Make us your home page

WellCare settles lawsuit for $200 million, posts second-quarter loss

TAMPA — WellCare Health Plans reported a second-quarter loss Monday, resulting largely from charges to settle separate lawsuits by investors and the federal government.

The Tampa company posted a quarterly loss of $128.9 million, or $3.05 per share. A year earlier, the company posted a quarterly profit of $37 million, or 88 cents per share.

The Medicaid and Medicare managed-care company disclosed Monday a settlement to pay $200 million to shareholders in a class-action suit. They sued for lost stock value after the FBI and the Florida attorney general's Medicaid fraud unit raided WellCare's Tampa headquarters in October 2007.

In June, WellCare agreed to pay $137.5 million to the U.S. Justice Department and other federal agencies to settle lawsuits accusing the company of overcharging for its Medicaid and Medicare programs.

The deal, which would resolve a nearly three-year federal investigation, could get derailed. An attorney for a whistle-blower who sued WellCare pledged to challenge the settlement. Tampa attorney Barry Cohen says the deal underestimates the value of fraud.

During the second quarter, WellCare reserved $194 million for the shareholder settlement. For the federal lawsuit, WellCare reserved $55 million during the second quarter. The balance of the suit settlement had been reserved earlier.

"We believe we will be able to meet our known near-term monetary obligations, including the terms of this (shareholder) settlement agreement, and maintain sufficient liquidity to operate our business," said Tom Tran, WellCare's chief financial officer, in a statement.

The company also announced a restructuring that will affect fewer than 100 jobs. A spokeswoman last week put the number at 87 nationwide but couldn't say how many layoffs were in the Tampa Bay area. WellCare employs about 3,500 people, with 2,300 in Tampa.

Steve Huettel can be reached at [email protected] or (813) 226-3384.

WellCare settles lawsuit for $200 million, posts second-quarter loss 08/09/10 [Last modified: Monday, August 9, 2010 7:22pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times


Join the discussion: Click to view comments, add yours

  1. City Council approves $5 million for Clearwater Marine Aquarium expansion


    CLEARWATER — The City Council on Thursday approved contributing $5 million to the Clearwater Marine Aquarium for its massive expansion project.

    Clearwater has agreed to contributed $5 million to the Clearwater Marine Aquarium 
's $66 million expansion project.. [ Clearwater Marine Aquarium] 

  2. Trigaux: Florida, Tampa Bay lagging in growth of their startups

    Economic Development

    The annual assessment of how entrepreneurs are doing across the country is out from the Kauffman Foundation — among the best watchers of the nation's startup scene. How do Florida and Tampa Bay fare?

    Lured by financial incentives, startup GeniusCentral relocated from Manatee County in 2015 to St. Petersburg, promising to creatye 40 new jobs. It took downtown space in an appropriately creative workpace for entrepreneurs. It did not last there, later moving back to less expensive space in Manatee. A new Kauffman Index report on entrepreneurship found that Florida is a good place to launch startups but a tougher place to grow them.
  3. Pleasant dreams: sleep travel site gives high marks to Tampa airport


    TAMPA — Traveling might be considered closer to a nightmare than a dream for many. But that might be different for those who travel through Tampa International Airport. It was ranked the No. 3 overall best airport in North America by Sleeping in Airports, a travel site that tracks the best airports to catch some …

    Tampa International Airport was ranked as the No. 3 best overall airport by travel site Sleeping in Airports. | [Times file photo]
  4. Google parent leads $1B Lyft investment, deepening Uber rift


    SAN FRANCISCO — Google's parent company is throwing its financial support behind ride-hailing service Lyft, deepening its rift with market leader Uber.

    This  file photo shows a smartphone displaying the Lyft app.Google's parent company, Alphabet Inc., is throwing its financial support behind ride-hailing service Lyft, deepening its rift with market leader Uber. [Associated Press, 2016]
  5. ReliaQuest opens storefront in mock city of JA Biztown

    Economic Development

    TAMPA — ReliaQuest, a Tampa-based cybersecurity company, opened a "storefront" Wednesday at JA Biztown. The storefront is part of a mock city where students learn economic concepts and run businesses. About 20 real-life Tampa Bay companies sponsor storefronts that local students get to run for a day as part of a …

    ReliaQuest, a Tampa-based cybersecurity company, opened a "storefront" Wednesday at JA Biztown, a mock city where students learn to run businesses. | [MALENA CAROLLO, Times]