Make us your home page
Instagram

Today’s top headlines delivered to you daily.

(View our Privacy Policy)

Universal Health Care inches toward sale … or liquidation

Dr. A.K. Desai founded Universal Health Care Group. The company employs nearly 1,000, mostly at its St. Petersburg headquarters.

CHRIS ZUPPA | Times (2011)

Dr. A.K. Desai founded Universal Health Care Group. The company employs nearly 1,000, mostly at its St. Petersburg headquarters.

The future of troubled Medicare insurer Universal Health Care Group — whether it's sold or liquidated — is quickly coming to a head.

Florida regulators are seeking an immediate order to liquidate the St. Petersburg-based insurer in an emergency hearing before a judge in Tallahassee this morning. A liquidation hearing had been scheduled for March 21, but the Florida Department of Financial Services sought to move up the date after Universal missed a court deadline to object to the state being appointed receiver.

Regulators want to move quickly, with an order to liquidate Universal in place by April 1.

Staying in operation any longer without state oversight could harm policyholders, creditors, stockholders and the public, the state alleges.

On Feb. 4, Florida regulators deemed the company nearly insolvent and accused executives of a broad pattern of financial mismanagement — including fraud and diversion of funds — under founder and chief executive officer A.K. Desai. Universal filed for bankruptcy reorganization Feb. 6.

In requesting the expedited hearing, regulators said they were concerned about a continued reduction in the quality of services at Universal "as many employees have resigned or transferred to other health care companies due to the financial turmoil."

Moreover, regulators said, many health care providers have terminated their agreements to provide coverage for Universal members, some without providing the required 60-day notice. The disgruntled providers have alleged that they're not being paid in a timely way and that Universal has failed to comply with its contracts.

On a separate track, federal bankruptcy Judge Rodney May on Monday preliminarily approved the sale of Universal Health Care for $33.25 million in cash to Citrus Universal Healthcare Inc., a unit of New Jersey-based CarePoint Insurance Co. Citrus was chosen as prevailing bidder in an auction over Dr. Kiran Patel, founder of WellCare Health Plans and a well-known local entrepreneur. Patel had offered $36.5 million for the company, but his bid was to be paid over time.

Universal attorneys previously said that a sale would take liquidation off the table.

Judge May's decision, however, still needs regulatory approval. Amy Bogner of the Florida Office of Insurance Regulation said as of Tuesday afternoon the agency had still not received an acquisition application.

Citrus Universal said it is working with crisis-management experts at Alvarez & Marsal, which already deployed "a large team of seasoned industry experts" to Universal's headquarters in downtown St. Petersburg.

"We have incredible confidence in our ability to turn around Universal, if given the opportunity, with the expertise of Alvarez & Marsal and look forward to improving the company to position it to provide long-term quality and service for all members," Citrus spokesman Spencer Baretz said.

Members of Universal health plans were supposed to continue to receive coverage throughout the ordeal. Because of the company's situation, however, members have the option of contacting their agent to consider alternatives outside of the regular open-enrollment period.

Universal provides coverage for about 140,000 members, and as of early this year had nearly 1,000 employees, the vast majority of them at its St. Petersburg offices. Desai could not be reached for comment Tuesday.

Jeff Harrington can be reached at jharrington@tampabay.com or (727) 893-8242.

Universal Health Care inches toward sale … or liquidation 03/12/13 [Last modified: Tuesday, March 12, 2013 11:05pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...
  1. Former CEO of Winn-Dixie parent joining Hong Kong company

    News

    The former CEO of the Jacksonville-based parent of Winn-Dixie grocery stores, Ian McLeod, has landed a new leadership role in Hong Kong. He is joining the pan-Asian based Dairy Farm International Holdings Ltd. as group chief executive.

    Ian McLeod, who is stepping down as the CEO of the parent company of Winn-Dixie, has been hired by Dairy Farm International Holdings. 
[Photo courtesy of Southeastern Grocers]
  2. Eckerd Kids: Teens in group foster homes must be allowed to keep phones

    News

    TAMPA — For many teens still reeling from being taken into foster care, a cell phone is a lifeline, child advocates say.

    Eckerd Kids, the agency that runs child welfare in Tampa Bay, will in January require agencies that run group foster homes to allow children to use cell phones. Some group homes are concerned that children may use phones for unathorized contract with their parents or other adults or to post pictures of other foster children on social media
  3. Hillsborough Democrats call Confederate monument vote a continuation of white supremacy

    Blogs

    TAMPA — Two days after Hillsborough County commissioners decided not to touch a Confederate monument in downtown Tampa, Hillsborough County Democrats have decided to weigh in.

    On Friday afternoon, Hillsborough County Democrats decried a vote by the county commission not to remove the Confederate monument in downtown Tampa.
  4. For starters: Ramus to DL, Peterson back, no further moves

    Blogs

    We were expecting a flurry of roster moves this afternoon and we got one. OF Colby Ramus is on the 10-day disabled list retroactive to June 19 with left hip tendinitis.

    Colby Ramus is on the 10-day disabled list retroactive to June 19 with left hip tendinitis.
  5. Editorial: Failure to invest in transit means fewer HART routes

    Editorials

    It was simple economics that forced HART, Hillsborough County's mass transit agency, to cut its bus routes. The agency will focus its resources on the more crowded urban core, limiting service in the suburbs in an effort to get more bang for the buck. These are the hard choices communities must make when they refuse to …

    Hillsborough Area Regional Transit is cutting bus routes from 41 to 34. Those in more rural areas will find it harder to catch a bus.