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.


WellCare political muscle at issue

By Mike Wells
10/5/2010 © Health News Florida

WellCare Health Plans became one of the biggest political contributors in Florida between 2004 and 2007, using a web of companies and employees to shower the state Republican Party and GOP candidates with campaign cash.

But Tampa attorney Barry Cohen says WellCare did more than line pockets to keep political favor. Cohen, who represents a whistleblower in a federal lawsuit against WellCare, said today the contributions were pennies on the dollar compared to the money the HMO saved in Medicaid fines — and the profits it made.

In an unusual legal move, Cohen now wants one of the recipients of the campaign cash, Attorney General Bill McCollum, disqualified from helping decide how much WellCare should have to pay to settle the whistleblower case, which alleges widespread Medicaid fraud.

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Attorney sues Avvo.com over profile mistakes

By Mike Wells
9/3/2010 © Health News Florida

A health-law attorney in St. Petersburg has triggered comment in legal circles nationwide for suing an online consumer rating service that gave him just 3.7 out of 10 points — a rating described in a legal blog as lower than a “brick.”

Larry Joe Davis Jr. of St. Petersburg filed suit for defamation against Avvo.com, a consumer site for lawyers, which lists Davis with a red-lettered “caution” sign because of disciplinary action by the Florida Bar. Davis, who is board-certified in health law, represents physician groups and hospitals.

A previous suit against Avvo by an attorney who had a “caution” sign was thrown out on First Amendment grounds.

Davis says he’s not suing Avvo.com over the rating, but because the Seattle-based company put him in the wrong category, gave an outdated address and used his photo without his permission. He said he discovered his listing under “labor and employment law” from a potential client.

Avvo CEO and President Mark Britton said Davis’ allegations of harm are farfetched and classified the lawsuit as the act of a schoolyard “bully.”

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Suit claims hospital chain paid kickbacks

By Mike Wells
8/10/2010 © Health News Florida

A former hospital executive has accused Naples-based Health Management Associates of offering money, free rent and private jet trips to entice doctors to refer Medicare patients to the company’s hospitals.

In a whistleblower lawsuit unsealed Aug. 2 by a federal judge, former hospital CEO J. Michael Mastej also accused his former employer of filing fraudulent claims on services HMA’s facilities provided the ill-gotten Medicare patients.

His lawsuit doesn’t specify an exact number of claims, but states that the fraud spanned from at least 2007 to the present at facilities “in Florida and elsewhere.” HMA presently operates approximately 56 hospitals in 15 states.

Mastej, who now lives in Blairsville, Ga., is a former resident of Bonita Springs in Lee County. He filed the qui tam suit in January.

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WellCare settles with shareholders

By Mike Wells
8/9/2010 © Health News Florida

WellCare Health Plans announced a second-quarter loss but also preliminary settlement of a class-action suit by shareholders with the Securities and Exchange Commission for $200 million.

This proposed settlement does not affect the one still pending with the U.S. Attorney’s Office for the Middle District of Florida over civil charges of Medicaid fraud. The company has said previously that it expects to settle that case for about $137.5 million, although a whistleblower in the case has promised to fight for more.

Other news from the company is also a mix of positive and negative. WellCare achieved full accreditation — an effort that takes years — from a national association, but also announced restructuring plans that will involve layoffs.

Most of the positions being eliminated are currently unfilled, the company said, so layoffs should affect fewer than 100 employees among a workforce of 3,400.

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Bidding hits FL company hard

By Mike Wells
7/7/2010 © Health News Florida

Medicare’s new competitive bidding system, which offers taxpayers and beneficiaries better deals on home medical equiment, has already dealt a blow to at least one Florida firm even before the bid-winners are announced.

Clearwater-based Lincare Holdings (Nasdaq: LNCR) is among the public companies that analysts have placed on a watch list of fast-falling stocks that are trading with unusual volume. Lincare is one of the nation’s largest providers of home oxygen equipment, with more than 750,000 customers.

Florida is a major player in the initial phase of bidding, with one of the selected metro areas including Miami-Dade, Broward and Palm Beach counties. Another includes Orange, Lake, Osceola and Seminole counties.

Last Thursday, as Health News Florida reported, the Centers for Medicare & Medicaid Services announced the bidding program will save taxpayers and beneficiaries 32 percent next year, on average, and even more than that in the Florida counties that are participating.

The announcement provoked a market response because the cuts were much steeper than analysts expected.

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Whistleblower’s complaint about WellCare Health Plans unsealed

By Carol Gentry and Mike Wells
June 27, 2010 © Health News Florida

The complaint that launched a federal investigation of WellCare Health Plans four years ago by a whistleblower within the company has now been unsealed, and the picture it paints of the state’s largest Medicaid HMO contractor is grim.The complaint, filed by former WellCare financial analyst Sean J. Hellein, portrays a company so ethically challenged that it rewarded employees who dumped hundreds of sick newborns and terminally ill patients from the membership rolls, thereby pumping up profits by millions of dollars.

It describes a company that embraced fraudulent accounting as a business model, eventually stealing between $400 million and $600 million from Medicare and Medicaid programs in several states, perhaps most of it from Florida.

These “ill-gotten gains were taken by deceiving, outsmarting and concealing the truth from government regulators,” said Hellein’s attorney Barry Cohen in a press release Friday.

WellCare has not yet issued a response, but has in the past has termed what occurred “accounting errors.”

Cohen persuaded U.S. District Court Judge James S. Moody to unseal the records on Thursday after learning that the U.S. Attorney’s Office was discussing settling the case with WellCare for $137.5 million.

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WellCare, feds agree on $137.5M

By Mike Wells
6/25/2010 © Health News Florida

WellCare Health Plans has announced a $137.5 million preliminary settlement with the federal government that, if executed, would halt investigations into allegations of accounting fraud.

The Tampa-based provider of Medicaid and Medicare services has been under official investigation since October 2007.

WellCare made the settlement announcement on Thursday in an SEC filing, which outlined its agreement with the civil divisions of the U.S. Department of Justice and the U.S. Attorney’s Offices for the Middle District of Florida and Connecticut.

The preliminary settlement is subject to approval of an executed written agreement. Upon its execution, the company would pay the government over a period of up to 36 months, plus interest at the prevailing Medicare Trust Fund rate.

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WellCare won’t disclose political $

By Mike Wells
6/11/2010 © Health News Florida

Last month, a former director of WellCare Health Plans publicly called for the company to be more transparent in disclosing its financial issues. But Regina Herzlinger’s request went nowhere.

On Thursday, at the Tampa company’s annual meeting, the Harvard Business School professor was replaced on the board of directors, and a proxy vote calling for WellCare to disclose its political spending went down to defeat.

The official shareholder election results were released Thursday afternoon in an SEC filing, which showed about 23 percent of the votes cast were in favor of the proposal. According to the filing, shareholders owning 87.46 percent of the company’s common stock were or represented by proxy at the meeting.

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WellCare ex-director fires more volleys

By Mike Wells
5/13/2010 © Health News Florida

Rather than simply resign from WellCare Health Plans’ board of directors and leave peacefully, Dr. Regina Herzlinger apparently isn’t willing to let the company have the last word.

Last week, according to a Securities & Exchange Commission filing by the company, Herzlinger sent WellCare a letter saying she disagreed with the company’s description of the circumstances regarding her recent resignation.

This week, she’s made her feelings clear in an online site read by millions: Huffington Post. In an opinion piece published Wednesday afternoon, Herzlinger said she was going public about what happened at WellCare to show the need for greater “transparency” about medical decisions and insurance coverage.

Read the rest of the story here.