By now, the Centene/Hope Florida story is pretty well known. Centene agreed to pay Florida $67 million to settle allegations involving Medicaid pharmacy benefit overbilling.
But the state didn't get all of it. Florida directed Centene to send $10 million to the Hope Florida Foundation. Centene had seven days to make that payment.
Within 18 days, Hope Florida had sent the entire $10 million to two nonprofits. Those groups subsequently sent $8.5 million to a political committee fighting Florida's mari--ana amendment.
A grand jury later described the money as “misappropriated as part of a sophisticated scheme to fund political activities,” although it found insufficient evidence to bring criminal charges.
Centene says it was directed by the state to make the donation and “had no part in or knowledge of” what Hope Florida subsequently did with the money. That's important.
There is no evidence I've seen that Centene knew where the money would eventually go.
This is where the irony gets pretty hard to ignore. This is a company that requires employees to complete annual Fraud, Waste and Abuse training.
Remember: Centene has a Special Investigations Unit.
It tells employees to be vigilant in detecting, preventing, and correcting fraud, waste, abuse, and non-compliance. Centene says its FWA work is about “accountability, transparency, and efficiency.”
And its own values include: “We do what is right, not what is easy.”
Meanwhile, Centene remains deeply embedded in Florida's Medicaid system. So forget what happened after Hope Florida received the money for a minute.
Here's the question I'd like somebody (maybe a reporter who’s not afraid to write about something real, not margins or stock price-related) to ask Centene: When $10 million from a Medicaid settlement was redirected to a foundation instead of the state, what questions did Centene's compliance, legal, or executive teams ask before sending it?
Maybe there are perfectly good answers. Let's hear them. Because now there's another development. The money trail has reached the IRS. 😳
The IRS Whistleblower Office has acknowledged receiving a claim involving the Hope Florida money and assigned it a claim number. That does prove wrongdoing not prove wrongdoing. It doesn't mean the IRS has opened an examination.
And it certainly doesn't prove Centene did anything illegal. (very important!)
But this story has moved a long way from a weird $10 million line item in a Florida Medicaid settlement. For a company that spends a lot of time teaching everyone else about fraud, waste, abuse, transparency, and accountability, asking what its own people knew, what they asked, and what controls were applied seems pretty reasonable.
“We do what is right, not what is easy.”
Centene requires annual Fraud, Waste and Abuse training. Maybe the next one should include a case study. Start with the $10 million.