Politics » Politics Feature

John Ford Gets New Indictment: OmniCare This Time


Senator John Ford was indicted Monday in Nashville on federal charges related to his consulting work for OmniCare Health Plan.

Ford is already under indictment on other federal charges in the Tennessee Waltz investigation for allegedly taking bribes from a phony company set up by the FBI.

The new indictments allege that from 2001-2005 Ford received more than $800,000 in payments from TennCare contractors. TennCare started in 1994 as the replacement for the federal Medicaid program. OmniCare, now called UAHC Health Plan of Tennessee, is a subsidiary of Michigan-based United American Health Care (UAHC), a publicly-traded company with connections to former city appointees of Mayor Willie W. Herenton.

The other contractor named in the indictment is Doral Dental, a managed care organization that had TennCare's dental services contract.

The indictment has two mystery characters identified as "Individual A" and "Individual B" who were Ford's partners in Managed Care Services Group. Ford owned 40 percent of the consulting group and the others each owned 30 percent. Individual A is from Pennsylvania, while Individual B is described as "a high-level executive with UAHC, with United American of Tennessee and with OmniCare and also was a 30 percent owner of MCSG."

Public records point to Osbie Howard as Individual B. Howard was city treasurer from 1992-1995 and was Herenton's campaign treasurer in 1999. He was president of OmniCare until 2005. According to a public statement released by UAHC in 2005, Howard was "involved" with Managed Care Services Group but UAHC was unaware of it until that year. The statement said "Mr. Howard's outside business activities with Managed Care Services Group were not approved by UAHC and were not consistent with UAHC’s code of conduct." The statement announced his resignation.

Howard's successor and UAHC’s current vice president in charge of Tennessee is Stephanie Mebane Dowell, formerly Herenton's administrative assistant and later director of legislative affairs for Methodist LeBonheur Healthcare. She joined UAHC in 2001.

Ford is charged with two counts of wire fraud and four counts of concealing his business interests in the TennCare contractors. The indictment represents a rare use of the criminal justice system to prosecute someone for not complying with disclosure requirements of the Registry of Election Finance.

Ford was chairman of the Senate’s General Welfare, Health and Human Resources Committee and a member of the TennCare Oversight Committee. With Ford's help, Omnicare enrolled more than 100,000 uninsured West Tennesseans in its managed care network. The indictment says Ford did numerous favors for OmniCare and Doral Dental, in exchange for hefty consulting fees to Managed Care Services Group.

"The facts alleged in this indictment reveal an appalling willingness to violate (his) duty by using his public position for personal gain," said U.S. Attorney Craig Morford.

According to the indictment, Ford was the key to the growth of OmniCare and OmniCare was the key to the growth of United American Health Care.

"Substantially all of Omnicare’s revenues were derived from TennCare for providing managed care services to TennCare enrollees assigned to OmniCare," the indictment states. "OmniCare's revenues from TennCare were primarily based on, and proportional to, the number of enrollees that the Bureau of TennCare assigned to OmniCare ... After on or about November 1, 2002, substantially all of UAHC's revenues were derived from its ownership of, and provision of services to, OmniCare through UAHC's wholly-owned subsidiary.”

Ford concealed his true financial interest in MCSG from the Chief Clerk of the Senate, the Registry of Election Finance, and his colleagues in the Senate, according to the indictment.

The indictment contradicts UAHC's 2005 statement that MCSG was "unrelated to HAHC or any other UAHC subsidiaries. UAHC said at that time it was still investigating the circumstances of Howard’s relationship with John Ford.

UAHC is publicly traded on the NASDAQ. For fiscal year 2007, it had first-quarter revenues of $4.2 million, according to its financial statements. The stock closed Monday at slightly over $9 a share but traded as low as $2 earlier this year.

On its Web site UAHC says its business plan is to "grow business in Tennessee," where it has 116,000 members and relationships with 19 hospitals and 900 doctors.

Dowell, 43, is listed as chief executive officer of UAHC Health Plan. Financial filings say she is married to a physician, Dr. Stanley Dowell, who is one-third owner of an internal medicine practice that had UAHC contracts until November of 2005. — John Branston

Keep the Flyer Free!

Always independent, always free (never a paywall),
the Memphis Flyer is your source for the best in local news and information.

Now we want to expand and enhance our work.
That's why we're asking you to join us as a Frequent Flyer member.

You'll get membership perks (find out more about those here) and help us continue to deliver the independent journalism you've come to expect.

Add a comment