WellCare to pay $80 million to settle fraud case

WellCare Health Plans will pay $80 million to settle a Florida Medicaid fraud case, according to federal prosecutors and the Tampa-based managed-care plan. The U.S. Attorney’s Office for Florida’s Middle District has filed a criminal fraud conspiracy charge against the company. Those charges will be dismissed within five days under a deferred prosecution agreement once WellCare pays the fines and agrees to independent monitoring of its business practices.

The company engaged in an “elaborate scheme” to defraud Florida Medicaid and Healthy Kids programs out of about $40 million by inflating expenses submitted between 2002 and 2006 through a subsidiary, Harmony Behavioral Health, according to U.S. Attorney A. Brian Albritton.

WellCare will pay $80 million to the state, including $35.2 million the company already paid in August 2008. WellCare will pay $25 million within five days, and the remaining $19.8 million by the end of the year. WellCare must also “accept and acknowledge full responsibility for the conduct that led to the government’s investigation,” according to the U.S. attorney’s office.

“The company has cooperated fully in these matters and the board of directors is very pleased they have been resolved,” said WellCare Chairman Charles Berg in a written statement. WellCare, which was raided in October 2007, said it is cooperating fully with other ongoing investigations.

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