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|Traded as||NYSE: MOH
S&P 400 Component
|Founder||Dr. C. David Molina (deceased)|
|Headquarters||Long Beach, California, USA|
|Revenue||US$ 14.18 billion (2015)|
|US$ 143 million (2015)|
Molina Healthcare (NYSE: MOH) is a managed care company headquartered in Long Beach, California, United States. In 2016, Molina Healthcare was ranked 201 in Fortune 500. In 2015, the company's health plans served about 3.5 million people through government-based healthcare programs.
Molina Healthcare was founded in 1980 by C. David Molina, an emergency room physician in Long Beach, CA. He had seen an influx of patients using the emergency room for common illnesses such as a sore throat or the flu because they were being turned away by doctors who would not accept Medi-Cal. As a result of his emergency room work, Dr. Molina established his first primary care clinic with the goal of treating the lowest-income patients, regardless of their ability to pay.
The company was run by Dr. Molina's son, J. Mario Molina, MD, who was a physician. He was the president and CEO of the company. John Molina, Mario's younger brother, was the CFO of Molina Healthcare. In May of 2017 J. Mario and John were removed from their positions by the board, ending family control of the company. The two took over the Molina's operations after their father died in 1996 and continued to expand the company.
However there are reports that it was J Mario Molina's outspoken criticism of the current administration that motivated the firing.
"I've been a very vocal critic of what's going on in Washington," Molina told Politico. "I know the other health plan executives have been afraid to speak out. Maybe they're smarter than I am, but I'm not going to back off."
FierceHealthCare.com reported: "Molina Healthcare had thrived in the ACA's individual marketplaces, but revealed in February that it lost $110 million in the fourth quarter of fiscal year 2016, due at least in part to the fact that it had to pay significantly more into the risk adjustment program than it had anticipated. However, despite those losses, Molina beat Wall Street predictions for the first quarter of 2017, the results of which were announced a day after the brothers were fired."
There has also been speculation by industry analysts about a sale of the company, which may present an additional motivation to remove members of the founder's family from leadership positions.
C. David Molina's daughter Martha Bernadett, MD is also a part of Molina Healthcare. Since receiving two Robert Wood Johnson Foundation awards in 2002, Dr. Bernadett has served as the Executive Vice President of Research and Innovation at Molina Healthcare. She founded the Molina Institute for Cultural Competency, Book Buddies and the Molina Foundation, a non-profit organization to promote access to education and health care to reduce disparities.
In 2017, a federal court ruled that the US government owed Molina Healthcare $52 million under the Affordable Care Act's risk corridor program, after congressional Republicans had blocked the payments.
The first Molina Medical clinic was opened in Wilmington, CA in 1980. Since then, 29 clinics have opened in Northern California, Southern California, Washington, New Mexico, Florida and Utah. Molina Medical Group (MMG) also runs state-owned clinics in Fairfax County, Virginia. The clinics were opened to provide health care to low-income families and individuals.
Molina Healthcare has focused on government-paid health care programs such as SCHIP and Medicaid since it became a health maintenance organization in 1985. From 1985 to 1997, the company was only in California.
In 2015, Molina Healthcare entered into an agreement to acquire some assets of the Medicaid and MIChild businesses of HealthPlus of Michigan and its subsidiary - HealthPlus Partners, Inc. In a similar deal, Molina Healthcare of Florida, Inc., which is a wholly owned subsidiary of the company, inked a deal to acquire some assets of Preferred Medical Plan, Inc.'s Floridian Medicaid business in 2015. Additionally, they signed an agreement with MyCare Chicago to purchase some Medicaid business assets. In 2015, Molina Healthcare acquired Providence Human Services (PHS) and Providence Community Services in a $200 million deal to expand their coverage into the behavioral and mental health services. In 2015, PHS underwent a rebranding to become Pathways. As of September 30, 2015, Molina Healthcare had over 3.5 million members in its health plans. The health plans are operated by the respective subsidiaries in its states, each of which is a licensed HMO.
Molina Healthcare filed with the Securities and Exchange Commission for an initial stock offering in December 2002 and went public in July 2003 with a stock offering of $102 million. The shares were priced at $17.50, and Molina raised approximately $124 million in the initial public offering. In its stock market debut, Molina sold 6.6 million shares at $20.30, making the company the third-best first day gainer of 2003. As of 2013, Molina sold 296 million shares at $34.58. Molina Healthcare was the first company from Inc. Magazine's Inner City 100 list to go public. As of February 20, 2014, there were approximately 125 holders of record of common stock.
Molina Healthcare entered the Medicare market in 2006. The company currently offers Medicare health plan options in eleven states: California, Florida, Illinois, Michigan, New Mexico, Ohio, South Carolina, Texas, Utah, Washington, and Wisconsin.
Molina Healthcare acquired Unisys' health information management business in December 2010 to create Molina Medicaid Solutions (MMS). MMS has Medicaid Management Information Systems (MMIS) contracts with Idaho, Louisiana, Maine, New Jersey and West Virginia. In June 2011 the state of Louisiana selected CNSI, a Maryland-based health care technology services company, to replace Molina as the state's MMIS and fiscal agent operations. However, in March 2013, Gov. Bobby Jindal canceled that contract. A new fiscal agent had yet to be named at that time. MMS also gained a contract with the U.S. Virgin Islands. Molina Medicaid Solutions will administer operations for the territory out of its West Virginia location.
Beginning in 2014, Molina Healthcare offers Marketplace plans in nine states where it offers Medicaid health plans - Covered California, Washington Healthplanfinder, and New Mexico Health Insurance Exchange through State Facilitated Marketplaces; Texas, Utah, Wisconsin, Ohio and Florida through Federally Facilitated Marketplace; and Michigan through Partnership Marketplace On November 16, 2016 the Seattle Times reported that about 11 million people currently get their coverage through the exchange.
Molina was selected to participate in dual eligible demonstration projects in California, Ohio, Illinois, Michigan, South Carolina and Texas to serve patients who are eligible for both Medicare and Medicaid.
Molina Healthcare was awarded the 2011 Alfred P. Sloan Award for Business Excellence in Workplace Flexibility. The award ranks Molina Healthcare in the top 20 percent of employers nationally in terms of its programs, policies and culture for creating an effective and flexible workplace. In 2006, Molina Healthcare was named among the 100 best corporate citizens by Business Ethics magazine. Time Magazine recognized Dr. J. Mario Molina, CEO of Molina Healthcare, as one of the 25 most influential Hispanics in America.
In April 2011, a lawsuit was filed against the company and its outsourcing firm Cognizant Technologies in California state court. Both companies are accused of discriminating against American workers who claim they were fired and replaced with H-1B workers. The companies are accused of violating numerous federal and state labor laws. In July, the U.S. District Court, Central District of California ruled that there were no federal claims, which the plaintiff's attorney had acknowledged in his Declaration in Support of (the plaintiff's) Motion to Remand. Molina has expressed confidence it will "win in court because specific allegations have been examined and found false."
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