TAMPA — Whistle-blower Sean Hellein will receive nearly $21 million for triggering a successful federal inquiry into Medicare and Medicaid fraud at his former Tampa employer, WellCare Health Plans.
Hellein in late February withdrew his objections to a pending $137.5 million civil settlement with WellCare. But the size of his payout was unclear until Tuesday, when U.S. Attorney Robert O'Neill announced the settlement of all four lawsuits initiated by whistle-blowers.
Three of the suits were in the U.S. Middle District of Florida in Tampa, the fourth in the District of Connecticut.
In mid 2006, Hellein, then a senior financial analyst with WellCare, secretly recorded executives discussing ways to double bill for patient services. WellCare, which provides managed-care plans for 2.6 million people on Medicare and Medicaid, was required to spend a certain percentage of the government's money on care or refund the difference.
Based on Hellein's information, the FBI raided WellCare's Tampa headquarters in October 2007. WellCare previously settled a shareholders' class-action lawsuit.
Resolution of the civil suits brings total recoveries from WellCare to $217.5 million. O'Neill said recovered funds from restitution and the settlement will go to federal and state programs that suffered losses because of the fraud, while forfeited funds will go to law enforcement to help fund future investigations.
Whistle-blowers who bring a lawsuit under the False Claims Act are entitled to receive a percentage of the recovery. Hellein's award of $20.75 million represents his share of the $40 million in restitution received by the United States plus the federal portion of the $137.5 million civil settlement.
Well-known Tampa lawyer Barry Cohen represented Hellein.
Three other parties in the case — Clark Bolton, SF United Partners and Eugene Gonzalez — will split about $4.66 million and be entitled to more money if WellCare makes a contingency payment due to a change in ownership. Under the civil settlement, WellCare is on the hook for an additional $35 million payment if the company is sold or there is a change in control within three years.
WellCare separately told investors Tuesday that state and federal prosecutors will seek dismissal of any pending criminal charges against the company within five days. Five former WellCare executives, including CEO Todd Farha, chief financial officer Paul Behrens and general counsel Thaddeus Bereday, still face criminal charges.
Jeff Harrington can be reached at [email protected] or (727) 893-8242.