JULY 13, 2016 01:21 PM (EDT)
A.M. Best Downgrades, Places Ratings of QCA Health Plan, Inc. Under Review With Developing Implications
|Jennifer Afriyie |
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Managing Senior Financial Analyst
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Manager, Public Relations
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Assistant Vice President, Public Relations
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FOR IMMEDIATE RELEASE
OLDWICK - JULY 13, 2016 01:21 PM (EDT)
A.M. Best has downgraded the financial strength rating to B+ (Good) from B++ (Good) and the issuer credit rating to “bbb-” from “bbb” of QCA Health Plan, Inc. (QCA) (Little Rock, AR). Additionally, A.M. Best has placed each rating under review with developing implications.
The rating downgrades reflect the anticipated diminished implicit and explicit support that QCA may receive from its ultimate parent, Catholic Health Initiatives (CHI), following CHI’s announcement of the intention to sell its insurance businesses. CHI’s consolidated insurance division operates under QualChoice Health, Inc. (formerly known as Prominence Health Inc.), which owns QualChoice Holdings, Incorporated. QualChoice Holdings, Incorporated is the parent company of QCA and QualChoice Life and Health Insurance Company, Inc. On June 29, 2016, CHI publicly announced that it is evaluating structural alternatives regarding the future relationship with its insurance business. These alternatives include a partnership with others, a sale or keeping the insurance businesses. CHI is expected to disclose additional information by the end of September 2016. In A.M. Best’s opinion, the announcement indicates declined strategic importance of QCA to its parent, CHI. Therefore, A.M. Best expects that CHI’s capital and operational support for QCA may weaken in the near to medium term.
The under review status reflects the uncertainty surrounding the future of QCA, its expansion plans and the strategic role that QCA will play within CHI’s insurance group structure.
QCA’s ratings will remain under review until A.M. Best receives more definitive directions from CHI’s and QCA’s management of the final strategy to be pursued, as well as QCA’s business and capitalization plans.
This press release relates to rating(s) that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page.
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