than twice as many eviction cases as the housing authority in Maine’s biggest city, Portland, located in the state’s other congressional district, even though Portland has many more public housing units.

This issue isn’t unique to Maine. Eviction Lab, a research organization based at Princeton University, has found that some public housing authorities around the country use evictions as a rent collection tactic, sometimes at higher rates than private landlords.

Victoria Morales runs the Quality Housing Coalition, based in Portland, and was the architect of the eviction prevention program that launched this year. She said she didn’t know how often Maine public housing tenants faced eviction until the Bangor Daily News and ProPublica shared their findings, as her organization doesn’t usually work with people in public housing. “I think it is hard to see that this exists if you’re not in it,” Morales said.

Morales excluded tenants in public housing from the fund because she said their rent is already supposed to be affordable. The goal was to help people facing eviction who were not already receiving some type of aid, she said. (In the end, however, the program allowed renters to apply who were receiving other types of housing assistance — just not those living in public housing or who had a federal Section 8 voucher.)

The program’s cost to the state was also a factor in limiting who was eligible, said state Rep. Rebecca Millett, D-Cape Elizabeth, who sponsored the legislation that spurred the fund. “We had to get it through the appropriation process when we were competing with all the other really important needs that our state is facing,” Millett said. Although Millett’s 2023 bill didn’t pass, a year later lawmakers decided to create and fund the rent relief program with $18 million through the supplemental budget process.

MaineHousing, a quasi-state agency that awarded a contract to Morales’ organization to run the program, estimated that 1,000 households could benefit over two years. In the first month, the program received 1,400 applications and had to start putting people on a waiting list.

Even with the high demand, two national housing experts said the Stable Home Fund could help more people if tenants of public housing could participate. That’s because monthly rent in public housing is much lower than on the private market.

Those experts said they don’t know of another eviction prevention program that excludes people in public housing. Kevin Connor, a spokesperson for the agency that runs Massachusetts’ program, said it is open to any household because the state wants to prevent homelessness, “whether they are in a house they own, an apartment they rent or a subsidized unit.”

Morales did not say whether she planned to advocate for public housing tenants to be included in the program in the future, but she said she would support the change if the state decided it was a priority.

Millett said she’d like to see the program expanded to help every Mainer who needs assistance, including people in public housing. But she will not be around when lawmakers convene in January; after 12 years in the Legislature, she didn’t run for reelection. Without Millett, and with no guarantee of future funding, the program’s longevity remains an open question.

After her eviction, Gallagher-Garcia was forced to move back into a shelter. (Linda Coan O’Kresik/Bangor Daily News) Evicted From Public Housing

Public housing delivered Gallagher-Garcia from homelessness. But being evicted from public housing pitched her right back into it.

One cool day in April 2022, her nieces and nephews helped her empty out her apartment, throwing her furniture into a dumpster. “Basically, I didn’t have anything,” she said, in the same matter-of-fact way that she described many of the other challenges she’s faced, including battling cancer. When she checked into the shelter, it ended her longest period of housing stability since 2017.

She couldn’t move in with her sister, Nancy Gallagher, who also lives in the housing authority, because the authority bars people who have been evicted from staying with other residents. She had to stay near Presque Isle because that’s where her job was. So Gallagher-Garcia went to the shelter. “I just didn’t have time to find anywhere else to go,” she said.

Gallagher-Garcia spends an afternoon at the apartment of her sister, Nancy Gallagher, in the Presque Isle Housing Authority. (Linda Coan O’Kresik/Bangor Daily News)

Her dog, Tex, went to the kennel in Caribou, the next town up the road. Under the shelter’s rules, Gallagher-Garcia had to leave her metal crochet needles behind at her sister’s apartment because they could be used as weapons. She also was required to leave the shelter every morning; when she didn’t have to go to work or see a doctor, she spent the day in her sister’s living room calling around for apartments.

In her second year at the shelter, in 2023, her health started to decline — first a hernia, then ovarian cancer. With that diagnosis came more tests, surgeries and chemotherapy. “January, February, March, three months behind each other, not even giving my body time to heal or anything, one surgery after another,” she said. She made frequent trips to see specialists as far away as Portland, four and a half hours away.

Living in a room at the shelter with three to four women, she had little privacy when nurses came to check on her surgical wounds. When other residents started asking what was going on, she decided to tell them. “I didn’t sugarcoat it,” she said about her discussion with a boy in the shelter. “I said, you know, I could go to sleep and not wake up.”

In July 2023, she returned to work part time despite continued chemotherapy treatments, so she could save up enough to leave the shelter. She didn’t like sitting around, she said: “I wanted to go back to work and have something to do for myself.”

Finally, in June, after two years in the shelter, she moved into a motel. She was glad to have a quiet place to stay, and she got her dog back after paying a fee. But it cost $1,000 a month, twice as much as her apartment at the public housing complex. After about nine months, she fell behind on her rent, and the motel kicked her out, too, she said.

As of early December, Gallagher-Garcia was still at the local homeless shelter, looking for a place of her own. Every week, she said, she called landlords, looking for someone to accept her despite her financial struggles and prior evictions.

Then, she found something: a hotel room for $1,200 a month. That’s more than the last place, which she couldn’t afford. But she just turned 62, and now she can draw Social Security. Between that and her job, she hopes she can make it work.

This story was supported in part by a grant from the Fund for Investigative Journalism.

Bangor Daily News reporter Sawyer Loftus may be reached at sloftus@bangordailynews.com.

by Paul Kiel

ProPublica is a nonprofit newsroom that investigates abuses of power. Sign up to receive our biggest stories as soon as they’re published.

For most working Americans, paying their share of the taxes that fund Medicare is an unavoidable fact of life. It’s so automatic for many workers that they may not even realize it takes a bite out of every paycheck. In theory, everyone is required to contribute to the country’s health insurance program for seniors, no matter how poor or rich, from cashiers to CEOs.

Not on Wall Street. There, some of the most powerful people in finance found a way to opt out.

The trove of tax records behind ProPublica’s “Secret IRS Files” series contains plenty of examples of billionaire financiers who avoided Medicare tax despite earning huge amounts from their companies. In 2016, Steve Cohen, the owner of the New York Mets, paid $0. So did Stephen Schwarzman, head of the investment behemoth Blackstone. Bill Ackman, the headline-grabbing hedge fund manager, was able to shield almost all his income from the tax.

How do they do it? Business owners, like any self-employed person, whether they’re a freelance Uber driver or a hedge fund manager, have the responsibility to declare their self-employment earnings on their tax returns. Indeed, the vast majority of small-business owners have no choice but to do so and pay the same taxes that wage earners pay, including Medicare.

But high-priced tax advisers, wielding a once-obscure bit of the tax code, found a way to make that obligation vanish. By carefully channeling profits through a company in a way that invokes that obscure provision, even a Steve Cohen, with a tax return showing he received hundreds of millions in profits from his hedge fund, can exempt that income from Medicare tax.

The three billionaires contacted for this article said they followed the law as written. They also pointed to the fact that they paid substantial income tax, which for them carries a much higher rate. Medicare tax is 2.9% for most people and 3.8% for high earners.

But these maneuvers by the rich hasten Medicare’s future crisis. Sometime in the 2030s, the program’s trust fund is due to run dry. Closing the loophole, along with eliminating other ways around the tax for wealthy business owners, could raise more than $250 billion over 10 years for Medicare, according to recent government estimates.

Over the past three years, ProPublica has mined the tax records of the rich to detail the many ways they avoid taxes. We’ve focused on basic structural features of the U.S. system that advantage them. We’ve uncovered maneuvers of questionable legality that seem to have escaped the notice of the IRS. The Medicare tax loophole occupies a gray area. The IRS definitely knows about it, but it’s unclear if the agency will be able to stop it.

The potential of the loophole first surfaced in the 1990s, and the IRS soon expressed the view that active business owners shouldn’t be allowed to exploit it. It was only in recent years, however, that the agency got tough. Today, the IRS continues to battle what it considers a serious abuse, waging a rare, long-shot campaign to prevent some of the nation’s wealthiest citizens from using the loophole.

The story of how America’s richest financiers avoid paying Medicare tax gives unique insight into the peculiar, messy way taxes work in the U.S. No one set out to create the loophole when it first entered the tax code in 1977. But a series of seemingly unrelated policy changes, together with a revolution in how American businesses are structured, conspired to deliver a major tax advantage to the wealthy. On Capitol Hill, interest groups have successfully defended that advantage, branding any effort to close the loophole as a tax hike on Main Street businesses.

Approaching its 50th birthday, the loophole, for now, lives on.

Fixing One Problem, Creating Another

Over the 2010s, years of budget cuts sliced deep into the IRS’ enforcement muscle. Audits, especially those of the wealthy and corporations, plummeted. In response, agency leaders decided to conduct a kind of triage and focus the IRS’ dwindling might on the most pressing and addressable problems. Among the agency’s early priorities was to curb the widespread use of the Medicare tax loophole.

Beginning in 2018, the agency began hunting for business owners who, in its view, were abusing the law. It launched over 80 audits aimed at hedge funds, private equity firms, consultancies and similar businesses. Cohen’s firm was just the sort of thing the agency was looking for.

Before Cohen became popular as the approachable, gap-toothed, sweater-wearing Mets-fan-in-chief, he was a controversial figure on Wall Street, the inspiration for the legal-risk-taking hedge fund lead character in the Showtime series “Billions.” Cohen made his fortune through his original hedge fund, SAC Capital, known for rapid-fire trades with a remarkable track record. In 2013, SAC pleaded guilty to five criminal counts of securities and wire fraud, agreeing to pay $1.8 billion in penalties and effectively shut itself down. Cohen was not personally charged. Turning the page, he soon formed a new hedge fund, Point72.

The IRS’ audit of Point72 focused on one thing: how the profits had flowed to Cohen. In 2015, his firm earned $125 million from clients, and the money was routed to him through Point72 Asset Management LP.

Those last two letters, which stand for limited partnership, were Cohen’s key to accessing the loophole.

For most of the last century, before hedge funds and private equity firms dominated Wall Street, limited partnerships played a very specific role. They allowed investors, as limited partners, to buy into a business — often oil drilling or real estate development — without the usual risks of ownership like being pursued for the business’s debts.

But by the 1970s, creative uses of limited partnerships proliferated. One variety caught Congress’ attention. Government employees were covered by public pensions and thus were not eligible for Social Security, but brokerages were pitching these employees on limited partnerships as a way around that. The government workers could buy a small share of a business and receive self-employment income that qualified them for future Social Security benefits.

The scheme was condemned by both parties. After all, Social Security was meant to reward people’s labor, not their investments. Only income earned by someone actively running a business should count toward Social Security.

The solution, Congress decided, was to exclude most income earned by limited partners. It wouldn’t count toward self-employment income and, as a result, wouldn’t be subject to self-employment tax, which goes to Social Security and Medicare. As part of a major 1977 Social Security reform bill, this soon became the law.

It seemed like an easy fix. At the time, limited partners were, as a rule, passive investors. The line between the two types of partners that made up a limited partnership was real: General partners ran the business, and limited partners didn’t.

“Limited partners were historically forbidden under state law from getting too involved in the business,” said Susan Hamill, professor of law at the University of Alabama. “If they got involved at all, they would simply be treated as general partners, and the liability shield would be stripped away from them.”

Lawmakers assumed things would continue as they’d always been. They didn’t. The 1977 law, it turned out, had passed at the dawn of a new age, one where limited liability became standard for business owners, not a special condition with strings attached.

A new business structure, the limited liability company, exploded in popularity in the ’90s. LLCs limited the legal liability of all owners regardless of their role. Limited partnerships morphed into something that functioned similarly. After the change, the fact that someone was a limited partner said nothing about what they did for the business. They could be the CEO or a passive investor. It became common for owners to serve as both limited and general partners.

In this new world, the 1977 law was no longer a narrow exclusion. It was a broad grant of tax avoidance to anyone with a canny tax adviser.

Point72 Asset Management LP was part of the trend.

To take advantage of the loophole, Cohen needed to channel his firm’s profits through a limited partner before the money reached him.

One obstacle, it might seem, was that Cohen was one person. How could he partner with himself? That part was simple. A partnership requires at least two partners, but they can be companies or people. Cohen created two business entities, each wholly owned by him. One became the limited partner, the other the general partner.

Over 2015 and 2016, Point72 Asset Management earned $344 million in profits; 99.98% of that went to the limited partner and was declared exempt from Medicare tax. While those profits were subject to the 40% income tax rate (as much as $136 million in tax), Cohen’s returns showed $0 in self-employment income both years, helping him avoid up to $11 million in Medicare tax.

The IRS audited those returns and determined that the full $344 million was self-employment income. Last year, Point72 challenged that finding in court in a case that continues to this day. A spokesperson for Cohen declined to comment, citing the ongoing litigation.

“A Nasty Little Tax Increase”

Almost as soon as LLCs began their rapid spread, IRS officials recognized the possibility of widespread avoidance of self-employment tax. The problem became more urgent after 1993. Since its beginning, Medicare tax had, like Social Security, been capped. But Congress, in need of more revenues to support Medicare, eliminated the cap. Suddenly, avoiding Medicare tax might save a business owner millions of dollars instead of, in 1993, under $4,000.

In 1997, the IRS proposed a rule that would dictate how the 1977 law should be interpreted. A limited partner would mean essentially what it had meant back in 1977, when the term described passive investors. People who worked more than 500 hours (about three months) annually for the business could not be a limited partner under Section 1402(a)(13), the loophole’s place in the tax code.

IRS rule proposals are usually soporific affairs closely watched only by tax practitioners. But in early April 1997, fax machines in Republican congressional offices spat out a message that ended this rule’s obscurity.

The IRS was about “to slip through a nasty little tax increase on America’s partnerships,” the memo read. It was from Steve Forbes, the millionaire magazine publisher and 1996 Republican presidential candidate. He’d centered his self-funded campaign around the idea of a “flat tax,” under which he promised “the IRS would be RIP.” Now he was rallying his party against what he called a “stealth tax increase.”

His message reached Rush Limbaugh, the conservative radio host, who was then at the height of his influence. Soon after Limbaugh mentioned Forbes’ faxed memo on his nationally syndicated show, Speaker of the House Newt Gingrich, a Georgia Republican, called in.

Congress would “intervene directly,” Gingrich promised. “And as you yourself pointed out earlier, we didn’t get elected to raise taxes. We got elected to lower taxes and simplify them and to end the IRS as we know it,” he said.

“Now, folks, that is fast action,” Limbaugh boasted.

A coalition of powerful trade groups hurriedly formed to pressure Congress to follow through on Gingrich’s vow. The rule change would raise taxes by more than $1 billion over the following decade, they estimated, and must be stopped.

The coalition represented businesses that were both small and decidedly not small (among the members were the U.S. Chamber of Commerce and the Securities Industry Association). But their message emphasized the rule’s impact on the “small business community.”

In fact, most small-business owners already paid Medicare and Social Security taxes. Then, as now, the most common form of small business was the simple sole proprietorship, taxspeak for a business with a single, human owner.

By July, the coalition had prevailed. A short provision of a major bill, the Taxpayer Relief Act of 1997, forbade the IRS from issuing any new rule “with respect to the definition of a limited partner” in the next year.

The IRS had been roundly rebuffed. It would be almost two decades before the agency would seriously consider trying again.

In the meantime, the options for business owners to skirt Medicare tax multiplied. New forms of partnerships arose, and the subchapter S corporation, which offered its own loophole around Medicare tax, emerged as an even more popular vehicle. The breadth of the tax avoidance meant that opposition to closing those loopholes would be even fiercer the next time there was a major threat.

“100% Political Fear”

In early 2010, President Barack Obama’s administration and a Democratic Congress were struggling to pass the Affordable Care Act when they hit on a way to help fund it. The proposal boiled down to an expansion of Medicare tax. Whereas before it had only applied to income from work, now, for high earners, it would extend to investment income like dividends and capital gains. The rate would also go from 2.9% to 3.8%.

But, while new forms of income would now be subject to the tax, the proposal intentionally left huge gaps. It wouldn’t touch the ability of business owners to use loopholes to avoid Medicare tax and would even limit their exposure to the new tax on investment income.

Why create a new, complicated tax that favored some forms of income over others, asked Jason Furman, then a member of Obama’s National Economic Council. In a meeting with Obama and his advisers, Furman advocated for a simple, uniform version of the tax that would also close the loophole, he said. The president agreed on the merits, Furman said. But arousing the opposition of the business lobby could endanger the whole bill. It wasn’t worth the risk. “It was 100% political fear,” Furman said.

A monumental health care reform effort like the ACA was already controversial, and members of Congress were looking to get it passed, said Robert Andrews, a former New Jersey Democratic representative and lead negotiator on the bill. They chose the funding option “with the least political risk,” he said.

“This was an ugly compromise, and I think we knew it was an ugly compromise and worth it for the greater good,” Furman said.

Pushing Around the Edges

As the years passed and no legislative fix came, the IRS vacillated on what to do about the limited partner loophole. The Treasury Department decides which tax regulations to pursue, and under the Bush and then the Obama administration, there wasn’t appetite for another bruising fight over a new rule. At the same time, IRS officials decided they couldn’t ignore what they viewed as widespread abuse of Section 1402(a)(13).

They decided on a middle path, said Curt Wilson, who in 2008 became the senior IRS attorney overseeing partnership issues. “We looked for places where we could push around the edges, so to speak,” he said.

This wasn’t a crusade. But in audits, when the opportunity presented itself, the agency cracked down on what it saw as abuse of the loophole. Agents focused on some of the newer forms of partnerships that had sprouted since 1977. LLCs were the prime target.

“We were looking at hedge funds, private equity firms, things like that where there were big dollars,” Wilson said. The goal was to make a splash with a precedent-setting case.

Landing that big case proved elusive. Instead of fighting it out in court, taxpayers were content to privately settle the audits with the IRS’ appeals division, Wilson said. The IRS did its best to send a message, releasing an advisory letter in 2014 to a hedge fund that said the fund’s LLC members didn’t qualify as limited partners. But that wasn’t a binding rule, and it fell short of a headline-grabbing court decision.

What’s more, the IRS risked playing Whac-A-Mole. Even if the agency succeeded in dissuading taxpayers from using the loophole with LLCs, business owners could simply register their business as a limited partnership instead. As the granddaddy of partnerships with limited liability, the LP, the original limited partnership, offered taxpayers the strongest claim for invoking the loophole.

ProPublica’s database of IRS data includes the tax returns of thousands of wealthy business owners through 2018. These titans of capitalism, despite huge flows of ordinary income, often reported remarkably little self-employment income in the 2010s. The LP appears to have been their favored variety of partnership.

In 2017, Bill Ackman earned $413 million in income through an LP operated by the hedge fund he manages, Pershing Square, famous for taking activist stances in companies. As was typical in other years, Ackman reported self-employment income of $4.7 million, a small fraction of his total business earnings. The difference meant he paid $142,000 in self-employment tax instead of more than $13 million.

In a statement, a spokesperson said: “Mr. Ackman has followed the advice of his tax advisors whose interpretation of the law has been the industry standard since 1977. Should the law change, Mr. Ackman will of course adjust his tax payments accordingly.”

In 2018, at least $143 million flowed via a Blackstone LP to Stephen Schwarzman, the firm’s CEO. As in years past, he exempted the income from Medicare tax. Schwarzman, who sits atop an investment firm with over $1 trillion in assets, reported no self-employment income at all in five of the seven years between 2012 and 2018.

“Mr. Schwarzman is one of the largest individual taxpayers in the country and fully complies with all tax rules,” a spokesperson said.

Attacking Head-On

The IRS’ announcement of its audit campaign in 2018 meant the agency would stop pushing around the edges and unleash a frontal assault: Its audits would target not just the newer form of partnerships but also LPs.

This time, after years of audits and appeals within the IRS, the agency finally got its splashy court case. Many taxpayers chose to settle, but Cohen’s partnership and at least five others took their cases to tax court, the first in 2022. All argued they were following the law.

Soroban Capital, a hedge fund, was audited after converting to an LP from an LLC. Demonstrating the gulf between owners and employees, Soroban’s three partners collected $142 million in income over the two years of the audit, while paying a total of $74 million in salaries and wages (subject to Medicare tax) to the fund’s staff.

Soroban’s founder, Eric Mandelblatt, was once an employee. His compensation from Goldman Sachs cost him $128,000 in Medicare tax one year, according to ProPublica’s IRS database. After he started his own hedge fund and began earning tens of millions more, his Medicare tax bill never exceeded a third of that, the records show. Soroban did not respond to requests for comment.

In 2023, the IRS won a major tax court decision against Soroban. The “limited partner exception of I.R.C. § 1402(a)(13) does not apply to a partner who is limited in name only,” the court said, because Congress had only intended to “exclude earnings from a mere investment.” A “functional analysis,” the court said, was needed to determine whether a partner was really “limited.”

With the Soroban decision, the loophole entered a new stage in its history. It’s the most serious challenge since 1997 when, protected by Congress, the loophole emerged not only unscathed but stronger. This time, it’s up to the federal judges who will be reviewing appeals of the tax court’s rulings in the IRS’ cases.

One of the audit targets, Sirius Solutions, a consultancy, has already sought a more sympathetic venue than the U.S. Tax Court. Last summer, it turned to the 5th U.S. Circuit Court of Appeals, known for its conservative bent. Industry groups representing the hedge fund and real estate industry have filed amicus briefs. Tax law experts told ProPublica they are skeptical the IRS’ position will ultimately prevail.

Still, amid this uncertainty, the Treasury Department and IRS last year announced plans to start work on a regulation for Section 1402(a)(13). It’s a process that could take years if it isn’t halted by the incoming administration. If a new rule is finally released, it might again face a hostile Congress. It would also be subject to challenge in the courts.

As has always been the case, the simplest solution is for Congress to change the law. Democrats will keep trying, said a former senior congressional aide, especially when they propose some new expensive initiative and need ways to pay for it.

Including a fix for the Medicare tax loopholes is “a beautiful pay-for,” he said. “It’s real money, and there are not a lot of options sitting around that are this obvious and relatively straightforward technically.”

The last attempt came a couple years ago, when Democrats needed to cover the cost of their $2.4 trillion climate bill. Build Back Better, as it was initially called, passed the House with a provision similar to Furman’s gap-plugging tax. The proposal was estimated to raise $252 billion over 10 years.

But the bill stalled in the Senate, where Democrats needed every vote. In the summer of 2022, negotiations suddenly approached consensus on a new, slimmer bill, soon dubbed the Inflation Reduction Act. The gap-plugging tax was part of the mix.

As they had 25 years before, business groups quickly rallied. Several dozen trade groups co-signed a letter to congressional leaders. The National Federation of Independent Business launched radio ads. “Now Congress is considering a brand-new tax on West Virginia small businesses, an additional tax wrongly characterized as the closing of a loophole,” ran one ad targeting Sen. Joe Manchin, one of the two key swing votes.

When a deal was finally announced on the bill, the proposal was gone. There had been other, less politically dangerous options to raise revenue.

Do You Have a Tip for ProPublica? Help Us Do Journalism.

by Stephen Engelberg

ProPublica is a nonprofit newsroom that investigates abuses of power. This story was originally published in our Dispatches newsletter; sign up to receive notes from our journalists.

Elon,

I know your relationship with ProPublica got off to a rocky start when we contacted you about a story we were writing about your federal taxes. You replied with a lone punctuation mark — “?” — and subsequently called the story that mentioned you “a bunch of misleading stuff.”

We can agree to disagree on that story and a lot of other things. But we thought it might be useful to reach out again in light of your role, along with Vivek Ramaswamy, as co-head of the Department of Government Efficiency.

Simply put: If you’re trying to identify wasteful practices and spending by federal agencies, you’ll find a wealth of actionable issues that our reporting has surfaced over the past 16 years. You and Vivek noted in your recent Wall Street Journal op-ed on your plans for DOGE that “the federal government’s procurement process is also badly broken.”

Our reporting over the years provides some powerful illustrations of that point. ProPublica’s work on the Navy’s cost overruns and design flaws in its ships is second to none. We recently disclosed how Microsoft boxed its competitors out of providing cybersecurity software to the biggest government agencies, including the Pentagon. (Microsoft defended its conduct, saying in a statement that its “sole goal during this period was to support an urgent request by the Administration to enhance the security posture of federal agencies who were continuously being targeted by sophisticated nation-state threat actors.”)

Perhaps the most immediate relevance of our journalism to your work arises from your reported interest in creating a phone app that most Americans could use to file their taxes.

No national news organization has been more focused on this subject than ProPublica. We have thoroughly documented why the United States is one of the only industrialized countries in the world that does not provide free filing to its citizens: Companies like Intuit that make billions of dollars selling tax preparation software have persuaded Congress to block free filing and keep their businesses alive.

I’d encourage you to take a look at the story “Inside TurboTax’s 20-Year Fight to Stop Americans From Filing Their Taxes for Free.”

You’re a busy person, so I’ll provide a TL;DR version: The tax prep industry has blocked free filing by organizing a bipartisan coalition on Capitol Hill that is anchored by House Republicans but includes Democrats like Zoe Lofgren, who represents Silicon Valley.

The industry also attracted support from longtime Republican figures like Grover Norquist, who has branded proponents of free filing as “big spenders in Washington, D.C.” who are trying to “socialize all tax preparation in America.”

As you know (or will soon learn if you pursue this agenda), despite decades of resistance, the IRS recently launched a pilot program for free filing. It works pretty well, but it’ll likely remain small scale unless something changes in the current Washington status quo.

That’s where you and Vivek have a historic opportunity.

What has always struck me about Washington is its ability to resist fundamental change. People arrive with big plans for reforms and often end up becoming part of the problem.

I began my career as a Washington reporter in 1983, two years after President Ronald Reagan took office promising to upend how business was done in the capital. Reagan was serious about coming up with some concrete ideas for saving money and reducing waste. He created a presidential commission of business executives and urged its members to work like “tireless bloodhounds.”

“Don’t leave any stone unturned in your search to root out inefficiency,” the president said.

Two years later, the commission delivered 47 volumes of reforms that it said could save $424 billion in government spending over three years. Most of the proposals required congressional action, a daunting task when the Senate was controlled by Republicans and the House by Democrats. In the end, only 27% of the recommendations were enacted. By the time Reagan’s term was over, government spending was up and the deficit had grown.

I believe Republican control of the presidency and both houses of Congress gives you and Vivek a better shot at taking on issues like free tax filing that have long been dismissed as lost causes. There’s a broad coalition of Americans who voted for Donald Trump, many of whom feel the government cares little about their problems. Politicians of both parties understand that their futures may depend on taking real, measurable steps to address those concerns.

Eliminating the annual ritual of paying money to a third party in order to tell the government what it already knows about your personal finances could be both popular and more efficient.

There has been a lot of skepticism about whether it’s possible to achieve your goal of cutting trillions of dollars from the federal budget. It appears to me that you could only rack up that level of savings by slashing everything from Medicare to military spending. I think the president’s political advisers will take the ax out of your hands before you hit the first trillion.

That’s not to say there isn’t an array of government programs that could be better run. We see our job as holding power to account, and the waste of the people’s money is one focal point of our reporting. That’s why we’ve written repeatedly about waste and fraud in Medicare and Medicaid, the government’s two biggest health care programs. (We’ve also covered the way cuts to those programs harm people.)

I have little doubt that we will write stories in the coming years that will enrage people you know. Some of our work may even focus on you or your companies. With immense power comes immense scrutiny. (As we did several years ago, we will always reach out to you for your response before we publish anything about you.)

Still, I would be disappointed if we did not also publish a piece or two that prompted you to storm into Vivek’s office and say: “Damn, this is outrageous. We could fix this.”

Best,

Steve Engelberg