Ultimed’s ulti-trouble

Share on Nextdoor

The bold print atop a press release sent out last week by the Michigan Office of Financial and Insurance Services (OFIS) reads: "Commissioner Protects HMO Members Through Ultimed Takeover."

There should have been one other word added to that bold print: "Finally."

The release goes on to trumpet that OFIS Commissioner Linda A. Watters had successfully petitioned Ingham Circuit Court to place the Detroit-based HMO under what's officially known as "rehabilitation," giving the state control of operations at the long-troubled health insurance company owned by businessman Harley K. Brown.

The OFIS says that last week's court hearing "came after several unsuccessful attempts over a period of many months to resolve a variety of issues with Ultimed's management and Board of Directors. After reviewing the petition, the court found that Ultimed was in such a critical financial condition that its continuing operation would be hazardous to the policyholders, creditors and the public."

The fact that Ultimed could be hazardous to policyholders and others doing business with it isn't exactly a news flash. Nearly two years ago, Metro Times published an exposé ("Ill begotten," March 31, 2004) detailing problems with companies controlled by Brown. Among the people profiled in that article were Angela and Bill Calder of Belleville.

In April 2003, Bill, who works as a truck driver for the dairy owned by his family, was rushed to the hospital when a blood vessel in his head burst. At the time, the Calders' health care coverage was provided by Ulticare as part of a low-cost program created by Wayne County.

Like Ultimed, Ulticare is controlled by Brown. And, as with Ultimed, the company has a history of not paying its bills. And when health care providers doing business with the companies weren't paid, they went after the patients themselves to collect the debts.

The result was a mountain of bills for people like the Calders, who still continue to be hounded by creditors. Angela estimates there's still about $15,000 in unpaid medical bills she and her husband are on the hook for. "They're about to start garnisheeing his wages." To make up for the lost pay, Angela says she's studying to become a medical assistant so she can get a job.

At the time of our original article, both Ultimed and Ulticare had contracts with Wayne County. That's no longer the case, says Teresa Blossom, spokeswoman for Wayne County Executive Robert Ficano. Neither of the companies has been doing business with the county for at least a year, Blossom says.

However, another company identified by the state as being affiliated with Brown is currently contracted with the county. Community Care Partners Inc. is one of three companies identified on the Wayne County Web site as a provider for the HealthChoice program. HealthChoice offers medical coverage to employees of small businesses within the county. Cost is split between the employee, the business and the county, with each paying one-third of the premium.

A March 2005 quarterly report filed with the state by Ultimed indicates that Community Care Partners is an affiliate company. Kathy Reggio, Community Care's executive officer, says that's incorrect, and that there is no association with Brown. She says the company is owned by Robin Barclay. Barclay, who shares a house with Brown, is identified in corporate records as Ultimed's chief operating officer.

Both Blossom and Reggio say that Community Care, which began providing coverage through the county's HealthChoice program one year ago, has had none of the problems previously associated with Ulticare or Ultimed.

On Monday, after News Hits began raising questions about the state's allegation of an affiliation between Ultimed and Community Care, Judge William E. Collette, who issued the initial order allowing the state takeover of Ultimed, issued a second order specifically allowing Community Care Partners to continue working as a provider in the HealthChoice program.

Neither Brown nor his attorney returned calls seeking comment. But that's OK with us. It looks like plenty of information about the way Brown does business is going to be forthcoming soon. The rehabilitator appointed by the court has been given "immediate, full and complete possession, control, access to and use of all books, accounts, documents, and other records, information or property" pertaining to Ultimed. That includes everything from computer data to attorney-client privileged information. It also includes Brown's tax returns for the past five years, and info about his business partners and all affiliates or subsidiaries.

In other words, everything. The rehabilitator (don't ya love that title?) is also required to make an accounting of Ultimed's financial condition to the court by May 31. We can't wait.

Send comments to [email protected]

About The Author

Scroll to read more Metro Detroit News articles


Join Detroit Metro Times Newsletters

Subscribe now to get the latest news delivered right to your inbox.