Large disease-management firm files for bankruptcy

NEWS IN BRIEF — Posted Sept. 28, 2009

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LifeMasters Supported SelfCare Inc. announced Sept. 14 that it was petitioning for Chapter 11 bankruptcy. The disease-management company, based in South San Francisco, Calif., said it has sufficient cash to continue operating but is filing in response to liabilities created by its participation in several disappointing Centers for Medicare & Medicaid Services projects.

Over the past four years, the company, along with eight others, took part in three CMS projects testing the impact of disease management on patients participating in fee-for-service Medicare and on patients eligible for both Medicare and Medicaid. The projects did not produce the cost-savings desired by CMS, and LifeMasters stopped taking part early this year. CMS wants all participating companies to repay fees earned in excess of generated savings, and company officials felt bankruptcy was a better option than contesting this in court.

"Rather than endure a costly and time-consuming legal path to challenge CMS, we have chosen to restructure our CMS and other liabilities through the Chapter 11 process," company president George D. Pillari said.

No service disruptions are expected, and officials believe that it will emerge from this process as a viable company.

Note: This item originally appeared at

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