Legend Healthcare is history

Sunday, June 30, 2002

SHARON HILL, Pa. - After two and a half years of struggling for survival, managed care network Legend Healthcare filed for Chapter 7 bankruptcy April 29, leaving some former members bitter and with little hope of recovering what they are owed.

The biggest allegation among former members is that Legend collected payment from managed care companies and then failed to pass it on to HMEs who provided the services.

"They almost put us and many others out of business," said a former Legend member who asked that her name not be used. "It cost me millions of dollars to purchase the equipment and service the patients. I'm still paying leases for things I'm never going to get paid for."

Legend filed for bankruptcy in the U.S. Bankruptcy Court Eastern District of Pennsylvania. Chapter 7 means the company will liquidate its assets to pay off as many creditors as possible.

Legend officials could not be reached for comment but claim the company has no assets, according to a court employee.

The network's problems began 21/2 years ago when it severed its relationship with managed care company United Healthcare, claiming among other things that United was doing business with Legend members on the side and thus depriving Legend of revenue. In January, Legend lost an arbitration hearing on the $15.4 million it claimed United owned.

Losing the arbitration didn't surprise another former member. "I don't'think they were organized enough with their documentation to support anything," the HME said. "It was back and forth every time we had to deal with them. I can see how a court would throw this out."

Legend's affiliated HME company, Beckett Healthcare, filed for Chapter 11 bankruptcy in Dec. 2000. HME