which he says was the first national database of health insurance information.
But by 1983, he was broke. He had drained the $4.5 million as well as a $600,000 bank loan.
"It was the first time I saw the possibility of failure," Fernandez said. An accountant advised him to file for bankruptcy, but Miami attorney Cesar Alvarez told him his reputation was paramount and to try to work things out.
Fernandez went back to the bank and asked for six months and $100,000 more. In return, he sold his house, his Mercedes and his boat, moved with his wife and two children into his parents' home, and got the business off the ground. He changed the name of the company to Comprehensive Benefit Administrators, and sold it in 1989 to Ramsay HMO for $3.5 million.
Because of the sale, he became a substantial Ramsay shareholder and the company's No. 2 executive. He had signed an employment agreement to stay three years or until the HMO doubled in membership.
By January 1992, the HMO had doubled in size, and he left, but with a non-compete agreement for South Florida. Two years later, United Healthcare bought Ramsay for $500 million. His stock was worth more than $25 million.
He turned to Tampa, and in 1993, Fernandez started Physicians Healthcare Plans, flying his private plane from Miami each day to work.
He had invested $1 million. Eighteen months later he sold 49 percent of the company for $30 million.
"A 30-to-1 sale in 18 months," Fernandez said. "And I still had control."
In 2000, he bought back the 49 percent for $20 million, and two years later, sold the company for $160 million to AmeriGroup, retaining a segment of the business that AmeriGroup didn't want, CarePlus Health Plans.
Fernandez's strategy is to find troubled companies that are in a nosedive and that need to be pulled out.
When he sells them, he shares the profits with the employees who helped him turn around and grow the businesses.
"I've never looked at any deal as my last deal. I've always looked at it as another deal," he said. "You need talented people, so spread it around and you get talented people willing to work as hard as you work."
He has also developed a group of 28 partners who invest in all his deals, including Philip Frost and Alvarez. Fernandez puts in 80 percent, and the others put in the rest.
Next, he bought CAC Medical Centers, which was losing $60 million a year. He paid $10 million for it in 2003. In two years, he made it profitable and sold both CAC Medical Centers and CarePlus Health Plans to Humana for $485 million.
This time, he signed a five-year national non-compete agreement barring him from involvement in HMOs. But he didn't retire.
"If I stop moving," he said, "I think I will whither away."
So he launched a private equity firm, MBF Healthcare Partners, in 2005. He brought in two partners who had worked with him at Ramsay: Jorge Rico and Marcio Cabrera. Today they have a staff of 13, looking at a deal a day.
So far, they have bought six core companies, and folded in other acquisitions. The six include Suncrest, a home nursing company; a 60 percent ownership in Navarro Pharmacies; Nutriforce, a vitamin manufacturer; and eMindful, an Internet-based counseling service.
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