Six former WellCare officials are suing the Tampa-based company over health care fraud allegations related to its services in Georgia and other states.
The six claim that WellCare improperly kept money that should have been paid to hospitals or been repaid to Medicare or state Medicaid programs in Florida, Georgia, Illinois, New York, Ohio, Kentucky and Missouri.
The False Claims lawsuit, filed in the U.S. District Court in Tampa in May 2013, had been sealed while the U.S. Attorney’s Office decided whether to intervene in the case, Health News Florida reported this week. The case was unsealed last week after federal prosecutors decided not to step in.
WellCare serves more than 590,000 Georgians in the state’s Medicaid and PeachCare programs.
The company operates one of three care management organizations in Georgia that oversee the care of a total of more than 1 million members in the two government insurance programs. These organizations operate like HMOs for patients in the programs.
WellCare also has more than 29,000 Medicare Advantage members in Georgia.
Company spokeswoman Crystal Walker said in a statement to GHN on Tuesday, “We have a copy of the complaint, but have not been served. It is our understanding that the government does not plan on intervening in this complaint. Therefore, if the plaintiffs elect to proceed, they will have to do so independently.
“WellCare is deeply committed to regulatory compliance and ethical behavior. Our systems and processes support a culture of integrity, personal accountability and transparency.”
The complaint says that when WellCare switched its accrediting organization to the NCQA in 2010, it had to make decisions on whether a hospital admission was medically necessary within 24 hours of receiving clinical information. The company had been using up to 72 hours as its standard under its previous accreditation, the suit says.
The company’s denial rate for coverage of inpatient care, which ran between 11 and 14 percent in 2011, plunged to about 2 percent by November 2012 — the industry average, the complaint alleges. This “caused friction” within the company, the lawsuit says.
The plaintiffs say they “resisted directions from WellCare management to artificially restrict and limit inpatient hospital admissions based on criteria other than medical necessity.”
The Georgia Department of Community Health, through a spokeswoman, declined to comment, saying the agency does not comment on pending litigation. Georgia Attorney General Sam Olens, through a spokeswoman, also declined to comment on the lawsuit.
In a previous fraud case, WellCare settled criminal charges in 2009 against the company by agreeing to pay $80 million. The company later settled a class-action suit by shareholders for $200 million and a whistleblower suit for $137.5 million. Three former WellCare officials received prison terms.
Georgia’s portion of that settlement with the federal government and several states was $33 million in federal and state funds. Georgia’s net amount was $13 million.
Medicaid is jointly financed by the states and the federal government.