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WellCare Health Plans, Inc. Pays $137.5 Million to Resolve Allegations that it Committed Medicare and Medicaid Fraud

On April 3, 2012, U.S. Attorney Robert O’Neill announced that WellCare Health Plans, Inc. agreed to settle four lawsuits alleging violations of the federal False Claims Act (FCA).  WellCare is a Tampa, Florida-based company that provides managed health care services for 2.6 million Medicare and Medicaid beneficiaries nationwide.  In all four lawsuits, whistleblowers filed suit under the qui tam provisions of the False Claims Act and the U.S. Department of Justice (DOJ) intervened, investigated, and negotiated the settlements of the suits.

The lawsuits alleged that WellCare inflated the amount it claimed to spend on medical care to avoid returning money to Medicaid, and it retained overpayments it received from the Florida Health Kids program. In addition, the DOJ claimed that WellCare falsified data to misrepresent the medical conditions of patients and the treatments they received, abused the market by “cherry picking” healthy patients to avoid higher costs, manipulated performance metrics at its call center, and operated a sham Special Investigations Unit.

The settlement resolves these allegations and more and requires that Wellcare pay the U.S. and nine states — Connecticut, Florida, Georgia, Hawaii, Illinois, Indiana, Missouri, New York and Ohio — a total of $137.5 million plus interest over three years. In the event that the company is sold or undergoes a change in control, WellCare may be required to pay $35 million in contingency

“In an era of decreasing federal and state budgets, and increasing healthcare costs, we must pursue all available civil remedies to recover losses suffered by government healthcare programs. This settlement should serve as notice to those defrauding state and federal healthcare programs that, in addition to appropriate criminal prosecutions, we will utilize civil suits to root out their conduct and recover their ill-gotten gains,” said U.S. Attorney O’Neill.

The Employment Law Group® law firm has an extensive nationwide whistleblower practice representing employees who have been victims of retaliation.

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