Submitted by Armen Hareyan on Oct 25th, 2007
Health Insurer WellCare
Federal and state authorities on Wednesday raided the headquarters of Tampa, Fla.-based health insurer WellCare, which provides Medicare and Medicaid managed care plans and has 2.3 million members nationwide, the Miami Herald reports. No information on the purpose of the investigation has been disclosed (Stacy, Miami Herald, 10/25). The St. Petersburg Times reports that almost all of WellCare's $4 billion in revenue comes from federal and state governments (Hundley, St. Petersburg Times,10/25). The company has about 155,000 people enrolled in MedicareAdvantage plans, making it one of the largest providers of benefitsthrough the program, according to Bloomberg/South Florida Sun-Sentinel (Timmerman/Goldstein, Bloomberg/South Florida Sun-Sentinel, 10/25).
WellCare in a release said that service to its members would be uninterrupted and that it is cooperating with authorities (St. Petersburg Times, 10/25). Agents from the FBI, HHS and the Florida Medicaid Fraud Control Unit conducted the raid (Francis, Wall Street Journal, 10/25).
Peter Costa, an analyst at FTN Midwest,said that it appears to be a criminal investigation, the penalties ofwhich could include "being barred from doing business with thegovernment if it is for fraud, which it most likely is given thedepartments involved."
WellCare has been under scrutiny forseveral months. Last year, the company admitted that independent salesagents in Georgia were enrolling deceased people in Medicare plans.This year, WellCare was among several insurers cited to have aggressivemarketing practices of MA plans, which resulted in a temporary suspension. WellCare in August was cited again for violating parts of its Medicare contract, which includes sales practices (St. Petersburg Times, 10/25).
Georgia's Department of Community Health-- which administers Medicaid and PeachCare, the state's SCHIP -- alsois investigating WellCare. It has been auditing payments to medicalproviders for the insurer, in addition to Amerigroup and Peach State (Miller, Atlanta Journal-Constitution, 10/25).
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