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The down side of WellCare's good fortune

By HELEN HUNDLEY
Published January 7, 2007

WellCare's blistering growth rate has caused some strain. For example:

-- Its fast-growing, standalone Medicare drug plan, with nearly 1-million members, received a "poor" rating in the latest Medicare performance report.

A WellCare spokesman said this may be due to confusion among members who had been automatically enrolled. These members can switch to another insurer at any time if they're not happy.

-- WellCare lost a bid to renew a Medicaid HMO contract in Indiana for 2007. The contract accounted for less than 4 percent of WellCare’s revenues.

-- Dr. Ace Hodgin, WellCare’s chief medical director since mid-2004, resigned suddenly in early December. Heath Schiesser, president of WellCare’s prescription plans, was demoted in October to a part-time advisory position. Schiesser will receive $250,000 if he does not compete with WellCare or talk about the company for a year after the job ends.WellCare's president and chief executive said executive turnover is to be expected.

“What we need as a $1-billion company is different than what we’ll need as a $5-billion company,’’ CEO Todd Farha said. “If you don’t see additions or new executives, I’m not doing my job.’’

[Last modified January 7, 2007, 08:09:46]