St. Louis, Missouri-based Centene Corporation, a multi-line managed care enterprise that serves as a major intermediary for both government-sponsored and privately insured health care programs, has announced major legal settlements involving irregularities in the company's disclosure and billing practices. The settlements may directly impact the company's finances and possibly lead to another reduction in force.
According to a statement filed with the Securities and Exchange Commission...
"On June 14, 2021, Centene Corporation announced that it has reached no-fault agreements with the Attorneys General of Ohio and Mississippi to resolve claims made by the states related to services provided by Envolve Pharmacy Solutions, Inc. (“Envolve”), the Company’s pharmacy benefits manager subsidiary.
Under the terms of these agreements, Centene will pay $88 million to Ohio and $55 million to Mississippi. The practices described in the settlement focused on the structure and processes of Envolve primarily during 2017 and 2018. In the settlements, the Company denies any liability for these practices.
As a result of the settlement, the Ohio Attorney General’s litigation against the Company will be dismissed.
Additionally, the Company announced it is in discussions with a plaintiff’s group led by the law firms of Liston & Deas and Cohen & Milstein in an effort to bring final resolution to these concerns in other affected states. Consistent with those discussions, Centene has recorded a reserve estimate of $1.1 billion related to this issue, exclusive of the above settlements."
In February 2021, the company reported a fourth-quarter loss of $12 million and noted plans to eliminate 3,000 workers and 1,500 open positions to resolve the overlap in functions and positions with Phoenix, Arizona-based Magellan Health, acquired in January 2021 for $2.2 billion.
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