Late News: WellCare told to stop enrolling Medicare Advantage, Part D

WellCare Health Plans was ordered by the CMS to halt enrollment and marketing of its Medicare Advantage and Part D prescription drug plans by March 7, citing the company’s “longstanding and persistent failure” to follow the requirements of its contracts. The CMS outlined the sanctions against the Tampa, Fla., company in a seven-page letter. Based on audits conducted in 2007 and 2008, according to the letter, the company engaged in and failed to correct prohibited door-to-door solicitation and activities that “misled and confused beneficiaries.” The government received 2,500 complaints from WellCare enrollees between Jan. 1 and Feb. 1, 2009, and the company has the highest rate of marketing complaints of Medicare Advantage plans with 100,000 or more enrollees. WellCare issued a news release saying the company is devoting substantial resources to address the issues identified by the CMS and its own monitoring. “We take CMS’ concerns very seriously,” President and Chief Executive Officer Heath Schiesser said in the release. The sanctions do not affect current enrollees in WellCare’s Medicare plans. Oppenheimer & Co. analyst Carl McDonald summarized in a research note that the punishment is “bad, but not as bad as it first sounds.” McDonald noted that the suspension comes after the 2009 open-enrollment period has closed and allows WellCare to take care of the problems before the next window opens Nov. 15.