It sounds like your grandson may have had a fracture of the femur(thigh bone) since he was in a hip spica cast. Hip spica cast refers to a cast that goes from waist-to-toe. This type of cast is required when the upper leg is broken and must be held still until healing takes place.
A loose cast does make it possible for objects to get under the cast. This accounts for a fair number of skin problems. The specific types of foreign objects reported over the years by surgeons removing casts includes anything and everything from small toys or crayons to rocks, money, paper clips, and food. Pretty much anything children can stuff down inside the cast can end up surprising the surgeon (and parents/grandparents) when the cast is removed.
The best warning we can give any caregiver of children wearing casts is to take your child back to the physician when a cast becomes too loose. Sometimes tissue wasting occurs (especially muscle wasting or atrophy) after the cast has been on for several weeks. In other cases, swelling present at first goes down or goes away. In either case, the cast is looser and problems with skin abrasion or skin breakdown can occur (not to mention odd things finding their way down inside the cast).