Federal, State Authorities Raid Health Insurer WellCare; Target Unknown

Main Category: Litigation / Medical Malpractice
Also Included In: Health Insurance / Medical Insurance;  Medicare / Medicaid / SCHIP
Article Date: 26 Oct 2007 - 11:00 PDT

email to a friend   printer friendly   opinions  

Federal and state authorities on Wednesday raided the headquarters of Tampa, Fla.-based health insurer WellCare, which provides Medicare and Medicaid managed care plans and has 2.3 million members nationwide, the Miami Herald reports. No information on the purpose of the investigation has been disclosed (Stacy, Miami Herald, 10/25). The St. Petersburg Times reports that almost all of WellCare's $4 billion in revenue comes from federal and state governments (Hundley, St. Petersburg Times, 10/25). The company has about 155,000 people enrolled in Medicare Advantage plans, making it one of the largest providers of benefits through the program, according to Bloomberg/South Florida Sun-Sentinel (Timmerman/Goldstein, Bloomberg/South Florida Sun-Sentinel, 10/25).

WellCare in a release said that service to its members would be uninterrupted and that it is cooperating with authorities (St. Petersburg Times, 10/25). Agents from the FBI, HHS and the Florida Medicaid Fraud Control Unit conducted the raid (Francis, Wall Street Journal, 10/25).

Peter Costa, an analyst at FTN Midwest, said that it appears to be a criminal investigation, the penalties of which could include "being barred from doing business with the government if it is for fraud, which it most likely is given the departments involved."

WellCare has been under scrutiny for several months. Last year, the company admitted that independent sales agents in Georgia were enrolling deceased people in Medicare plans. This year, WellCare was among several insurers cited to have aggressive marketing practices of MA plans, which resulted in a temporary suspension. WellCare in August was cited again for violating parts of its Medicare contract, which includes sales practices (St. Petersburg Times, 10/25).

Georgia's Department of Community Health -- which administers Medicaid and PeachCare, the state's SCHIP -- also is investigating WellCare. It has been auditing payments to medical providers for the insurer, in addition to Amerigroup and Peach State (Miller, Atlanta Journal-Constitution, 10/25).

Reprinted with kind permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation© 2005 Advisory Board Company and Kaiser Family Foundation. All rights reserved.

• Additional
• References
• Citations