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HMO thrives amid complaints

By KRIS HUNDLEY
Published February 1, 2007

Dr. Akshay Desai of St. Petersburg prides himself on his versatility. A physician turned entrepreneur, the 48-year-old Indian native is also a major Republican donor and frequent appointee to state boards, most recently named by Gov. Charlie Crist to the body that oversees Florida's schools.

"Making policy is a tremendous enjoyment for me," Desai said. "I do it instead of golf."

But many members of Desai's fast-growing Medicare plan provider, Universal Health Care in St. Petersburg, wish he'd pay more attention to his business. Universal was co-founded in 2002 by Desai and Dr. Zachariah P. Zachariah, another prominent Republican fundraiser from Fort Lauderdale. As it has grown to become the state's fourth-largest Medicare HMO, Universal has also attracted a disproportionate share of customer complaints for aggressive marketing, false advertising, denied medical treatments and poor customer service.

Last year, Bob Archer, then Pasco-Pinellas coordinator for a program that advises Medicare beneficiaries on insurance options, was so frustrated with Universal's handling of one member's problem that he took the unusual step of reporting the case to the Florida Department of Elder Abuse.

"Universal is light years ahead of everybody in terms of the quantity of complaints," said Archer, who was unable to get Universal executives to return his calls directly. "We seldom get complaints about other Medicare HMOs."

Patricia Petrizzo of Wesley Chapel fought with Universal for months last year after it repeatedly denied cancer treatments for her adult son. "I have no doubt what they did was set up obstacles to see who would beat down the door to get what they needed," said Petrizzo, who even called Desai at his Snell Isle home to ask for help, only to be rebuffed. "My son had us fighting for him. But this is a medical policy for the elderly and disabled. And they often don't have the resources to fight."

Though 20 percent of Universal's members switched to another insurer for 2007, the company still netted 75,000 new enrollees for the year. The reasons: expansion of Universal's Medicare HMO, Medicare Masterpiece, into eight new Florida counties plus the introduction of a new Medicare Private Fee for Service (PFFS) plan in Florida and seven other states. PFFS plans allow members to go to any health care provider that accepts Medicare as long as the provider is willing to bill the insurer, instead of the government.

Universal gets about $800 a month from Medicare for each HMO member. The PFFS plans are even more lucrative, paying the insurer about 19 percent more than original Medicare.

Desai is not surprised that most of Universal's new enrollees opted for the PFFS plan, which Universal calls its "Any, Any, Any" plan.

"Original Medicare is one size fits all," he said. "You bring in the private sector and you get innovation. Our plan also offers dental, hearing, prescriptions and cash back on their Part B premium."

There has been one drawback: Doctors have been a bit slow getting on board, refusing to take PFFS plans if they don't already deal with the insurer. Universal has responded by running full-page newspaper ads, assuring providers the new plans offer win-wins for everyone.

"The challenge is education," said Desai, who said he is aware of members' complaints about being promised access only to have service denied. "The customer thinks it's bait and switch. But we can't force doctors to take the plan."

Similarly, Desai brushes off complaints from members who are still waiting for refunds on their Part B premiums, a much-touted marketing feature of several Medicare HMOs. Delays are due to problems with Social Security and Medicare, he said, and the situation has since improved.

But Universal's attempts to keep up with its growth while saving pennies has created customer frustration. The company's phone system crashed in January after thousands of new members who had not yet received their ID cards overwhelmed the system.

And Universal's policy of routing customer service calls to a call center in Chennai, India to save money is a frequent source of complaint. "I'm not biased," said Gayle Schram, a member in Hudson who has been waiting over a year for her Part B refund. "I just can't understand what they're saying."

Desai defended the work of the 360 Indian contractors, saying they are highly educated and closely monitored. "We don't feel the call center is an issue," he said.

As he builds a fast-growing Medicare HMO, Desai is following the path of another well-known local physician, Dr. Kiran Patel, who built WellCare HMO in Tampa to $1-billion in annual revenues before selling it to a New York investment firm in 2002.

Like WellCare, Desai said he plans to take Universal public in the second quarter of 2008. After years of financing the company through private investors, last year Universal received $30-million in venture financing from the New York City firm of Warburg Pincus.

Times researcher Caryn Baird contributed to this report. Kris Hundley can be reached at hundley@sptimes.com or (727)892-2996.

Fast Facts:

Universal HealthCare Inc.

Headquarters: St.Petersburg

What it does: Offers Medicare and Medicaid health plans

Employees: 420 in Florida, 360 contractors in India

[Last modified February 1, 2007, 00:08:34]