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TAMPA, FLA. » WellCare Health Plans Inc. agreed to pay $137.5 million to the federal government and nine states, including Hawaii, to resolve civil claims that it overbilled Medicare and Medicaid, the Justice Department said Tuesday.
The settlement resolves four lawsuits filed under the False Claims Act, which lets whistle-blowers sue on behalf of the government and share in any recovery. Three of those cases were filed in Florida, and one in Connecticut, according to U.S. Attorney Robert E. O’Neill.
The Justice Department investigated the cases and joined in them.
Sean Hellein, a former WellCare financial analyst whose complaint initiated the probe, will get $20.75 million, O’Neill said. Three others — Clark Bolton, SF United Partners Inc. and Eugene Gonzalez — will split $4.66 million, O’Neill said.
The attorneys for SF United Partners said in a statement, "We are enormously pleased for our clients, who took considerable personal risk in coming forward to alert law enforcement of a variety of fraud schemes perpetrated by WellCare."
Besides Hawaii, states sharing in the settlement are Connecticut, Florida, Georgia, Illinois, Indiana, Missouri, New York and Ohio, O’Neill said.
The Hawaii attorney general’s office was not able Tuesday to immediately say how much the state will get from the settlement.
WellCare, a Tampa-based insurer, paid $80 million in 2009 to resolve a criminal investigation that led to a guilty plea by a former analyst and charges against five other executives, including ex-CEO Todd Farha, O’Neill said.
The civil settlement resolves claims that WellCare inflated what it said it spent on medical care to avoid returning money to Medicaid and that it knowingly retained overpayments received from Florida’s Medicaid program, he said. Medicaid is the government medical assistance program for low-income patients.
"This settlement should serve as notice to those defrauding state and federal health care programs that in addition to appropriate criminal prosecutions, we will utilize civil suits to root out their conduct and recover their ill-gotten gains," O’Neill said.
Denise Malacca, a WellCare spokeswoman, declined to comment on the settlement beyond a company statement on March 23. It announced then that a settlement had been reached and that it would not have a material impact on the company’s finances this year.
"We are pleased that these matters are fully resolved," CEO Alec Cunningham said in a statement that day. "WellCare is a transformed company that is focused on providing quality, cost-effective health care solutions."
The company may be required to pay $35 million more if it’s sold or has a change in control in the next three years, according to O’Neill.