Business ties put ed board seat in limbo

Dr. Akshay Desai's troubled company gives senators pause.

Published May 19, 2007

One of Florida's top education officials is in political limbo.

When Gov. Charlie Crist appointed Dr. Akshay Desai of St. Petersburg to the seven-member Board of Education in January, Desai's confirmation by the state Senate seemed a given.

But late in the session, legislative leaders received a heated missive from the state insurance commissioner about Desai's company, Universal Health Care Insurance, and legislative changes he said the company was seeking.

"I am convinced that the ramifications of this change could be very harmful to our senior citizens, to our medical providers and to the Medicare program in Florida," Commissioner Kevin McCarty wrote in an April 18 letter.

Led by Sen. J.D. Alexander, R-Lake Wales, senators balked. The session ended May 4 without a confirmation of Desai's appointment, which started the clock ticking on his seat. Crist has 45 days from the end of session to reappoint Desai, which would allow the die-hard Republican and Crist fundraiser to hang on until he can be considered by next year's Senate.

But Crist's intentions are unclear. Asked in Clearwater Wednesday whether Desai, 49, would continue to be his nominee, Crist did not offer a strong endorsement.

"I don't know," he said. "I'm reviewing that right now."

Desai said he was disappointed by the senate's actions.

"You wish it did not happen, but you just have to continue to serve," he said.

He said he was not familiar with the 45-day clock and had not heard from Crist.

"My understanding is, (the confirmation) would come up for discussion again in the next Senate session in the fall," he said.

Crist picked Desai to replace Phil Handy, a close confidante of former Gov. Jeb Bush. Many political observers saw the move as a strong signal from Crist that he would not blindly follow Bush's vision of reform.

The board helps set state policy, proposes a budget for the Education Department and hires the state education commissioner.

Desai came to the seat with sound education credentials, having served on the Board of Governors, which oversees the state university system, and as the Bush-appointed chairman of the Council for Education Policy, Research and Improvement.

Last year, he gave $100,000 to Boca Ciega High -- where his oldest child went to school -- to start a program aimed at boosting student performance through corporate leadership skills.

But Desai also arrived with strong ties to the Republican Party -- he was an elected delegate to the party convention in 2000 -- and a tangle of business dealings with the state. Soon, his health maintenance organization was clashing with state regulators.

In February, McCarty recommended liquidating Universal after it failed to meet a state deadline for fortifying its financial reserves by more than $100-million. Two months later, he sent the letter to lawmakers after hearing Universal might try to change state law requiring the specified reserves. His office found the company's premiums had exceeded projections by at least $750-million.

"The excessive premium writings result in obligations to senior citizens and medical providers that make the viability of the company extremely doubtful," he wrote.

Universal's woes led to the loss of 25,000 policyholders and 100 employees. But Desai said Wednesday it remains "a solid company and currently it is showing a monthly profit."

Desai said he tried to contact Sen. Alexander during the session, but never heard back.

Alexander did not return calls for comment Wednesday. But Sen. Dennis Jones, R-Treasure Island, said Alexander encouraged senators to "take a deep breath" until issues regarding Desai's company are resolved.

"I know Dr. Desai. Very honorable guy. Smart," Jones said. But postponing his confirmation "was the right thing to do."

Times staff writer Will Van Sant contributed to this report.