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Robert Trigaux

WellCare 'one of largest health care frauds'

Wellcarefbiraidchriszuppa Wake up and good morning. So, after two and a half years, is Tampa's WellCare Health Plans -- one of the area's biggest corporations -- finally emerging from its purgatory? It began, from the public's eye, in October 2007 when more than 200 FBI agents, Florida investigators and inspectors from the U.S. Heath and Human Services department raided WellCare’s corporate headquarters. (FBI raid photo by Chris Zuppa, St. Petersburg Times.)  

That  prompted what one federal attorney now calls "one of the largest health care fraud cases in the United States."

Now WellCare will pay $80 million and hire an outside monitor to avoid prosecution on a U.S. charge the company plotted to cheat government-backed health-care programs of $40 million in Florida. A one-count criminal information was filed against the company alleging conspiracy to commit health-care fraud, U.S. Attorney for the Middle District of Florida Brian Albritton said Tuesday. If the company follows what is known as a deferred prosecution agreement, the U.S. will seek dismissal. Here's the complete deferred prosecution agreement with Wellcare, a backgrounder on the case as well as the FBI's release on the investigation.

Said Albritton: "In charging WellCare, we have sought to punish the company for its misconduct," Albritton said at a news conference in Tampa. "But we have, at the same time, tried to avoid crushing it." Here are more details from the St. Petersburg Times, which has tracked this investigation for years, including the 2007 raid.

HealthschiesserwellcareceoFor those not familiar with the company, WellCare Health Plans provides managed care services exclusively for government-sponsored healthcare programs, focusing on Medicaid and Medicare.

Heath Schiesser (see photo), who originally joined WellCare in 2002 as senior vice president of marketing and sales, assumed the role of president and chief executive officer in January 2008 following a purge of senior management that included CEO Todd Farha (shown with glasses in next photo: by Ken Helle of the St. Petersburg Times). Listen to Farha, when still CEO, explaining the FBI raid.

Said Schiesser, whose pay tops $8 million, in a bland statement: "We are pleased to have reached this resolution."

The deferred prosecution agreement requires WellCare to consent to the civil forfeiture of $40 million and pay an additional $40 million in restitution to Florida Medicaid and Healthy Kids, which provides affordable health insurance for children whose parents can't afford private coverage and don't qualify for Medicaid.


WellCare must also retain an independent monitor, selected by the U.S. Attorney's Office, to review the company's business operations and report on its compliance with federal and state health care regulations; cooperate with the government's ongoing investigation; and develop adequate internal controls to prevent any future abuse. The company said it will pay $25 million within five business days of the filing, and has already paid another $35.2 million. The remaining $19.8 million will be paid by year's end.

The agreement doesn't necessarily exempt WellCare executives and employees responsible for the fraud, however. The government's investigation is ongoing. Albritton would not discuss any further details.

Farha, a former executive with Oxford Health Plans, in 2002 led a New York investor group to buy WellCare from founder and Tampa cardiologist Kiran Patel. Farha, a former top Republican fundraiser who raised more than $100,000 for the Bush-Cheney campaign in 2004, this year has opted to keep a very low profile.

-- Robert Trigaux, Times Business Columnist

[Last modified: Tuesday, June 1, 2010 11:24am]


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