WellCare Health Plans of Tampa promoted insider Alec R. Cunningham to replace CEO Heath Schiesser, who had agreed to leave the managed-care company by Dec. 28.
Cunningham, 42, has run WellCare's largest operating division, which serves Medicare and Medicaid members in Florida and Hawaii. He joined the company in 2005 as vice president of business development and has also played a leadership role in WellCare's government affairs work.
Before that, Cunningham developed and managed state-sponsored health care plans for WellPoint Inc.
Schiesser was promoted to chief executive in January 2008 after former chief executive Todd Farha and two other top executives were forced to resign amid federal and state investigations.
The federal investigation focused on WellCare's accounting practices, which let the company hold onto excess payments from Florida's Medicare and Healthy Kids programs. Both programs require insurers to spend at least 80 percent of state money they receive on mental health care or refund the difference.
In a settlement in May, WellCare said it kept $40 million to which it wasn't entitled. The company agreed to pay $80 million to avoid criminal prosecution.
Later that month, WellCare paid $10 million to settle a lawsuit with the Securities and Exchange Commission. The company had to restate years of earnings reports because of the fraud.
Under his termination agreement, Schiesser will receive an $800,000 bonus and $1.2 million separation fee in addition to his $400,000 salary for 2009. He also cannot seek employment with a competitor.
Steve Huettel can be reached at [email protected] or (813) 226-3384.