CT Husky Dealt Another Blow!

Anyone who has been watching the news on T.V., or is just a member or supporter of Moveon.org should be aware of the issues surrounding the State Child Health Insurance Program. This program is also known as SCHIP. SCHIP is able to function due to the support and injection of federal funds. Sadly those funds are now at risk of drying up because George Bush used his veto power to block the legislation that would have permitted that funding to arrive to Connecticut.

Connecticut Husky, is the state recipient of the SCHIP dollars that cover low income children and their parents in the state medical system. That system is also connected to Wellcare, a publicly traded medical claims processing company that is responsible for 35,000 Connecticut citizens and 1600 medical offices. The Department of Social Services has been put on watch to monitor the companies viability in meeting the obligations to the state.

Wellcare problems began when FBI agents and law enforcement personnel, some from the attorney generals Medicaid Fraud Control unit, raided the Tampa, Fla., headquarters. The agents came with warrants in hand, and began searching and questioning Wellcare employees.

News of this raid hit Wall street and caused the stock to plunge from $118.00 a share down to under $30.00 share. Investors reacted to fear of insurance fraud or some other malfeasance that triggered a panic

CT has gone into high alert with Gov. Rell ordering inquiries into alternative health providers to cover the 35,000 children now at risk of being dropped with little or no warning. This news continues to shadow the already ailing SCHIP program of which President Bush promised to Veto again. Bush called Congress's record this year a disappointment and scorned several lawmakers who refused to give up on the SCHIP funding. Bush called the revised Draft of the SCHIP bill a waste of time and urged house leaders to pass more pressing legislation like the war spending bill and legislation that will classify more people as terrorists.

This panic is gravely disheartening, I will not say that the potential for insurance fraud is rampant because it is a problem. Personally I have seen the skyrocketing costs of health care hurt both hospitals and HMO's. I have also read reports on un-insured persons skewing the cost of care. While I cannot expertly comment on any of this, I will say that from my personal experiences with local doctors, sick children, and the Husky program, that the whole process is pretty much a nightmare void these additional challenges.

It is my opinion that their stock will probably not recover, my guess is, that at this point every major Wall Street predator and shark is circling the water just looking to feed on the misery that has befellen the Wellcare stock. It has been my experience that once confidence is lost the market rarely allows a stock to recover. One way I think Wellcare's stock could possibly recover would be for it to "Trend" upward again. With these types of investigations taking years, its is doubtful that anyone other than a high risk investor would want to touch this stock. My guess is that the damage to their stock is going to get worse.

Wall street already has posted news of investor lawsuits hitting the stock, and this company now is going to have a disrupted revenue stream due to the harm caused by the negative publicity surrounding it. The Feds, I expect, are going to pursue their typical investigation, of which may end up costing many Millions of dollars.

The spin machine is already in place on this Husky fiasco and everyone is in high alert on what to do to avert the major disruption that may be coming soon. This aggregate attack on children's health care in Connecticut is going to be a true test of our state leaders ability serve its children. It's now time to put "legs" on our leaders "rhetoric."

Parents covered by Husky should be following this issue closely to guarantee our state is able to deliver on the health and safety of your children. If some parents have the ability to get dual citizenship it may be a good idea for you to check out another countries healthcare system as a back up.