You work in the compliance department at Bayfront Hospital, where there has just been a birth injury. During a delivery late last night, after the baby's head had nearly exited the birth canal, his shoulder became lodged on the mother's pubic bone. At this point, there were risks to both the baby and mother if the baby couldn't be delivered soon. And with the head partially delivered, a C-section wasn't an option. In the course of pulling the baby out, the obstetrician, Dr. Marina Owens, put pressure on the baby's neck, tugging the head to the right in such a way that the nerves of the brachial plexus on the left side were stretched and damaged.

The result was a birth injury called Erb's palsy. It was evident immediately after delivery that the baby wasn't moving his left arm. In the newborn nursery, a neonatologist did an exam about one hour after birth that revealed paralysis of the left arm and shoulder.

In most infants, Erb's palsy will resolve on its own within the first month or two of life with no lasting injury. In about 20 percent of cases, however, the injury is permanent. In the meantime, there's nothing to do but watch and wait. There is no treatment in the first month or two of life that would affect the outcome for the baby.

Nurse Valve, an employee of Bayfront Hospital who was caring for the mother during labor and delivery, spoke to the mother of the injured infant a few hours after delivery. She suggested that the mother speak to her pediatrician immediately concerning the newborn's condition and said "You can't trust these folks. I've seen Dr. Owens tug on babies that way a dozen times. It isn't right."

The patient reported this conversation to Dr. Owens this morning, demanding to know what had happened and stating that she planned to contact a lawyer as soon as she's discharged from the hospital.

Another nurse was present during the conversation between Dr. Owens and the patient and reported it to her supervisor immediately.

Dr. Owens works in a small group practice of three OB/GYNs. She and her partners have admitting privileges at Bayfront Hospital and one other hospital in the metropolitan area.

The general counsel and chief compliance officer of the hospital have called a meeting with their associates to discuss measures that should be taken to address this incident and to prevent similar incidents from occurring in the future.

What factual questions would you like to investigate, and why? What compliance program weaknesses can you identify, and what recommendations would you would make to minimize Bayfront Hospital's exposure to liability now or in the future?