Catholic Health Initiatives in Talks to Buy QualChoice

Catholic Health Initiatives of Denver, the parent company of St. Vincent Health System of Little Rock, is in talks to buy some or all of QualChoice of Little Rock.

Details about the nature of a CHI purchase were unavailable Tuesday. Michael Stock, president and CEO of QualChoice, declined to release details of the negotiations when contacted by Arkansas Business.

"Our existing shareholders are having ongoing discussions about how best to structure their ownership interests so that it's in the best interest of QualChoice going forward," he said. "I can't really talk about the details of the conversations that might be going on while they are in progress."

A spokesperson for CHI wasn't immediately available for comment Tuesday morning.

Stock said St. Vincent is a shareholder of QualChoice, an Arkansas-based health insurance carrier. Other shareholders include Arkansas Children's Hospital and the University of Arkansas for Medical Sciences.

But at the end of 2012, the University of Arkansas System said it wouldn't renew the contract under which QualChoice handles third-party administrator duties for its employee health plan.

After the contract was terminated, UAMS "began taking a less of an active role in the plan as an investor," Stock said.

Arkansas Insurance Commissioner Jay Bradford said on Monday that his understanding was that QualChoice's investors have agreed "for the merger" with Catholic Health Initiatives and the transaction "is virtually completed except for some minor details."

Bradford said the transaction will require approval from his office, but that he will fast track the regulatory filings. He said he expects to see documentation in a few weeks.

"Catholic Health Initiatives has tremendous financial capacity, and it's going to really enhance the ability of QualChoice to write coverage for Arkansans," Bradford said.

He also said that he would expect QualChoice then to sell insurance in other states because CHI is "such a big company."