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Judge: WellCare Medicaid fraud cost Florida $11-million

TAMPA — One final question remained before a federal judge can decide how to sentence the former WellCare executives convicted of health care fraud last summer: How much did the men cost the state of Florida?

The price tag matters because U.S. District Judge James S. Moody Jr. will take it into account when determining potential prison sentences for the former leaders at the Tampa-based managed care group.

Prosecutors say the former WellCare executives deprived the state of $28 million by inflating the costs of their services for Medicaid patients.

Defense attorneys argued prosecutors had little evidence to back up that figure, maintaining that the state didn't lose any money from the actions.

In a hearing Tuesday, Moody ended up borrowing from both sides' arguments: He put the loss to the state in 2006 at nearly $11 million. Sentencing will be scheduled at a later date.

A federal jury in June found former chief executive officer Todd S. Farha, former chief financial officer Paul L. Behrens and former vice president William Kale guilty of two counts of health care fraud for submitting false expenditure reports to the state Medicaid program.

The jury also found Behrens guilty of two other charges of making false statements related to health care matters.

On each of the health care fraud counts, Farha, Behrens and Kale face up to 10 years in prison.

The other charges carry a maximum of five years.

Federal sentencing guidelines can jack up prison sentences on health care-related convictions based on the amount of the loss to the government.

Losses above $20 million trigger the maximum enhancement.

A fourth defendant, former vice president Peter E. Clay, was found guilty of making false statements to federal agents.

According to the March 2011 indictment, WellCare took Medicaid money from Florida's Agency for Health Care Administration with the understanding that if it did not use 80 percent of the funds set aside for behavioral health services, the difference was to be returned to the state. But, prosecutors say, WellCare executives conspired to inflate what they actually spent to reduce the amount they had to return.

Judge: WellCare Medicaid fraud cost Florida $11-million 02/18/14 [Last modified: Tuesday, February 18, 2014 9:35pm]
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