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5:08 pm
Wed September 3, 2014

Medicare HMO Fined, Frozen

Florida Healthcare Plus, a Medicare HMO and drug plan, is under state review for making a $600,000 error in a financial statement and has been temporarily blocked from enrolling any new members, its chief executive says.

Susan Molina, CEO, Florida Healthcare Plus
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The company, based in Coral Gables, was also recently fined $113,200 by the federal Centers for Medicare and Medicaid Services (CMS) for a different type of infraction -- "systemic failures" to provide all the benefits due to members under CMS rules.

The fine was explained in a July 17 letter to Florida Healthcare Plus' CEO Susan Molina from Gerard J. Mulcahy, director of the CMS enforcement group for Medicare Advantage and drug plans. He wrote that in a December 2013 review, CMS determined that the plan had delayed or denied some patients' access to their medications. Also, some of the HMOs' members who filed complaints or appeals faced inappropriate delays or denials of the right to access a health service, the letter said.

Molina was not in charge at the time of the December audit. She was brought in by investors to turn the HMO around in January.

The accounting error, which occurred this summer, involved a duplicate listing of a capital contribution  on a quarterly report to the Florida Office of Insurance Regulation, Molina said.  "They caught it; we didn't, unfortunately," she said.

The error caused the HMO to fall below the required amount in capital reserves by a small amount, which was quickly rectified, Molina said. But the damage was done.

"The state of Florida asked us to stop enrolling until they can complete an investigation of our financials to make sure everything is okay," Molina said.  She said the review would start next week and that OIR officials would be on-site Sept. 15.

OIR spokesman Harvey Bennett said the agency cannot confirm or comment on any ongoing reviews.

The enrollment freeze will have only a minor impact unless it lasts more than a month. Open-enrollment season for Medicare plans begins Oct. 15. Florida Healthcare Plus has only 11,000 members.

"We're small but we believe we can  make it through this," Molina said.

The plan has been in trouble with CMS before, as Health News Florida reported in April. The federal agency fined the plan more than $40,000 that month for failing to notify its members in the fall of 2013 of the changes in the plan for 2014.

Aside from its headquarters in Miami-Dade County, Florida Healthcare Plus also has an office in Tampa.

--Health News Florida is part of WUSF Public Media. Contact Editor Carol Gentry at 813-974-8629 (desk) or e-mail at cgentry@wusf.org. For more health news, visit HealthNewsFlorida.org.