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164 workers to lose jobs as Federal Way health plan company closes

A screen capture of Soundpath Health, whose Federal Way operations will start winding down operations at the end of the year. Those plans will be managed by Premera Blue Cross starting Jan. 1.
A screen capture of Soundpath Health, whose Federal Way operations will start winding down operations at the end of the year. Those plans will be managed by Premera Blue Cross starting Jan. 1.

A closure and layoff notice of a Federal Way medical insurer caps Catholic Health Initiatives’ gradual move away from the health insurance business.

This time the move takes with it a local Medicare Advantage provider — QualChoice Health Plan Services — as the contract switches to another entity.

The state’s Employment Security Department on Thursday gave notice of closure concerning the company, with layoffs starting Dec. 31.

CHI, based in Englewood, Colorado, is the parent company of QualChoice. The subsidiary oversees CHI’s QualChoice commercial plan for Arkansas clients. It also handles SoundPath Health Medicare Advantage plans in some Washington state counties, including Pierce, and plans in Arkansas, Nebraska, Kentucky and Ohio.

CHI acquired a majority interest in Federal Way-based Soundpath Health in 2013 for $24 million. The next year it announced a deal for QualChoice Holdings, based in Little Rock, Arkansas, as it expanded its health insurance presence.

That business plan soon switched gears.

In 2016, CHI decided to divest its health plan operations” which led to it ending operations of its Medicare Advantage plans after Dec. 31, Michael Romano, national director of media relations for CHI, told The News Tribune via email.

The Soundpath account — with nearly 23,000 enrolled — had become the largest Medicare Advantage plan in the CHI portfolio. Its Medicare Advantage contract was sold to Premera Blue Cross, which will take over those accounts Jan. 1.

“The transition is seamless for current Soundpath Medicare Advantage enrollees living in the Premera Blue Cross service area,” Romano said.

Employees have known the changes were coming since 2016, Romano said, adding they “will receive severance pay and other compensation as well as other job placement assistance as we wind down operations in our Federal Way location.”

Romano said the initial staff reductions of 47 people will occur Dec. 31, The rest of the cuts will come through 2019 for a total of 164 positions eliminated, according to information from Romano and the state notice.

As for the Arkansas work, “CHI continues to seek a suitable new owner for the commercial plans based in Arkansas,” Romano said.

Debbie Cockrell: 253-597-8364, @Debbie_Cockrell
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