Prosecutors play WellCare tapes in Medicaid fraud trial

Published Mar. 19, 2013

TAMPA — Jurors in a high-profile Medicaid fraud case heard on Monday the secretly recorded conversations that lie at the heart of the federal prosecutors' allegations against four former WellCare executives.

On the 2007 video and audio recordings, a handful of WellCare employees are heard discussing the state's request for the insurer to put price tags on the mental health services it purchased with government Medicaid money.

But something clouded the issue: WellCare's two HMOs had been paying a third company, called Harmony, which was also owned by WellCare. That left the WellCare managers figuring out how to answer the question.

The resulting conversations, recorded by a whistle-blower, contained little drama and no outright gotcha moments. But prosecutors have said that the complicated calculations the recording captures illustrate a company trying to hide profit it would otherwise have to refund to the state.

On Monday, one of the prosecution's key witnesses, former WellCare senior financial planner Greg West, testified that the letter that WellCare eventually sent to the state reflected a desire to keep its set-up under wraps.

"It was explaining the pricing method without explaining Harmony," said West, whose voice is heard on the recordings. He pleaded guilty to charges of conspiracy to commit Medicaid fraud in 2007 and agreed to cooperate with federal prosecutors to get a lighter punishment.

Defense attorneys for the four executives are expected to get their first turn today at questioning West.

Former chief executive Todd Farha and four other former executives were indicted in 2011 on charges of conspiracy to commit Medicaid fraud and making false statements.

Prosecutors say WellCare took Medicaid money from the state with the understanding that if it did not use 80 percent of the funds allotted for behavioral health services, the difference was to be returned to the state.

But WellCare executives conspired to inflate what they actually spent in order to reduce the amount they had to return, say prosecutors, who contend WellCare shortchanged the state by at least $30 million.