WellCare, Tenet Have More Than Probes in Common

OKLAHOMA CITY -- WellCare (WCG - Cramer's Take - Stockpickr) is starting to resemble the beleaguered Tenet (THC - Cramer's Take - Stockpickr).

Both health care companies ranked as stock-market superstars until high-profile government raids killed their popularity. Moreover, both touted strong compliance programs that failed to protect them in the end.

Just as Tenet once did, WellCare relies on the same person to defend the company as it does to keep it in line. Thaddeus Bereday doubles as WellCare's general counsel and its chief compliance officer.

For its part, WellCare says that it combines the two roles "to ensure that compliance is always represented at the senior management level." WellCare further stresses that its independent auditors and "various regulatory partners" review the company's compliance program on a regular basis.

But when Christi Sulzbach filled both of those posts at Tenet, she came under attack by powerful critics before losing her job and ultimately becoming the target of a government investigation.

"Apparently, neither Tenet nor Ms. Sulzbach saw any conflict in her wearing two hats as Tenet's general counsel and chief compliance officer," U.S. Senate Finance Committee Chairman Chuck Grassley complained when announcing an investigation of Tenet four years ago. "As general counsel, she zealously defended Tenet against claims of ethical and legal noncompliance ... while as chief compliance officer, she supposedly ensured compliance by Tenet's officers, directors and employees.