The president of SynCare, LCC - the Missouri Medicaid contractor ousted last year after a barrage of patient complaints - has filed bankruptcy, leaving a trail of heavy debts to former employees, vendors and its Fortune 500 backer, Centene Corp.

The Chapter 7 filing also sheds new light on SynCare's relationship with Centene, the Clayton-based giant in the field of Medicaid management. Centene, in fact, is listed as the biggest creditor of SynCare's Stephanie DeKemper, who owes Centene nearly $2 million in business loans. Centene is also named as a co-debtor on a $266,735 loan DeKemper obtained from Regions Bank.

DeKemper's personal and business debts are comingled in the bankruptcy, filed on Dec. 29 in federal court in Indianapolis, where her company was based. In all, DeKemper lists $793,661 in assets and debts totaling $5.9 million.

DeKemper and SynCare owes former employees unpaid wages totaling about $350,000, and thousands more in unreimbursed expenses, according to the documents. The company also left banks, investors and vendors on the hook, for amounts ranging into the tens and hundreds of thousands of dollars.

DeKemper's bankruptcy filing comes four months after the Missouri Department of Health and Senior Services severed ties with the company. A former Indiana police officer, DeKemper also worked as a Centene executive before she purchased and ran SynCare.

SynCare, which started work on its state contract in mid-May, was hired to assess the eligibility of Medicaid clients for in-home medical services. The assessments, for the physically and developmentally disabled, also covered personal needs, such as bathing and light housekeeping.

But the company's work - or rather its failure to complete it - soon snowballed into a statewide debacle, enraging patients and health providers and embarrassing state officials who hired the company.

One of those health officials who helped evaluate the SynCare bid - Christine Larson, chief of the department's Bureau of Program Integrity - ended up as a key SynCare manager, in charge of field assessors. (The bankruptcy lists her as a creditor who is owed more than $4,000 in unpaid salary and expenses.)

Craig Henning, a statewide health care advocate and director of the Disability Resource Association in Washington, Mo., called the bankruptcy another chapter in a woeful saga.

"There were enough indications of problems with SynCare from the get-go, and the involvement with Centene is extremely concerning," Henning said. "People don't call home community services because they want to. They call because they don't have a choice. The state fumbling the ball on these people makes me embarrassed to be a Missourian."

CENTENE CONNECTIONS

Centene wields substantial clout in the healthcare industry and in state politics, donating heavily to politicians of both parties, including Democratic Gov. Jay Nixon. The company holds contracts to manage Medicaid programs in about a dozen states but not Missouri.

Centene received $8 million in Missouri tax incentives for choosing to remain in St. Louis County and expanding its Clayton headquarters in 2008.

Since January 2006, Centene and its executives have given more than $400,000 in campaign contributions to dozens of Missouri politicians, including about $85,000 to Nixon.

Centene's donations to Nixon's campaign included $10,000 on Nov. 18 of 2010, a month before the state issued a request for bids on the Medicaid contract; $5,000 on June 21 of last year, the day before Larsen resigned her state position to take a job with SynCare; and another $20,000 on June 26.

SynCare donated $5,000 to Nixon on July 5, just before its mismanagement became public when it missed a payroll and abruptly laid off 29 workers.

In previous public comments, Centene has downplayed its connection to SynCare and denied helping the company get any business in Missouri.

Presented in September with a company document listing $400,000 in loan guarantees to SynCare and DeKemper, Centene spokeswoman Deanne Lane acknowledged the company "provided financing (to SynCare) and is now a creditor." Centene's more extensive financing, including $2 million in loans, only became public in DeKemper's bankruptcy.

In an interview Friday, Centene chief executive Michael Neidorff acknowledged the company's investment in SynCare didn't exactly pay off. "Not everything you try, works," he said.

Neidorff said he personally hired DeKemper several years ago as a chief operating officer of a Centene subsidiary in Indiana. She ran a program that served pregnant minority women who faced a high risk of obstetric problems. She also served as a Centene vice president for diversity and special projects, and as president of the Centene Foundation for Quality Health Care, which provides grants to nonprofit organizations in many states.

Neidorff said his company helped DeKemper purchase SynCare in January 2010 because it was a certified "minority business enterprise" whose mission was to provide quality health care to the disadvantaged.

"She had a company that was culturally sensitive, but she also (was working with) some respected physicians," Neidorff said. "$2 million is a lot of money, but if you save one, two, or three premature babies from being seriously ill for the rest of their lives, how can you calculate that value?"

In 2008, when DeKemper made an unsuccessful bid for the Indiana House of Representatives, Neidorff and his wife Noemi each donated $2,500 to her campaign.

Neidorff stressed that Centene did not finance SynCare's explorations in the Missouri market, but indicated that he and DeKemper had spoken about working together in other states.

"We did not bank her in Missouri. The loans we made were all focused on Indiana. ... When she said she was going to Missouri, that's when I told her she was on her own."

Asked whether he considers DeKemper a friend, Neidorff said: "No."

Neidorff also questioned the legitimacy of some of SynCare's expenditures since DeKemper bought the company, but he did not detail examples.

PATIENTS PAID THE PRICE

With or without Centene's help, SynCare secured a contract potentially worth about $5.5 million to assess the needs of the nearly 53,000 homebound Missouri residents requiring Medicaid-subsidized medical and personal services.

Before a Missouri legislative vote authorized hiring a third-party contractor, those assessments were provided by home-health providers who also provided services to patients, which some called a conflict of interest.

But SynCare's problems surfaced almost immediately, starting with understaffing that prevented the company from filing assessments within the contractually agreed period of 15 days, according to providers, patients and lawmakers.

The goal of home-health services, in part, is to save money with preventive care that limits more expensive hospital stays. But after SynCare took over, reports surfaced that some patients were forced into hospitals or acute care facilities because delayed assessments prevented them from getting home care.

Other complaints involved SynCare curtailing the number of hours providers were allowed to spend with patients on a weekly or monthly basis. Patients and providers also waited hours on hold when calling SynCare's Ballwin call center.

At the end of August, the health department responded to the outcry from the public and lawmakers by terminating SynCare's contract, though SynCare officials countered that the company had quit on its own.

Since then, state workers have taken over direct management of the assessments and struggled to clear a backlog of 15,726 cases left by SynCare. Health department spokeswoman Gena Terlizzi said Friday that the agency has cleared all of those cases.

The state has no current plans, she added, to outsource the assessments to a private contractor.

UNPAID DEBTS

The papers DeKemper filed recently with the U.S. Bankruptcy Court for Southern Indiana list scores of former SynCare employees who are owed unpaid wages.

"How do you lose that kind of money ($5.9 million) in four months?" asked ex-employee Herman Pruitt Jr. in an interview. "It's impossible."

As SynCare hurdled toward collapse last July, the bankruptcy filing shows that DeKemper liquidated over $390,000 in retirement accounts, stock holdings and life insurance policies.

Her primary assets, according to the petition, include a five-bedroom, four bathroom home in Indianapolis valued at $400,000 and a $370,000 North Hollywood, Cal. condominium on which DeKemper is a co-signor on her son's mortgage.

The court record also shows DeKemper has 11 payments remaining - at $924 a month - on a 2009 Mercedes Benz. She also left debts of $650 for flowers and gifts, and $2,492 for jewelry.

DeKemper's debts range from $11 owed a former employee for expenses, to an outstanding $10,000 commitment to the Indianapolis chapter of the March of Dimes, to a $73,000 bill with the Drury Inn & Suites in Creve Coeur, to the $2 million she owes Centene.

Other major debts include:

• Fifth Third Bank - Loans totalling $950,000

• Indianapolis technical services provider Synergy ISG - $319,332

• Anthem Blue Cross Blue Shield - $167,352

• Outstanding software lease with PNC Equipment - $311,933

• Outstanding leases on SynCare Indianapolis offices - $1.034 million

• Outstanding lease on Ballwin office - $1.029 million

A spokeswoman for Missouri Attorney General Chris Koster said the state has secured the $677,000 performance bond forfeited by SynCare when its contract was terminated. The attorney general is meanwhile meeting with health department officials to "calculate other damages" incurred by SynCare.

But the company should never been hired in the first place, said Missouri Rep. Ryan Silvey, R-Kansas City, chair of the Interim Committee on Budget Transparency, which last summer successfully pressured the Missouri Department of Health and Senior Services to sever its ties with SynCare. "I'm disappointed the (health) department) didn't do more due diligence."