The Daily Mail photo
Posted on 10/25/2007 7:52:37 AM PDT by wagglebee
For the past two years, analysts have been asking how fast-growing WellCare Health Plans of Tampa has been able to make so much money running government health plans for the poor and elderly. Now government investigators may be asking the same thing.
On a rainy Wednesday morning, more than 200 federal and state agents swarmed WellCare's campus on Henderson Road in Tampa, forcing employees onto the sidewalk and into their cars.
Steven Meitzen, 51, who arrived at WellCare about 9:40 a.m. for a job interview, said he was initially told it was a bomb scare. "Later on, I talked to someone who said the FBI had a subpoena and were looking for records," he said.
By midday, the complex's parking garages were half-empty, but federal agents remained busy. They were still milling around WellCare's buildings in the early evening; a Ryder truck was backed up to a loading dock.
The U.S. Attorney's Office in Tampa said little about the search, which involved personnel from the Federal Bureau of Investigation, U.S. Department of Health and Human Services and the Florida attorney general's Medicaid Fraud Control Unit. The search warrant is sealed.
Both federal and state officials, however, said that the investigation should have no impact on delivery of health care to the more than 2.3-million members of WellCare's managed care plans.
The company's customers are about evenly divided between Medicare and Medicaid plans. WellCare is the largest Medicaid provider in Florida, with more than 350,000 members. The company also offers Medicare Advantage plans to seniors in seven states and a stand-alone drug plan nationwide.
The timing of the raid could be detrimental as WellCare is in the midst of convincing seniors to sign up for its 2008 plans.
WellCare issued a release saying that it was cooperating with authorities and that essential services to members would remain uninterrupted. Though its customer service number was working Wednesday, WellCare's Web site was replaced with a notice saying, "We're sorry, but something went wrong. We've been notified about this issue and we'll take a look at it shortly."
The company, which went public in July 2004 at $17 a share, has had a meteoric rise, with its stock more than doubling in the past 12 months. On Wednesday, WellCare's shares dropped $6.77 or 5.5 percent, to $115.50 before trading was halted about 11 a.m. It ended the day down $7.10 at $115.17.
FTN Midwest analyst Peter Costa downgraded his rating on WellCare stock to "sell" from "neutral" on Wednesday, citing the search. Costa said the investigation appeared to be a criminal one.
"Criminal investigations are harder to prove, likely to be more company specific and carry stiffer penalties, including being barred from doing business with the government if it is for fraud, which it most likely is given the departments involved," Costa said in a research note.
Thomas Carroll, analyst with Stifel Nicolaus in Baltimore, called the raid "ominous" and downgraded WellCare shares to "sell" from "hold" in a note to clients. Contacts within the company said BlackBerries, computers and files were seized from corporate, marketing and human resources offices, according to Carroll.
Carroll suspects the raid is potentially the result of a lawsuit in which an employee brought a matter to the attention of authorities.
"When the FBI and HHS raid a health care company, the outlook on earnings, legal proceedings and the entire operations of the company can be questioned," Carroll said.
WellCare's business practices have come under increased criticism over the past several months. Last spring, the company said independent sales agents in Georgia enrolled dead people in Medicare plans. In May and June, WellCare representatives appeared along with other insurance executives at hearings in the Senate and House into aggressive Medicare marketing practices. WellCare and six other insurers subsequently agreed to a temporary halt in marketing one type of Medicare plan, while promising to initiate consumer safeguards. In August, however, Medicare cited WellCare once again for violating several provisions of its Medicare contract, including sales practices.
WellCare, which had earnings of $139.2-million in 2006, gets all of its nearly $4-billion in revenues from state or federal governments. Profits come from the difference between the amount received from the government and the amount spent on overhead and medical care for its members.
The company routinely has outperformed its competition; for the quarter ending in June, the company said just 80.8 percent of its revenue was spent on medical claims, down from 82.7 percent a year ago.
WellCare's high margins have had analysts scratching their heads. In April, two Wall Street analysts said Florida in particular was too generous in its Medicaid reimbursement to WellCare. The analysts, with CIBC World Markets and Goldman Sachs & Co., were particularly critical of WellCare's use of a subsidiary in the Cayman Islands for reinsurance, saying it allowed the company to shift money in the form of reinsurance premiums.
WellCare said its reinsurance arrangement had been approved by stateregulators and rejected claims it was overpaid.
Florida Medicaid payments were raised 7.5 percent in July, to an average of $215 per member per month. Cuts of about 1.5 percent could be on the way in January, however, if Gov. Charlie Crist approves recommendations made during the recent special legislative session.
Medicare reimbursements average about $800 per member per month and will increase 3.5 percent next year. Because the federal government wanted to encourage private insurers to offer Medicare plans, it pays about 12 percent more for seniors on private plans than it does for traditional Medicare.
WellCare was a slow-growing Florida company until 1992 when its owner, Dr. Kiran Patel, sold it to a New York investment group led by financier George Soros. The bankers hired Todd Farha, an aggressive Harvard MBA, to transform the company. Under his leadership, WellCare's earnings have increased eight-fold and the company's investors and executives like Farha have profited handsomely from appreciation in its stock.
In an interview last year, Farha credited WellCare's success with hard work, attractive member benefits and close attention to the basics. But he has also nurtured the kinds of relationships invaluable to a company dependent on government funding.
WellCare and its affiliates have given the Republican Party of Florida some $105,000 in contributions this year, according to state election records. They've also given the Florida Democratic Party $5,000 this year. In 2006, WellCare's PAC gave $66,000 to federal candidates, all Republicans.
And the company's board has included the head of the Florida agency that oversees Medicaid, Dr. Andrew Agwunobi. Agwunobi was a director for six months before being picked to head the Agency for Health Care Administration. For his six months service on WellCare's board, Agwunobi received stock, which he sold for more than $1-million.
Current WellCare board members include former Florida Sen. Bob Graham and Ruben King-Shaw, former head of Florida's health agency and an ex-deputy chief at Medicare.
You have FM.
The Daily Mail photo
Sounds like an improtant and interesting book.
Re: post 156.
I read a post by one of the FReepers (forgot the name) that this was what happened, so I was glad to find a link and story about it.
Previously I mentioned Garry Wills, and here is another non-viable tissue from his works, appearing in the LA Times, of all places. So, I must keep to a tiny extract. I encourage reading the whole thing at the link, though, if anyone seeks to understand Garry Wills more than I would. The title says enough.
Whether through serendipity or through some sort of causal connection, it now seems that the onset of a functioning central nervous system with a functioning cerebral cortex and the onset of viability occur around the same time -- the end of the second trimester, a time by which 99% of all abortions have already occurred.
Opponents of abortion like to show sonograms of the fetus reacting to stimuli. But all living cells have electric and automatic reactions. These are like the reactions of Terri Schiavo when she was in a permanent vegetative state. Aquinas, following Aristotle, called the early stage of fetal development vegetative life. The fetus has a face long before it has a brain. It has animation before it has a command center to be aware of its movements or to experience any reaction as pain.
Abortion isn't a religious issue
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Having recently celebrated the life and work of William Wilberforce, some religious leaders have called abortion-on-demand the 'new slavery'; the human rights issue that will define our generation's place in history.
It is forty years since abortion became legal in Britain.
The Archbishop of Canterbury, Dr. Rowan Williams, has warned that abortion is increasingly being seen as the easy option for women, perhaps just another form of contraception. In the process, he says, British people risk losing sight of the sanctity of life.
Abortion – This generation’s ‘slavery’
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The ongoing Medical Ethics and Holocaust lecture series hosted a teleconference discussion in the Applied Computational Engineering and Sciences building Tuesday to discuss the history of genocide and people with disabilities.
The lecture was broadcast live on the Internet from the Holocaust Museum of Houston and included panelists from the University of Houston, the Baylor College of Medicine and Independent Living Research Utilization, a disabilities research and consultation firm .
Bill Monroe, an English professor and dean at the University of Houston, discussed the idea of perfection through literature, citing examples from a 1960s comic book.
"Eugenics, euthanasia and extermination were extremes taken to eliminate the 'imperfections' throughout history," Monroe said.
Lecture series discusses history of disabilities in relation to genocide
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Thread by wagglebee.
A national debate on balancing the right to life with skyrocketing health-care costs could endanger services for the elderly and fuel demands to legalize euthanasia, some experts say
. Dr. Robert Cushman, CEO of the Champlain Local Health Integration Network in eastern Ontario, stirred a hornet's nest this week with a call for a serious debate on the right to die with dignity as a matter of public policy.
Health costs intrude in right-to-die debate
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Thread by Daffynition on the remarkable story of one kid who beat the abortionists at their own game. Thanks, wagglebee, for the ping.
When doctors found that Gabriel was weaker than his brother, with an enlarged heart,and believed he was going to die in the womb, his mother Rebecca Jones had to make a heartbreaking decision.
Doctors told her his death could cause his twin brother to die too before they were born, and that it would be better to end Gabriel's suffering sooner rather than later.
Mrs Jones decided to let doctors operate to terminate Gabriel's life.
We're twinseparable! Happy with his brother, the boy who refused to die
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That's as deep as he goes in matters of life and death.
FRED THOMPSON IS BEYOND IGNORANT.
He said the only comparison between his daughter's death and Terri's was they were both END OF LIFE matters. No, they are not! Terri was not dying but she was MURDERED.
Fred Thompson would be a good candidate for MICHAEL SCHIAVO to support. No, on FRED. He's a bioethicker and no friend of the disabled.
And, on abortion, he can only relate to it as far as his four year old daughter. Fred cannot deal with issues unless he personalizes them and that's not leadership. He's ONE DIMENSIONAL and better keep his acting gig.
Bump for life, from conception to natural death.
Why doesn’t anybody ever talk about protecting the disabled and the seniors? It’s about machines and tubes.
I believe in Terri's case it still qualified as MEDICAID FRAUD cuz the placement at Hostage Woodside was for FIVE YEARS, not six months or less.
This may stop future HINOS from laundering their wives' rehab monies to death profiteering lawyers. You know their names.
www.judgegeorgegreer.com and www.michaelschiavo.org
(this should be in the news but I am multi-tasking today. See www.sptimes.com keyword: Medicaid.
Unscrupulous relatives, stop it!!!
Medicaid tightens eligibility standards or just window dressing? I think they’re just covering their tracks again for all the fraud, not just about Terri’s inhumane case. See my last.
there is medicaid fraud all the time and the govt knows all about it. They don’t care. We gave them the power and they brought in socialism. It is a catastrophe!
I think they do these fbi raids sometime to illustrate that the system works. hah! It works well for the insurance companies and hmo’s who overbill, make up doctor visits and modalities, and also give illegal aliens benefits.
http://www.wordonwheels.org/
March 18, 2008 marks the beginning of the Terri Schiavo Memorial Run which will depart from Durango, Colorado to the final destination of St. Petersburg, Florida on March 31, 2008; home of the Terri Schindler-Schiavo Foundation. This run will have 20+ stops along the way to visit the Harley-Davidson Dealerships "en route" (promoting awareness of the TSMR), and allowing for minor services, if needed (oil changes, batteries, plugs, etc.). There will be 3 scheduled major "hook-up" stops, to join up with the riders who are registered to meet us at any one of those three pre-determined stops.
Man assaulted at peanut festival put on life support ~ http://www.dothaneagle.com/gulfcoasteast/dea/local_news.apx.-content-articles-DEA-2007-11-04-0024.html .
Mike Cowherd is 60 years old, has a severe head injury, and isn’t expected to recover. What are the odds that his respirator will be turned off before he starts breathing on his own?
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Event features Alan Keyes, Rev. Frank Pavone, Christopher West, Joan (Andrews) Bell -- Randall Terry to hold two day training seminar for college students.
Contact: Mario Saint Francis, Operation Rescue XX Event, 202-439-2600
PHILADELPHIA, Oct. 29 /Christian Newswire/ -- This November 23 and 24, Randall Terry and other pro-life leaders plan to hold an event in Philadelphia to coincide with the twentieth anniversary of the first abortion clinic sit-ins by Operation rescue. The event will include meetings and activist training held at the Philadelphia Convention Center.
Photo: A 1987 abortion clinic sit-in. These sit-ins were often referred to as "Rescues"
To announce the event to the media Randall Terry will hold a news conference in Philadelphia on Tuesday, October 30. Mark Harrington, founder of the Genocide Awareness Project, who will also be on site with their traveling photo-mural exhibit which compares the contemporary genocide of abortion to historically recognized forms of genocide.
News Conference Details---
When: Tuesday, October 30, 2007, 2:00 pm
Where: Temple University's Bell Tower located at 13th Street and W. Berks Street, Philadelphia
Who: Randall Terry, Founder of Operation Rescue; Mark Harrington, founder of the Genocide Awareness Project
Why: to discuss 2 days of training and protests. Mr. Terry will answer questions concerning civil disobedience in Philadelphia, and the months ahead.
"Our mission is to unleash a new generation of activists and leaders, who will create the tension necessary to put abortion front and center in this years political races." -- Randall Terry, Founder, Operation Rescue
"The 20th anniversary celebration of Operation Rescue has the potential of being a New Pentecost for the pro-life movement." -- Fr. Frank Pavone, National Director of Priests for Life and President of the National Pro-life Religious Council
News Conference -- Operation Rescue to Hold 20th Anniversary Event in Philadelphia
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