Photo courtesy Molina Healthcare
The Molina Healthcare board of directors fired CEO J. Mario Molina, MD, and his brother and CFO John C. Molina after the insurer showed poor financial performance.
Molinda announced the leadership changes Tuesday, effective immediately.
The board has named Chief Accounting Officer Joseph W. White interim president, CEO and CFO, and said it would immediately commence the search process for a permanent CEO.
"In light of the company's disappointing financial performance, the board has determined to change leadership in order to drive profitability through operational improvements," said Chairman Dale B. Wolf.
The board named Wolf as non-executive chairman of the Board.
Molina's stock price was up over 15 percent as of Tuesday afternoon on the news of the change in leadership.
J. Mario Molina and John C. Molina will continue to serve as directors on the board, and Dr. Molina remains a candidate for re-election as a director at the company's upcoming annual meeting.
Mario and John Molina led the company for more than 20 years.
"These changes represent targeted and deliberate actions to enhance the company's focus and improve its competitive position within the healthcare industry," Wolf said. "With the industry in dynamic transition, the Board believes that now is the right time to bring in new leadership to capitalize on Molina's strong franchise and the opportunities we see for sustained growth. The Board is committed to achieving operational excellence and improving the company's financial performance on behalf of our shareholders, more than 20,000 employees and our over 4 million members."
Molina is active in the Affordable Care Act market and in March, was touted as an ACA success story. He has been outspoken opponent of the Republican plan to repeal and replace the ACA.
White has over 25 years of financial management experience in the healthcare industry and has served as Molina Healthcare's chief accounting officer since June 2003. He led the company's most recent operational improvement initiatives, Molina said.
White previously served as CFO of Maxicare Health Plans, where he was also a member of the board of directors.