B. T., a nine-year-old Florida child diagnosed with autism spectrum disorder, had a vocabulary of just thirty words, and would get so frustrated trying to communicate she would bite herself.
As a Medicaid patient, she was entitled to receive ongoing treatment under federal law, and for the last six-and-a-half years, she had received an hour of speech therapy three times a week to master two-word commands.
Suddenly last year, B. T.’s care was cut in half, even though her condition had not improved.
What changed? Her care was now being overseen by a company called Health Network One, a Fort Lauderdale–based middleman — placed in between her therapist and the health insurer — that was responsible for paying for her treatment.
In Florida’s quest to save money on its Medicaid system, which provides government-funded health care for the state’s poorest patients, lawmakers largely shifted the responsibility of deciding who’s sick, and how to treat them, from state regulators to insurance companies.
Critics feared insurers’ desire for profits and the burden of managing the risk of paying for sick patients would result in less care. And with Health Network One, which has come to dominate Florida’s Medicaid program for speech therapy services, acting as a second middleman in between children and their care, that fear has come to pass, clinicians say.
Here’s how the privatized model worked before Health Network One: the state paid the health insurer a set amount per patient each month, and then left managing that care, i.e. paying for specific services, up to the health insurer. That way, the state could know roughly how much it was paying for the Medicaid program each year and limit its risk.
Now, in an arrangement that likely saves insurers money, the health insurer is turning around and paying Health Network One a set amount per patient each month for the specific services it covers, like children’s speech therapy, and leaving the rest up to Health Network One.
But instead of paying for each child’s treatment session, Health Network One’s business model is to pay individual therapists a lump sum for each child’s care over a set period of time, requiring them to figure out how many sessions the amount would cover. This means that the company is effectively placing a limit on how much care each patient receives, one that might not correspond to the patients’ needs.
And because neither Health Network One nor the insurer are issuing notices of reduced care, children and their families have nothing to appeal.
The result is that Florida is controlling costs — but at the expense of children not getting federally mandated care, according to insurance company audits, interviews with nine therapists and one practice manager, as well as a federal lawsuit filed against the state by two children, including B. T., and their parents.
Our analysis of internal Medicaid audits done by health insurance companies and required by the state shows kids for whom speech therapy was paid by Health Network One received nineteen fewer treatment sessions on average over six months in 2020 than those for whom speech therapy was not paid by the company.
National experts say the practice financially caps care and is more than unethical: it may violate federal Medicaid law.
“That’s patently illegal,” said Sara Rosenbaum, a health law and policy professor at George Washington University. “They can’t put an arbitrary upper limit on coverage.”
The Therapist’s Dilemma
In 2000, Health Network One first registered with Florida as South Florida Network Management in Fort Lauderdale under Luis Mosquera, who is still the company’s CEO today.
South Florida Network Management became Health Network One in 2002.
The company claims it more than doubled in size between 2017 and 2021. That year, the Miami-based private equity firm H. I. G. Capital invested in the company, a move that Health Network One says led to more growth. In 2021 the company told the state that it now manages therapy for more than 1.75 million largely low-income kids, compromising Florida’s largest pediatric Medicaid network.
The company didn’t respond to three requests for comment on this story.
Six of the nine insurers that contract with the state to administer its Medicaid program subcontract with Health Network One, which is also working to expand beyond Florida to other states. On LinkedIn, the company’s CEO touts the firm earning more than $250 million in annual revenue, though not all of it can be attributed to Florida Medicaid therapy services.
Health Network One doesn’t serve just kids or Medicaid patients. In addition to speech therapy, Health Network One also works in occupational and physical therapy. And beyond these services, Health Network One manages dermatology, podiatry, vision, gastroenterology, and urology care. The company’s business models in these other areas of health care may differ from the one they use to pay Florida speech therapists.
Regardless, the Florida speech therapists say the company pays them so little that they have to choose between treating children at payment rates that could drive them out of business or giving kids less care than they need.
For instance, a therapist treating B. T. would be paid $71.44 an hour by the state under Medicaid. But under Health Network One, for that therapist to follow B. T.’s prescribed care plan of an hour of treatment three times per week, that formal Medicaid rate would be effectively reduced to $25 an hour, according to the lawsuit.
That’s why therapists say Health Network One’s model doesn’t cover the cost of care.
“We can’t see these kids,” said Orlando-based speech therapist Charlene Westman. “I say to families, ‘It’s a program I can’t participate in because it puts me in unethical positions.’”
Companies like Health Network One are effectively placing a hard cap on patient care, by paying therapists a lump sum for treatment, according to interviews and two therapists’ contracts from 2018 and 2021 that we obtained and reviewed.
Under federal law, Medicaid patients under the age of twenty-one are entitled to a benefit called Early and Periodic Screening, Diagnostic, and Treatment services. The benefit was created to ensure low-income children get treated for health conditions before they’re disabled by them.
Attorneys and therapists are claiming Health Network One is repeatedly violating that benefit.
The Florida Agency for Health Care Administration, which is responsible for the state’s Medicaid program, declined to comment for this story, citing the pending litigation. But the agency believes Health Network One’s business model is legal, according to its response to the federal lawsuit, and it has largely ignored fifteen years of complaints by therapists about the company.
And yet, state officials have acknowledged in letters to insurance companies that the business model could shirk federal law. And because so many of Florida’s therapists have refused to work for Health Network One, the state in 2019 demanded insurance groups that subcontract with the company pay it $193,000 in damages for not having enough providers to see children.
Either way, Florida officials have done nothing to stop Health Network One from further entrenching itself in the state’s Medicaid system.
Because therapists sign contracts with Health Network One, the state argues in its response to the federal lawsuit, they are responsible for treating children regardless of how much they’re paid.
“At best, the first amended complaint sets forth allegations showing that the providers are in breach of, or have breached, their contractual obligations with the [insurers] to provide speech therapy services to plaintiffs,” reads one state defense from the lawsuit.
The case is being mediated.
Kids Receive Less Care
In the federal lawsuit filed against the state last year, lawyers for two children with severe disabilities say they received measurably less care under Health Network One than they would have with an insurer that didn’t work with the company.
Katy DeBriere, an attorney with Florida Health Justice Project representing the children and their families in the suit, declined to comment for this story. Her cocounsel, Sarah Somers with the National Health Law Program, didn’t respond to a request for comment.
The second child, A. G., was a four-year-old Medicaid patient living in Pinellas County with his mother and two brothers. Because of two different language disorders, a learning disability, and attention deficit/hyperactivity disorder, only half of what he said was understandable, according to the lawsuit.
A. G. also labeled every color “blue” and couldn’t count consecutively to five. His therapists worried that without treatment, he wouldn’t be ready for kindergarten.
In March 2022, A. G.’s therapist prescribed an hour of speech therapy twice per week for six months. But because his care was overseen by Health Network One, he received half that amount: half an hour twice per week, according to the lawsuit.
Officials with Florida’s Agency for Health Care Administration, which manages the Medicaid program, have long been aware that Health Network One’s business model led to less treatment for children.
In a 2006 letter to one insurance company, regulators wrote that under the insurer’s agreement with Health Network One, “treatments are more restrictive” than they would be under the fee-for-service program, which paid therapists per session and was the dominant model at the time.
Therapists and a practice manager interviewed by us say the problems are common with the company. Justin Drawdy, a foster care parent who runs a speech, occupational, and physical therapy clinic with his wife in St Lucie County, said these issues were persistent with Health Network One.
Drawdy said that his adopted daughter and a boy he fostered were supposed to go through Health Network One for therapy. But when he realized his daughter would only be receiving treatment once per week, he switched them to health plans that didn’t subcontract with the company and paid for more care.
Making that switch took “hours upon hours to research,” Drawdy said. “The typical working-class family would not be able to switch their child from Health Network One,” Drawdy said. “It’s just so time consuming.”
And most parents without his insurance expertise wouldn’t even know there are other options besides Health Network One, Drawdy said.
“You just think: We’re getting therapy and we’re doing good,” Drawdy said.
Providing early intensive therapy multiple times per week saves the government money in the long run because the treatment is more likely to be effective, Drawdy added.
“But if you do it once a week for 30 minutes, you’ll be in therapy for the duration of the child’s school years,” Drawdy said, which will often mean pulling children away from class.
Therapists Have Repeatedly Complained
Since at least 2008, clinicians have been complaining to state Medicaid regulators about Health Network One’s business model.
One letter by a speech therapist sent to Florida officials in 2008 said the model promoted treatment only once per week, “which slows down progress significantly.”
To provide “steady/continued/ethical care,” therapists often needed to provide “free treatments . . . even when seeing the patient 1x/week,” the therapist wrote, according to the letter obtained by us.
In 2014, therapists met twice with state officials, representatives from health insurance companies, and Health Network One, according to therapists’ notes obtained by us from those meetings.
The notes from the first meeting were written by two therapists and sent to the Florida Association of Speech-Language Pathologists and Audiologists. Regulators at the time did not fully understand Health Network One’s business model. But when it was explained to regulators, “[e]yebrows literally went up in unison,” according to the notes.
The therapists wrote that “when that payment scheme was clarified . . . the reaction appeared to be sincere and very disconcerting.”
Notes taken from the second meeting by now retired Tampa-based speech therapist Enid Gildar say that Florida’s Medicaid director at the time, Justin Senior, seemed to be concerned about the situation.
Senior “strongly stated reduction in services was non-negotiable and that the goal of privatization was to save money, not reduce services,” Gildar’s notes state.
When asked about the meeting, Senior, now the CEO of the Florida Safety Net Hospital Alliance, which advocates for children’s, public, regional perinatal intensive care and teaching hospitals, told us over text message that he didn’t remember exactly how the dispute turned out, but that Health Network One was “trying to use an innovative bundled-payment model for therapy services that led to widespread confusion and allegations that they were scrimping on services.”
The model “made it unclear whether the patients were actually getting the therapy they were prescribed — and unclear how a patient’s family would ask for a fair hearing if they felt they weren’t getting what was prescribed,” Senior said, adding that he didn’t believe there were ongoing problems with the company after the “initial burst of confusion.”
Still, the following year, it seemed as though changes were afoot.
On January 9, 2015, the state issued “corrective action plans” to three Florida subsidiaries of large national health insurance companies that subcontracted with Health Network One: Amerigroup, a Florida subsidiary of the national company Elevance Health; Humana; and Sunshine, a Florida subsidiary of the national insurance company Centene. The state required the companies to show how they were able to uphold federal Medicaid law while working with Health Network One.
By 2018, Health Network One modified its payment system, the three companies wrote in separate letters obtained by us to the Florida Association of Speech-Language Pathologists and Audiologists. And Health Network One’s updated payment model was approved by Florida regulators, the three companies wrote.
When we asked these companies how exactly the new payment model changed to ensure it was upholding federal Medicaid law, only a spokesperson from Elevance Health commented, saying that Health Network One is an approved Florida subcontractor, and the insurer complies with the law, adhering to “guidance and regulations set forth” by the state Agency for Health Care Administration.
Therapists say the model did not change substantially, however, and records show that providers were still refusing to work with Health Network One.
The following year, the Florida Agency for Health Care Administration issued liquidated damages against health insurers that failed to show they contracted with enough required therapists to treat low-income children. The state demanded all nine health insurance companies pay it a collective $209,000 for the failure. The five that worked with Health Network One at the time had to pay more than 90 percent of this amount: $193,000.
A 2020 survey by the Florida Alliance for Pediatric Therapies that included responses mostly from occupational, physical, and speech therapists shows that among 148 respondents, 105 of them (71 percent) said they weren’t treating patients through Health Network One. In a separate question as to why they weren’t treating patients through Health Network One, among 108 respondents, ninety-five of them (88 percent) said it was because the company’s “methods/procedures poorly impact patient care; do not support my practice’s ability to provide quality services at [a] fair reimbursement.”
At the same time, therapists continued to argue that Health Network One’s business model was illegal.
That same year, four of Florida’s largest therapy associations, including physical and occupational therapy in addition to speech, wrote to the CEO of Centene Florida that the payment model’s updates “have not resolved these challenges” in complying with federal law.
Among their complaints was that Health Network One’s unusual business model made it impossible for patients to challenge the amount and course of treatment. Because the company was paying therapists a lump sum, it wasn’t making any decisions about care. This meant that patients had nothing to appeal.
To their point, the company says on its website that for outpatient therapy, “our denial rate is below 1%.”
Lawyers in the federal lawsuit claim the inability to appeal medical decisions violates both the Medicaid Act and the right to due process under the US Constitution’s Fourteenth Amendment.
Centene never responded to the therapy associations’ 2020 letter, according to Felice Abby, the immediate past president of the Florida Association of Speech-Language Pathologists and Audiologists.
“This is definitely still an issue and every point raised in the 2020 letter remains to this day,” Abby wrote in an email to us.
Therapists have continued to complain to the state. In April and May of 2021 alone, seventy-one complaints were lodged against Health Network One, records show.
Privatization on Steroids
At the end of 2022, Health Network One announced that the number of patients it covered had expanded that year from 5.1 to 5.5 million in its operational states, including Florida, Puerto Rico, New Jersey, and Georgia.
Today, Health Network One claims to cover certain health services for eight million Americans, growth that is largely due to its January acquisition of the Florida-based vision company Premier Eye Care, which operates in thirty-seven different states and treats two million patients, per a press release.
There’s another way to look at these numbers: The 1.75 million largely low-income children in Florida who may need occupational, physical, or speech therapy make up 22 percent of Health Network One’s overall business today, even with all its growth.
Health Network One, its CEO, president, and affiliated companies have contributed $917,750 to Florida lawmakers and political committees since 2001, state campaign contribution records show. These interests have made their largest donations — $152,500 — to the Republican Party of Florida. The next largest total amount they’ve donated is $67,500 to the Florida Republican Senatorial Campaign Committee, followed by $60,000 across 2020 and 2021 to Florida governor Ron DeSantis’s political committee.
Fourth on their total contributions list is $47,500 to the Florida Democratic Party. They also gave $30,000 supporting Charlie Crist when he ran for governor as a Democrat in 2014 and lost to then incumbent Republican Rick Scott.
The company has been registered since 2005 with the Florida Office of Insurance Regulation as a “third party administrator,” which is a business that contracts with insurance companies to provide back-office services like claims processing or billing.
What separates these administrators from typical insurance companies is that they aren’t financially responsible for the patients’ health care.
But Health Network One advertises taking on “full risk” for all eight million patients whose care they manage across the United States. Florida contracts from 2016, 2018, and 2019 that were obtained and reviewed by us support this description.
Health Network One is paid by the insurance company a fixed monthly amount for each patient whose care its manage, much like the state pays each insurance company a fixed monthly amount for each patient whose care it manages. And just like how the state expects the insurance company to manage the risk of paying for the care of those patients, the insurance company is then delegating that risk to Health Network One for those specific services.
In other words, Health Network One has functioned as an insurance company for the specific care it manages, like speech therapy. And as such, it has incentives to limit that care, said Andy Schneider, a research professor at Georgetown University’s McCourt School of Public Policy.
“They’ll want to use all the controls that they have to limit use of services,” Schneider said. “That’s their financial incentive.”
It’s unclear exactly how common Health Network One’s business model for therapy treatment is, but the company advertises itself as a trailblazer. Mosquera, its CEO, wrote in a 2021 op-ed for the online news site Florida Politics that the company was “pioneering approaches that ensure the best outcomes for Florida’s Medicaid recipients, especially children.”
But other states have allowed health insurers to subcontract their responsibility of managing patient care to physician groups or other health plans.
In California, for example, Kaiser Health News reported that insurance companies handling its Medicaid system were also subcontracting with physician groups.
And federal authorities have found that states are repeatedly violating the Medicaid benefit. In 2022, Congress directed a federal agency overseeing Medicaid to enforce states’ compliance with the law after the Government Accountability Office reported that many children were not getting necessary health screenings.
Now, because of this new directive, the federal government must give greater oversight of states’ compliance with this Medicaid benefit requirement, work with them to fix violations, and then report on their progress to Congress.
As Health Network One moves into other states, meanwhile, practitioners are voicing their concerns.
Cynthia Flynt, a speech language pathologist with a private practice in North Carolina, said that Health Network One is trying to move into her state. In response, she reached out on various Facebook groups to other clinicians to see how it is to work with them.
“The next thing I know, I’m getting different responses from private practitioners in Florida and other states talking about how poor the reimbursement rates are and how the kids are not getting the services they need,” said Flynt.
Flynt added: “I’m fearful that therapy services for kids will cease to exist in the same manner as they have for years if this group enters North Carolina.”
Since making her initial comments, Flynt said Health Network One has already signed a contract with a North Carolina Medicaid insurer.