Kenneth Burdick has been named CEO of WellCare Health Plans, a Tampa, Fla.-based managed-care company that has suffered smaller margins and upheaval in its executive ranks this year.
Burdick, 56, will start his new role Jan. 1. He has served as WellCare's president and COO since June, and he joined WellCare last January as president of the company's national health plans. Burdick previously was the CEO of Blue Cross and Blue Shield of Minnesota and was pushed out after only six months on the job due to differences in leadership styles. He has also held executive roles with UnitedHealth Group and Coventry Health Care, which is now part of Aetna.
Burdick replaces David Gallitano, who was hired as the interim chief in November 2013, when WellCare's board fired Alec Cunningham. Few details were given about Cunningham's departure. Cunningham has since been named CEO of Fidelis SeniorCare , a Medicare Advantage HMO.
WellCare, which operates Medicare and Medicaid plans, has had a rough go so far in 2014. Profit was down 58% in the first nine months of this year even though revenue was up 35%. Medicaid is its primary business line, and membership has soared. But WellCare's Medicaid medical-loss ratio has also increased, meaning more premium dollars are being spent on medical care.
Gallitano told investors on a third-quarter call that WellCare still had a “ways to go” to get its Medicaid business back to “an acceptable margin.”
Burdick will head into 2015 with skepticism from Wall Street, as well as some other newer faces in the C-suite. CFO Thomas Tran resigned from WellCare in November; Andrew Asher, 46, took his place. “I'm very optimistic about WellCare's mission and direction,” Burdick said in a news release. “We are making great progress on our strategic plan.”
Burdick will receive a $1 million salary as CEO of WellCare, up from his $550,000 salary when he first joined the company. He is also eligible for up to $1.5 million in short-term bonuses and millions more in long-term incentives and stock options.
WellCare Health Plans, Inc. began operations in 1985 and is based in Tampa, Florida. WellCare provides Medicare and Medicaid managed care health plans for 2.2 million members, partners with over 91,000 physicians, and employs over 3,500 associates. Wellcare Health Plans, Inc. is the holding company for several subsidiaries, including WellCare, Staywell, HealthEase, Harmony, and 'Ohana. Regional offices are located in Miami, Florida; Manhattan, New York; New Haven, Connecticut; Baton Rouge, Louisiana; Marietta, Georgia; Houston, Texas; and Chicago, Illinois.