WellCare sues 2 more; profits up

By Mike Wells
11/4/2010 © Health News Florida

WellCare Health Plans has left its cloud behind and come out into the sunshine, announcing better-than-expected earnings and filing suit against two more former executives.

During a broadcast of its third quarter results this morning, WellCare announced a strong performance, with profits up — even after adjusting for costs of government investigations and lawsuits associated with accusations of Medicaid fraud that were filed last year.

“It seems like they’ve got their house back in order now,” said Roy Moore, senior market analyst for HealthLeaders-Interstudy.

A new study by HealthLeaders, which analyzes the managed care market, said WellCare’s strong Medicaid HMO position in multiple states will enable it to grow with the upcoming Medicaid expansion that is part of the new health law passed earlier this year. The Patient Protection and Affordable Care Act could bring WellCare 16 million new Medicaid beneficiaries by 2019, growing its Medicaid business by 46 percent, the study said.

While Republicans have threatened to repeal the health-care law, they can’t as long as the Senate and White House are in Democrats’ hands. Moore said the newly elected Republican governors — including Florida’s Rick Scott — will likely push for the outsourcing of Medicaid services to HMOs like WellCare.

“The states are essentially broke,” Moore said. “They don’t want Medicaid expanded, but they do want [those patients] to be in the HMOs. The overall ‘pie’ won’t get bigger but the percentage of the pie going to companies like WellCare will get bigger.”

Read the rest of the story here.


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